Today, I’m starting out with a new series – focused on the PMP exam and meant as a preparation for it. Consequently, we are now moving back to “square one” and start with the basics to make sure we will use the proper terms.
What’s a project?
A project is temporary in nature, has a definitive start and end date. In PMI’s PMBOK Guide terms, a project is successfully completed when it delivered on the set goals and objectives – that also means that the involved stakeholders are happy with the outcome.
A stakeholder is anyone who has a vested interest in the outcome of the project (be it positive or negative). Obviously, a project manager needs to deal with stakeholders, because key stakeholders can make or break a project.
Projects only exist to deliver something new, like a new product or service, that doesn’t exist yet. Said products and services may range from something tangible like a car to intangible things like a new mobile service plan.
The features and characteristics of a project are commonly defined via progressive elaboration – I’d call it “agile specification”: it basically means that we start out with a rather rough plan at the beginning of the project and keep clarifying and making it more detailed over the course of the project. In principle, this is the only feasible way to deal with a project’s features anyways: when you launch a project, you simply don’t have all the facts and details on the table. A project sponsor will give you a vision and general idea of what he wants, but you’ll have to clarify that picture continuously to ensure you’re really delivering to his need.
In contrast – operations is ongoing and repetitive work that keeps going on without a set end date. Usually this means repeating a particular set of processes over and over again to deliver a specific output.
Nonetheless, it’s not uncommon to have a project extend into operations; this may happen for example when
- developing a new product or service or changing an existing one
- improving the product development or an operational process
- in general – whenever a project reaches the end of a phase (and for example delivers to operations)
A project is
- has a definitive start and end
- delivers something new
- completed successfully after meeting the stakeholder expectations
What’s a program?
A program is a collection of related projects that are managed in similar and coordinated ways. Managing the program’s projects collectively allows one to deliver additional benefits which wouldn’t be brought to realization if the project’s were managed separately.
Therefore, the projects in a program work towards a common broader goal and deliverable. An example for such a program is a housing development program, which may consist of several projects – one for building construction, one for roadwork and traffic planning, another one for utilities and so on.
Programs primarily focus on managing project inter-dependencies and gaining a benefit from the connection.
What’s a portfolio?
A portfolio is a collection of projects, too. However, a portfolio’s projects aren’t necessarily managed in a collaborative way. Instead, they serve a common business objective, not a particular common goal.
For example, an IT company may have multiple “website development” projects in its “web development” portfolio; however, these projects do not serve a common customer or goal. They primarily deliver on the business objective to deliver websites to customers.
Portfolios therefore primarily focus on optimizing efficiencies over multiple independent projects – in regards to cost, resource, risks and schedules.