Enforcing strategic fit of project portfolios by project termination: An empirical study on senior management involvement

Project portfolios are vehicles for strategy implementation. Senior management should terminate projects no longer conforming to corporate strategy in order to ensure strategic fit. This paper investigates how rigorous termination of bad and troubled projects affects portfolio effectiveness and senior management's decisive role in this context. We introduce the concept of project termination quality, analyse its consequences for strategic fit and how it is affected by senior management involvement. Using a quantitative longitudinal study of a sample of project portfolios, we show that termination quality positively affects strategic fit. We also show a positive, but inverted u-shaped relationship between senior management involvement and termination quality. We conclude that there is an optimal degree of involvement, beyond which an additional involvement of senior managers results in negative effects.     

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.     

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.     

Advancing project and portfolio management research: Applying strategic management theories

This paper focuses on the application of strategic management theories to Project Management and Project Portfolio Management research, specifically the Resource-Based View, Dynamic Capabilities, and Absorptive Capacity. A literature review and four research experiences illustrate the advances achieved through the use of these three theoretical perspectives, and contribute to the development of this field by providing examples and guidance for theory development and future research. Commonalities between the research examples include a strong strategic focus, recognition of the importance of knowledge and learning, and research questions seeking understanding and explanation. These research experiences outline the successful application of strategic management theories to a wide range of contexts, using diverse methodologies at a variety of levels of analysis. The findings indicate a broad potential for further fruitful research stemming from the relatively recent application of strategic management theories to Project Management and Project Portfolio Management research.     

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.     

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.     

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.     

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.     

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 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.     

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.     

How knowledge management impacts performance in projects: An empirical study

This paper develops theory and tests the relationships between knowledge management and various aspects of performance in IT-enabled business projects. The proposed theory posits that knowledge management is instrumental to Project Performance when mediated by a new concept, Knowledge Alignment. The research model is tested on survey data from 212 IT-enabled business projects. Findings show that project managers who achieve Knowledge Alignment among the people and the artefacts from three parts of the project – the IT team, the business change team, and the governance team – can have a significant positive impact on the achievement of business value from the project. Achieving higher levels of Knowledge Alignment is shown to have no significant negative impact on attainment of schedule and budget targets. This is the first statistical study to demonstrate the effect of knowledge management and Knowledge Alignment on the attainment of project management targets and of business value in IT-enabled projects.     

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.     

Measuring the impact of a major project management educational program: The PMP case in Finmeccanica

This work aims at providing evidence of the impact of project management training programs. The research focuses on the impact of training effectiveness (higher learning) on the project managers' competencies (applied behaviors). Data have been collected within PMP-Project Management Program: a corporate training program developed and delivered through an academic–industrial collaboration between Politecnico di Milano University and the Education and Human Resources Development Department of Finmeccanica SpA. The program started in 2007 and has involved more than 2300 participants worldwide so far. The empirical analyses are based on an extensive survey conducted one year (rolling) after the training activities. The analysis of the relationships among the different variables provides evidence of the positive impact of training effectiveness on project management competencies. Moreover, the results show that two other variables, role-training matching and environment factors, have a strong conjoint effect, significantly increasing the impact of training on the project management competencies.     

Understanding project interdependencies: The role of visual representation,culture and process

Project portfolio management is central to many organizations' strategic processes and requires consideration of multiple factors and the ability to envision alternative future consequences to support strategic project portfolio decision making. Complex project portfolios with multiple project interdependencies are characteristic of many project environments, yet existing methods do not provide the clear understanding of project interdependencies that is required.     

The effects of project uncertainty and risk management on IS development project performance: A vendor perspective

The structural contingency perspective has been widely used in information systems development (ISD) project risk management research. This paper develops an integrative model to explore the moderating effects of uncertainty on the relationship between risk management and IS development project performance from a vendor perspective, rather than the client perspective that is mainly employed in the literature. A survey-based research design is used to collect data to test the proposed model. The results reveal that project uncertainty can moderate the effects of project planning and control on process performance and the effects of user participation on product performance. More specifically, the results indicate that project planning and control makes a greater contribution to process performance when there is a low level of inherent uncertainty and that user participation makes a greater contribution to product performance when there is a high level of inherent uncertainty. The results of this study contribute to a more acute understanding of the contingency approach to ISD project risk management.     

Task completion competency and project management performance: The influence of control and user contribution

Recent research examines the relationship between competency and success in the information systems project environment. The links, however, are not well established and the antecedents of competency not well explored. We model the link between general task completion competency and performance of development teams with two crucial antecedents built by other stakeholders, the contribution of users and controls established by management. A sample of information systems professionals confirms the model and places a focus on the competencies of the professionals involved in a development. Management must be aware of team level controls and the competencies within a team and not focus on the individual members of a system development team.     

Barriers to effective configuration management application in a project context: An empirical investigation

Configuration management (CM) is not a new set of ideas, what it does represent is an effective way for project managers to use a formalized methodology in order that they can manage status and changes to it throughout the lifecycle. This research sets out to identify and prioritize the obstacles in the effective implementation of the CM practices, categorize these obstacles into more manageable groups of factors, and analyse the effects of multiple factors on the identification and rating of these barriers. Nineteen barriers are finalized and prioritized on the basis of their criticality and as a result three groups (managerial and organizational barriers, implementation barriers, and planning and process barriers) are extracted with the help of factor analysis. This study will help both configuration management and project management professionals to plan better and avoid the impacts of these key obstacles from much earlier in the definition phase.     

A conceptual model for project management of exploration and production in the oil and gas industry: The case of a Brazilian company

The objective of this study was to obtain a better understanding of factors that influence Exploration and Production (E&P) project management success and corporate financial performance. The study follows structural equation modeling (SEM) methodology to achieve greater understanding of the intricate network of relationships between variables involved in E&P project management. A comprehensive theoretical framework was needed to formulate the conceptual basis of research. Observation of the real world and practical experiences were also important. To that end, we conducted a case study in a large Brazilian oil company. Field research was essential because of the lack of similar studies in the oil and gas sector. The model developed is a theoretical construct known as a structural and measurement model (set of latent variables, observed variables and hypotheses, depicted in a path diagram). This model contributes significantly to the company because it is a global representation of the main factors for improving E&P project management. However, the findings should be interpreted with caution because adjustment and validation of the theoretical model were not performed.     

Feeling good,being good and looking good: Motivations for,and benefits from,project management certification

Project management (PM) is one of many occupations following a path to professionalization that includes voluntary certification. It has been said that certification, and especially voluntary certification, can be seen as an approach to being good by improving our competence in the profession, or a means to looking good, essentially signaling the capabilities of the holder. Based on self-determination theory, we contribute to this discussion the notion of feeling good whereby certification provides a way to challenge one's capabilities, provide self-actualization, and a sense of worth. Using two sets of survey responses, collected 10 years apart (2004 and 2014), we assess whether there are differences in the demographics of those seeking voluntary project management certification, and the motivations (expected benefits), and realized benefits associated with this certification, at these two points in time. Demographically, the people with certification and those not pursuing certification did not exhibit any significant differences in either time period. Analyses indicate that feeling good and being good are the main motivators but participants pursuing certification in 2014 reported lower levels of motivations and received more benefit than those in 2004. Comparing responses as to why professionals pursue voluntary PM certification across a decade span, gives us an indication of how these perceptions may be changing with the increased popularity of the certification. We compare these findings to similar studies examining other volunteer certifications and conclude by discussing the potential impact of these changes from the perspective of the individuals seeking certification, the occupation, and certifying organizations.