The Value of Project Portfolio Management in Healthcare

Project Portfolio Management (PPM) isn’t just a nice to have IT methodology – it’s an incredibly valuable management process that allows organizations to perform at their highest potential. With both health and life on the line, there is arguably no other industry that benefits more from running optimally than healthcare.

PPM methodologies are essential for managing healthcare projects as these organizations often encounter challenging situations when managing their projects. From having more projects than resources to do the work, to having leaders overemphasizing the needs of their customers and making siloed decisions, strategic PPM in healthcare often becomes highly complex. In fact, only 16% of organizations are shown to be highly effective in their PPM strategy and by 2025, 70% of digital investments will have failed to deliver expected outcomes due to no adoption of a PPM approach. Many times, IT teams also have difficulties feeling comfortable saying “no” to leaders, which creates a fragmented approach to work that results in conflicting priorities, redundant process, misaligned goals, and inessential work being added to their calendars. This begs the need for organizations to mature the way IT teams recognize and design their work. PPM, coinciding with proper data collection and analysis during the ‘intake’ phase of projects, should empower teams to work with agility, tie tasks to goals and strategies, routinely discuss alignment and priorities, and be confident and comfortable in saying “no.”

What is PPM in Healthcare?

PPM is the essential and strategic management of one or more projects and programs within a portfolio that supports an organization’s overall success. PPM is different from both project and program management. While project and program management focus on doing projects the right way, PPM focuses on selecting the right projects within the portfolio to work on at the right time. It requires various techniques, perspectives, and processes that enables organizations to better manage their portfolios, make data-driven IT and business decisions, and meet organizational goals and objectives.

Modern day healthcare IT organizations are highly complex environments, having a multitude of patient healthcare products and services, supporting infrastructures, and shared services such as security, compliance, and legal. With such diverse IT and business objectives, project prioritization can become a challenge. To address that challenge, organizations should utilize the proper foundation and maturation of portfolio management processes, strategies, and capabilities that can allow them to run IT departments like a business – by thinking and acting in terms of business values and outcomes – and to enable flexibility in workflows. Healthcare organizations should also be agile to adopt PPM best practices and develop and implement a well-defined end-to-end process of portfolio management disciplines, capabilities, and services. When properly executed, PPM has a wide range of capabilities, including:

• Facilitates leadership level enterprise goals & objectives planning
• Coordinates with senior leadership to identify strategic and operational growth areas
• Helps to guide leadership through strategic discussions
• Empowers strategic investment planning through enterprise/IT exercises
• Builds project & program delivery frameworks
• Creates and implements portfolio & program management governance processes
• Delivers projects & programs using an efficient and effective PMO catalog of services

Why Project Portfolio Management is Valuable in Healthcare

There are numerous reasons why PPM is both valuable and needed in healthcare. Not only are organizations adopting PPM frameworks meeting their strategic business objectives, but they experience higher productivity, cost savings, and less chaos. This enables high quality results, allowing their healthcare team to most efficiently serve the most important population – their patients. Here is a deeper look into the key reasons PPM is so valuable in healthcare: 

1. Decreases Time Spent on Low Value Projects

Often times, organizations fail to explicitly stop or reject lower value projects and work, resulting in lost potential and more time unnecessarily spent on work that ultimately brings no value. IT teams are also often being asked to do more work with less people, given difficult and non-strategic projects from various areas in the organization, and are lacking visibility and transparency into initiatives and resource capacity.

PPM spans the entire lifecycle of project work – from idea generation to operationalization. Being able to collect better information earlier in the lifecycle allows portfolio management teams to faster drive, and more effectively execute, projects and programs. PPM processes will also drive reliable and consistent data across the full lifecycle of projects and programs, which is critical in providing information on areas of contention, misalignment, and situations with indecisiveness due to lack of consensus. These are all necessary and crucial points of data that better drive decision making by leadership within an organization.

2. Reduces Costs

PPM reduces enterprise budget expenses by eliminating redundant projects and efficiently utilizes resources in a cross-functional, matrixed environment. As PPM allows gathering key data through demand management and intake processes, project and program leadership can easily visualize the repetitive activities and activities with low a value-add. PPM can also assess and monitor resource requirements for prioritized projects; leveraging internal shared resources often contributes to cost savings by reducing dependencies to external resources and assets.

3. Alleviates Resource Planning Challenges

Resource planning is a major project and program management challenge, where it’s important to ensure the best resources are working on the right project at the right time. Crucial information collected by PPM practices from cross functional teams (IT, Finance, HR, etc.) at an early stage of the project management lifecycle allows the portfolio management and IT management teams to align resources strategically. This ensures proper analyses are done and resources are confirmed, reserved, and then allocated to prioritized projects based on organizational needs.

4. Allows for Scalability  

PPM can also inform and enable IT organizations to effectively scale up or down as needed based on key factors like unplanned spikes in project estimation, project roadmap changes due to shift in enterprise priority or strategy, resource constraints that can’t be mitigated, or the inability to secure or allocate the right number of resources with the right skillsets at right time. PPM can also provide guidance for project managers to help them implement preferred program and project practices at the ‘just right’ level needed for management visibility and control. These practices include the balance between implementing useful program and project practices, which are understood and supported, versus those viewed as a hindrance to getting work done.

5. Improves Quality of Projects

PPM is a critical component of project justification and governance. It enables organizations to assess and evaluate proposed and ongoing projects and programs to properly assess the allocation of limited resources, time, and budget. In summary, PPM can improve organization’s return on investment (ROI) and on-time deliveries. The discipline of PPM helps an organization select and prioritize projects with the greatest potential ROI even before the projects are executed! Effective PPM provides a consistent way to evaluate, select, prioritize, budget, and plan for the right projects: those that offer the greatest value to the organization’s strategic interests. PPM starts with developing a strategic focus and ends with selecting the right projects.