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Contents

Overview .......................................................................................................................3

Why Have a P3O®?.......................................................................................................10

Case Study: P3O® Pilot .................................................................................................19

Designing a P3O® Model..............................................................................................20

Implement and Re‐energise.........................................................................................44

Case Study: No Skeletons in the Cupboard at BT Design ............................................59

How to Operate a P3O® ...............................................................................................60

Roles.............................................................................................................................72

Case Study: Skipton Building Society ...........................................................................89

Glossary of Terms and Definitions ...............................................................................96

Overview

Definitions

P3M

Portfolio, Programme, and Project Management (also including value and risk

management).

Portfolio

The totality of an organisation’s investment (or segment thereof) in the changes

required to achieve its strategic objectives.

Programme

A temporary, flexible organisational structure created to coordinate, direct, and oversee the implementation of a set of related projects and activities to deliver outcomes and

benefits related to the organisation’s strategic objectives.

Project

A temporary organisation, created for the purpose of delivering one or more business products to an agreed business case.

Portfolio Management

A coordinated collection of strategic processes and decisions that enable the most

effective balance of organisational change and business as usual.

Project Management

The planning, delegating, monitoring, and control of all aspects of the project, and the

motivation involved, achieve the project objectives within the expected performance

targets for time, cost, quality, scope, benefits, and risk.

What is a P3O®?

A decision‐enabling and support business model for all business change within an

organisation.

This includes single or virtual structures, i.e. offices (permanent and/or temporary),

providing a mix of central and localised functions and services, and integration with

governance arrangement and the wider business such as other corporate support

functions.

The elements that make up P3O®:

Organisation Portfolio Office

Hub Portfolio Office

Programme Office

Project Office

Centre of Excellence

An example of a P3O® Model

Based on AXELOS P3O® material. Reproduced under licence from AXELO S Limited. All rights reserved.

Key Functional Areas of P3O®

The three main functional areas of P3O® require different competencies, skills, and

experience:

1. Strategic planning or portfolio support – It focuses on supporting senior management decision‐making. This includes the continuous portfolio definition practices of understand, categorise, prioritise, balance, and plan management dashboards, and most importantly the provision of challenge, scrutiny, and oversight.

2. Tactical or delivery support – It focuses on hands‐on support to the successful delivery of change, sometimes through a flexible pool of delivery programme and project resources to enable fast mobilisation.

3. Centre of excellence or capability support – It focuses on the development of standard processes, promoting consistent portfolio, programme, and project working practices.

Exercise

In the pyramid illustrated below, assign where portfolios, programmes, and projects sit

in relation to one‐another.

Fill in the blanks regarding the differences between portfolio, programme, and project

management

1. ______management is just the management of an individual, standalone project.2. A project is usually part of a_________, but a ________cannot be part of a

project.3. Programme management is the management of several_________, directly

addressing how they are managing themselves.4. __________deliver strategies, whereas projects will be strategy‐driven.5. __________are made up of programmes.6. Portfolio management determines the priorities of _____________.

Business as Usual

The way a business normally achieves its objectives.

Organisational Context

An effective P3O® can increase an organisation’s chance of successfully delivering on its

strategic objectives by maximising benefits realised from its continued investment in

business change programmes and projects.

It maintains a ‘big picture’ understanding of the business change portfolio

Provides decision support to ensure the right programmes and projects are

launched

Provides standards and processes to ensure a consistent delivery

Delivers an independent oversight, scrutiny, and challenge, to ensure things are

done correctly

Assistance in the building of a competent workforce capable of first‐class

programme and project delivery

Improving upon organisational accountability, decision‐making, transparency,

and visibility

Protecting revenue and spend

Executing change more effectively and efficiently to improve programme and

project delivery

Defending reputation and stakeholder confidence

‘Run the business, Change the business’

Based on AXELOS P3O®material. Reproduced under licence from AXELOS Limited. All rights reserved.

P3O® Model elements aligned with portfolio, programme, and project lifecycles

Based on AXELOS P3O® material. Reproduced under licence from AXELOS Limited. Al l rights reserved.

This, therefore, could have an adverse effect on expected outcomes and generate a

significant threat to any already scarce resources.

Without the involvement of an effective P3O® model, organisational strategic

objectives may still be reached, but potentially in a fragmented or unstructured way.

2. Hub and Spoke Model – Large organisation model with multiple de‐centralised permanent portfolio offices designed to serve specific divisions, geographical regions, business units, departments, or functions.

3. Temporary Office Model – No permanent office exists. Temporary programme and

project offices (or individuals with support skills) are set up as new initiatives are

launched.

4. Virtual Office Model – No physical central office. Business or functional units carry out P3O® functions across the organisation.

5. Small Organisation Model – Very small office, or a single individual. Usually focused on consistency of methods/training etc.

Structures of Portfolio

There are five types of ‘models’ in P3O® that describe the way, in both structure and nature, how offices and their functions can be organised.

1. Organisation Portfolio Office Model – A single, permanent organisation

level portfolio office, focused on strategic portfolio support, planning,

delivery support, and COE functions, with temporary programme and project offices set up to support new initiatives as they are launched.

Quiz 1

1. Is the following statement true or false?There are five key functional areas of P3O®.

True

False

2. What is a portfolio?

A decision‐enabling and support business model for all business change within

an organisation

A temporary organisation that is created for the purpose of delivering one or

more business products to an agreed business case

The totality of an organisation’s investment (or segment thereof) in the

changes required to achieve its strategic objectives

A coordinated collection of strategic processes and decisions that, together,

enable the most effective balance of organisational change and business as

usual

3. The Organisation Portfolio Office Model is…

A very small office, or a single individual

A single, permanent organisation

A large organisation

None of the above

4. A programme’s lifecycle is comprised of…

Identify, Define, Deliver Capability/Realise Benefits, Close

Define, Deliver Capability, Identify, Realise Benefits

Define, Realise Benefits/Deliver Capability, Initiation, Close

Start‐up, Identify, Initiation, Realise Benefits

Why Have a P3O®?

Any policies and performance requirements of an organisation are typically realised via

portfolios, programmes, projects, and operational business units.

An integrated set of outcomes and benefits are measured, managed, monitored, and

refined to ensure that optimal investment and strategic goals are achieved.

Benefits of a P3O®

A strong visibility of progress

Predictability of delivery

‘Big picture’ view

A consistency to approach and delivery

Decision‐making transparency

How Do P3O®s Add Value?

By adding an appropriate P3O® model in an organisation, it will optimise and improve the

delivery and implementation of business change.

An ideal P3O® will be able to operate and deliver the right services within an organisation’s

matrix structure. This will ensure that programmes and projects can coexist with existing

permanent functions.

A compelling business case must be presented to senior managers and other senior‐level

support in order to approve the venture.

Any potentially realised benefits will need to be fully understood as well as an estimation of

costs.

Any P3O® model worth its weight should be able to answer the questions ‘What value will it

add to the organisation?’ and ‘How will it work?’ with special consideration to

organisational and business divisional boundaries.

The agreement of the P3O®’s vision, operating model, and transition plan is integral to any

sort of sustained success it will yield.

Careful management is necessary for the P3O® to deliver value after it has been

implemented and established.

Change management is a vital part of a successful implementation. This change will be

widespread, though, and will affect multiple stakeholder groups.

It is recommended that the implementation is run as a programme, with the appropriate

best‐practice management and governance in place.

However, some organisations may have to limit the change to a small, single office. In

which case, the P3O® design and implementation phases will be managed as a project.

It is important to effectively engage with stakeholders, communicate well, and keep an eye

on benefits.

An understanding of any problems that may arise, and opportunities intended to

realise, would also be advantageous.

Governance Focus

Business Change Strategy

Business Change Design

Business Change Delivery

Business Change Value

Governance requirements, and the way in which the governance is supported and

enabled, will fluctuate depending on the organisation. An ideal P3O® will fulfil all of

these requirements.

Business change governance support and enablement

Based on AXELOS P3O® material. Reproduced under licence from AXELOS Limited. All rights reserved.

The P3O® can add real value to any senior management decision‐making and

governance capability if it:

is an appropriate model for the organisation

is adequately resourced

interfaces with decision‐making bodies

has services aligned with other service providers within the organisation, such as

finance, procurement, or audit

Best Management Principles for extracting value from programme and project

investment:

Govern effectively – How P3O®s can help

Providing support to Senior Responsible Owner and Senior Management

Ensuring risks, issues, and changes are escalated to the right decision‐making

authority

Making sure complete, timely, and accurate data is collected at source so that

analysis and amalgamation enables quality decision‐making

Hold people to account – How P3O®s can help

Providing the Senior Responsible Owner and Senior Managers with decision‐

making support

Ensuring that the right decisions are escalated to the right people, with relevant information to support the decision‐making process

Providing standard role descriptions and terms of reference for the boards

Providing support, coaching, and training for all roles available

Prioritise investment, align and adjust to business strategy – How P3O®s can help

Maintaining a register of all programmes and projects within the portfolio,

including any ideas in the pipeline

Facilitate and support pre‐programme and project scoping workshops

Support risk identification workshops

Providing a fast‐track mobilisation service to programmes and projects

Supporting feedback from programmes and projects to strategy

Safeguard value – How P3O®s can help

Supporting the business‐case process

Providing a benefits tracking service to business owners

Ensuring benefits are not double‐counted and that the measurement process is

robust and usable

Helping to get more value via benefits from investment across programmes and

projects

Invest in people and process – How P3O®s can help

Developing tailored approaches based on Best Management Practice approaches

and ensuring that they are easily accessible to everybody in the PPM community

Developing training, coaching, and mentoring approaches for all roles within the

PPM environment

Advising on skills and capability assessments

Track progress through highlight and exception‐based reporting – How P3O®s can help

Providing timely reporting and exception management service from project to

portfolio level

Developing management dashboards that engage and focus senior management

on the key risks and matters that affect the delivery of the portfolio

Making sure that the data collection process operates proficiently and effectively

Exercise

List as many benefits for a P3O® as you can.

Investment for the P3O®

Identifying the Stakeholders

It is essential to identify and engage with your stakeholders, especially in regards to a

programme that could affect many of them.

Senior managers who will benefit from the change should be identified and engaged

immediately.

They will need to buy into the benefits that they will receive and use their influence to

drive the change forward.

Another critical success factor is the nomination of a P3O® sponsor, making sure they

are a senior manager with authority, influence, and charisma.

This person must embody the P3O® vision and ensure organisational commitment at all

levels.

Identifying the Problem

The success of a change programme hinges on the understanding of problems that

need to be solved, and realising what opportunities need to be maximised.

Consensus between the board on the serious issues and problems are essential, too.

This assures that the P3O® sponsor fully understands what success looks like across the

organisation at all levels.

Gathering these views and gaining a consensus on the right issues could take the form

of interviews, workshops, or surveys.

By debating any problems in open sessions, the root cause of these problems, and their

solutions, will be recognised and defined.

Overcoming Common Barriers

Lack of Focus

There can be a reluctance from senior managers to consider the full requirements of a

P3O® model, instead focusing on a single component (training, PPM, framework

development etc.)

This can only partially deliver the P3O® functionality, which will then lead to

restrictions on the value of the P3O®, and a failure of realised benefits.

In many organisations, two problems prohibit gaining the consensus of senior

executives:

Many executives do not understand how change management should work, with

no differentiation to other forms of management

Executives who do have some understanding, though, do not understand what is

in it for them

Funding the P3O® Model

Another barrier when building a consensus is the perception of the overhead

associated with P3O® operations. Some stakeholders will be reluctant to fund the

overhead to structure a P3O® model.

Once the P3O® is operational, an effective way to maintain focus on the value of P3O®

is to report on achievements towards the success measures against the cost of the

P3O® business units.

Some organisations might not see the value in providing support to programmes and

projects, so a project manager might take cost‐cutting measures so that tasks can be

completed within budget.

This can lead to a staggered, slower‐pace of change throughout the organisation, as

well as potentially delay benefits.

Challenging the Current Culture

A proposed P3O® model might challenge the current culture in an organisation, which

can threaten the ability of the P3O® to realise any forecasted benefits.

If the embedded culture is at senior level, it can be especially difficult to impose a new

model, with the potential for failure considerably higher.

Effective stakeholder analysis and a strong communications plan will assist in breaking

down these barriers.

Bureaucracy of the P3O® Processes and Standards

A common barrier to building a consensus among senior management is the perceived

bureaucracy associated with compliance with repeatable processes and governance

arrangements for the delivery of business change.

Processes should be kept as simple as possible, and new processes should align with

existing procedures that are already seen to add value.

It would be beneficial to introduce, or strengthen, formal sign‐offs for business cases

and implement a gated sign‐off approach to stop rogue projects at its inception.

In order for projects and programmes to be deemed a success, most of the services

that are described in the P3O® model must be carried out.

Other Barriers

Some other common barriers include:

A lack of authority for the P3O® to provide the governance and control

arrangements

Inadequate use of the individual P3O® offices, or lack of integration with other

functions, within the wider organisation

A lack of clarity in the roles, responsibilities, and accountabilities of the P3O®

staff

No clarity in the scope of individual P3O® offices

Absence of commitment from senior management to the P3O® concept

Timescales

The projected timescales for a programme to be established and implemented can

differ depending on the level of value to be achieved, and/or the level of activity to be

undertaken.

A typical change programme to move an organisation from Level 1 P3M3® maturity, to

Level 3 P3M3® maturity could take between 18 months and two years.

This timeframe can be varied due to the level of investment to shorten it, or a lack of

investment, which will slow it down.

A stepped approach to change is the ideal way of implementation, allowing capabilities

to be introduced and fully embedded.

Timescales are ultimately driven by the ability of senior management and their

appetite for making decisions on the way forward.

Quiz 2

1. Is the following statement true or false?A ‘big picture’ view is not a benefit of a P3O® model.

True

False

2. Which of the following is not an aspect of governance focus?

Business Change Strategy

Business Change Value

Business Change Design

Business Change Process

3. Any P3O® model worth its weight should be able to answer the question:

‘What value will it add to the organisation?’

‘Are our benefits double‐counted?’

‘How many months will it take to implement this change?’

‘How many workshops will we need to hold?’

4. How long could it take for an organisation to move from a Level 1 to a Level 3 P3M3® maturity?

Between 12 months and 2 years

Between 18 months and 2 years

Between 6 months and a year

Between 2 years and 3 years

Case Study: P3O® Pilot

Based at Tameside Council in Ashton‐Under‐Lyne, Greater Manchester, Martin McCann has

spent the last few years developing and implementing their tailored Project Management

Approach. As part of the transformation team, his main role is to encourage, support the

adoption, and application of best practice project and programme management within the

organisation.

