7 Crucial Success Factors for Multi-Project Management

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+++ How to Keep Everything in View and Complete Your Projects with More Certainty +++

By Johann Strasser                                                                                                                Read article in German

Does this sound familiar? At your company, you handle many parallel projects, which often leads to:

  • Inefficient scheduling
  • Employee overload
  • Unnecessarily increased costs
  • Quality problems

The right environment for multi-project management or program management will help you to remedy this and be more successful. In this article, you will learn what is involved.

Challenges in Multi-Project Management

If you are working in a multi-project environment, you will be familiar with this challenge: You have to implement many projects in parallel while drawing on the same resource pool.

In addition, smooth functioning is hampered by the circumstances of the multi-project environment:

  • Projects are implemented in different departments
  • Resources from different departments need to be coordinated
  • The projects’ priority and strategic contribution can change
  • Project costs have to correspond to the budget
  • Some projects are interdependent
  • The project environment becomes more and more international
  • Report requirements become increasingly complex
  • Decisions have to be made in a short space of time
  • Precise project information is required

Distinguishing between Multi-Project Management and Program Management

We define the distinction between multi-project management and program management as follows:

  1. Projects within a program serve a common, overall goal.
  2. Multi-Project Management comprises all projects of an organizational unit

Interested in program management? Read 8 tips on how to succeed.

Problems in Multi-Project Management and their Causes

It is a fact that: The sheer number of parallel projects makes for regular surprises. This leads to the problems listed at the beginning:

  • Rescheduling
  • Resource conflicts
  • Cost increases
  • Variations in quality

The reasons for these problems vary:

  • Missing overview of all projects and resources
  • Wrong priorities for initiatives and projects
  • Unrealistic planning of delivery dates and efforts
  • Unprofessional management of the projects
  • Wrong decisions in the case of resource conflicts
  • Improper closure and documentation of projects

If you succeed in reducing these problems, or even removing them as far as possible, your projects will be more successful.

The following 7 success factors will help you.

1. Provide for an Overview of All Projects and Resources

Keep track of the many parallel projects. You will only succeed in this if you use a central database once you have reached a certain number of projects. The central database will permit you to produce reports as required for your information or for informed decisions.

The chart below shows the different possible perspectives on the project portfolio. In addition to a central project list and resource overview, the illustration provides the following information on the portfolio:

  • Status reports
  • Portfolio and pipeline overviews
  • Risk matrix
  • Resource and cost charts

Learn more about the Project Status Report, its Contents and the Process Involved.

Underneath, you can find the tools for controlling the individual projects: for resource coordination, project monitoring, and data exchange with the controlling department.

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Figure 1: The central multi-project environment – Overview of the project portfolio from all perspectives

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When implementing such a central solution make sure, you can track information from the aggregated overview down to the smallest detail. And remember: Better to start with limited functionality and build on that than to use maximum functionality and fail at the very beginning.

Our tip: Make portfolio meetings time-limited. It is impossible to look at all projects and resources each time. Therefore, make sure that you define traffic light indicators and other criteria that will allow you to effectively filter the right projects and resources.

2. Use Your PMO for Standards, Processes and Methods

If you want to administer your multi-project environment efficiently, your projects have to meet certain standards in structure and setup. In addition, you need to define processes for planning and updating projects.

As decisions have cross-project effects, controlling for all projects should follow the same intervals – using data that is as recent as possible. Project managers need to know what to do when. And how to do it. That is why they need the appropriate training and supervision.

7 Crucial Success Factors for Multi-Project Management

Figure 2: Appropriate processes and high data quality enable a PMO to ensure professional multi-project controlling.

The latter can be responsibilities of a PMO serving as a hub of communication between project managers, team leaders, decision-makers, and controllers.

Your PMO should be responsible for the efficient flow of information and the continuous improvement of the maturity level in project management. For instance, improvements could include:

  • Supporting the roles involved
  • Determining how projects are initiated
  • Coordinating resource requests
  • Ensuring reports are up to date, complete and plausible
  • Establishing processes and methods
  • Training project managers
  • Introducing a suitable tool for project, portfolio and resource management

Also consult our Checklist for PMO Setup with 10 Vital Success Factors for the PMO.

The benefits of a well-established and accepted PMO should be:

  • Time savings due to routine and training
  • Decrease in project delays, costs and effort overruns
  • Improved profitability of customer projects
  • Reduction of resource conflicts
  • Improved strategic direction of the projects

Our tip: It is vital for your PMO to have backing from top management. However, it must not be perceived as a supervisory body. Instead, it has to give clear proof of its value to the project teams. This will ensure acceptance.

Find out how to set up a successful PMO.

3. Prioritize Initiatives and Projects Appropriately

To avoid having to deal with too many projects at once, you should concentrate on the important and urgent ones. Therefore, set priorities in line with corporate strategy. Start your projects according to these priorities.

We urgently recommend a way of making prioritization easier. Create a decision matrix to differentiate between operations and different project types. The design of this project-worthiness analysis needs to be individual for every company.

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Figure 3: Project-worthiness analysis for distinguishing between operations and project types

Depending on the rating, you need to use different controlling methods. This is about expending administration and controlling effort appropriate to the size of the undertaking.

Make your prioritization independent of the project type. You can determine the importance using previously established drivers.

Our tip: Make sure you actually use the most resources for the most important projects.

Read about 7 steps to optimal project portfolio management.

4. Be Strategic in Your Capacity Planning

Strategic resource planning, also known as capacity planning, has one aim: the predictive allocation of employees with the necessary skills.

