A project can be developed independently but often, and especially in large organizations, we use programs and portfolios. Do you know the difference between a program vs portfolio? Here is a simple explanation.
As a project manager we need to know the differences between Program vs Portfolio. These are areas that are above project management, but are often sought after by many experienced project managers.
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Differences between Program vs Portfolio
A program should consist of several interrelated projects and even other subsidiary programs. On the other hand, a portfolio can group both projects and programs, as well as subsidiary portfolios, without the need for them to be related.
This can create some confusion, some people think of programs as big projects. This is a mistake, the sense of the programs is to coordinate several projects of greater or lesser scope to obtain greater benefits for the organization.
What can happen is that a large project is divided into smaller ones and grouped into a program. Ultimately, the goal of creating a program is to optimize the use of resources, reduce risk and maximize benefits.
Nor should we understand portfolios as megaprojects. It is simply a way of organizing projects and programs to achieve the strategic objectives of the organization.
Example of program vs portfolio
If you still have any doubts, let’s give a couple of examples of programs and portfolios. Then we will explain in more detail what is the role of the program manager vs. portfolio manager.
An example of a portfolio could be a large energy company that wants to develop a new business unit focused on renewable energy. To this purpose, it could create solar energy projects, wind energy projects and hydraulic energy projects. They could all focus on the same strategic objective, but they need not be interrelated.
An example of a program could, however, group together solar energy projects. In other words, various projects such as: R&D, installation of a plant with photovoltaic panels, creation of distributed generation systems, etc. that are somehow interconnected.
Program vs Portfolio Manager
A portfolio manager supervises and controls all programs and projects. Its job is more corporate as it will give priority to those who are most important to achieving the goals of the organization.
It is in their hands to allocate resources and investment efficiently according to the strategic objectives of the organization. Similarly, they can cancel projects and programs if they cease to be interesting or beneficial.
A program manager coordinates all of his or her projects. It must deal with changes, problems or conflicts that arise and achieve more efficient management. This work is essential because otherwise it would make no sense to group the projects together, they would simply be carried out independently.
If your project is part of a program or portfolio you will have to collaborate with a program manager or a portfolio manager. Basically you must lead your team and manage resources effectively to achieve the project objectives. Your objectives are different, limited to the life cycle of the project, but aligned with the goals and objectives that the organization wants to achieve.
If you want to learn more about project management we recommend our online master’s degree in project management. A course that you can take at a distance and that will allow you to grow professionally. It also prepares you to obtain the official certifications that will accredit you as a professional in project management.