‘The implementation of the Project Management Approach underpins the Council’s

Transformation Programme, which has a large number of new and existing projects within

its remit. We’re facing changes which are both exciting and challenging,’ Martin says.

He was keen for Tameside to be among the first organisations to pilot the new P3O®

guidance from OGC. P3O® brings together a set of principles, processes, and techniques to

facilitate effective portfolio, programme, and project management through enablement,

challenge, and support structures. These structures also bridge the gap between the

strategy and policy makers and the Council’s service delivery teams.

‘I met Anne Marie Byrne, the P3O® project manager, at a conference, and from what she

said about P3O® I knew that it would be both relevant and timely for my organisation to

take part,’ Martin said.

Martin and his colleagues have been tasked with setting up a Programme Office to provide

monitoring, reporting, and control information on the transformation work programme.

‘The P3O® guidance is a comprehensive, practical resource that pulls together threads from

all the OGC best practice methods. The guidance provides both interesting and useful

information and it came at the perfect time for me to start applying it. It has helped solidify

and structure many of my plans and ideas for setting up our own PSO. It has also provided

me with good ideas on how to sell it to the right people within the organisation,’ he says.

Martin also plans to use the P3O® guidance to incorporate relevant generic and functional

roles and responsibilities into the job descriptions of any new programme office staff. ‘I

have tried to link the P3O® roles and responsibilities to the functions and services the

programme office intends to provide over the next few years, illustrating the levels of

resource we will need if we want to run an effective programme office that continues to

meet our needs as the Council’s PPM capabilities increase. Given that it can take a few

years to start reaping the benefits of more effective programme management, I want to

plant the seeds and start the process as early as possible, whilst managing expectations

properly on the way!’

‘The manual will be a real boon to anyone starting out on setting up a P3O®. It does a

good job of tying P3M3®, PRINCE2®, and MSP® together in a comprehensive fashion,

which is exactly what a good P3O® should be able to do. I also found that reading the

P3O® guidance has helped clarify my understanding of how to apply MSP® in general,’

he says.

Designing a P3O® Model

The design of a P3O® model should address:

The P3O® model itself and how it will be deployed

How many separate offices there should be

The functions and services they offer

Where component offices are physically located

Organisational factors that can cause variations on the models:

Economic sector (public, private, voluntary)

Size of the organisation

Approach to organisational governance arrangements

Number, size, complexity, and duration of projects

Organisational portfolio, programme, and project management maturity

Centralisation vs decentralisation of core services

If the business is driven by local or central investment decisions

Any opportunities provided by the organisation for growth of staff

If there is a mind‐set of continual improvement in the organisation

Whether programmes and projects are carried out as internally focused

initiatives, or if they are delivering to a client base

Any geographical divisions of the organisation

Another dimension that drives the P3O® model is the business goals of the

organisation, which could include the following:

Improving the quality/quantity of the service

Reducing time to market

Increasing revenues

Reducing costs

Improving the quality of a product

As outlined in the first module of the workbook, a P3O® provides a decision‐

enabling/delivery support structure for change within an organisation.

The three functional areas in which the P3O® can provide this service:

Strategic planning/portfolio support functions

Delivery support functions

Centre of excellence functions or services

These functional areas require different skills, competencies, and experience. Often,

offices are set up to focus on one of these areas, or rather a large office split up into

teams.

It is essential for the head of the P3O® to develop the services in line with business

requirements and continually demonstrate the value of these services provided.

Design Considerations for a P3O® Model

Reporting Lines

‘Where should a P3O® sit within the organisation?’

‘Where should its component offices report in terms of line management?’

There is no simple or single answer to these questions, because a P3O® model is

usually made up of different components and offices that serve a business need.

For a P3O® to maximise its value to an organisation, though, it will need to report to a

main board director (strategy or business change).

Where an organisation portfolio office exists, it should report to a main board director,

the CEO, COO, CFO, or CIO.

However, if the portfolio office is a hub in a decentralised model, aligned with a

particular division or department, then report to the divisional director.

Reporting lines should also be reflected in programmes and projects.

Consider whether there will be direct reporting lines to the programme or project

manager, and also if the programme office/hub portfolio office reports to the

programme or project directors.

Centralised vs Decentralised Offices

In many organisations, a single P3O® office will sit in a central corporate function or

department.

This office performs one, or all, of the portfolio support, delivery, or COE functions.

Some organisations will set up an office for each of these.

In other organisations, specifically large or functionality‐focused ones, with

decentralised decision‐making and a strategy of deploying local resources closest to

business delivery, there may be a small central office with portfolio support and COE

functions working out of hub offices.

Decentralised models tend to focus their support on local need, but care must be taken

to ensure that a consistent organisation‐wide set of standards are enforced.

P3O® Model with an Organisation Portfolio Office

In this model, there is one permanent P3O® office, which may be called the

organisation portfolio office. This office carries out the following activities:

Strategic planning/portfolio support – Enabling strategies, prioritisation, senior

management decision support

Delivery support – Flexible resource pool of delivery support staff (specialists,

coordinators, support officers etc.)

Centre of excellence – Standards, assurance, competencies, and training

Depending on the maturity of the organisation, and where the office reports within the

organisational structure, the office’s services may be limited. It may also have to work

with other organisational departments to deliver all requirements.

If a programme or project creates a temporary office, the support staff will need to be

trained appropriately and they may be line‐managed through the organisation portfolio

office or the business units themselves.

However, in some organisations, strategic planning support functions may have

evolved into a separate office under a strategy director. An example of this is displayed

below:

An example of a P3O® model separate strategic portfolio office


Where this occurs, the ideal scenario would be a merging of the two offices under a

single director. If this is not a viable option, though, then the two offices should work

closely with each other.

Underlying Success Factors for Models with an Organisation Portfolio Office,

Advantages and Consequences

A P3O® champion representing senior management continuity of support

Allows for decision‐making at senior levels and drives action through other

management teams

However, the P3O® is not recognised, processes are not used, and processes are

not embedded in the culture and the initial rollout effort is wasted

Clarity of strategy and direction for management of change

Gives direction for prioritisation and capacity planning

However, the organisation does not have a portfolio of programmes and projects

aligned to the organisation’s goals, and too many programmes or projects are

started that do not add real value to the organisation

A highly respected, charismatic, and comfortable head of P3O®

Gives the P3O® units gravitas across the organisation, and the head of P3O® is

invited to senior planning meetings so they can influence decisions

However, P3O® requirements are not considered when key restructuring

decisions are made, and rolling out standards and methods across an

organisation is difficult

A portfolio office that is staffed with highly competent senior staff

The ability to empathise with delivery programmes and projects, knowledge of

what works and what does not, and getting the respect of others is easy

However, P3O® can be seen as just an admin office, or a ‘post box’

An established programme/project management forum/community of practice (COP)

Lessons are shared ‘in context’ – of how enterprise standards translate into

reality, the organisation portfolio office can learn directly from programme and

project managers, and any changes in industry practices can be communicated

easily to the full PPM community

However, there is a potential for local programme offices to form cliques, with no

sense of corporate identity, and there is no face‐to‐face forum to discuss and

debate issues and updates to organisational best practice

A blueprint for the P3O® that is regularly reviewed and updated in line with

improvements

Allows for a structure and focus for P3O® development and delivery, and utilised

to focus senior management’s attention on the added value of the P3O® and

challenge attempts at cost‐cutting

However, the purpose and services of the P3O® model are vulnerable to constant

change as senior managers champion changes over time, and personal visions

intervene

An intranet or collaboration zone where all PPM staff can access best practice and

standards

A single source of access for standards that are periodically updated, and

lessons/emerging industry good practice can be centrally applied and easily

accessed by all

However, local standards evolve and develop constantly, and individuals will save

templates on local drives and do not keep up with changing best practice

A P3O® champion representing senior management continuity of support

Exercise

Match‐up the relevant advantages with each underlying success factor.

Gives direction for prioritisation and capacity planning

P3O® model with hub portfolio offices connected by spokes

A P3O® model with hub portfolio offices will have a permanent central organisation

portfolio office that is connected to a number of permanent decentralised offices.

These offices then act as hub portfolio offices to the temporary programmes and

projects that they service.

This model is often referred to as a hub‐and‐spoke model, providing the benefit of

scalability for large organisations and supports business ownership by maintaining a

level of decentralisation.

Clarity of strategy and direction for management of change

Gives the P3O® units gravitas across the organisation, and the head of P3O® is invited to senior planning meetings so they can influence decisions

Allows for a structure and focus for P3O® development and delivery, and utilised to focus senior management’s attention on the added value of the P3O® and challenge attempts at cost‐cutting

Allows for decision‐making at senior levels and drives action through other management teams

Lessons are shared ‘in context’ – of how enterprise standards translate into reality, the organisation portfolio office can learn directly from programme and project managers, and any changes in industry practices can be communicated easily to the full PPM community

The ability to empathise with delivery programmes and projects, knowledge of what works and what

A highly respected, charismatic, and comfortable head of P3O®

A portfolio office that is staffed with highly competent senior

staff

An establishes programme/project management forum/community of practice (COP)staff

A blueprint for the P3O® that is regularly reviewed and updated in line with improvements

All information flows, and processes arranged, so that they move along spokes to the

organisation‐level office at the centre.

The figure illustrated below depicts a permanent central organisation portfolio office

with hub portfolio offices.

An example of a P3O® model hub portfolio offices temporary programme


This model is often the choice for large, more complex organisations, possibly with a

multi‐ national reach. A geographical spread of sites may necessitate the setting up of

separate portfolio offices.

Programmes and projects will use the standards and assurances from the corporate

COE or the local hub portfolio office, depending on the size and maturity of the

organisation.

Underlying success factors for hub portfolio offices

An effective capacity planning and flexible resourcing model

Allows for the geographic clustering of resources, and resources will be familiar

with the local business model and working practices

However, resources continue to be bought in, or asked to travel over a large

geographical area

Availability of good heads of portfolio offices using core standards and methods

Provides a flow‐down of good practice and standards with localised tailoring and

application

However, the local hub portfolio offices develop their own standards and do not

share best practice, and the transfer of staff across portfolio offices requires

constant training

An established head of portfolio/programme offices forum

Consistency of application of enterprise or corporate best practice, and learning

from each other how best to apply enterprise or corporate standards

However, the local hub portfolio offices develop their own standards and do not

share best practice, and the transfer of staff across portfolio offices requires

constant training

Virtual P3O® Model

The ultimate decentralised model is the virtual P3O® model, where there is no

permanent office.

Any functions and services are embedded in the organisation’s business delivery units,

with activities undertaken by a central strategy or business‐planning office or the

finance department.

This model typically exists in organisations with a high‐level of PPM maturity, where

consistent standards are embedded, the PPM resources are highly competent, and

P3O® functions and services can be provided across the organisation without the need

for a physical structure.

A significant aspect of this model is the programme, risk, and project management

forums/communities of practice.

All PPM professionals come together at regular events to share best practice and learn

about any new methods of working.

It is a common place for a virtual P3O® to be developed using external resources and internal collaboration tools.

This allows a more community‐based connection, with a similar core team. In terms of

cost‐reduction, this could be valuable for an organisation to explore further as its PPM

maturity rises.

Underlying success factors in the virtual office model

The organisation has a P3M3 maturity level of three or above

Allows for consistent, reliable working practices, as well as a culture of review

and continual improvement

However, there is no consistent way of working and there is the potential that

multiple methods will progress across the organisation

Established programme/project management forums

The sharing of best practice and a collaborative approach to the updating and

embedding of these practices

However, the base standards and practices can stagnate, and any updates

without consultation are seen as an imposition and consistency of approach

disappears over time

A single point of ownership by a senior PPM professional for portfolio, programme,

and project standards

The senior professional is outward‐facing to look for and contemplate advances

in best practice

However, local variations sneak in and the earlier work is undone

Standards are continually developed and embedded through reference to external

best practice

Provides a single point of reference for virtual teams to access, which is updated

regularly

However, local variations sneak in and the earlier work is undone

A strong, underlying PPM culture

Those involved in delivering change (mainly the senior board members)

understand their roles and the benefits of a consistent approach

However, programmes and projects act individually and do not deliver consistent

working practices, and the training overhead for programme and project

managers to bring boards and business resources up to date is excessive

Exercise

Match‐up the relevant advantages with each underlying success factor.

Permanent vs Temporary Offices

In a P3O®, it is usually recommended that permanent offices be established in order to

provide functions and services that support ongoing portfolios, senior management

decision‐making, and the setting of generic standards for all change initiatives.

These permanent offices are likely to be organisation portfolio offices, local hub

portfolio offices, and COEs, resourced by permanent staff that are trained to perform

specific functions.

When a new programme or project is launched, it may require its own temporary

programme or project office.

If there is a permanent office with a central flexible delivery team, then these resources

may be requested from there.

This ensures that the start‐up process is fast‐tracked and costs are kept to a minimum

due to already trained staff.

However, in some organisations the central pool either may not exist or will not be big

enough to cope with the demand, in which case staff will be seconded to project roles.

Some organisations might develop a framework agreement with a partner organisation

to provide all programme and project staff (managers and support).

Whenever contract or framework staff are used, though, they should be inducted into

the organisation’s standards and ways of working.

The organisation has a P3M3

maturity level of three or above

The senior professional is outwardfacing to look for and contemplate advances in best practice

Those involved in delivering change (mainly the senior board members) understand their roles and the benefits of a consistent approach

Allows for consistent, reliable working practices, as well as a culture of review and continual improvement

The sharing of best practice and a collaborative approach to the updating and embedding of these practices

Provides a single point of reference for virtual teams to access, which is updated regularly

Established programme/project

management forums

A single point of ownership by a senior PPM professional for portfolio, programme, and project standards

Standards are continually developed and embedded through reference to external best practice

A strong, underlying PPM culture

With an organisation that has a low PPM maturity level, each new programme or

project is usually staffed with local business people, sometimes supplemented with

contract staff to bring in any additional expertise.

Although there is no organisation portfolio office, there may be an underlying project

method, which is defined on the company intranet or already established in the

company’s culture.

This model suffers from inconsistency of approach on programmes and projects, with

extreme variations in terms of delivery success, dependent on local business managers’

competence.

