Portfolio project management system architecture for a large corporation with divisional management structure

1,aVolkov Andrey, DSc, prof., 2,bKraynov Dmitriy 1Rector of Moscow state university of civil engineering (National research university, MSUCE),

Moscow, 129337, Yaroslavskoye shosse, 26

2Post-graduate student of Moscow state university of civil engineering (National research university, MSUCE), Moscow, 129337, Yaroslavskoye shosse, 26

avolkov@mgsu.ru, bdkrainov.cs@gmail.com

Keywords: PPM system – portfolio project management system

Introduction.

Currently, more and more companies are coming to the point where it becomes obvious that it’s

dangerous to drive investment and project activities of the enterprise without usage of specialized

IT-systems in the face of fierce competition in the market.

If the activities of the company are narrowly profiled, for example, the company’s operation is

design and assembly of steel structures, then it’s possible to use just project management systems for

automation. This decision will allow the company's management to obtain information about the

implementation of any project at any time without attraction other specialists. Also, it’ll be possible

to see aggregated data of the portfolio in a whole.

Let’s consider the problem of project activities management on a large organization scale. Usually,

large corporations are engaged in many diverse activities and realize many different types of projects.

In this case, the solution that makes it possible to increase the effectiveness of project management is

the Project Portfolio Management System (PPM).

Project Portfolio Management (PPM) system is a business tool used to effectively manage a

number of portfolios or projects towards an overall objective. Each individual project is created in

order to achieve a specific business objective or advantage. They should all benefit the overall project

portfolio. The PPM is an umbrella for all of the individual projects.

Requirements to PPM-software are growing constantly. So modern PPM solutions must provide:

• centralized management of one or more project portfolios to achieve the strategic goals of the

organization;

• implementation of all portfolio management processes and their interactions, in accordance

with current standards, in particular, PMI;

• flow control of all projects, regardless of their lifecycle phase;

• support for all areas of knowledge, reflected in the standards of project management;

• be easy to use, highly customizable to individual user requests;

• ensure interaction between portfolio management process members.

Problem description.

When the company decided to automate the processes of project and portfolio management, the

first and foremost issue is to identify the target architecture of the IT-system. Exactly system

architecture will impact on the success of the project and the success of the company in a whole.

The figure below shows a sample organizational structure of a large corporation with divisional

management structure engaged in various types of business.

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Figure 1: Sample of organizational structure of a large corporation

Obviously, each division has its own specificity. Types of projects, realized in the parent company

and its subsidiaries are different. For example, a list of attributes required for analyze in capital

construction projects is fundamentally different from attributes in IT systems implementation

projects or R&D projects. Organizational management structures are different for different project

types. Different models of documents endorsement, different projects realization monitoring

regulations, different patterns of the project schedule, and etc.

Unfortunately, rather often, a company taking the decision to move to project portfolio

management, not has established project management processes. The company's management,

understanding the existing problem, commit IT architect to automate two processes using one system.

Enlargement architecture of such "universal" systems looks like this:

Figure 2: Enlargement architecture of universal PPM and PM system

2314 Architecture, Building Materials and Engineering Management IV

System architecture pictured above has a number of positive and negative aspects:

Advantages:

• Centralized project management system;

• Reducing the time of reporting on the projects realization;

• Increased reliability of the data.

Disadvantages:

• The system is extremely loaded with attributes (Master data) of all types of projects (for

example, building materials directory is used only in the building projects);

• The system keep attributes of all types of projects that are not universal;

• High maintenance and development labour coefficient of a centralized system;

• High risk of unsuccessful implementation of PPM-system associated with the need to "adjust"

for all related systems.

Figure 3: Master data crowding

We assume that most of the subsidiaries at the beginning of implementation of PPM-system has a

clearly defined methodology of accounting and system that automates it. Obviously, that in all

companies, not only the systems, but even accounting policies are very quite different. That’s why a

problem that there is no single integration scenario with ERP-systems is inevitably. So, development

different scenario for each system also loads the centralized system

Solution.

Decentralized approach can allow to get rid of the negative aspects of the system shown above. In

this approach project management systems and PPM systems are separated from each other. The

PPM system must should be the only one, because project portfolios are managed centrally, at the

level of top management. As regards for a project management system, then there should be several,

separate for each of the types of projects / divisions. However, all of the project management system

should be designed to meet the requirements of senior management to the composition of indicators

that are maintained in system.

Architecture diagram of such a solution is shown in the figure below.

Applied Mechanics and Materials Vols. 584-586 2315

Figure 4: Decentralized archtecture of PPM-system

As we can see, this approach can improve the performance of each system, reduce the cost of the

solution support. So, we can see, that decentralized approach in PPM-systems implementation is

much more effective, when the company has a divisional structure.

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2316 Architecture, Building Materials and Engineering Management IV

Architecture, Building Materials and Engineering Management IV 10.4028/www.scientific.net/AMM.584-586 Portfolio Project Management System Architecture for a Large Corporation with Divisional

Management Structure 10.4028/www.scientific.net/AMM.584-586.2313