Impact of customer integration on project portfolio management and its success—Developing a conceptual framework

The growing number of company projects requires comprehensive management, project portfolio management (PPM), for strategic alignment and efficient use of resources. In parallel, companies face customers demanding higher value, and joint value creation with customers is considered a key success factor in the future. Project portfolios delivering products and services for customers implicate a link between PPM and an increased customer focus. Combining the research fields of marketing and PPM for the first time, this study proposes customer integration into PPM. I develop a framework describing the impact of customer integration into PPM on project portfolio success mediated through relationship value. Furthermore, the study describes relevant aspects for customer integration on the project portfolio level and identifies interfaces for cross-functional integration of a customer portfolio representative within the PPM process. The findings and limitations of this study are discussed, and further research is suggested.     

Behavior of internal stakeholders in project portfolio management and its impact on success

Stakeholder behavior and stakeholder management are key success factors within project portfolio management (PPM). This empirical study of 197 project portfolios investigates the effect of the intensity of engagement (IoE) of portfolio-internal stakeholders on project portfolio success. We show that the effect of stakeholders is phase-specific and that role clarity as a measure of PPM maturity affects the nature of the relationship between the IoE of stakeholders and portfolio success. The effects of the IoE of senior managers on success are not clearly positive with regard to strategic portfolio structuring and are even negative in operative portfolio steering in established PPM systems. In immature PPM systems, line managers tend to take advantage of their position in resource management. Surprisingly, the influence of portfolio managers in portfolio steering is insignificant. Altogether, this paper shows the diverse effect of the IoE of stakeholders on portfolio success. This study enriches project research by applying stakeholder theory to the project portfolio context and offers practical guidance for further professionalizing PPM.     

The influence of business strategy on project portfolio management and its success — A conceptual framework

Firms are facing more difficulties with the implementation of strategies than with its formulation. Therefore, this paper examines the linkage between business strategy, project portfolio management, and business success to close the gap between strategy formulation and implementation. Earlier research has found some supporting evidence of a positive relationship between isolated concepts, but so far there is no coherent and integral framework covering the whole cycle from strategy to success. Therefore, the existing research on project portfolio management is extended by the concept of strategic orientation. Based on a literature review, a comprehensive conceptual model considering strategic orientation, project portfolio structuring, project portfolio success, and business success is developed. This model can be used for future empirical research on the influence of strategy on project portfolio management and its success. Furthermore, it can easily be extended e.g. by contextual factors.     

Formalization of project portfolio management: The moderating role of project portfolio complexity

Companies frequently implement formalization to improve success. Previous research has found supporting evidence for the performance-enhancing effects of formalization in both single project management and project portfolio management. However, there is no research on how formalization at the project level interacts with formalization at the portfolio level, or on how this interaction may impact success. This study investigates the interaction of formalization at both levels and examines the moderating effect of project portfolio complexity on formalization. Using a sample of 134 firms, this study shows that single project management formalization and, likewise, portfolio management formalization are directly connected to portfolio success. Simultaneous formalization at these two levels delivers a complementary effect, resulting in an increase in success that is more than additive. A contingency analysis confirms that the proposed positive effects become more prominent if complexity is high. Complexity measured as project interdependency has a stronger moderating effect than complexity measured as portfolio size.     

The three roles of a project portfolio management office: Their impact on portfolio management execution and success

Project portfolio management offices (PPMOs) are a subset of project management offices (PMOs) that handle collections of multiple single projects and programmes, i.e. portfolios. PPMOs are centralised organisational units that cater to the demands of various stakeholders by performing specialised tasks. They are initiated by their organisation's leadership in response to increasing management challenges originating from project portfolios. Although there has been considerable research on PMOs in general, not only a clear understanding of multi-project PMOs' activity patterns set in specific contexts like project portfolio management, but also both existence and mode of multi-project PMOs' contribution to successful performance are still lacking. By quantitatively analysing PPMOs in 278 portfolios, we identify three different activity patterns, which are interpreted as distinctive roles. We show a significant positive effect of PPMOs' coordinating and controlling roles on performance in terms of project portfolio management quality, which is a predictor of portfolio success.     