Underlying success factors for temporary offices

Centrally documented programme or project standards and templates

All programme and project managers will have a central point to refer to for

standards and templates, and there will be a consistency of approach and

terminology across the organisation

However, all programme and project managers act individually and use their own

templates, and where there is a large contract PPM pool, external staff bring

their own familiar standards and ignore any internal enterprise or corporate ways

of working

A consistent approach to programme and project management training through the

procurement of an approved set of courses and training providers

All staff are advised to go on similar courses through a standard set of providers,

and this training will be upheld by consistent messages and language

However, staff select which courses they wish to attend, meaning there are

inconsistencies in the language and messages. Additionally, training providers are

not able to tailor courses specifically to a local company’s culture

An established heads of programme/project offices forum, including key staff from

portfolio offices

Allows for the consistency of application of enterprise or corporate best practice,

as well as the learning from one another about how best to apply these

standards

However, local offices develop their own standards and do not share best

practice, and the transfer of staff across programme and project offices requires

constant re‐ training

Co‐located vs Distributed Models

The ideal scenario is to have a permanent organisation office with staff physically co‐

located, ensuring team cohesion and consistency of approach.

However, in some organisations, because of a lack of physical office space, or an

adherence to work/life‐balance policies allowing individuals to work from home, the

team will work in a distributed model.

Where a distributed office or team exists, it is important that there is a recognised

single set of standards, albeit with separate owners for components of the standards.

It is crucial that the distributed team communicates frequently, with meetings, central

information portals, and collaborative working practices.

What Functions and Services Should the P3O® Offer?

High‐level Functions and Services

The many functions and services that the P3O® provides should be able to contribute

directly to the outcomes required by the organisation, whilst being based on the

business drivers, levels of governance, and customer demands.

Although every office may deliver all of their functions and services, they may also have

a different functional emphasis: planning, delivery, or COE.

Organisation portfolio offices typically focuses on delivery support services, but

temporary programme and project offices will focus on delivery support services.

High‐level functions and services of a P3O® modelBased on AXELOS P3O® material. Reproduced under licence from AXELOS Limited. All rights reserved.

Integration with the Wider Organisation

The P3O® will not exist in a vacuum. It is vital to understand how the functions and

services provided will integrate into the wider organisation.

A common failure of permanent P3O®s is a lack of integration of the model within the

wider organisation model.

It is the job of the head of the P3O® to understand who is responsible for what various

tasks and functions, as well as how the model, and the various offices within it, will

interact with them.

Other functions include:

Strategy development and management, including business planning

IT service management (release, change, and configuration)

Human resources

Marketing/public relations

Procurement/purchasing/commercial, including bid management

Finance

Corporate risk management

Corporate information assurance

Audit

Quality

Business operation

Other professional resources will exist in a matrix management environment with local

business lines management, but a professional link to an organisation portfolio office

or COE, just as P3O® resources do.

Clarity is required in terms of roles and responsibilities for delivering functions and

services across business areas.

Embedded resources may be assigned to another programme or project temporarily,

but their original department will ultimately still control them and the processes that

they follow.

The figure illustrated below is an example of the embedding of resources from an

organisation portfolio office, COE, and business functions into a temporary programme

office.

An example of the embedding of resources from an organisation portfolio office


The P3O® model provides the governance backbone for all change within an

organisation, certifying that all decisions are made at the appropriate level and in a

timely manner.

Effective collaboration with all bodies across the organisation is necessary due to the

influence on decision‐making.

This relationship needs to be clearly defined and rules of engagement recognised as

well.

Governance must be agreed and defined in terms of:

Who makes the decision and when

What delegated limits of authority are in place

The rules and routes for escalation and cascading of information, risks, issues,

and changes

This agreement should reflect the governance and information required to meet the

needs of all stakeholders.

Independence of P3O® Assurance Services

Independent assurance services are often included within a P3O® service offering.

These may take many forms, such as coordinating or facilitating gated reviews, regular

health checks, internal or independent audits, and lesson reviews.

Assurance teams can also provide quality assurance to programmes and projects by

providing an assurance resource (full or part‐time) or independent guidance on the

tailoring of processes in the start‐up stage.

It is essential that the assurance service is independent of the programme or project

delivery, and there are no conflicts of interest.

The P3O® itself should be subject to independent assurance and external audit itself,

paying particular attention to the external review of COE functions and services, to

ensuring that good practice is being kept up‐to‐date with changing industry standards

and trends.

Within a multi‐programme/project environment, staff across the P3O® may carry out

assurance at appropriate checkpoints and at gated reviews.

Independent assurance external to the delegated assurance from the programme or

project board may be requested by senior management, and may be focused on

fulfilment of strategy, impact on business operations, management of dependencies,

or other areas of concern.

Information Assurance

The value of information assurance varies from organisation to organisation. Banking

organisations and others with sensitive information will understand that it is vital to

their business, and that they will need to invest both a lot of time and money into

maintaining their robust systems, processes, and procedures.

The Data Protection Act and the Freedom of Information legislation defines the

minimum statutory guidelines for all organisations – with implications for all portfolios,

programmes, and projects.

Information assurance is based on three concepts:

Confidentiality

Integrity

Availability

These mean that information is only available to those who have a need and the

authority to see it, only those with the correct authority can change information, and

that the information is available whenever and wherever the business necessitates it to

be.

Careful consideration of the information assurance requirements for projects and its

outputs is imperative at the beginning of the process.

In cases where the information assurance function or department is separate within an

organisation, the P3O® should engage appropriately with the experts within it and

follow the process of embedding information assurance resources into portfolio,

programme, and project offices.

Non‐PPM Functions and Services

Sometimes, it may be necessary for the P3O® to undertake its functions and services

outside of the PPM area of operations.

This could involve:

Providing a secretariat service to management boards

Looking after travel and accommodation

Liaising with procurement regarding the acquisition of equipment of resources

Exercise

In the alignment of governance services provided by the P3O®, governance must be

agreed and defined in terms of:

Fill in the blanks with Authority, Rules, Changes, Who, Cascading, Decision

_______makes the______ and when

What delegated limits of________ are in place

The_______ and routes for escalation and _______ of information, risks, issues,

and_______

Sizing and Tailoring of the P3O® Model

Questions to be asked when designing a P3O® model:

‘How many people will the P3O® need?’

‘What level should they be at?’

The key drivers for the size of a P3O®:

The number and size of the programmes and projects to be serviced by the P3O®

The number of functions and services to be provided by the P3O®

The size of the organisation

There are, however, many more factors to be considered.

A P3O® may service a single programme, a number of programmes, or the

organisation’s full portfolio of change.

The PPM maturity of the organisation needs to be taken into account by the P3O®

model, in order to determine the detailed size and design of the individual offices

within the organisation.

The size and design also depends on the P3O® vision and the business drivers that it is

set up to assist.

The number of staff within a P3O® inside of an organisation can vary between one

person to over one‐hundred. On average, though, the figure is between five and ten

people, especially when individuals are undertaking a generic role.

Sizing a permanent organisation portfolio office or a hub portfolio office will differ from

sizing a temporary programme or project office.

For temporary offices, resources may be:

Taken from a flexible resource pool within a hub portfolio office

Engaged on a temporary basis from the contract market

Engaged as a work package through a framework agreement with a management

or PPM consultancy company

The structure of the P3O® model has an impact on the number of required resources.

It could be a more cost‐effective solution to upgrade an existing programme office to a

hub portfolio office to provide services to programmes and projects, rather than

establishing a dedicated programme or project office.

A mature organisation portfolio office, or an organisation with flexible resource pools,

will most likely have reduced staffing costs.

The design and shape of a P3O® model should not be carried out just by formula, as no

formula can fully take into account every small aspect of any organisation or

programme.

Sizing Option One – By Budget

This is based on the size and financial investment in the portfolio or programme.

Usually, the overall cost of the P3O® will range between 3% and 5% of the total

financial investment.

The level of P3O® provision will vary as the portfolio changes or the programme

progresses.

Sizing Option Two – By Size

This second model calculates the size of a temporary programme office, and bases

these calculations on the headcount of the programme.

The table on the next page illustrates how the overall headcount of a programme office

is taken as a percentage of the programme headcount.

It assumes the programme office:

Produces some management reporting

Uses basic IT tools

Works within an environment where the P3M3 maturity level is between 2 and 3

Unit Headcount

Programme 30 60 120 200 300 500 1000

Programme office 3 4 7 9 12 17 25

% programme office staff 10 7 6 5 4 3 3

An adjustment to these numbers will be required for these situations:

A higher or lower level of P3M3 maturity

Additional services provided

Programmes spread over multiple locations

Complex or novel programmes

Programmes with a large number of third parties

Programmes with intricate finances and/or benefit management plans

Programmes with a large number of projects

The need for short‐term resources required for peak loading

Programmes with a complex stakeholder communication plan

Sizing Option 3 – By Function

In this model, an estimate is made of the number of hours or days required per month

for each service the P3O® plans to deliver.

This is then converted into the number of full‐time equivalent employees required for

each service, which then gives an estimate of the number of resources needed for the

P3O®.

The size of an office, and the activities that it carries out, will vary throughout the

project or programme lifecycle.

This exercise should be carried out at least twice: once in the definition stage, and

another at the start of implementation.

The number of programmes or projects within the portfolio may drive sizing for some

functions at any time, whereas other functions could be driven by the governance.

structure and required input.

FTEs per functional area for a P3O® sizing model


Additional Considerations for a Temporary Programme or Project Office

Temporary programmes and projects will notice a variance in their sizes throughout the

lifecycles too.

This is where the use of flexible resource pools through hub portfolio offices can

become of value.

In the definition stage of a programme or project, internal consultancy is required for

establishing and tailoring standard processes, initiating the reporting cycle, developing

plans, and fast‐tracking the team.

Through the implementation and delivery phases, the need for constant planning

support reduces because the programme/project manager will take responsibility for

the updating of the plan.

The assurance role should continue to provide continuity, support through lesson

sharing, ongoing health checks, gated reviews, and advice.

Generic support from specialist may also be required during the delivery stage,

dependent on the size and complexity of the programme or project.

The closedown and post‐implementation review section of a programme or project will

no longer require delivery resources.

However, internal consultancy could assist in the independent lesson reviews and

evaluations.

A commonly found problem when reviewing temporary programme offices is that their

programme support staff is too large.

Often, this is because the number of staff is established during the definition phase and

then the staff is kept on to assist the project manager with their job.

Solutions to this problem include:

Setting up hub portfolio offices with flexible resource pools, therefore utilising

the available support to provide delivery throughout the lifecycle

Engaging consultancy support in the definition stage of a programme or project,

usually from a COE, external organisations, or PPM consultancy companies

Engaging contract staff to assist in the definition phase. A problem with this,

however, is that the staff will not be trained in local standards and will often

bring their own processes on board

Quiz 3

1. For temporary offices, resources may be…

Fully engaged in order to meet expectations

Integrated into the wider organisation

Carrying out information assurance tasks

Taken from a flexible resource pool within a hub portfolio office

2. Information assurance is based on three concepts:

Integrity, Definition, Availability

Confidentiality, Integrity, Availability

Availability, Integration, Definition

Confidentiality, Definition, Availability

3. ‘Reducing time to market’ is a business goal of an organisation that drives the P3O®

model.

True

False

4. The ultimate decentralised model is the ______ where there is no permanent office.

Organisation Portfolio Office Model

Virtual P3O® Model

Hub Portfolio Offices Model

Procurement Standards Model

Implement and Re‐energise

Introduction to the Implementation Lifecycle

The P3O® implementation lifecycle has four major steps, which are supported by MSP®

Principles:

Identify

Define

Deliver

Close

Implementation Lifecycle for a permanent P3O® Model


Identify

This process assesses the current state of P3O® provision and identifies the key

stakeholders. Outline documentation for the P3O® model is created at this point,

including a summary document called a Brief, which require validation by

management.

Activities also include:

Agreeing the P3O® Vision

Demonstrating the Value

Agreeing the appropriate cost model

Identifying stakeholders

The portfolio, programmes, and projects cannot be considered successful without the

stakeholders being satisfied. One can recognise the stakeholders from the information

about the budget, project sponsor, objects, schedule, assumptions and constraints, and

Top Management. One can get a large amount of information about the stakeholders

by interviewing the experts, or through a brainstorming session. Good questions to

consider are:

Who has direct involvement in the projects and/or programmes?

Who has indirect involvement?

Who are the suppliers?

Who are the competitors?

Who can make your portfolio/programme/projects fail?

Who may be affected by the outcomes?

Assessing the current state

The main purpose here is to drive the right information from your analysis and

assessment. Impartial honesty is the best policy at this stage. You will need to gather

opinions from various stakeholders and pull together as much factual information

about the current portfolio, programmes, and projects you can find.

There are several forms of assessment, including:

P3M3 Maturity Assessment

PPM Maturity Model

Value Matrix

P3M3® Maturity Assessments

P3M3 Structure


The level of organisational maturity in portfolio delivery demonstrates how well the

organisation can support its programmes and projects. The P3M3® Maturity Model is a

specific management maturity model to assess organisational effectiveness. There are

seven perspectives taken into consideration:

Management Control

Benefits Management

Financial Management

Stakeholder Management

Risk Management

Organisational Governance

Resource Management

There are five levels of maturity:

0. Awareness

1. Repeatable

2. Defined

3. Managed

4. Optimised

A programme uses a P3M3® Model to:

Improve performance

Assess maturity of projects

Measure itself against one or more perspectives

Ensure it is working consistently across all projects

Overview of P3M3


Value Matrix

The P3O® Value Matrix is a simple tool to assist senior managers in determining their

core problems and assessing the scope of the P3O® model. In order to create a vision

of what the P3O® model should provide, we need to understand what is offered now

and how effective it is. Typical questions to ask during the data gathering are:

Are the existing P3O®s doing the right thing?

What is the current perception from stakeholders ‐ is it favourable and why?

Are they doing what they do well? Do we have the right people and skills with

correct level of seniority and authority to get things done?

What should a P3O® stop doing?

What should a P3O® start doing?

By debating these issues in an open session, core problems can be identified, defined,

and the P3O® model design to resolve or limit them through the services provided. The

Value Matrix is intended to generate discussion and should be considered as part of a

well‐ planned and facilitated workshop or interview.

P3O® also suggests using a Value Matrix to determine the scope of the support and

assurance services to which the organisation has access. The matrix considers three

levels of change management that an organisation may experience in handling

portfolio, programme, and project management.

P3O® Value Matrix


Agreeing the Vision

The Vision Statement describes what the P3O® is and what it intends to do, describing a

compelling future state in a way that a variety of stakeholders can understand it, in

order to be convinced to support and invest in the P3O®. It uses the current reality as

part of its justification, using the current state assessments and business case, and

provides sufficient context and direction to enable the blueprint development.

