What metrics or methods may a program/portfolio manager use to determine whether a project is going well or not?

Question

A program/portfolio manager is responsible for a program or portfolio of projects and has a subordinate team of project managers which manage these projects. The projects may be agile projects or non-agile ones. A program/portfolio manager may have 1-on-1 meetings, stand-ups with project managers, they also send weekly or monthly reports about the progress of their project.

As a program/portfolio manager, how do you understand that one project is going well (in terms of budget, scope, schedule, etc) and another project isn't going well? What metrics do you require the project managers to provide?

Answer 1

The core metrics are:

• Cost variance: current period, cumulative to date, and at completion
• Revenue Variance (if seller of services): current period, cumulative to date, and at completion
• Profit Margin Variance (if seller of services): current period, cumulative to date, and at completion
• Schedule variance: current period, cumulative to date, and at completion
• Customer Satisfaction Ratings
• Aged Billed AR
• Unbilled AR
• Invoice Variances (if seller of services)
• Days Sales Outstanding (if seller of services)
• Unfilled Team Requisitions, Aged, and impact to Revenue / Profit (if seller of services) and costs
• Deliverables Completion Tracking, Verification and Validation, and Variances
• Quality Assurance and Quality Control Metrics

There are other signals you could identify but they will likely roll-up to one of these.

Answer 2

Mr. Espina has offered the textbook standard answer and I agree with his answer. That list is a bit granular, and I'd like to add a few more general metrics that would help me to understand and interpret the information collected. I'm looking for an "elevator speech set" - a set of numbers that can be presented intelligibly on a single slide/ couple of sentences.

• Stakeholder preferred metrics - Part of stakeholder management is to ask the stakeholder what metrics are most important to the stakeholder, how often they want to be briefed on those metrics, and in what format.

• When will the project be done? What is the current estimated completion date? Any change from the last status briefing? (This answer is provided by the lower level metrics in D. Espina's answer, but I'm looking for the top line summary.)

• What is the projects total estimated cost? Change from prior status briefing? (This answer is provided by the lower level metrics in D. Espina's answer, but I'm looking for the top line summary.) (Note: Actually I rarely care about this; there are projects & portfolio's where the PM is not responsible for cost).

• What are the top risks/issues? Any change from prior status briefing?

Answer 3

Routinely Compare/Contrast Costs and Contributions to Portfolio Value

There cannot be a single, canonical answer to your question. Portfolio management is a discipline that intersects with project management, but is really more of a business concern than a project management one. Therefore, it is up to each business to define the metrics and key performance indicators that will enable decision-makers to evaluate trade-offs and resource allocations across an entire program portfolio.

The goal of any portfolio system is to distribute resources and risks across multiple projects. Some projects will succeed while others will fail. Portfolio management as a discipline involves itself with which programs to fund and routinely rebalancing resources across the project portfolio. When a project is under-performing, portfolio management enables organizations to reallocate resources within the portfolio, or to terminate unprofitable or unsuccessful projects altogether to make room for new projects.

How you determine which projects are adding value and which ones aren't will be specific to your company and your industry. More importantly, how you compare projects with each other will depend on organizational values and market conditions that are unknowable outside of your company. Treat it like any set of investments, and compare/contrast the costs and determine portfolio value in whatever ways advance the company's interests.