An empirical investigation on how portfolio risk management influences project portfolio success

Project risk management is recognized as essential in order to cope with the challenges arising from the environment. Literature suggests a portfolio-wide perspective for managing risks in project portfolios. However, research on risk management and its success in a project portfolio context is scarce. This study examines how portfolio risk management influences project portfolio success. Using a sample of 176 firms, this study provides evidence that portfolio risk identification, the formalization of the portfolio risk management process, and risk management culture directly influence risk transparency, whereas risk prevention, risk monitoring, and the integration of risk management into project portfolio management are directly connected to risk coping capacity. The findings also suggest that both risk transparency and risk coping capacity have a direct impact on project portfolio success. However, the results did not confirm the hypothesis that risk transparency and risk coping capacity have a complementary effect on success. Implications for scholars and project portfolio managers are discussed.     

Project portfolio management in practice and in context

Companies struggle with the sub-optimization and changes among their projects, even if various normative instructions and good practices have been introduced for project portfolio management. At the center of this paper is the need to understand project portfolio management in practice and in context. The purpose is to report a review on recent empirical research literature regarding project portfolio management, to draw attention to the limitations with viewing portfolio management as a rational decision process, and to develop new avenues for research regarding project portfolio management in practice and in context. As a result, this paper shows that, to respond to uncertainties and complexities in business environments, project portfolio management can be viewed as negotiation and bargaining and as structural reconfiguration, besides rational decision processes. These alternative perspectives offer new insight into the dilemmas identified in day-to-day project portfolio management and open up avenues for resolving them, thereby promoting success in project portfolio management.     

The integration of ideation and project portfolio management — A key factor for sustainable success

Effective management of single projects is no longer sufficient. In today's business market, proactive management of the whole project portfolio has become increasingly important for achieving long-term success and competitive advantage. At the front end of projects, opportunities are discovered, ideas are created, and the foundation for later project, portfolio, and, eventually, corporate success is laid. This paper contributes to the project management body of knowledge by combining the front end view on projects with the holistic view of managing project portfolio landscapes. It focuses on establishing a framework for conceptualization of the relationship between ideation and project portfolio management in product development environment by relating ideation portfolio management, front end success, and project portfolio success, and lays the groundwork for further empirical research. The overarching topic I address is the conceptualization of how ideation can facilitate and sustainably improve portfolio success in the product development environment in the long-term.     

Contemporary project portfolio management: Reflections on the development of an Australian Competency Standard for Project Portfolio Management

Project portfolio management is an emerging aspect of business management that focuses on how projects are selected, prioritised, integrated, managed and controlled in the multi-project context that exists in modern organisations. Competency standards have been developed by professional bodies for project managers. However, to date there has been no attempt to develop a competency standard at the portfolio management level. This paper examines the process for development of the first performance-based competency standard for project portfolio management and identifies how this contributes to the body of knowledge in both project portfolio management and project management more broadly. The intent is to use the Standard to improve project portfolio management capability and practice in organisations, which in turn promotes efficient resource use and more profitable project outcomes. Specific issues regarding Australian practice are described, along with implications for how this may impact Australian practice in the future.     

The interplay between dynamic capabilities’ dimensions and their relationship to project portfolio agility and success

Recent literature emphasizes agility's importance for a project portfolio's success in a dynamic environment. Conceptually, dynamic capabilities should be relevant antecedents for portfolio agility since they help organizations cope with dynamic environments. Dynamic capabilities disaggregate into three dimensions: sensing market and technology opportunities, seizing opportunities through prioritizing and exploiting them, and continuously reconfiguring assets and structures. Although previous literature emphasizes the importance of dynamic capabilities for project portfolio management (PPM), former research rarely analyzed dynamic capabilities in PPM empirically. Further, dynamic capabilities can be conceptualized differently, and it remains unclear how different conceptualizations coexist and what effects they have on the results of a study. This paper quantitatively investigates the relationship between dynamic capabilities’ dimensions (sensing, seizing, and reconfiguring) and project portfolio agility and success using a multi-informant, cross-industry sample of 135 project portfolios. The findings show that dynamic capabilities positively relate to portfolio agility and that portfolio agility mediates the relationship between dynamic capabilities and portfolio success. Surprisingly, sensing, seizing, and reconfiguring do not have entirely complementary effects. Instead, at least two of the three dimensions must be strongly present to enhance portfolio agility positively. The study underscores the importance of dynamic capabilities for portfolio agility. It contributes to the literature on portfolio agility in PPM and a more differentiated view of dynamic capabilities' dimensions and their consequences.     