Demonstrating the Value

The Business Case provides the justification for the proposed investment and should be

reviewed throughout the introduction of P3O®. Content and structure will vary

between P3O®s, because there is no ‘one size fits all’ solution. Outputs can be

summarised as a list of desired outcomes. It should be aimed at senior management. In

constructing the business case and gaining commitment from senior managers, it is

important to understand which benefits are achievable and what elements of P3O®

capability will need to be in place to realise those benefits.

The Business Case will include:

Aims

Background/Reasons

Objectives for Portfolio, Programmes, and Projects

Cost Benefit Analysis

Possible risks

Exercise

In the box, explain the impact of the results of the P3M3 maturity assessment on the

design, planning and delivery of the P3O® Model and the P3O® Blueprint

Define

This process establishes the team, refines the Vision Statement and the Blueprint. It

works on Stakeholder Engagement and delivers an implementation plan. This is all

summarised in a Programme Definition Document, which should be validated by

management. It also includes developing, modelling, and validating the benefits.

Refining the Vision Statement

The outlined vision statement needs to be developed and refined to include a high‐

level view of outcomes that will be achieved across process, organisational, technology,

and information areas once the P3O® implementation is completed. Its main purpose is

to market the goals of the programme across with wider organisation.

The Blueprint

Blueprints often use the POTI Model to define the scope of all changes taking place as a

result of the projects. POTI stands for Processes, Organisation, Technology, and

Information; the four areas that outline all elements compiling the P3O® scope.

Processes

Projects adapt current processes and implement new ones. Any operational business

models that will undergo change due to the projects in the programme and portfolio

come under this area. For example:

Performance levels

Functions and services

Use of pictures, process models, or swimlanes

Organisation

All personnel and HR organisation information, including any changes made,

requirements for the business, and organisational culture. For example:

Re‐arrangement of staff

Training requirements

Roles and responsibilities

Governance

Technology

All P3O® technology requirements are included in this section, including equipment,

tools, systems, and resources. For example:

Equipment needs

New networks or systems

Information

This area consists of mostly intangible data, such as new information requirements for

stakeholders. This may not be available early on in the blueprint development. For

example:

Changes to reporting systems and requirements

Project/Programme specific data outcomes

Information assurance

An important factor to consider when developing the blueprint is the type of P3O®

culture the organisation hopes to create. A culture is a pattern of responses

discovered, developed, or invented during a group’s history of handling problems that

arise. Culture determines what sort of actions and behaviour is acceptable, relevant,

workable, or implausible. Below are characteristics of a beneficial P3O® model:

Information Sharing: Describes the exchange of programme and project data to report

information, knowledge, and wisdom between roles, technologies, and the broader

organisation.

Focus on learning: P3O®s provide services to enable improvement, so rather than track

data looking for failure, they review and challenge documentation early on in the

process, in hope of increasing portfolio, programme, and project maturity.

Value focus to all activities: The aim here is to improve decision making and focus on

finding more attractive options rather than opting for any alternative. There is a P3O®

need for greater depth, a clear governance structure, and a sound conceptual basis for

relating strategic objectives to each investment.

Innovative: For P3O®s, innovation looks to implement new ideas, create dynamic

products, and improve services. The successful delivery of projects and programmes is

the measuring tool for innovation.

Service focussed: P3O®s place significant impact on customer service as a cornerstone

to realising financial and quantifiable benefits. As programmes rely more on

consultancy services, it is vital that P3O®s look to continually improve the services they

offer.

Proactive analysis: Instead of reacting to a situation post‐occurrence, P3O®s support

seeing potential problems before they occur through proactive analysis. Taking action

towards a risk as it happens, rather than after, leads to a reduced impact and cost

Threats to achieving the Blueprint

Lack of continued senior management commitment

Resistance to change

Overly focussed on toolsets, processes, and templates

Managing the implementation of P3O® as a project

Initial lack of quality of portfolio or programme information

The P3O® becomes the de‐facto of business change

Insufficient support to utilise or recruit required skills

Plan stages or tranches

Many P3O®s are closed down within a five‐year period, so it is important to clarify early

benefits to stakeholders for their investment. These can then be used to fund later

tranches, so that if the P3O® does last, it will finance itself.

The first tranche of delivery should contain early benefits that achieve

demonstrable improvements and easily implemented deliverables. A portfolio

register is useful at this stage, so stakeholders and management can see all the

strategies, benefits, and impacts of programmes and projects on the organisation

as a whole. This should include a defined investment budget and balanced set of

resources.

Aligning the development of P3O® capability with the normal organisation

business‐ planning cycle is also a good idea as it allows for integration of the

P3O® model and its benefits into the business budget lifecycle.

A projects dossier aims to improve PPM maturity within the organisation and the

figure below shows an outline plan based on the dossier.

When developing a projects dossier, it is important to consider:

Existing PPM maturity and targets

Priorities for capability development

Ability to embed change

Functions and services as a results of P3O® added value

Pace of change requirements

Resource capacity

Scale of portfolio

Risks to delivery and planned benefits

Threats to achieving the Blueprint

Lack of continued senior management commitment

Resistance to change

Overly focused on toolsets, processes, and templates

Managing the implementation of P3O® as a project

Initial lack of quality of portfolio or programme information

The P3O® becomes the de‐facto of business change

Insufficient support to utilise or recruit required skills

Plan stages or tranches

Many P3O®s are closed down within a five‐year period, so it is important to clarify early

benefits to stakeholders for their investment. These can then be used to fund later

tranches, so that if the P3O® does last, it will finance itself.

The first tranche of delivery should contain early benefits that achieve demonstrable

improvements and easily implemented deliverables. A portfolio register is useful at

this stage, so stakeholders and management can see all the strategies, benefits, and

impacts of programmes and projects on the organisation as a whole. This should

include a defined investment budget and balanced set of resources.

Aligning the development of P3O® capability with the normal organisation business

planning cycle is also a good idea as it allows for integration of the P3O® model and

its benefits into the business budget lifecycle.

A projects dossier aims to improve PPM maturity within the organisation and the

figure below shows an outline plan based on the dossier.

When developing a projects dossier, it is important to consider:

Existing PPM maturity and targets

Priorities for capability development

Ability to embed change

Functions and services as a results of P3O® added value

Pace of change requirements

Resource capacity

Scale of portfolio

Risks to delivery and planned benefits

Outline plan for a P3O® establishment and PPM maturity development programmer


Develop, Model, and Validate the Benefits

Develop a benefits management strategy, benefits map, benefit profiles, and a benefits

realisation plan as defined in MSP®.

Some of the benefit drivers a P3O® can provide are:

Increased cost savings

Increased cost avoidance

Increased strategic alignment

Increased programme and project throughout

Optimisation of benefits

Increased level of portfolio management maturity

Reduction in threats

Maximisation of opportunities

More effective use of resources

A benefits map will illustrate the relationship between outputs, capabilities, outcomes,

benefits, and objectives. This is crucial to learn about the cause and effect relationship

between the elements in a programme. The benefits map contributes heavily to the

benefits realisation plan, outlining the realisation sequence through a chain of benefits.

Timescales can also be developed from the map, informing the creation of schedules within

the realisation plan.

Deliver

The P3O® guidance strongly recommends and incremental approach to implementation (in

tranches) with a focus on the realisation of benefits in each increment.

Deliver new capability, and transition and stabilise operations

Successful delivery of project outputs that enable benefits within time, cost, and quality

restraints is a key aim of implementing P3O®. However, it is vital to ensure the rate of

change is bearable by the organisation and ongoing support throughout integration is

maintained.

Realising the Benefits

Benefits realisation has three stages:

Pre‐transition

Transition

Post‐transition

There can be a tendency to be over‐optimistic with expectations when defining and setting

targets of benefits. This can produce commitments from key stakeholders early on, which is

incredibly beneficial to the programme’s early stages. However, when the benefits are

reviewed, the support gained at the start could easily falter due to failed promises.

Choosing suitable KPIs (Key Performance Indicators) is crucial in benefits management.

Current KPIs must be supplemented by other measures to assess the benefits realised by

the programme. Some of these measures may fluctuate due to process variations or

seasonal trends, so it is important to understand and reflect this in the relevant plans.

Benefit Reviews

Benefits reviews can be time‐driven or event‐driven, taking place, at a minimum, at the end

of each tranche to ensure that benefits realisation is still on track.

The objectives of a benefits review is to:

Assess and update each individual benefits profile and benefits realisation plan

Check that all benefits are aligned to the programme’s objectives

Inform stakeholders and senior management of the progress in benefits realisation

Assess the level of benefits achieved against the benefits realisation plan

Assess the performance of the changed business operations against their originalperformance levels

Review the effectiveness of how benefits management has been handled, sharing

any learned lessons

Reviews will require the benefits realisation plan itself, as well as its benefits map and any

relevant individual benefit profiles. If any concerns arise, then the benefits management

strategy should be revisited.

Close

When a specific programme has been developed to set up a new P3O® capability, formal

closure and post‐implementation and benefit reviews are essential. This enables making

the P3O® capability part of ‘business‐as‐usual’ and allows time to reflect.

Exercise: Give some examples of the steps you would take in the Buyitall scenario that

would incorporate these characteristics within its P3O® model

Information Sharing

Focus on learning

Value focus to all activities

Innovative

Service focused

Proactive analysis

Temporary Programme or Project Office

The temporary programme or project office is designed specifically for a finite lifecycle. This

means there are different requirements on size, scale, and complexity. There are key

success factors involved in the setting up of a temporary office:

Organisational Context

When there is an organisation portfolio office or hub portfolio office in place, the

temporary programme/project office may be resourced with standards and templates

provided by the Centre of Excellence. The processes of the temporary office will be a

standard function provided by the organisational portfolio office:

An example of a P3O® model temporary programme and project offices


In organisations without an Organisation Portfolio Office or Centre of Excellence, the set‐up

of the temporary programme/project office will rely on the local business team responsible

for the relevant programme or project and the maturity of their approach to PPM and its

processes. A physical programme or project environment is also required, perhaps using

existing business facilities to provide workspace, equipment, and software etc. Some

organisation have equipped office areas with team‐working tools specifically for short‐term

use.

Definition and Implementation

It is suggested that 10% of the programme/project timescale be spent on establishing the

temporary office, alongside other start‐up activities at the beginning of the

project/programme. The structure and functions of the temporary programme or project

office are determined in the initiation documentation and these requirements will drive the

office model and its processes.

Some key requirements are:

A configuration library

Guidelines for storage and security of documents

Tools, including drawing and collaboration tools

The temporary programme or project office may be run by one person, or a team of generic

or function‐based roles. Deciding what skills are required takes into account the

stakeholders, the business environment, the scope, and the timescales. For example, a

project with multiple stakeholders with complex requirements might need a specialist

stakeholder and communications role. The members of the office may be permanent staff

taken from the Organisation Portfolio Office or other areas of the business. They could also

be temporary or contract resources, brought in specifically.

Wherever the resources are drawn from, induction and team building would be beneficial.

If a COE exists, it can provide an introduction into the organisation standards, or a manager

can give a project or programme briefing.

Running a temporary office through to delivery

The temporary office should constantly evaluate its processes to ensure they are the best

approaches, as well as its resources to check they are still providing value. It is

recommended that these reviews take place at the end of each tranche between the

programme manager and the office.

Key areas to focus on:

Key areas of focus for a temporary programme or project office


Closing and Recycling the temporary office

Due to its finite lifecycle, the temporary office must ensure its documentation, benefits,

contracts, and resources can be correctly transferred to operational areas. If an

organisation has tools, methods, and skills from a previous programme or project, it can be

left as part of a temporary office. It is common to mistakenly reinvent these elements,

when they are actually buried in documentation. Reusable elements include processes,

templates, tools, or best practices approaches, which should be fed back into the COE to

ensure a learning organisation.

Quiz 4

1. What does the P in POTI Model stands for?

Performance

Processes

Project

Portfolio

2. Which stage of the implementation cycle is the business case most relevant?

Identify

Define

Deliver

Close

3. How might your strategy change, knowing that some P3O®s only last about five years?

Adjust the blueprint

Reduce timescales

Emphasise early benefits

Increase costs at early stages

4. Which document outlines the details of all programmes/projects

Blueprint

Projects Dossier

Business Case

Portfolio Register

Case Study: No Skeletons in the Cupboard at BT Design

This case study describes how P3O® helped the senior management at BT Design make

business‐critical decisions.

Designed to enable decision‐making and support organisations going through large‐scale

change, Portfolio, Programme, and Project Offices (P3O®) is the latest best practice

guidance from OGC. Programme Manager Chris Barnes discusses how BT Design used P3O®

to create a Centre of Excellence. Utilising a highly professional group of evangelists for

P3O® to maximum effect, BT Design established a portfolio management approach which

showed senior management how the business was functioning.

In 2008, BT Design (the design and implementation arm of BT) was partway through a

significant transformation: the rapid expansion into new markets and geographies meant

we had to rationalise many disparate operational systems and legacy platforms in order to

realise significant potential benefits. We initiated Milestone – a programme aimed at

coordinating delivery of these rationalisation efforts, and paving the way for new

‘twentyfirst century’ platforms and technologies that would enhance our customers’

experience.

Milestone’s first objective was to understand the nature of the activity already underway.

Milestone brought together existing programmes focused on network rationalisation,

where there was a large element of interdependency. It was clear that these programmes

were being delivered in different ways and were at different stages in their lifecycles. We

needed to set out consistent approaches to deliver the programmes and follow best

practice. We felt that P3O® would give us consistency, delivery support, and the ability to develop our capability. A programmer management approach, which underpinned our

activities with a proven set of tools, was very appealing.

We charted the lifecycle of programmer and project management capabilities to underpin

how much flexibility we had, so we could assess which programmers were a priority and

which were not.

We adopted a portfolio management approach for strategic planning, looking at

programmes together and analysing how well board‐level decisions were made. Some

programmes were very large but we wanted to know what their business case was, what

their benefits were and what management information could support their structure. We

wanted to be able to provide information that would help senior management make

informed decisions. We also looked at best practice and the use of MSP® and PRINCE2®, as

well as BT’s own expertise. We wanted to deliver a tailored approach to programmes and

grow capability. We decided to implement P3O® from the top down and to set

requirements that way. We showed the senior management team improved ways to report

on costs and on what benefits their programmes brought the organisation. We

demonstrated how important that kind of information is and how it filters down into

projects. Because we wanted to maximise resources, we had to make some tough, highlevel

decisions. Having the correct information and being able to plan strategically was key. The

reporting structure of P3O® allowed the flow of information to be traced back to its source.

