Maximizing Efficiency & Profitability with Project Portfolio Management within the Construction Industry
In the construction industry, management of a number of simultaneous projects is a complex and daunting responsibility. Project Portfolio Management (PPM) is a management practice to manage and maximize a portfolio of projects to align with company goals and provide the highest possible ROI (return on investment). With the best deployment of PPM methodologies, the operational effectiveness of the company can be increased, expenditures can be reduced, and customer satisfaction levels can be increased.
Understanding Project Portfolio Management
Project Portfolio Management is the management of a group of projects to prioritize and implement the aligned projects with the company-wide strategies. In contrast to the management of separate distinct projects, PPM offers a comprehensive overview to support the decision-making body to manage the proper deployment of the assets, estimate the threats, and monitor the performance of all the included projects within the portfolio.
Challenges of Traditional Project Management Tools
Many construction companies are built upon applications such as Excel spreadsheets or standalone software like that of Microsoft Project. Albeit they have very basic functionalities, they present a multitude of challenges:
- Lack of audit controls: Manual entry of the data can lead to increased error rates, while amendments can occur without the necessary approvals, causing inconsistencies to arise.
- Disjointed Communication: Updates and change requests are distributed across a sequence of separate e-mails or independent ticket systems that are difficult to track and manage appropriately.
- Version Control Issues: With e-mail or the cloud to exchange documents comes a multitude of versions confusing to team members.
- High Licensing Expense: It is costly to license all the team members separately and time-consuming to do that.
Benefits of a Centralized Web-Based PPM
Adopting a web-based central PPM solution removes the aforementioned problems by bringing the following advantages:
1. Enhanced Team Communication and Teamwork
With a web-enabled environment, the team can access information regarding the project at all moments, encouraging team coordination and transparency. Members can update their status with ease, share documents, and communicate within a shared environment.
2. Improved Resource Management
PPM tools also provide information regarding the assignment of the resources to the managers to enable them to delegate the work to the team members based on their skills and their current work schedule.
3. Streamlined Change Management
Integrated workflows allow smooth change handling with all the change documented, authorized, and tracked systematically to avert the threat of change without proper authorization and to uphold the integrity of the project.
4. Robust Reports & Analytics
Advanced reporting capabilities provide actual performance information to the project to support evidence-driven decisions. Managers can track KPIs, track budget levels, and track the overall status of the project at a glance.
5. Cost savings
By consolidating a number of applications into a single platform, licensing them becomes less costly and maintaining them is also less costly. Enhanced efficiency with less error also saves cost overall.
Implementing PPM within the Construction Industry: Guidelines
To maximize the potential of PPM, the following best practice must be followed by the construction companies:
1. Align the Projects with Strategic Objectives
Ensure that all projects within the portfolio support the organization’s long-term goals. This alignment facilitates better resource allocation and prioritization.
2. Standardize Processes
Develop standardized methodologies of implementation and planning. Consistency of the procedures maximizes the team effectiveness by reducing the team members’ learning time.
3. Invest In Training
Provide comprehensive staff training to fully leverage the potential of the PPM system. With well-trained staff, the potential of the tool can best be maximized to provide increased results of the project.
4. Monitor and Adjust
Regularly review the performance of the project and accordingly implement the necessary adjustments. Regular monitoring facilitates fixing the problems ahead of time and enables the projects to stay on schedule.
Case Study: Maximising Project Management with Smartsheet
Palfinger, a well-established international crane and lifting solutions provider, was dealing with the management of a myriad of types of projects distributed across various departments and locations. To solve this problem, Palfinger implemented the Smartsheet cloud-enabled PPM solution. The solution was easy to use with automation capabilities with robust reporting capabilities that made the company:
- Increase the number of managed projects to a little less than 350 from 50 within a year
- Enhance collaboration by allowing data sharing between projects and standardizing reporting.
- Reduce email usage by automated work streams and status updates in real time.
- Facilitate cross-functional coordination to support the matrix-type company organization
By adopting the solution of Smartsheet, Palfinger increased the visibility of the project, made the communication easier, and made the implementation of the project more effective.
Conclusion
Project Portfolio Management is a rich introduction to the construction industry with a number of positive influences that encompass increased effectiveness, cost savings, and coordination. With the change to a web-enabled central PPM solution, the company is able to manage complex work portfolios successfully, align work with company-wide priorities, and support company expansion. It is a strategic decision to implement PPM that enables the company to compete successfully within a highly competitive environment.