Emerging strategy recognition in agile portfolios

Agile practices become increasingly popular for projects and project portfolios offering firms a higher flexibility to adapt to dynamic environments. This study investigates the antecedents and consequences of agile practices' relevance for strategy formulation in project portfolio management processes. Building on complex adaptive systems theory, we hypothesize a positive relationship between agile capabilities and emerging strategy initiatives and eventually portfolio success. Agile capabilities refer to both the project portfolio organization's intensity of and competence in applying agile practices. Using a sample of 135 portfolios and multiple informants for each portfolio, the results support entrepreneurial orientation and voice behavior as antecedents for agile capabilities. Furthermore, the findings support an agile portfolio's positive relationship with emergence recognition and overall portfolio success. The findings contribute to the literature by identifying two significant antecedents of agile capabilities as well as empirically demonstrating the positive relationship between agile portfolios and emerging strategy recognition. For practitioners, the study encourages the application of agile practices by stressing the general positive influence of agile capabilities and underlines entrepreneurial orientation and voice behavior as important methods of empowerment for agile portfolio processes.     

Practices,projects and portfolios: Current research trends and new directions

Project portfolio management (PPM) bridges strategy and project management. Traditional research in PPM has primarily investigated the rational, top-down and structural aspects of strategizing. By doing so, it has failed to focus on the underlying practices that are triggered by the strategy and how these practices frame strategy implementation. Practice-based research provides a methodological lens to explore the reality of strategic enactment through the project portfolio. Practice-based perspectives are under-represented in PPM research; therefore the aim of this paper is to provide an agenda for further practice-based research in PPM. Central to this agenda is a concern with various aspects of practice, including its discursivity, representation, dynamic capabilities, leadership and materiality.     

Examining the role of transformational leadership of portfolio managers in project performance

Research into the role of transformational leadership in project based organisations has generally focused on project managers or senior managers and less so on portfolio managers who oversee multiple projects to achieve business objectives. This study examines the impact of transformational leadership behaviour of portfolio managers on project performance directly and indirectly through other intervening variables such as climate for innovation and innovation championing. Using a questionnaire survey, data were obtained from 112 project managers in a UK project based organisation. Transformational leadership behaviour of portfolio managers was found to have a positive and significant relationship with project performance. Innovation championing and climate for innovation both partially mediated the relationship between transformational leadership and project performance. The study confirms the importance of portfolio managers in enhancing project performance and identifies the need for project based organisations to cultivate transformational leadership behaviour among them for enhanced performance. It also highlights the need for further exploration of the role of portfolio managers in improving project performance.     

Identifying,framing and managing uncertainties in project portfolios

Uncertainties in the organization, external environment and from single projects may hamper project portfolio performance unless managed properly. This paper introduces a framework on uncertainties and their management in project portfolios and pursues increased understanding on how managers can take uncertainty into account better. We explore uncertainties, how managers frame them as opportunities or threats, and the actual practice of managing them across ten R&D project portfolios. The framework on project portfolio uncertainties and their management is further refined based on the empirical results. As key contributions, we show evidence on the balanced existence of three types of uncertainties, the threat bias in their framing, and the dominance of rational, opportunity driven mechanisms of control in uncertainty management. We discuss the context-dependent practice of project portfolio management and the need to complement rational mechanisms with structural and cultural, for project portfolio management to become a dynamic capability.     