How to Operate a P3O®

Overview of Tools and Techniques

Tool

A data manipulation system that informs and improves decision‐making through presenting

programme and project information and data.

Tools may be used in the following ways:

Individual

Collaborative

Integrated

Technique

A procedure to accomplish a certain activity or task. Techniques use tools to collect,

manipulate, and present the inputs and outputs.

Standard techniques can be found:

Within corporate or P3O® standards and policies

In knowledge repositories

With programme or project resources through skills transfer or coaching

Within P3O® templates and deliverables guides

Through the communication of approaches

Benefits of Tools and Techniques

Automation of Business Procedures

Reduced staff requirements

Reduced overhead on project delivery teams

Reduced need for manual processes e.g. data collection, printing, and distribution

Improved Compliance with Business Procedures

Due to automation of workflows, approvals, and governance mechanisms

Integration of business processes with organisation components

Improved Timelines of Decision‐Support Information

Allowing automatic validation of information against standards

Providing audited business rules around the information

Enabling reallocation of manual processing time to improving information quality

Providing structure to decision‐support information processes

Introducing automated ways of assessing decision‐support information

Improved Decision Making

Integration of data into repositories provides improved visibility and analysis of

cross‐programme information

Due to ability to automate view and structure of information

Improved capability to perform what if and scenario analysis

Improved Management

Connectivity allows for improvements to collaboration between programme/project

team members

Improved Staff Competence

Skills transfer

Reduced reliance on conventional wisdom, and a transfer of knowledge to known

facts based on historical information

Rationalisation of legacy systems

Tools for the P3O® that are of an integrated nature may be able to rationalise a

number of disparate systems

Critical Success Factors

Focus on adding value to the organisation rather than the features of the tool

Marketing often focusses on the tool’s features and sophistication rather than their

use to the organisation

Research services that compare tools also focus on the functions of the tool, when

they should look at ease of implementation and the quality and credibility of the

organisation behind the tool

The Blueprint needs to consider any use and benefits of tools that will support the

P3O® and match the correct tool to the right requirement

Match the sophistication of the tools and techniques to the PPM Maturity of the

organisation

The standard of the tools and techniques needs to align with the organisational maturity because they need to integrate with the business processes, information flows, and the competencies of the resources using them

There is a need for programme and project standardisation and data quality

Advanced tools that can prioritise projects based on data received on costs, benefits, etc., cannot work if the data quality is too low, as a result of a lack of project lifecycle

Ensure the governance for programme and project delivery is in place to enable decision making, and align the software with this decision making structure

Understand the intent of the tool or technique

Some tools will be developed for specific purposes, or aligned with standards of a

specific industry to better suit their needs. This means that if offered to the wider

market, it might not be easily adapted to a new environment

Understand the management methods from which the tool/technique was derived

Implement tools as part of an organisational change effort

Tool suppliers often want a quick implementation, so will sometimes provide

standard project frameworks or transition plans for implementing tools

It is critical to consider and plan the enabling projects and subsequent projects

around the tool implementation project.

Manage the tool implementation as a business change project and not as a

technology implementation

Clear guidance and training should be developed and delivered as part of the implementation activities

Tools should be assessed for the time and effort they will require in case new skills within the P3O® are required, or if the PPM community will need more time

Maximise successful programme and project delivery through incremental

implementation

Consider how implementation may be adopted incrementally to concentrate the

efforts of the delivery team

Use pilot and early adopters and ensure all plans and successes are communicatedeffectively to the PPM community

The disadvantages/problems of ‘big bang’ project implementation equally apply to

tool implementation

Agree tool ownership within the organisation

For integrated tools across the hub portfolio offices, it is important that ownership

and accountability for tool operations are clearly outlined and enables users to

provide feedback and enhancements

Exercise

Explain how organisational maturity impacts on successful tool implementation in relation

to the CSFs outlined above:

P3O® Tools

Examples of Tools

Strategic Mapping Software

EPM Solutions

Enterprise Architecture Systems

Knowledge Management Systems

Performance Management Systems

Risk Management Systems

Requirements Management Systems

Enterprise PPM (EPM) Solutions

These are the most common integrated tools used in the P3O® that aid in data collection,

maintenance, and reporting all in one solution. This enables a roll‐up of information from

one data source to all project/programme levels; they can produce integrated reports for

multiple audiences from a single set of data. A wide range of EPM solutions are available

but organisations have difficulty utilising them due to low PPM maturity – this emphasises

how PPM maturity is a vital consideration in tool selection.

Selecting and Implementing an EPM Solution

Key questions to consider when developing a requirements document for the selection and

implementation of enterprise PPM solutions

Strategic

How will the PPM tools support the proposed P3O® Model?

What is the key objective of the PPM tools?

Do the features match the organisation’s requirements?

Is the organisation planning to use the PPM solution to support strategic or business planning cycles?

What features will be required now, and as the maturity of the organisation increases?

Is the current PPM maturity appropriate for a move from individual tools to collaborative tools?

What is the track record of PPM tools within the organisation?

Does the organisation need to purchase and implement the PPM tools as part of a permanent P3O® model, or use an outsourced solution as part of a temporary P3O® model?

How will senior management respond to new ways of working as a result of PPM solutions?

What are the organisational change management implications of moving to a PPM solution?

Is the organisation’s investment in multiple individual tools/software less efficient or effective than implementing an enterprise PPM solution?

What are the risks associated with the implementation of the PPM solution and how will they be managed pProcess

What processes will the PPM solution be aligned with? Can it support the current processes and evolve to accept the new processes?

What processes can be done more efficiently using the PPM solution than by the

manual one?

What benefits can be realised by implementing more features?

Which processes are the highest priority to implement to realise early benefits?

How will the PPM solution integrate with the wider organisation?

Organisation

What roles and responsibilities will the PPM solution require?

What skills/competencies are required to implement, maintain, and improve the

PPM solution?

Will the PPM maturity of the organisation impact positively or negatively the PPM

solution, and the realisation of its benefits?

Are suitably skilled resources available to operate the PPM solution in production?

Tools and Technologies

Will the architecture support project delivery?

What licence requirements best suit the organisation’s approach?

Should the tools be purchased outright, outsourced, or used via a host solution?

Are the PPM tools easily configurable?

What costs are associated with the customisation of the tool?

What integration requirements will there be to legacy or line‐of‐business systems?

What are the minimum data requirements? How much effort is needed to ensure allaspects of information assurance?

Information Flows

What key questions are being asked by senior management about the portfolio?

What information is needed from project/programmes to achieve this?

What information does the organisation need to monitor to achieve better

outcomes?

Will the information be automatically rolled‐up, or will multiple systems be needed?

Can data be easily migrated from current approaches into the PPM solution?

Can data be easily validated after migration to maintain data quality?

What capability is there to provide metrics on the health of the information within

the EPM solution?

P3O® Techniques

Examples of Techniques

Portfolio Prioritisation and Optimisation

Complexity Modelling

Management Dashboards

Knowledge Management

Business Process Swimlanes

Capacity Planning

Assurance, Gated reviews, and Health Checks

Prioritisation and Optimisation

Objective: To categorise the programmes and projects within a portfolio, based on agreed

measures that are commonly financial or use a multi‐criteria analysis, such as risk.

Benefits: Aids in determining where investment should be directed, rather than all projects

going full‐throttle, using the same resources and being cost inefficient. It supports senior

management in decision–making, evaluating how programmes/projects are aligned with

strategic objectives.

An example of strategic alignment and risk level diagram


Complexity Modelling

Objective: To determine the appropriate lifecycle and governance for the programme/

project based on its complexity.

Benefits: Provides a structured approach to the tailoring of the standard lifecycle and

governance, thus providing both flexibility and standardisation of portfolio management

requirements.

Activities involved: The organisation must determine the criteria for the complexity of

projects and programmes. Analysis is performed to discover the drivers and their

parameters for the aforementioned criteria. Weightings are applied to create an algorithm

that results in an overall complexity score. The complexity score is used to determine the

recommended governance structures and tailored lifecycle for the project. It is important

to know that this technique will require refinement and ongoing review to ensure that the

weightings are appropriate to the governance applied.

Capacity Planning for Resource Management

Objective: To understand the resource capacity and competency supply‐and‐demand‐

levels, as well as take action to match these appropriately to delivery requirements.

Benefits: Reduces any obstacles in relation to capacity or competency that may impede

project/programme delivery

Sometimes, capacity planning is just an annual baseline for the planned porfolio that

informs project portfolio phasing to reduce gaps between resource supply and demand for

the year. It may also only address the capacity of key known resources points of failure, or it

may include competencies as well. As P3O® capacity increases, capacity planning may

involve frequent assessments based on resource experience.

Knowledge Management

Objective: To create an environment, including providing tools and processes, to support

the creation and sharing of knowledge.

Often confused with information management, knowledge management differs in that it

includes ideas, insights, experience. Due the difficulty of documenting that data, knowledge

management focuses on connection people.

The P3O®’s management of knowledge should be sensitive to the organisation’s view of

knowledge, but the P3O® can also change the opinion of the organisation by introducing

new knowledge management principles that tap into previously undervalued knowledge.

Management Dashboards

Objective: To provide decision‐support information across the portfolio using highlight and

exception‐based reporting, therefore giving a rolled‐up view of more detailed information.

Benefits: Supplements larger volumes of detailed reporting, allowing the decision‐makers

to better determine progress and understand where intervention may be required.

Activities Involved: When the programme or project sends in a status report, the dashboard

rearranges the data across different metrics. This allows the project board to quickly see

key information and evaluate where requires attention. The management board is updated

periodically and provided to the relevant governance group. The design and content of the

board must be fit for purpose for the relevant decision‐making bodies. Fitness for purposeis

confirmed by each of them, to ensure all requirements are satisfied.

It is important to note that this technique requires trustworthy and reliable information as

its main input. Information assurance should be applied to all data to ensure is trusted to

be the one version of the truth. If traffic lights are used, there must be consistent, agreed

use of red, amber, and green to ensure objective reporting.

An example of a portfolio management dashboard


Assurance, Gated Reviews, and Health Checks

Objective: To provide an individual assessment of the performance of the portfolio,

programme, or project against its objectives and the standards.

Benefit: Provides objective assurance of the decision‐support information inputted into the

P3O® and the reactive ability to get the programme or project back on track

Business Process Swimlanes

Objective: To document standard and repeatable business processes with appropriate

linkages and agreed accountabilities.

Benefits: Documents, baselines, and continually updates repeatable processes as progress

evolves in response to lesson sharing and increased PPM maturity.

An example of a swimlane for schedule management


Exercise: Match up the techniques and their objectives

Quiz 5 1. Which statement regarding assurance functions and services is false?

Takes various forms including regular health checks

Carries out audits of the programme performance

Provides guidance on the decision support information

Provides independent assurance in addition to that provided by a Programme Board

2. Which tool links information in a hierarchical manner for multiple business change initiatives?

Individual

Collaborative

Integrated

Assurance

3. Which of these is not a benefit of tools and techniques?

Improved compliance with business procedures

Reduced staff requirements

Provides structure to decision‐support information

Rationalisation of legal systems

4. Where are standard techniques typically documented?

Within knowledge repositories

Within the Portfolio Office Business Case

Within P3O® templates and deliverables guides

Within a number of places

Roles

P3O®s categorise roles into three sections: Management, Generic, or Functional. If the

office is large and/or permanent, the functional roles will often be assigned to one or more

people, whereas if it is small or temporary, the roles are often amalgamated under one job

desciption.

Management Roles

All management roles require:

Strong leadership and management skills, coupled with strong PPM skills

The ability to make and maintain relationships with all parts of the business, to ensure all initiatives meet the requirements of the portfolio board

An understanding of the bigger picture and the objectives of the portfolio in regards to the wider environment and how to ensure alignment with wider policy and strategic initiatives

Established relationships across the business and portfolio, including senior managers, programme and project teams, and third‐party service providers

P3O® Sponsor

Purpose:

To support and guide the implementation and continuing lifecycle processes of

the P3O®

Use strong leadership, management, and authority to establish and continually

improve the P3O® Responsibilities:

Develop and maintain business case, to secure the investment to re‐energise the

P3O®

Ensure business needs and issues are addressed properly

Review whether projects and programmes are aligning with wider policies

Identify how P3O® can assist in the change portfolio of other business areas

Risk Management

Head of P3O® (Permanent Office)

Purpose:

To set‐up and run the permanent office, perhaps taking over the role of portfolio

manager as well

To ensure the integrity of the portfolio and its contents

Identify any gaps in iniatives to clarify which activities will fill them

Responsibilities:

Work with senior management to define and implement the portfolio framework

Create strategies for the planning, monitoring, and delivery of the portfolio

Support the portfolio director in agreeing projects to include in the portfolio

Maintain relationships with other business initiatives to prevent responsibility

overlap

Design management dashboards

Allow programmes and projects access to strategic information

Establish framework agreements for the purchase, roll‐out, and maintenance of PPM

tools, training, and consulting

Head of Temporary Programme or Project Office

Purpose:

To set‐up and run the temporary office

Identify any gaps in iniatives to clarify which activities will fill them

Have the ability to deputise for the programme manager

Responsibilities:

Support overall integrity and coherence of programme or project

Support the programme manager in agreeing projects to include in the programme

Ensure exisiting initiatives and projects are adopted into the programme

Agree project closure with programme/project manager

Maintain relationships with other programmes to prevent responsibility overlap

Identify dependencies among the programme, its projects, and other initiatives

Report progress via management dashboards

Run end‐of‐tranche reviews and benefits reviews

Discover the reasons why strategic initiatives are underperforming

Inform project or programme of any changes

Be responsible for team objectives and continual improvement of P3O® service

Workload management and prioritisation between ad hoc requests and deliverables

Generic Roles

Portfolio Analyst

Purpose:

To facilitate development and management of an optimised portfolio

Ensure senior management decisions lead to fulfillment of strategic objectives

Responsibilities

Provide strategic overview of all portfolio contents, reporting anomalies

Evaluate process for possible improvements to aid project workflow and delivery

Manage prioritisation model

Initiate reviews of post‐programme/project evaluation reports and benefits to ensure

all goals are met

Design portfolio delivery plan, resource schedule, risk register, KPIs, and portfolio

dependencies register

Assess benefits management across programmes to identify gaps and overlaps and

eliminate double counting

Scan for impending strategy or policy changes

Provide aggregated analysis to the strategy board

Develop portfolio stakeholder strategy and ensure effective communication

Programme or Project Specialist

Purpose:

To provide specialist hands on support for programme and project managers

Promote PPM management methods and standards to implement best practice

Provide a consultancy service to boards (could be advice centre or have a specific

purpose like workshops)

Work with programme manager and business managers to define governance levels

and decide on level of support

Responsibilities

Coordinate information about the running, progress, and problems of

programmes/projects

Provide briefings on their roles and responsibilities to the board and assurance staff

Review completed programmes/projects to gather preventative information on

problems and/or good practice

Design and support governance and reporting

Build register of approved training courses and PPM events, detailing content, level,

and dates

Maintain a repository of good programme/project documentation and a library of

other useful resources, such as training aids or reference materials

Programme/Project Officer

Purpose:

To improve the planning and delivery process, by collecting and maintaining data in

consistent form

Responsibilities:

Establish guidelines, procedures, and templates to collect and maintain consistent

data

Implement information management system, and manage all configuration libraries

Provide basic training in configuration management techniques

Establish risk, issue, and change control processes and templates and assist in their

delivery

Provide a coordination/administration service to a programme or project

Exercise:

Your organisation does not have enough funds to fill all these roles. Evaluate their use, by

filling out the table below with a summary of the main consequences to the P3O® if they are lost.

