What is the difference between Portfolio Management and Project Management?
Project Portfolio Management (PPM) is a discipline that helps organizations prioritize and manage a portfolio of projects to align with strategic business objectives.
PPM consists of:
Portfolio Management,which identifies the best opportunities or proposals.
Project Management, which selects and manages a group of projects in terms of timelines, activities, and resources.
We are Fourteen TEC, the most qualified SAP partner in Italy for SAP Portfolio and Project Management implementation.
We have implemented SAP PPM in New Product Development processes, IT Governance, Commercial Portfolio Management, Facility Management, and Maintenance.
In the years 2021-2022, we collaborated with SAP Italy to implement the PPM solution for managing the funds derived from the National Recovery and Resilience Plan (PNRR) for the Ministry of Finance.
What is Portfolio Management?
Portfolio management involves coordinating a group of projects or investments as a whole, aiming to achieve specific objectives for the organization.
The goal of portfolio management is to select the optimal combination of projects or investments and allocate resources to maximize the return on investment for the company.
What is Project Management?
On the other hand, Project Management refers to the process of planning, organizing, and managing the resources required to complete a specific project.
The objective of Project Management is to complete the project within the agreed timelines, budget, and scope, achieving the set objectives.
In summary, Portfolio Management involves the overall management of a group of projects or investments, while Project Management focuses on the delivery of a specific project.
Both disciplines involve planning and resource allocation, but they have different objectives and operate at different levels of the organization.
What does the Portfolio Manager do?
The Portfolio Manager is responsible for overseeing a group of investments or projects and makes decisions on how to allocate resources to maximize the potential return on investment.
This includes selecting specific investments or projects to include in the Portfolio and determining the appropriate level of risk to take.
Additionally, the Portfolio Manager defines goals and strategies shared with the organization and develops a plan to achieve those objectives.
They analyze and evaluate potential investments or projects to identify those aligned with the Portfolio's goals and strategies.
The Portfolio Manager plays a significant role in resource allocation, deciding how to distribute capital, labor, and other resources among the investments or projects in the Portfolio.
Finally, they regularly monitor the performance of investments and make necessary changes to achieve business objectives, regularly engaging with stakeholders.
What does the Project Manager do?
The Project Manager is responsible for planning, organizing, and managing the resources required to complete a specific project.
The project represents a temporary effort to achieve a specific goal, and the Project Manager is tasked with delivering it within the agreed timelines, budget, and scope.
Initially, the Project Manager defines a project plan, working with the team to establish the project's scope, create a timeline and identify necessary resources.
These resources may include internal and external personnel, equipment, and materials.
Once the project is underway, the Project Manager monitors its progress to identify any issues or challenges that may arise.
If necessary, they will adjust the project plan to ensure the objectives are achieved.
As every project involves risks, one of the Project Manager's tasks is to identify potential risks and develop strategies to mitigate or eliminate them.
Ensuring the project stays within the defined budget is one of the Project Manager's responsibilities, with potential support from the Controlling department in cost monitoring.
Lastly, the Project Manager keeps all stakeholders informed about the project's progress and addresses any questions or concerns that may arise.
SAP PPM (Portfolio and Project Management) is the natively integrated solution with other SAP modules for project portfolio management.
If you want to discover SAP PPM implementation scenarios and the strengths of each that can enhance your business processes, we discussed them here.
Fourteen TEC is a specialized SAP Supply Chain consulting company focused on PPM and PLM processes and products, operating in Europe and worldwide.
For over 10 years, Fourteen TEC has been dedicated to improving efficiency, innovation, and productivity for companies and multinational corporations, offering tailor-made solutions for clients across all industries.
You can contact us and schedule a meeting with one of our consultants.
