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What is the exact difference between portfolio management and project management? What is their application in classic and hybrid environments? How often should an organization evaluate the progress of a project, program, or portfolio? Are all three items relevant to agile?
Before we proceed to BigPicture-specific settings, let’s see a quick explanation of projects, programs, and portfolios from a manager’s perspective.
Rule one: the hierarchy goes as follows (top-bottom): portfolio -> program -> project.
Let’s begin with Programs – a set of projects, managed and coordinated as a group and united in one purpose. If a Program is a collection of projects, then how is the program different from a portfolio? For example, a city’s “Cut smog by half between 2021 and 2025” is a program – neither a project nor a portfolio. That’s because:
What programs and projects have in common is a defined timespan. They are both temporary initiatives with a set start and end date.
However, Program is similar to Portfolio in terms of content – they both do not contain specific tasks but aggregate… projects or other initiatives. Of course, a portfolio could contain and aggregate programs, too. Have a look at Table 1, especially the 2nd, 3rd, and 4th rows.
Table 1. Compare Portfolio, Program, and Project
Do programs apply to agile environments?
Do programs apply to agile environments? The term "program" is strongly associated with classic project management. As long as there are projects beneath, even agile projects, there is also room for a program. However, traditional programs disappear once your organization is transformed to an agile framework, such as SAFe (SAFe has its own programs, very different from the ones we are talking about, but that is another story.)
In theory, when there are two or more PMs in a company, portfolio management starts to make sense. In practice, portfolio management is applicable whenever it brings clarity and consistency to Project Management activities. The ultimate determinant, of whether to employ portfolio management or not, should be one’s business need. The rationale behind portfolios is constrained by a portfolio’s budget to prioritize initiatives that deliver plenty of business value at the expense of minor initiatives that deliver little business value. Moreover, portfolio management on top of projects or programs might pay off when dealing with limited resources, including human resources.
If you opted for portfolio management, then PPM (Project Portfolio Management) software, such as BigPicture Enterprise, is more relevant than plain PM (Project Management) software.
Is one portfolio a sufficient reason to even bother with them? Or do you need at least two portfolios to “break even”? A single portfolio is a valid reason to use them if your PPM software is capable of aggregating data at the portfolio level, such as BigPicture Enterprise, see Figure 1. The single-portfolio setup might consist of that single portfolio plus a couple of satellite projects.
Figure 1. Portfolio view (called Overview) in BigPicture Enterprise. Note how the view is a mix of a portfolio, agile project, two classic projects, a hybrid project, and a SAFe ART (1). Also, note how we re-labeled the modules for the Hybrid project (2). (3) depicts how you can permit users to add a Box below certain parent elements only. (4) shows the Scope type configuration, and as we learned, the ‘aggregations only’ option should be used for Portfolios and Programs because the two should not accept tasks.
BigPicture is the most popular PPM application for Jira and Atlassian ecosystem. In order to use programs or portfolios, you need the BigPicture Enterprise edition. For mere projects, the regular BigPicture is fine.
BigPicture supports all three: projects, programs, and portfolios. The latest versions of BigPicture and BigGantt got a huge boost for Portfolio Management, with a particular focus on the financial level of projects and initiatives and customizable portfolio-level metrics. Therefore, for those who only need projects, we recommend the regular BigPicture. However, if you continue using the proven projects, programs, and possibly portfolios, PPM software, such as BigPicture Enterprise, is the way to go.
Agile transformation must be initiated deliberately. Just because your newly purchased PM or PPM software promotes agility is not a valid reason to be 100% agile. It is fine to pause halfway through. We talk about the agile transformation-related decisions and dilemmas here. Anyway, BigPicture is equally relevant if you pause your digital transformation halfway through (hybrid projects) and if you have completed the agile transformation. Agile projects, SAFe ARTs, LeSS Requirement Areas, and ‘Design your custom Box’ are all available in BigPicture Enterprise.