P3O® Sponser

Head of P3O®

Head of Temporary Office

Portfolio Analyst

Programme Specialist

Programme Officer

Functional Roles

Benefits and Value

Purpose

The purpose of the benefits and value role is that a reliable ‘fit for purpose’ approach to

benefits and value management is implemented and applied through the portfolio or

programme, and that benefits realisation is enhanced from the organisation’s investment in

change.

This role is typically undertaken by the portfolio benefits manager, or by someone that

reports to the portfolio benefits manager.

The finance department also plays a vital role in shaping the approach, methods, and

standards to be implemented.

Responsibilities

Developing and sustaining the P3O®’s benefits management framework

Forming the infrastructure essential in the implementation of the benefits

management framework

Providing training and awareness‐building meetings on the application of the benefits

management framework

Contributing in the investment appraisals, making sure that business‐case benefits

forecasts are dependable, and that they meet the organisation’s benefits eligibility

rules

Working with the business change managers and their teams to encourage more

effective benefits management practices

Providing guidance and support to the PPM and business‐as‐usual colleagues on the

expansion of initiative‐level benefits forecasts and benefits management policies

Providing assurance on the effectiveness of benefits management

On behalf of portfolio or programme management:

o Assisting the agreement of the benefits management strategy

o Leading benefits and dis‐benefits identification activities

o Leading and facilitating MoV studies

o Holding benefits‐mapping workshops, as well as evolving and maintaining abenefits map

o Facilitating agreement on the benefits realisation plan

o Upholding the benefits forecast

o Evaluating the impact of change requests for their possible effect on benefitsrealisation

o Tracking and reporting benefits realisation development for the dashboard

o Escalating issues with benefits realisation, as appropriate

Setting the standards for, and observing, post‐implementation reviews to compare

benefits realised with the benefits forecast

Working with the business managers or business change mangers to recognize

further opportunities for benefits management

Frequently revising and improving the effectiveness of benefits management

arrangements

Assessing benefits management across a number of programmes or projects to

detect gaps, overlaps and conflicts, and eliminating double‐counting in the benefits

plans of individual programmes and projects

Commercial

Purpose

The purpose of the commercial role is to ensure that the organisation carries out the role of

‘informed customer’, and that all commercial/procurement practices and decisions meet

the designated standards and offer the organisation value for its money.

It can also take on the role of supplier relationship manager, developing efficient and

effective relationships with suppliers, outsourcers, and partners.

This role may be a P3O® role, but is more likely to be embedded in the P3O®, with formal

line management from the commercial, procurement, or purchasing function.

Responsibilities

Early engagement with commercial, procurement, or purchasing teams to scope the

commercial element of the portfolio, programme, or project

Providing ongoing liaison with commercial, procurement, or purchasing teams

Providing liaison with the relevant statutory procurement functions

Developing and executing the portfolio, programme, or project procurementstrategy

Undertaking contracts management, including tracking deliverables against existingcontracts and managing any third-party or sub-contractor contracts

Ensuring that all contracts remain up‐to‐date and exit strategies are in place

Providing analysis of any requests for change that may have a contractual impact

Coordinate purchase order activities

Ensuring compliance with any applicable organizational, national, and international

standards and legislation

Providing commercial expertise/advice to the portfolio and programme teams, and

constituent projects

Facilitating relationships between the organisation’s senior management community,

SROs, and senior managers within the supplier community

Taking on supplier relationship manager responsibilities, which may include:

o Aiding the management of supplier and contractual risk, gauging all aspects of

supplier performance, and initiating remedial actions whenever and wherever

required

o Conducting contractual reviews with all major suppliers to the programme or

project on a regular basis

o Handling all aspects and stages of the contract lifecycle on behalf of the

programme or project manager

o Sustaining a catalogue of suppliers, services, products, and contracts within the

programme or project

o Providing a single liaison and contact point for all supplier and contractual issues

o Developing a full understanding of supplier strategies, plans, business needs, and

objectives

o Ensuring that the programme or project is working in partnership with suppliers,

building on long‐term relationships

o Enabling the development and negotiation of appropriate, achievable, and viable

contracts and contractual goals with suppliers

o Facilitating the negotiation of ‘value‐for‐money’ services and products with all

suppliers

Communications and Stakeholder Engagement

Purpose

The purpose of this role is to make sure that the management of the portfolio, programme,

or project’s stakeholders is effective.

Responsibilities

Sustaining the list of stakeholders and their interests

Leading the work to detect and document the programme stakeholders, their

interests, and their possible influence on the programme

Aiding the formulation of a stakeholder engagement strategy and the related

portfolio, programme, or project communications plan to ensure:

o An awareness amongst all stakeholders of the benefits and influences of the

portfolio or programme

o That expectations do not drift out of line with the planned delivery

o Commitment from stakeholders to the changes being presented, confirming the

long‐term success of the portfolio, programme, or project

o That all stakeholders are educated on the progress before, during, and after the

implementation or delivery of the project outputs and programme outcomes

o The promotion of key messages from the portfolio, programme, or project

o A demonstration of the commitment to meeting the requirements of the

portfolio, programme, or project sponsors

o True two‐way communication with stakeholders due to encouragement in

providing feedback

Endorse opportunities to maximise the benefits acquired from the portfolio or

programme

Organise stakeholder engagement and communication, ensuring effective timing and

interdependency management of communications

Coordinate internal portfolio and programme communications

Monitor the effectiveness of communications

Handle press enquiries

Establishing and sustaining any portfolio, programme, or project intranet site or

information portal

Information Management

Purpose

The purpose of this role is to act as the custodian and guardian of all master copies of the

portfolio, programme, or project’s information.

This role should ideally work closely with the security function or department in an

organisation in order to confirm that full information and physical security is considered

within a portfolio, programme, or project.

Responsibilities

Making sure that significant information assets are under configuration management

and change control, sharing information within the project, programme, or portfolio

Producing and operating libraries or other storage areas to store products and keep

reference materials up‐to‐date

Developing and handling document control procedures to cover baseline

management, controlled issue of master documents, version control, document

history, and distribution lists

Creating an identification scheme for all products, and assisting in the identification

of products

Establishing and administering baselines

Controlling the receipt, storage, and issue of all portfolio, programme, or project

products

Keeping a record of all issued copies of products and informing holders of any

alterations to their copies

Undertaking configuration audits and maintaining status information on all products

Guaranteeing that supplier configuration items are under control by providing a

single point of entry entering, and exiting, the programme for such items

Seeking out knowledge about how to access relevant information outside of the

programme office, other systems in the organisation, and internet resources

Ensuring that procedures are put into place to handle the security and secrecy of

programme/project documentation or other assets

Consultancy and Performance Management

Purpose

The purpose of this role is to offer internal consultancy and expertise in PPM and

organisation processes, as well as the monitoring of certain programmes and projects.

The services provided are focused on sustaining a minimum set of standards and achieving

the target performance.

Post holders should seek to continually improve the performance of the portfolio,

programme, and projects within an organisation.

Responsibilities

Making sure that their own procedures and templates are maintained in line with

industry best practice

Setting up and maintaining a performance improvement plan

Setting up and tracking portfolio, programme, or project metrics to monitor and

control performance

Sharing lessons and formulating action plans

Providing professional high‐level planning skills for programmes and projects

Providing project assurance service to project and programme boards, either directly

or through the engagement of third‐parties

Running facilitated workshops

Undertaking mentoring or coaching of portfolio, programme, or project staff,

including programme and project sponsors/SROs

Undertaking portfolio, programme, or project induction

Creating case‐study material and feeding back to the COE

Performing programme and project fast‐track, start‐up, and closure assistance

Assisting in programme and project ‘rescues’ through hands‐on development and the

delivery of action plans

Acting as a trainer in PPM for internal courses/workshops

Acting as method specialist/experts in PPM

Providing technical leadership, coaching, and mentoring in all PPM tool utilisation

Providing consultancy‐style services to programme and project delivery teams at the

definition stage, as well as throughout the lifecycle

Carrying out health checks on programmes and projects at any time during the

lifecycle

Providing business performance monitoring and reporting

Keeping abreast of, and evaluating the effectiveness of, new programme and project

management tools and techniques

Providing performance deviation escalation management

Finance

Purpose

The purpose of the finance role is to create a professional finance function within the

portfolio, programme, or project to ensure the timely provision of funding and effective

financial control.

This may be a P3O® role, but is more likely to be embedded in the P3O® with formal line

management from the finance function.

Responsibilities

Working with the chief finance function to assist the availability of suitably profiled

funding across financial periods

Controlling budget allocations and estimates of future spending

Evolving and sustaining the portfolio, programme, or project financial controls

Revising and tracking portfolio, programme, or project costs and revenues

Evaluating and collecting portfolio, programme, and project financial information

Assisting in benefits profiling

Handling invoicing and collection activities

Arranging monthly financial reports for the portfolio, programme, or project manager

Producing and maintaining financial models for the depreciation and amortisation of

programme and project costs

Providing programme accountancy aid with:

o Development and refinement of programme and project business cases

o Creating and distributing financial reports

o Development and maintenance of the resource management plan

o Advice on cost control and opportunities for savings

o Adherence to accounting procedures

o Capitalisation of capital assets

Issue

Purpose

The purpose of this role is to take the lead in ensuring that the portfolio, programme, or

project has operative processes in place to recognise, monitor, and solve any issues.

Responsibilities

Developing and executing the issue management strategy, making sure that the

commercial function leads on contractual issues

Communicating the issues management strategy, and the benefits of following it, to

all personnel

Forming and sustaining the portfolio, programme, or project issues register

Registering issues for ensuing investigation and resolution, monitoring items

identified as requiring action, prompting timely actions, and reporting on whether

required actions have been carried out

Making sure that all issues have a nominated owner

Ensuring that the agreed responses to issues are planned, resourced, and applied

Communicating with stakeholders, particularly those who are directly affected either

by the issue itself or by the response to the issue

Assessing how effective any issue response has been

Aiding in the regular monitoring and review of all issues

Examining issue registers across the portfolio, programmes, and projects, regarding

issues and their handling

Enabling cross‐programme/cross‐project impact analysis

Escalating issues to a higher authority

Liaising with the information role on configuration management

Change Control

Purpose

The purpose of this role is to take the lead in ensuring that the portfolio, programme, or

project has effective processes in place to identify, monitor, and resolve changes.

Responsibilities

Developing and applying the change control process, making sure that the

commercial functions lead on contractual changes

Clearly communicating the change control process and the benefits of following it, to

all personnel involved with the portfolio, programme, or project

Creating and sustaining the portfolio, programme, or project change register

Registering changes for subsequent investigation and resolution

Making sure that all changes have a nominated owner

Ensuring that all changes have appropriate impact analysis and are planned,

resourced, and implemented through formal configuration management


by the change itself or by the response to change

Assisting in the regular monitoring and review of all changes

Examining change registers across the portfolio or programme to look for common

themes and establishing consistent resolution procedures

Forming and maintaining an efficient two‐way flow of information between the

portfolio, programmes, and their projects

Escalating changes to a higher authority

Liaising with the information role on configuration management

Planning and Estimating

Purpose

The purpose of the planning and estimating role is to take charge in facilitating the

development and maintenance of the portfolio, programme, or project plan and

dependency logs.

Responsibilities

Outlining planning standards for portfolio, programmes, or projects to enable ease of

roll‐up of milestone data and dependencies

Facilitating the design, development, and ownership of the portfolio, programme, or

project plan

Sustaining and updating the plans, advising on missed forecasted milestones, missed

dependencies, and impact assessment

Maintaining and updating resource plans, advising on resource clashes and

shortcomings

Making sure all product‐based plans include activities, time, and resource estimates

for risk mitigation

Ensuring quality review activities and associated time have been allocated accurately

Investigating interfaces and dependencies between projects, recommending

appropriate actions where anomalies exist or in any areas of concern

Undertaking the tracking and maintenance of dependencies

Creating and operating mechanisms to track portfolio, programme, or project

delivery against the plan

Recognising and reporting deviations and trigger reports where appropriate

Reviewing plans against the business‐as‐usual plans to ensure change can be adopted

effectively

Providing estimating support to the portfolio, programmes, or projects

Defining and managing time‐recording processes

Making sure that impending policies or strategy changes are evaluated for their

influence on the portfolio, programme, or project plans or dependencies

Planning and Estimating

Purpose

The purpose of this role is to take responsibility for facilitating the development and

maintenance of the portfolio, programme, or project plan and dependency logs.

Responsibilities

Describing planning standards for portfolio, programmes, or projects to enable ease

of roll‐up of milestone data and dependencies

Assisting in the design, development, and ownership of the portfolio, programme, or

project plan, making sure that all milestones and internal and external dependencies

are recognised, recorded, and observed

Sustaining and updating plans, advising on missed forecasted milestones, and impact

assessment

Maintaining and updating resource plans, and advising on resource clashes andshortcomings

Ensuring all product‐based plans include activities, time, and resource estimates forrisk mitigation

Making sure quality review activities and associated time have been allocated

accurately

Evaluating interfaces and dependencies between projects, and recommending

appropriate actions where anomalies exist, or where there are areas of concern

Undertaking the tracking and maintenance of dependencies

Establishing and operating mechanisms to compare the portfolio, programme, or

project delivery against the plan

Detecting and reporting deviations and trigger exception reports when appropriate

Revising plans against business‐as‐usual plans to ensure change can be adopted

effectively

Providing estimating support to the portfolio, programmes, or projects

Defining and managing time‐recording processes

Ensuring impending policy of strategy changes are assessed for their impact on the

portfolio, programme, or project plans

Quality Assurance

Purpose

The purpose of the quality assurance role is to lead the work to ensure that any new

products or services delivered by the portfolio, programme, or project are fit for purpose

and capable of delivering the benefits required by the organisation board.

