From a distance, it seems that people use these terms interchangeably. They do however represent many different undertakings.
Trying to steer away from the “official” definitions provided by the various project management institutes and organizations I hope to explain it in a way that would be easily understood, and can be agreed upon by all professionals in the field.
Project Management – the discipline of planning, organizing, motivating, and controlling resources to meet specific goals. A project is a temporary undertaking with a defined beginning and end (usually time-constrained, and often constrained by funding or deliverable), undertaken to meet unique goals and objectives, typically to bring about beneficial change or added value. The temporary nature of projects stands in contrast with business as usual (or operations), which are repetitive, permanent, or semi-permanent functional activities to produce products or services. In practice, the management of these two systems is often quite different, and as such requires the development of distinct technical skills and management strategies. (http://en.wikipedia.org/wiki/Project_management)
Program Management – the process of managing several related projects, often with the intention of improving an organization’s performance. In practice and in its aims it is often closely related to systems engineering and industrial engineering. (http://en.wikipedia.org/wiki/Program_management) I would like to add that it could temporarily include the management of areas that are business as usual (or operations). Programs are also focused on obtaining business benefit observable from outside the program environment.
Portfolio Management (Project Portfolio Management) – centralized management of processes, methods, and technologies used by project managers and project management offices (PMOs) to analyze and collectively manage a group of current or proposed projects based on numerous key characteristics. The objectives of PPM are to determine the optimal resource mix for delivery and to schedule activities to best achieve an organization’s operational and financial goals ― while honoring constraints imposed by customers, strategic objectives, or external real-world factors. (http://en.wikipedia.org/wiki/Project_portfolio_management)
Just looking at these definitions does not distinguish large projects, from small programs, portfolios from very large programs and so on. So let’s look at what is different and then we should be able to tell them apart.
This will give us some basis for comparison.
- Portfolios do not have an end date
- Portfolios are entirely strategic
- Portfolios contain projects, programs, and operations that do not require a specific relationship to each other
- Portfolios don’t intend to reach a specific strategic objective, but rather address a strategic value or intent
- Programs have a specific strategic goal that it must satisfy
- All components in a program are included to deliver or contribute to reaching a measurable strategic goal (Could be more than 1)
- Programs may temporarily include the management of operations
- Programs have a start and end date within which they have to deliver on the agreed objectives
- Projects deliver a specific outcome (product, result)
A specific aircraft manufacturer has a project portfolio in which they intend to enhance the organization’s image, improve service delivery and secure the medium and long term financial future. Within this project portfolio, a program exists to design, develop and implement the manufacturing of a new aircraft. The program contains many projects, one of which is concerned with the building of the manufacturing facility in which the aircraft will be built.
Now that this picture is becoming clear -> I have a gift…
Sorry I simply had to include this graphic J it just keeps on growing…
Please ask questions, offer differing views and comment at will.
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