Program Management is an organizational function that oversees a group of individual projects linked together through a shared organizational goal or common area of impact. This programmatic grouping of multiple projects provides synergy, consistent management, and greater visibility to stakeholders than individually managed projects.
Program Management Vs. Project Management
Program management is sometimes confused with project management. Project management is the process of leading a project performed by a team to achieve certain goals, such as building a new product.
A project represents a single, focused work with a specific scope and defined output. Projects can run for several years, but their main focus remains the same. A project’s success can be measured by delivering artifacts and deliverables that align with a program’s larger goals.
Project management is delivering value that incrementally moves a program forward. Despite the emphasis on artifacts and deliverables, project management still involves strategy and planning since a project manager must determine how to meet the goals at the beginning of the project. Once a project is underway, a project manager tracks progress, allocates resources, manages risks, communicates, and more.
Program management entails managing a program with multiple related projects. Since programs are linked to strategic initiatives, they are often long-running and possibly permanent. Programs continue through organizational change, contribute to multiple goals, and contain many projects that deliver specific components of the larger strategic initiative.
Benefits of Program Management
Leveraging program management practices is an effective way to execute cross-functionally and realize the strategy. Programs allow the organization to translate strategy into actionable goals to measure performance and mitigate the risk of failure. Metrics should be measurable, attainable, and aligned with the program's overall goals.
What you decide to measure will drive the program and help define projects and their intended value. How and what is delivered may change; the program's strategic goals usually don’t.
If they have, the strategy has changed, and the organization needs to react accordingly. That is why it is so important for programs to be a translation of strategy and not some side-list aligned to it. Some examples of program metrics include:
- Financial metrics: Define the investment and its return from the viewpoint of the strategy. Identify financial metrics that can be measured incrementally to avoid waiting until completion, which will stifle the agility to shift along the way. While mature organizations require a minimum ROI, IRR, NPV, and payback period, they tell only half the story alone.
- Operational metrics: Operational metrics, if done correctly, can help program managers handle uncertainty. For example, improving customer experience is not always immediately a financial gain (though hopefully, in the long term, it is). Still, it can be a program goal that is part of a strategy around reducing customer churn. Metrics on customer experience are then needed to determine what needs to be done to improve customer experience. Understanding the metric that drives the program and its projects will determine how to improve the customer experience. The first project in the program could be to understand what could improve the customer experience metric. For example, would you improve the customer experience through shorter wait times, improved ticket turnaround times or an increased number of tickets answered to improve the customer experience and, ultimately, reduce customer churn? The program plan does not need to know how they will improve those processes, but they expect it to achieve the goals. Execution activities determine if more support staff is needed for the team, what new technologies could improve the throughput of ticket resolution, or if introducing a new process to handle complex and exceptional types of tickets is needed. The metric helps to realize what will, and more importantly, what won’t, achieve it, and it’s a critical component of effective program management.
- Business capability metrics: Successful strategic execution requires organizations to understand what they do well and what business capabilities they should focus on. This may even be a prerequisite for creating operational metrics. Quantify where the organization is today and where they want to be for the chosen business capabilities to track, monitor, and assess the impact of what is being delivered throughout the program.
- Risk: Risk should be looked at throughout the program. Balancing risk with working on projects with the greatest chance of success or impact on the organization is essential in assessing the program's value. Risk needs to be assessed, managed, and mitigated where possible, but it is important to know the risk of the program at any given time and communicate that to stakeholders.
These are just a few key metrics to consider when setting up program management to ensure maximum benefits realization. Keep in mind other Key Performance Indicators (KPIs) are important for specific projects and the program as a whole, and make sure they are defined and communicated from the start.