Responsibilities:

Ensuring compliance with any applicable organisational, national, and international

standards and legislation

Bringing together portfolio, programme, or project staff of different disciplines and

drive the group to plan, formulate, and agree a comprehensive quality management

strategy and quality management plan

Creating consistent quality practices and standards

Making sure tests and procedures are properly understood, carried out and assessed,

and product modifications are investigated if necessary

Working with the finance manager/analyst to ensure the portfolio, programme, or

project complies with audit requirements

Developing bespoke processes, and standards and templates for quality management

Coordinating quality reviews of portfolio, programme, or project documents and

deliverables

Providing health checks

Providing direction on quality criteria, reviewers, and sign‐off authority to ensure

cross‐portfolio or cross‐programme reliability

Working with commercial/purchasing staff to ensure an effective interface with

suppliers’ quality systems and oversee the quality review process for contractual

supplier deliverables

Liaising with COE or other bodies to arrange stage‐gated reviews

Coordinating gated reviews and stage reviews, and ensuring all information is

available in a timely manner and a quality format

Resource Management

Purpose

The purpose of the resource management role is to ensure that current and future

programmes and projects are equipped with enough human resources of the right skills, at

the right time they are required.

Responsibilities

Providing a capacity planning and resource tracking service across a portfolio or

programmes

Capturing the resource requirements of the portfolio, programme, or project and the

P3O® itself

Forecasting future resource needs, based on portfolio/programme/project plans,

close liaison with the relevant managers, and wider business plans

Providing a view of commitments on other programmes/projects and/or on

business‐as‐usual activities that will influence the ability of a portfolio, programme,

or project to deliver

Deciding on the best source for the required resources, depending on the long‐term

requirements of a particular skill and its likely availability

Planning and initiating the acquisition of the essential staff, in terms of both skill

content and quantity, ensuring they are in place at the time needed

Observing the deployment of staff, arranging new postings in advance of assignments

ending, to meet staff development needs, and to maintain a good match of skill to

role

Working with human resources and line management to facilitate succession

planning, including knowledge management and leavers’ process as required

Sustaining a database of resources, for people and their skills/attributes, location,

availability, contact details, and lead responsibility for the resource

Taking an active role in the training and development of portfolio, programme, or

project staff to increase the available skills capability and capacity within the business

Revising the provision of skills audits to regulate whether the proposed

programme/project staff have the required skills to deliver their role on the

programme or project

Establishing formal mentoring and coaching guidelines and mechanisms

Providing ‘help squads’ – supplementary skills to fill shortfalls within the portfolio,

programme, or project

Handling consultants’ and interims’ contractual status, closely monitoring use of

externals to ensure ongoing value for money

Managing resource planning, data collection, and PPM skills development

Risk

Purpose

The purpose of this role is to take the lead in making sure that the portfolio, programme, or

project has effective processes in place to identify and monitor risks, has access to reliable

and up‐to‐date information about risks, and uses the appropriate controls and actions to

deal with risks.

Responsibilities

Creating a risk management strategy for the P3O® in accordance with the corporate

risk management policy

Forming and maintaining the portfolio, programme, or project risk register

Supporting the identification and ongoing management of risks by running risk

workshops and risk‐review workshops

Making sure that all risks have a nominated owner

Ensuring all project risks that have wider programme implications are escalated and

dealt with at programme level

Providing cost estimates for all outstanding risks and making sure that risk mitigation

costs do not exceed risk occurrence costs


by the risk itself or by the risk responses

Evaluating how effective any response actions have been and whether the risksidentified have actually materialised, including the realisation of opportunities

Reviewing all risks on a constructive, ‘no blame’ basis

Establishing and sustaining an efficient two‐way flow of information between the

portfolio, programmes, and their projects regarding risk handling

Examining risk registers across the portfolio or programme

Establishing consistent mitigation and contingency plans for risks that should be

tackled across the portfolio or programme

Supporting the sharing of risk registers with the supplier community

Assessing and monitoring the effectiveness of risk processes and refining it as

necessary

Reporting

Purpose

The purpose of the reporting role is to provide a reporting service to the portfolio,

programme, or project.

Responsibilities

Providing consistent reports to boards, including a commentary on performance,

coordinating upward aggregation of data/information, and reports

Making sure the reports are reliable through consistent traffic lights

Recognising and reporting abnormalities and trigger exception reports when

appropriate

Developing procedures to fulfil the internal reporting needs of the programme,

including the development and production of any contractual reports

Making sure that reporting deadlines are achieved

Ensuring that the reporting process is robust, exception‐based, and flexible enough

to meet the changing needs of the programme or project

Creating a weekly/monthly reporting calendar with reminders to information

contributors

Implementing and managing the weekly and monthly reporting cycle, chasing

information as required and challenging the quality of the component data

Building and sustaining an information base of trend data for the programme or

project reporting

Secretariat/Administrator

Purpose

The purpose of this role is to provide portfolio, programme, or project administrative

support and a secretariat function for the relevant boards.

Responsibilities

Sustaining knowledge/reference libraries/repositories in relation to governance

boards

Supporting facilities requirements as far as possible, matching supply to demand

Assisting the resource management role with the acquisition of resources by

maintaining relationships with external organisations that can supply them

Supporting the quality assurance role by liaising with the COE or other bodies to

assemble health checks, audits, third‐party reviews, and stage‐gated reviews

Forming a help desk for enquiries/issues/problems

Assisting in administrative support to the P3O®, including workshop/meeting

administration and the establishment and maintenance of the filing system

Providing logistical support for training courses

Providing administrative support for other non‐PPM activities

Tools Expert

Purpose

The purpose of the tools expert role is to provide expertise in the software tools to support

the change environment.

This provides support to the PPM community to configure software, or to provide training

and coaching in its use.

Responsibilities

Inspecting the market to source tools

Liaising with tools vendors regarding requirements specifications

Liaising with tools vendors regarding implementation plans and training

Carrying out internal mentoring/coaching in tools

Advising new programmes and projects on the appropriate use of tools

Case Study: Skipton Building Society

Summary

Skipton Building Society is the fourth largest building society in the UK, with assets of about

£14.6 billion, 840,000 members, and 1,200 employees. At the beginning of 2010, after

incurring losses in the core business following the market crash in 2008, it faced a

substantial challenge in returning the business to profitability while meeting the

expectations of its board and the Financial Services Authority (FSA).

A review in March 2010 highlighted the need to consider some 80 plus ‘necessary’ projects,

yet the organisation did not have the processes and capability in place to prioritise

resources, or deliver them.

Between April and September 2010, a portfolio and project investment governance

framework and portfolio office were implemented to enable Skipton Building Society to

validate, prioritise, and deliver the necessary business changes with the resources available,

at an acceptable risk. This work used various aspects of the Portfolio, Programme, and

Project Offices (P3O®) guidance, which is part of the Best Management Practice portfolio,

adapted to Skipton Building Society’s needs.

Defining the governance framework first, followed by setting up the portfolio office while

engaging the senior executive team in a top‐down approach worked well. Establishing the

transformation (portfolio) board early created a demand for set up and operation of the

portfolio office services. Nine months after set up, the portfolio office and transformation

board were both working well. However, some challenges remained, notably resource

management, integrating the IT shared services organisation into the process and

integration with the corporate planning process.

Background

The company was created on 1 May 1853 as the Skipton and District Permanent

Benefit Building Society

Today, Skipton Building Society is the fourth largest building society in the UK, with

assets of about £14.6 billion, 840,000 members, and 1,200 employees. The building

society has a group structure comprising the core business and a number of

subsidiaries that are run independently; notable among these are Homeloan

Management Ltd (HML) and Connells

As a building society, several factors make the organisation different from a bank:

o The management must do what is best for its members (customers), who are in

effect the shareholders

o It must lend for mortgages and be largely funded through retail deposits

Following the market crash in 2008, the core business suffered losses in 2009, only

making a profit because of the contribution from its subsidiaries

In February 2010, Skipton Building Society had to lay off staff for the first time to

reduce costs and faced significant challenges in restoring the profitability of the core

business, while meeting greater demands for reporting, controls, and performance

from FSA

Before 2008 – Project management resources and capability were based within the IT

organisation

2008 – The business projects team was set up, which includes project managers,

business analysts, and project support functions

2009 – IT‐based project managers were transferred to the business projects team. The

team expands to five project managers, two project support staff, and five business

analysts

2009 – Project methodology based on PRINCE2® defined and signed‐off:

o Scarborough Building Society merger project completed

o Chesham Building Society merger project completed

February 2010 – Reorganisation leads to disbanding of project office functions within

business projects team

The Challenge

In March 2010, senior management recognised that there were significant challenges

ahead, which would require a transformational change within Skipton Building Society,

alongside the delivery of a significant number of projects to meet the expectations of the

board and external regulators (FSA). A review of the project landscape undertaken by

internal staff and external consultants identified the following issues:

Eighty‐plus possible ‘necessary’ projects outlined by management, including a critical

‘profit improvement plan’

Planning processes were not sufficient to enable comprehensive prioritisation,

approval, on‐going control of the portfolio, nor delivery of the benefits for each

programme/project. Projects were initiated by individual managers, with

prioritisation based on ‘who shouts loudest’

Programmes/projects were not being tracked for costs or realisation of benefits

Project sponsors ‘sponsored’, but project managers ‘owned’, projects

No accountability for outcomes or benefits

‘Business projects’ were viewed as ‘IT based’, and hence often the ‘responsibility’ of

IT to deliver

Delivering change was viewed as ‘project delivery’; that is, delivery of an IT system or

other output

The challenge was then to enable the organisation to validate, prioritise, and deliver the

necessary business changes with the resources available, at an acceptable risk. Key to

meeting this challenge was establishing a governance framework for the business change

portfolio and a portfolio office to support it.

Governance Framework

Working with the senior management team, we agreed the need to drive change from the

top of the organisation and to incorporate governance of business change within the

overall corporate governance framework. In this respect, the P3O® ‘run the business,

change the business’ concept was helpful in understanding the need.

It was agreed at the outset in April 2010 that the scope of any governance framework

would exclude subsidiaries as these operate independently (except where they require core

Skipton Building Society or group resources).

Thus, the transformation board was established to be ‘accountable for the selection,

prioritisation, and authorisation of all Project Investments within the Skipton Building

Society’. The transformation board reports into the senior management committee, which

comprises the senior executive management team chaired by the chief executive. The

transformation board sits alongside the management boards responsible for operational

management of the business. The portfolio office reports to the chair of the transformation

board, who is the transformation director.

Alongside the transformation director, the membership of the transformation board

consists of the group finance director (an executive director) with the company secretary as

second representative for the central functions; the head of the retail board with the head

of mortgage operations as a second representative for the retail board; and the chief

information officer to represent IT.

Terms of reference for the transformation board were defined, agreed by the

transformation board, and then approved by the chief executive. These were published

alongside other corporate governance information under the auspices of the company

secretary.

In addition, we defined a five‐gate investment management process, whereby the

transformation board at each gate, with resources (people and funding), would authoriseproject investments allocated to the next gate. The details of this process are a tailored

version of PRINCE2. The transformation board has the ability to reassess and authorise the

continuation of, or stop, a project at each gate. Submissions to the transformation board at

each gate are appropriate evolutions of an investment case, increasing in detail to gate C

and then focusing on outcomes and benefits at gates D and E.

Within this process, the transformation board is the escalation point for any issues that

cannot be resolved by individual business owners and project boards, and the

transformation board, in turn, escalates issues to the senior management committee.

The portfolio office supports and facilitates this governance framework, with the head of

the portfolio office filling the role of secretary to the transformation board.

Portfolio Office

Building on the existing business projects team, the portfolio office was established to

explicitly support the governance framework. Therefore, its functions follow directly from

those required by the governance framework.

In P3O® terms, we followed the ‘organisation portfolio office’ model with additional

elements. As per the governance framework, the portfolio office does not directly cover

subsidiary companies, which are run as independent businesses, but do sometimes use

Skipton Building Society resources.

Due to the size of the organisation (circa 1000 staff within the main office), and the

relatively low level of maturity with respect to programme and project management, we

incorporated project delivery resources (project managers and business analysts) within the

structure.

In addition, as Skipton Building Society had a particular issue with large volumes of

smallscale changes to core operational systems, a specific change request management

function was incorporated into the structure. Effectively, this provides a permanent project

management/support capability for dealing with on‐going change requests within the single

portfolio office structure.

Project support and resourcing were essentially existing functions within the previous

business projects team. Investment management, performance management, and portfolio

reporting functions had to be built from scratch, along with the change request

management capability.

The implementation of the portfolio office was carried out in a series of tranches, or stages

in line with P3O® guidance. However, it is based on a mix of priorities for the portfolio

office and the ability to recruit and develop the staff. The initial focus was on getting

control of inflight projects and enabling the transformation board to start assessing the

most urgent new projects.

One of the key issues in setting up a portfolio office is the resourcing of the portfolio office

itself and assessing the necessary mix of roles, capabilities, and capacity. Our approach was

based on assessing the functions, the volume of work, and capabilities available, in line with

the approach outlined in the P3O® guidance.

Of these, the head of the portfolio office and investment manager roles were the most

significant. The scope of the head of portfolio office role dictated the use of external

consulting and interim staff to drive forward, although the support and engagement of the

incumbent head of business projects was critical in the transition. For the investment

manager role, we were able to recruit internally for a finance manager who already had

experience of building business cases for corporate acquisitions and disposals. This internal

recruitment was then provided with some coaching support from an external consultant on the full scope of the role.

External consultants, transitioning to internal staff, and new recruits through coaching and mentoring over a three to six month period.

Comments on P3O®

The P3O® guidance says ‘P3O® provides a decision‐enabling/delivery‐support model for all

business change within an organisation’. As such, it provides a wealth of detail on the

possible benefits of setting up a P3O®, including organisational models, steps to carry out,

and things to do to set up and establish the necessary infrastructure. Making the most of all

this guidance, however, does require you to have a clear idea of what you are trying to

achieve.

