Project Portfolio Management Maturity Model

CENTER FOR BUSINESS PRACTICESChapter 2PM SOLUTIONS’Project PortfolioManagementMaturity Model®James S. PennypackerE D I T O R

CHAPTER 2Summary Description ofMaturity LevelsTHE PM Solutions’ Project Portfolio Management MaturityModel features a staged representation of practices andprocesses that progress through a proven path of five successivelevels, each serving as a foundation for the next.Level 1: Initial ProcessAlthough there is a recognition that there are project portfoliomanagement processes, there are no established practicesor standards, and individual project managers are not heldto specific accountability by any process standards. Documentationis loose and ad hoc. Projects are funded despiteabsence of critical information that demonstrates expectedand achieved improvements in program, business, or missionperformance.Level 2: Structured Process and StandardsProject portfolio management processes exist in the organization,but they are not considered an organizational standard.Documentation exists on these basic processes. Man-35

PROJECT PORTFOLIO MANAGEMENT MATURITY MODELagement supports the implementation of project portfoliomanagement, but there is neither consistent understanding,involvement, nor organizational mandate to comply for allprojects or project portfolios. Business value andprioritization levels are reviewed at the divisional level forlarger, more visible projects. Information available for managingthe project portfolio is often a mix between summaryleveldata and detail-level data.Level 3: Organizational Standards andInstitutionalized ProcessAll project portfolio management processes are in place andestablished as organizational standards. Nearly all projectsand project portfolios use these processes with minimalexception—management has institutionalized the processesand standards with formal documentation existing on allprocesses and standards. Senior management is regularlyinvolved in input and approval of key decisions and documentsand in key project portfolio issues. The project portfoliomanagement processes are typically automated. Eachproject and project portfolio is evaluated and managed inlight of organizational strategy and business value.Level 4: Managed ProcessProject portfolios are managed with consideration as to howthe portfolio performed in the past and what is expected forthe future. Common objectives and metrics are defined forthe portfolio and reviewed periodically with senior manage-36

SUMMARY DESCRIPTION OF MATURITY LEVELSment to maintain/balance the portfolio. Project portfolioinformation is integrated with other corporate systems tooptimize business decisions. Senior management clearlyunderstands its role in the project portfolio managementprocess and executes it well, managing at the right level, andclearly differentiating management styles and project portfoliomanagement requirements for different sizes/complexitiesof projects and project portfolios. Project portfolio managementprocesses, standards, and supporting systems areintegrated with other corporate processes and systems.Level 5: Optimizing ProcessProcesses are in place and actively used to improve projectportfolio management activities. Lessons learned are regularlyexamined and used to improve project portfolio managementprocesses, standards, and documentation. Managementand the organization are focused not only on effectivelymanaging project portfolios but also on continuousimprovement. The metrics collected during execution areused not only to understand the performance of projects andproject portfolios but also for improving management decision-makingcapability for the future.37

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