You also need to ensure that the appropriate employees will be available at the right time to implement strategically relevant projects.

With inadequate capacity planning you run risks such as:

  • Projects are not finished on time due to insufficient resource allocation
  • Project costs increase, as you are not using enough appropriate resources
  • Business opportunities cannot be exploited, as the required skills could not be obtained on time
  • Your coordination efforts for resolving resource conflicts are significantly higher
  • All of this can result in dissatisfied customers
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Figure 4: Predictive planning of new projects and required resources with the aid of strategic capacity planning

Strategic resource planning done properly can gain you a variety of benefits.

These include for instance:

  • You ensure that you reserve the most resources for the most important projects rather than for staffing unimportant ones
  • A complete overview of all resources, their project assignments and operations will keep you informed about the overall resource utilization
  • You know which – and how many – new projects can be started and also carried out in addition
  • You recognize resource bottlenecks in good time and are able to react to them in accordance with your corporate strategy
  • Many resource conflicts are avoided, as they never actually arise

Our tip: For successful strategic capacity planning, a strong PMO with backing from top management is vital. In addition, you need a suitable tool environment corresponding to the number of projects and resources.

Read more about the success factors of capacity planning.

5. Optimally Support Tactical Resource Planning

Tactical resource planning is the process of coordination between project manager and team leader. Project managers assign resources to the tasks of their projects. In doing so, they hope to actually get the team members they planned with. Where the resources they planned with are deployed in the end, is the decision of the respective team leaders.

Resource planning is anything but easy for project managers and team leaders because:

  • Efforts may not have been estimated as required
  • Team members are not as interchangeable as initially assumed
  • Project scope and delivery dates can change
  • Absences due to illness tend to be unexpected
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Figure 5: Actual project availability takes absences and operations into account – an essential key to realistic resource planning

A general rule for resource planning is: Only complete planning is good planning. To achieve this, you should mark the following points:

  • Planning can be considered complete once each team member’s absences, operations and project assignments have been recorded
  • Only team leaders are able to plan completely for their team members; project managers lack this insight
  • Project availability is determined by looking at the capacity minus absences and operations
  • Planning project assignments differs between line and matrix organizations.

Our tip: Better to be complete and slightly unspecific in your planning than specific but incomplete. Only complete planning is good planning. And get used to the idea that resource planning will not always be 100 per cent specific. Outside interferences tend to come before you can adjust your planning.

Read this article to find out how to introduce resource planning quickly.

You might like our article about the Challenges of Resource Planning in Project Management.

6. Ensure Transparency of Cross-Project Dependencies

The steering committee for multi-project management or programs issues its targets at regular intervals. This includes, for instance, directives concerning the important milestones at the interfaces.

These targets are allocated to the corresponding projects (top-down). And the project managers have to implement them.

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Figure 6: Bottom-up and top-down control between program plan and individual project plans

Our tip: Use “soft” links between the tasks of different projects. These have the advantage that project managers can see the resulting scheduling conflicts directly when making changes. However, this happens without changing their own plan, which is important. After all, project managers stay in control of their own planning.

Read more about business cases for “soft” project links.

7. Simplify Cross-Project Budget Planning and Cost Tracking

In performing their tasks, project managers and controllers are reliant on each other’s data.

This makes it necessary to integrate both their systems. Without an automatic transfer of data in both directions, two things would be impossible:

  • Timely monthly billing
  • Prompt distribution of remaining budgets between the projects

The basic integration scenarios are the following:

  • Aligning the project structure of the PPM and ERP systems
  • Forecast transfer from the PPM system to the ERP system for budget creation
  • Transferring the actual hours from the PPM system to the ERP system for settlement
  • Transferring the actual cost from the ERP to the PPM system for controlling
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Figure 7: Integration of PPM and ERP systems using the example of the working hours and cost type forecast

The advantages of such an integration are as follows:

  • No dual data entry
  • Timely provision of data
  • High data quality

Our tip: The benefit of such an integration increases along with the number of projects and updates. An integration of PPM, ERP and other systems can be simple at first. It can be gradually extended as required.

 

Summing Up the Most Important Rules

  • Better to make your planning complete and rough than incomplete and too detailed
  • The biggest mistakes arise if you do not plan all projects and resources
  • It is better to start with limited functionality and build on that than to use maximum functionality and fail at the very beginning

Conclusion – 7 Crucial Success Factors for Multi-Project Management

This article has explained why multi-project management ranks among the more difficult disciplines. And why this can have consequences for everyday project management.

You have also learned about 7 important success criteria which could help you to master the challenges of multi-project environments:

  1. Stay on top of many parallel projects with central project lists, reports, and overviews.
  2. Use your PMO for standards, processes and methods to increase project success.
  3. Prioritize initiatives and projects according to importance and urgency and in line with your corporate strategy.
  4. Plan your capacities strategically. And make sure strategically relevant projects are implemented by qualified employees.
  5. Support tactical resource planning with complete planning by the team leaders.
  6. Ensure transparency (top-down and bottom-up) in the case of cross-project dependencies through “soft” links between tasks and different projects.
  7. Simplify cross-project budget planning and cost tracking by integrating the controlling and PPM systems.

How do you master the challenges of multi-project management? Do you feel we have missed an essential point? We look forward to receiving your comments.

Final tip: Subscribe to the TPG Blog Newsletter now and never miss another blog post.

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2 Comments

  1. jesus gualdron on

    buen articulo, sin embargo no esta claro que herramientas usar para cumplir cada uno de los pasos.

    Good article, however it is not clear what tools to use to comply with each of the steps.

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