In our case, the driver was straightforward: in order to make the governance framework

function, and for senior management to be able to make the required decisions with regard

to the business change portfolio, a portfolio office was a necessity. The consequences of

not having one were obvious from the review in March 2010.

While there was discussion about ‘building the business case for P3O®’, it is not clear

whether one can do this if building the P3O® is itself providing the tools to build business

cases. Whenever we considered this question, it seemed like we would simply end up going

in circles in a chicken and egg situation.

P3O® defines a number of roles around analysis, benefits, commercial, and financial

aspects. We combined these within the investment manager role. We created a link to the

finance function by transferring someone from finance into the role, but their direct

reporting line is to the head of the portfolio office and hence the transformation board.

We fully defines the governance structure, processes, and templates (for example, investment case, risk tracking, etc.) before investing in any integrated tools. Once these had

been defined, implementing a tool accelerated the acceptance and engagement of staff in

the process. Indeed, being able to produce up‐to‐minute reports accelerated the pull for

data from the transformation board.

Two other aspects that are not mentioned, particularly in the guidance, but were relevant

was risk management, and assurance. With reference to risk management, we worked with

the operational risk function within Skipton Building Society to integrate

portfolio/programme/project risk management with their processes and tools. With regard

to portfolio/programme/project assurance, we engaged with the internal audit function in

a similar way to operational risk.

Other Best Management Practice Guidance

This case study focuses on the set up of the Skipton Building Society business change

governance framework and portfolio office, and hence P3O®. However, P3O® was not used

in isolation. The full set of activities undertaken at Skipton Building Society to address the

project‐related issues faced in March 2010 covered all aspects of project governance and

delivery, so PRINCE2, Managing Successful Programmes (MSP®), and the newly released

Management of Portfolios (MoP®) guidance were all relevant.

What Worked Well

Starting with an assessment of the project investment, the landscape within Skipton

Building Society enabled the identification of gaps and weaknesses, which were

addressed as part of the design and implementation

The top‐down approach: previous efforts to set up P3O® structures had been driven

by bottom‐up and did not succeed, whereas working with the senior executive team

in terms of their requirements helped set up success

Defining the governance framework first drove the requirements for the portfolio

office and eased the definition and implementation of services, roles, processes, and

tools required

Setting up the transformation (portfolio) board early on and driving decisions created

a pull on portfolio office services

Having the project delivery resources within the portfolio office eased the transition

to new methods of working

Defining governance processes and templates (Word/Excel/PowerPoint) for key

documents eased the selection and implementation of an integrated tool to support

governance

In turn, implementing a tool that directly supported the governance process eased

acceptance and transition to the new processes and ensured a single source of

project investment data. With further work, this tool now incorporates all project

costs, resources and project information required to represent the portfolio

Recruiting the investment manager from within finance helped with building links

between the portfolio office and finance

Supplementing internal resources with experienced external consultant/interim

resources to provide coaching and support accelerated implementation Challenges

Resource management and tracking. Across the organisation, there was a mix of no

tracking, with spreadsheets or systems being used to track time for different

purposes. A common spreadsheet was developed to capture project effort but this

was not successful and different approaches are being used for different resource

groups

A lack of previous exposure to structured approaches concerning business change

required more effort and attention throughout the organisation to embed the

changes. While project managers, or others with at least a working familiarity of

PRINCE2®/MSP® and related standards, easily adapted to the governance process

requirements, those without such exposure found it harder to adapt

Senior managers and executives required more support in understanding and

exercising their roles on project boards or as business owners (senior responsible

owners) than expected. Coaching helped but more formal workshops/training would

have been better

Lack of a process and structure around strategic planning and the development of

articulated strategic objectives hampered portfolio governance. In retrospect, this

should have been addressed in parallel with the governance framework

Multiple sponsors at executive level. While the engagement of senior executives was

very positive, having two formal sponsors with different expectations created

challenges in agreeing particular issues

Remaining Challenges/Questions

How to best integrate the IT shared services organisation that supports multiple

subsidiaries? At the moment, they have to work with each subsidiary’s portfolio

process

How to handle resource management going forward? The initial approach involves

multiple tools (i.e. a single process/tool has not been mandated)

How to best integrate the portfolio office with the corporate planning process?

Glossary of Terms and Definitions

Aggregated risk

The overall level of risk to the programme when all the risks are viewed as a totality rather

than individually. This could include the outputs of particular scenarios or risk

combinations.

Assurance

All the systematic actions necessary to provide confidence that the target (system, process,

organisation, programme, project, outcome, benefit, capability, product output,

deliverable) is appropriate. Appropriateness might be defined subjectively or objectively in

different circumstances. The implication is that assurance will have a level of independence

from that which is being assured.

Benefit

The measurable improvement resulting from an outcome perceived as an advantage by one

or more stakeholders.

Centre of Excellence (COE)

A coordinating function for all or part of P3RM ensuring change is delivered consistently

and well, through standard processes and competent staff. It may provide standards,

consistency of methods and processes, knowledge management, assurance, and training. It

may also provide strategic oversight, scrutiny, and challenge across an organisation’s

portfolio of programmes and projects. It may be a function within a wider scope of P3O® or

may be the only function of a P3O®. This function provides a focal point for driving the

implementation of improvements to increase the organisation’s capability and capacity in

programme and project delivery.

Chief Executive Officer (CEO)

Describes the role in a commercial organisation with the highest level of authority for the

total management of the business.

Chief Financial Officer (CFO)


management of the financial risks, planning, and reporting for a business. This role will

generally report to the CEO.

Chief Information Officer (CIO)


management of Information Technology for the business. This role will generally report to

the CEO but may also report to the CFO in smaller organisations.

Chief Operating Officer (COO)


development, design, management, and improvement of the open systems that create and

deliver the organisation’s products and/or services. This role will generally report to the

CEO.

Cost centre

An accounting term used to describe a division, business unit or part of an organisation that

does not directly contribute to achieving profit for a company. It indirectly contributes to

the organisation by providing a service or support function to profit‐making parts of the

organisation.

Design Authority

A role or function (permanent, temporary, or virtual) that provides expert specialist advice

or owns some corporate function, service, standard, or strategy that will be affected, or a

major programme outcome or change that needs to be controlled. This could be an IT or

property infrastructure design, or a major service contract; it could also be a business

process model or the programme or corporate Blueprint. The Design Authority provides

expertise and guidance on a specific area to ensure there is appropriate alignment and

control when changes are being planned and implemented. At a programme level, this role

may advise or own the Business Blueprint management on behalf of the programme

manager. At the enterprise level, this role may manage the Enterprise Architecture of the

organisation.

Dis‐benefit

An outcome perceived as negative by one or more stakeholders. Dis‐benefits are actual

consequences of an activity, whereas a risk has some uncertainty about whether it will

materialise

End Project Report

A report given by the project manager to the Project Board that confirms the handover of

all products and provides an updated Business Case and an assessment of how well the

project has done against its Project Initiation Document.

Enterprise Project (or P3RM) Management (EPM)

A term usually referred to by software vendors in relation to software (i.e. EPM tools) that

assists an organisation manage across multiple projects and programme delivery using a

common resource pool through to strategic analysis of investment through portfolio

management. This term does not reflect the actual offerings of the tools in that they

generally can support at portfolio, programme, and project (P3RM) level.

Expert Reference Group

A team of subject matter experts that can be used in a P3RM organisation to provide input,

advice, and challenge to the role accountable for an output or outcome to ensure that it

reflects the wider experience rather than an individual’s perspective only. It is important to

note that the role accountable for the output or outcome maintains the final decision and

should not treat an Expert Reference Group as a committee. An Expert Reference Group

may be drawn together at points in time or may be fully allocated to a project or

programme.

Full‐time equivalent (FTE)

A technique used to measure human resource involvement in a project, programme, or

operational activities. It is generally required where human resources are allocated across

multiple roles (e.g. 70% allocated to a project and 30% allocated to business operations). An

FTE of 1 means that a person or the sum of all people’s effort is 100% allocated to an

activity, based on the number of working hours available, treatment of overtime, and other

parameters.

Gated Review

Structured reviews of a project, programme, or portfolio as part of formal governance

arrangements that are carried out at key decision points in the lifecycle to ensure that the

decision to invest as per agreed Business Cases and plans remains valid.

Governance (business change)

Encompasses the structures, accountabilities and policies, standards, and process for

decision‐making within an organisation for business change to answer the key strategic

questions of ‘Are we doing the right things?’, ‘Are we doing them the right way?’, ‘Are we

getting them done well?’ and ‘Are we getting the benefits?’

Health check

A health check is a quality tool that provides a snapshot of the status of a project,

programme, or the portfolio. The purpose of a health check is to gain an objective

assessment of how well the project, programme, or portfolio is performing relative to its

objectives and any relevant processes or standards. A health check differs from a Gated

Review in that it is a tool used for assurance purposes by the P3O® to inform specific

actions

or capability maturity development plans, whereas a Gated Review is part of formal

governance arrangements.

Hub and Spoke

A term to describe a system of organisational design for P3O® where there is a centralized

office (the hub) connected to a number of smaller decentralised offices (the spokes) each

with a sub‐set of the centralised office’s business objectives, functions and services. All

information and processes (connections) are arranged so that they move along spokes to

the hub at the centre. A Hub and Spoke model provides the benefit of scalability for large

organisations and supports business ownership by maintaining a level of decentralisation.

Information Hub

The centralised element of the Hub and Spoke model for P3O® in terms of information

flows (see Hub and Spoke definition). It supports highlight and exception‐based reporting

for projects, programmes and/or portfolios by amalgamating information with the process

and information owned by the central office as the Information Hub. Information

Technology Infrastructure Library (ITIL) A set of guides on the management and provision of

operational IT services.

Informed customer

An individual, team, or group with functional responsibility within an organisation for

ensuring that spend on IS/IT or other procurement is directed to best effect, i.e. that the

business is receiving value for money and continues to achieve the most beneficial

outcome. The term is often used in relation to the outsourcing of IT/IS. Sometimes also

called ‘Intelligent customer’.

Key Performance Indicator (KPI)

Metric (either financial or non‐financial) that is used to set and measure progress towards

strategic objectives for an organisation.

Management Board

Generic term used to describe either project Management Boards, programme

Management Boards or Portfolio management boards, or any combination based on the

P3O® context.

Management Dashboard

A technique to represent vast amounts of decision‐support information at an amalgamated

level using tabular and graphic representation such as graphs and traffic lights.

Managing Successful Programmes (MSP)

An OGC publication/method representing proven programme management good practice

in successfully delivering transformational change, drawn from the experiences of both

public and private sector organisations.

Mandate

Information created externally to a project or programme that forms the terms of

reference and is used to start up a PRINCE2® project or identify an MSP® programme. A

Mandate may be initiated through an unstructured approach, or it may be derived from

strategic planning, business planning or portfolio management processes.

Matrix management

A type of organisational management in which human resources with similar skills are

pooled together for the assignment of work to other parts of an organisation. In this

approach, there is a separation between line management and line of authority in that a

person may report to several project, programme, or business managers to undertake

multiple work assignments at different times but have a line of authority to a different

manager altogether.

Organisation Portfolio Office

A type of P3O® model that is designed to centrally manage the investment process,

strategic alignment, prioritisation and selection, progress tracking and monitoring,

optimisation, and benefits achieved by an organisation’s projects and programmes on

behalf of its senior management.

P3M3

OGC’s Portfolio, Programme, and Project Management Maturity Model.

P3O® Sponsor

A senior manager with appropriate authority who champions the establishment and

evolving operation of the P3O®. They will ideally be a member of the main board.

P3RM

An acronym to describe portfolio, programme, project, and risk management together.

Peer review

Specific review of a project or any of its products where personnel from within the

organisation and/or from other organisations carry out an independent assessment of the

project. Peer reviews can be done at any point within a project but are often used at

stageend points.

PESTLE

Acronym for ‘Political, Economic, Social, Technological, Legal, and Environment’ and is a

technique used generally in organisational change management to undertake an

environmental scan at a strategic level.

Pet project

A project that is championed by an executive in an organisation that may be aligned to an

individual goal or goal for a specific part of the business, but not aligned to the strategic

imperatives of the organisation as a whole.

Portfolio, Programme, and Project Offices (P3O®)

The decision enabling and support business model for all business change within an

organisation. This will include single or multiple physical or virtual structures, i.e. offices

(permanent and/or temporary), providing a mix of central and localised functions and

services, integration with governance arrangements and the wider business, such as other

corporate support functions.

PRINCE2®

A method that supports some selected aspects of project management. The acronym

stands for PRojects IN Controlled Environments.

Programme Brief

A statement that describes the specific objectives, required benefits, potential risks, outline

costs, timescales, and potentially options for delivery for a programme.

Project Brief

A statement that describes the purpose, cost, time and performance requirements/constraints for a project.

Project Executive

The individual who is ultimately responsible for a project. Their role is to ensure that the

project is focused throughout its lifecycle on achieving its objectives and delivering a

product that will achieve the forecast benefits.

Project Initiation Document (PID)

A logical document that brings together the key information needed to start a project on a

sound basis and to convey that information to all concerned with the project.

Resource

An organisation’s physical or virtual entities (human or other) that are of limited availability

and can be used to undertake operations or business change.

Risk potential assessment (RPA)

A standard set of high‐level criteria against which the intrinsic characteristics and degree of

difficulty of a proposed project are assessed. Used in the UK public sector to assess the

criticality of projects and so determine the level of OGC Gateway Review required.

Scale of risk

A standard technique for estimating the probability and impact of a risk across an

organisation, portfolio, programme, or project. This may be provided as part of a risk

management standard (external) or a Risk Management Strategy or Policy.

Senior Responsible Owner (SRO)

The single individual with overall responsibility for ensuring that a project or programme

meets its objectives and delivers the projected benefits.

Swimlane

A method for documenting business process flows that separates each process step into a

row (or lane) of accountability for individual roles or groups.

SWOT

Acronym for ‘Strengths, Weaknesses, Opportunities, and Threats’. An analysis technique to

determine favourable and unfavourable factors in relation to business change or current

state.

Taxonomy

A classification of things, or the principles underlying such a classification. The term may be

applied to relationship schemes such as parent–child hierarchies and network structures. A

taxonomy might also be a simple organisation of kinds of things into groups, or even an

alphabetical list.

Zero‐based Cost Centre

Similar to a cost centre, except that the division, business unit, or part of the organisation

cross‐charges other parts of the organisation for some or all of its services or activities to

achieve a spend of zero when its costs and income from cross charging are added up.

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