Question

Differentiate between project, operations, program & portfolio ?. Give 3 examples each

Answer 1

Reasons for a need a project:

1. Market Demand
2. Customer Requirement
3. Environment or Regulatory conditions
4. Business case to achieve cost efficiency

Sometimes we may need to execute a series of projects; program is a collection of related projects. A program consists of multiple projects, with each project having its own goal. But they have to be managed in such a way that they achieve a program level goal together.

For example an organization wants to spread their business in southern India. The goal is to capture the market completely. In order to execute this program they may execute multiple projects like one project focusing on the requirement of south Indian customers, other focusing on differences in climatic environment of current cities and south, third one focusing on how to compete with existing competitors in the market. This may require managing co-ordination and conflicts among different projects.

Whereas a program is a collection of related projects, a project can exist without any program. There is an upper layer called portfolios. Portfolio is an organizational strategy/thinking to achieve strategic goals.

Goals or go-ahead for a new project comes from portfolio decision. Any organization has limited budget and resources. So depending on the strategic goal, organization has to decide what mixture of projects/program/operational activities gives them maximum benefit and meet their strategic goal. Strategic goal could be profit maximization or could be achieving a market share. In order to achieve bigger market share in a given timeframe, one need to use collection of project, program and or operational activities. Goals of a portfolio are usually Return On Investment or increase in customer satisfaction or getting a bigger market share or diversification. Project funding depends on these goals.