KPIs: The Project Portfolio Performance Checklist

Project Management Offices create organizational added value. To ensure that this is also recognized by all stakeholders, you should ensure the acceptance of your PMO through a high degree of transparency: Project portfolio performance must be quantified and communicated on an ongoing basis.

In this Capture blog post we, therefore, address the following questions:

• Why are project portfolio metrics essential for internal PMO acceptance?
• What characterizes high project portfolio performance?
• Which project portfolio KPIs (Key Performance Indicators) are there?
• Why should project portfolio KPIs be evaluated regularly?
• How do PMOs and project managers benefit from PPM analytics tools?

The internal standing of PMOs

Do you know this? As the person responsible for the PMO, you are very satisfied with the performance of your team. Within the company, however, you have to justify the work of the project management department. You practice professional project portfolio management. However, your stakeholders tend to perceive the inevitable project difficulties instead of the process-related improvements.

Rest assured: most cross-departmental organizational units naturally face similar challenges. However, the measurability of numerous factors influencing the company's success makes it much easier to establish cross-sectional functions in a sustainable way.

Project portfolio performance: a strategic and operational responsibility 

Depending on the organization, project portfolio management can take different forms. However, a project management office will only do justice to the intended activity profile if operational project control is strongly interlinked with strategic goals. To evaluate and successively increase project portfolio performance, it is therefore necessary to define operationally and strategically relevant key figures.

Central project portfolio KPIs at a glance 

We have summarized 13 central project portfolio performance KPIs for you.  These can be adapted and prepared multi-dimensionally - for example, broken down to different projects, departments, or employees.

Less is more: The art of smart data reports

For efficient data management in the Project Management Office, you need project portfolio management software. Among other things, it supports you in ensuring that data collection and analysis follow a uniform project management methodology. This way, PMO performance indicators remain comparable across projects.

The analytics functions and integrations of the PPM software with other systems offer sufficient scope for sophisticated data analyses. First, however, simple data reports need to be developed to generate "quick wins". The development and maintenance of a KPI system is not an end in itself, but ideally a management tool that is used on an ongoing basis to optimise and communicate project portfolio performance.

5 steps to measurable project portfolio performance

With PPM software you can relatively quickly create a data-based foundation around your PMO activities:

1. identify and focus on individual areas of improvement in PMO work.
2. define meaningful key performance indicators for these focus areas
3. track these key performance indicators at specific intervals and derive concrete measures
4. regularly check whether existing or new indicators are used in strategy discussions and coordination and adapt your indicator system if necessary
5. use the available data to draw attention to the performance of the Project Management Office and all project participants throughout the company.

The benefits of a data-driven project management culture

The effort required to quantify PMO work is manageable thanks to PPM software. The benefits of a strong data culture, on the other hand, are enormous and, in sum, can be seen as high project portfolio performance:

• Project failures are significantly reduced due to a better decision-making basis and learning curve.
• In the medium term, realized projects are characterized by a significantly higher business benefit.
• The improved transparency of operational project management work promotes an optimized cost structure and effective use of resources
• The need for further, possible process standardization is recognized more quickly
• If appropriate measures are derived from the key figures, stakeholder and employee satisfaction increases and thus also work productivity.

Capture reading recommendation: KPIs in resource management

It cannot be emphasized often enough: Demonstrably good project portfolio performance has a strong leverage effect on overall business success. When decision-makers recognize this connection, PMOs also get internal support and necessary implementation powers.

In practice, we observe that many CEOs demand better use of resources in their companies above all else. This topic could be a first concrete starting point when introducing KPIs in the Project Management Office.

Deepen your knowledge of resource management now with the Capture Whitepaper!