Exploring the roles of portfolio steering committees in project portfolio governance

Governing project portfolios engages different actors in organizations including portfolio managers, portfolio officers, top managers, and others who may team up as portfolio steering committees. While portfolio steering committees play a regular role in project portfolio governance, their role is still unclear. Through an in-depth multiple case study in three Danish companies, the roles of portfolio steering committees were explored. The results showed that portfolio committees may play three distinct roles in portfolio governance: a) communication and consolidation role, b) negotiation role, and c) decision making role. The results challenged the notion that portfolio committee meetings are the place and time to make collective decisions on the portfolio, rather, portfolio steering committees might unintentionally become or intentionally be used for other purposes than decision making. The empirical evidence of the study proposes that these three roles might be related to two governance design factors: frequency and duration of committee meetings.     

Reconciling alignment,efficiency, and agility in IT project portfolio management: Recommendations based on a revelatory case study

Current developments put significant pressure on IT project portfolio management (IT PPM), increasingly requiring IT project portfolios to be strategically aligned and efficient yet agile. Accordingly, our aim is to identify IT-PPM-related tensions among the three design goals alignment, efficiency, and agility, and to elaborate a set of design principles that will provide organizations with recommendations for reconciling these goals. We conduct our research trough the theoretical lens of Activity Theory. Our findings are based on a revelatory case study in the financial services sector and are evaluated through focus group discussions and expert interviews.     

Technological invention to product innovation: A project management approach

The optimal allocation of resources at the firm level to transform emergent technological invention into commercially successful products depends on the effective assessment and selection of projects. This study develops a multidisciplinary model for differentiating, prioritizing, and selecting investment in technological projects within an organization’s portfolio. Approaches from project portfolio and strategic technology management are integrated to explore how a particular product within a diverse project portfolio may be prioritized and developed. Our results suggest that the application of the suggested model to a portfolio of biotechnology projects may enhance the assessment of internal capabilities and external competitiveness, thereby providing a basis for firms to prioritize and preferentially allocate scarce resources within a portfolio of heterogeneous technologies.     

Project portfolio management: An integrated method for resource planning and scheduling to minimize planning/scheduling-dependent expenses

It is well known that the progress of R&D projects has more and more begun to rely on the availability of individual experts who are generally scarce and expensive. The matrix structure considers periodic staffing of project teams which has been found to be efficient for non-scarce human resources but is impractical for individual experts. Our objective is to develop and evaluate an alternative approach for resource planning and scheduling that might be useful for project portfolio management. The method we suggest is an extension of a recently developed optimization model for a job-shop with several machines and chance-constrained deliveries. Our method determines in advance the hiring and releasing points of individual experts that maximize economic gain subject to chance-constrained delivery commitments. For this purpose, we use a simulation based on a greedy priority dispatching rule as well as a cyclic coordinate descent search-algorithm. A benchmarking of the staffing of project teams and the integrative methods shows that integrated planning and scheduling is a very useful tool for the decision-making process in project portfolio management.     

Microfoundations of project portfolio regulation in joint university-industry laboratories

Joint university-industry laboratories (joint U-I labs) consist of a new, yet little understood model of academic partnership with the firms, typically involving the establishment of a collaborative research unit to conduct research and development (R&D) projects. This type of collaboration faces an ongoing challenge in dealing with the tension between the development and deployment focus in the project portfolio. While several studies have investigated project portfolio management in a given firm, little is known about the interorganizational portfolio management and how the actors manage tensions in joint U-I labs. This study aims to investigate the microfoundations of project portfolio management in joint U-I labs. By combining the multiple-case study and at-home ethnography methods, we identified that the regulation approach explains how partners in joint U-I labs dynamically adjust and manage the project portfolio. Based on the empirical findings, we propose a new framework for project portfolio management in joint U-I labs: portfolio regulation. This framework consists of four processes: dual scouting, dual matchmaking, joint selection, and bridgemaking. These microfoundations enable actors to strategically regulate the portfolio by increasing/decreasing resources related to development or deployment. Our study explores how portfolio regulation evolves within a joint U-I lab through four stages: formation, learning, reconfiguration, and joint portfolio. The proposed framework contributes to interorganizational R&D portfolio management theory and joint U-I lab portfolio management practice.