The size of the "toy": project, program, portfolio, a key distinguishing factor for the PMO
The differences between project, program and portfolio management may seem confusing at first. However, on closer inspection, the difference between these three categories of PMO becomes clearer. Simplistically, it's the size of the toy that sets them apart. A project PMO manages individual projects, a program PMO manages more complex objects, while a portfolio PMO handles a variety of projects, programs and activities sharing common resources.
We're talking about PMO as a person, not as a project office.
If you would like to know more about the 5 roles of the PMO, we invite you to read our dedicated article.
The distinction between program projects and portfolios
Project management
For the project PMO, this means planning, executing and controlling the activities needed to achieve specific objectives within a defined timeframe. It focuses on the realization of individual projects, whether it's creating a new product, launching a marketing campaign or building an infrastructure. Here are a few key points about project management:
- Detailed planning: Project management requires careful planning to define tasks, deadlines, resources and responsibilities.
- Specific objectives: Every project has clearly defined objectives, and project management aims to achieve them efficiently.
- Continuous control: Constant monitoring of project progress enables corrective action to be taken in the event of deviations from the plan.
According to PMI, a project is: A temporary undertaking initiated with the aim of delivering a unique product, service or result.
Program management
Program management involves coordinating and overseeing several related projects with the aim of achieving strategic benefits for the organization. It is based on a holistic view of all projects within a program. Here's what you need to know about program management:
- Strategic alignment: Programs are designed to support the company's strategic objectives by grouping together projects that contribute to the achievement of these objectives.
- Dependency management: Program management involves managing dependencies between projects to ensure smooth coordination.
- Value for money: Resources are allocated efficiently to maximize overall program benefits.
In simplified terms, a program can be considered as a "large project". A large project needs to be broken down into smaller projects.
Portfolio management
At the top of the hierarchy, after projects and programs, comes portfolio management. Encompassing all of an organization's projects and programs, and even subsidiary portfolios, it aims to maximize the value and benefits of the portfolio as a whole, and to achieve strategic objectives. Here are some important aspects of portfolio management:
- Strategic prioritization: Projects and programs are evaluated and ranked according to their contribution to the company's strategic objectives.
- Resource allocation: Resources are allocated to maximize overall portfolio value.
- Continuous monitoring: Portfolio management involves constant monitoring of the performance of projects and programs to ensure they remain aligned with the organization's objectives.
The nature of the objects managed: The key to PMO's difference
If we wish to take the distinction further, we need to look at the nature of the objects they manage. For the PMO, moving from a project to a program entails a higher level of complexity and temporality. Programs involve deeper transformations and an extended timeframe. When the move is made to a portfolio PMO, the complexity increases still further. You have to manage projects, programs and activities that share human, financial and material resources. The key to making a difference lies in the ability to manage increasingly complex issues.
We've written an article on the complex role of the PMO if you'd like to find out more.
