Part 1 of 2: Considerations for Establishing an Efficient Project Portfolio Scheduling System to improve key performance indicators.
Understanding Project Portfolio Scheduling
Projects typically are sequenced in the order in which they arrive for governance consideration. This mode of operation is known as a first-in-first-out (FIFO) sequencing policy. As part of the design of a portfolio, the portfolio manager may consider alternative ways in which projects are sequenced. The development and implementation of alternative sequencing policies belongs to the general area of scheduling. Scheduling involves determining a sequencing order and assigning starting times to a number of projects that tie up various resources for a period of time. Typically, the resources are in limited supply. Projects naturally are comprised of activities, and each activity requires a certain amount of specified resources for a given period of time.
Importance of Project Portfolio Scheduling
The importance of considering alternative scheduling schemes increases with the diversity of the projects in the portfolio. A simple scheduling approach is to classify work into ‘fast’ and ‘slow’ tracks based on an estimation of the required project effort. Other characteristics that can be used for project portfolio scheduling include the following,
- Arrival time
- Estimated critical path duration
- Importance (e.g. as given by monetary value)
- Due date (i.e. when the customer expects the project to be completed)
- Qualifying Good Quality Project Schedule
A key element of a scheduling system is its ability to identify ‘good’ schedules. Ideally, a numerical measure could be used to differentiate a good schedule from a bad one. This numerical measure is generally known as the objective function, and its value is either minimised or maximised. Finding the ‘right’ objective function for a scheduling situation, however, can be difficult. First, important objectives such as customer satisfaction with quality or promptness are difficult to quantify and are not immediately available from accounting information. Second, a process is likely to deal with three different objectives,
- Maximise the project output over some period of time
- Satisfy customer desires for quality and promptness
- Minimise current out-of-pocket costs
In practise, surrogate objectives are used to quantify the merit of a proposed schedule. Some of the most common surrogate objective functions are,
- Minimise the makespan (total time it takes to complete a project(s))
- Minimise the total (or average) tardiness (time elapsed after a promised date)
- Minimise the total (or average) weighted tardiness
- Minimise the maximum tardiness
- Minimise the number of tardy projects
- Minimise the amount of time spent in the system
The theory and practise of project portfolio sequencing and scheduling is mathematically complex, and because these models are not known or understood then significant business opportunities to improve time-to-market and time-to-customer key performance indicators are not being realised.
If you would like to know more about leveraging data-driven actionable insights for your project portfolio, then feel free to contact me on email@example.com
About Ian: I have more than 20-years IT Project Portfolio experience spanning vendor, solutions integrator and customer side both for private and government organisations. I have worked for Motorola, Ericsson, Vodafone, Dimension Data and Fujitsu amongst others. I am the principal of pminsight, a boutique consultancy specialising in empowering project organisations and professionals with project data-driven insights.