Okay so we’ve talked about projects now let’s talk about what programs are because the terms project program and portfolio you hear them around and a lot of people can’t separate projects from programs typically contain two or more projects so we say a program is defined as a group of related projects a group of related projects subsidiary programs and program activities that are managed in a coordinated manner to obtain benefits that you wouldn’t otherwise get if you were to manage these projects individually to make this easier to understand programs have at least two projects so it can’t be just one project it has to be at least two projects or more and it could also even have operational activities but for this you know for the specific outcome stated in a program and when programs are initiated there are typically initiated for some sort of a benefit that the organization needs and that benefit is usually measured in the form of a KPI okay a key performance indicator so a good example of a program would be a program to elevate the level of or maybe to elevate the rank of a school within you know a month its competitors or university is trying to rank higher amongst other universities or in areas number one the curriculum so that’s you know defining or designing curriculums would be one criteria another thing they may want to look at is qualification of their lecturers another one they may look at is location or facilities that they have which is a construction project they may want to look at an IT project may be digitizing content or using smart boards or other technologies at the university they may also need to consider financial matters and offer maybe incentives of programs for students they also may want to look at the mix of the students they may want to look at partnerships that they would have to create with some other organizations and there’s probably a few others so if you think about it there’s a lot of different initiatives of different flavors and natures that the university would have to do in order for it to rank higher and even when it does all of the things that we just mentioned it does not mean that the university is going to rank higher right then so a project typically you go in hand over and it gets inspected and they would sign off and it’s all done on a program you deliver all of the components as in the example of the University and you wait it out for like six months or one year and record the difference so after one year whatever assessment was done to rank the University when we do it after one year we should hopefully get a better result because we have built in all of the components required to rank higher so that’s one example of a program another example would be an oil and gas facility where you have extraction of oil happening and then let’s say processing of the oil and then the sales or the supply chain aspects of distributing the oil and then maybe storage facilities for the oil and if you think about it every one of these is a separate project and some of them of a different nature and this allows them to record some sort of benefit or KPI which could be the volume of oil that they sell so the project the program isn’t about extracting the oil that you know the construction we do for us to be able to access the oil is one project the warehouse the storage is another one the processing plant is another one and the distribution channel is another one and once you have all the pieces in place you can now monitor and see if your facility can now pump the amount of oil that you’re looking to pump out next let’s discuss mega-projects a lot of people confuse very large projects with programs well very large projects are what they are they’re very large projects and they’re not necessarily programs you can manage them like a program because they have a lot of sub projects but a large project is typically a large structure so a you know a major bridge that connects to cities can be considered and mega project a huge mall can be considered an mega project and Airport is considered a mega project so these mega projects are just humongous sized projects and they typically would run the range of 1 billion dollars or more and run for multiple years because they take a long time to actually build and they affect 1 million or more people so something that sizeable is called a mega project and the best approach to managing mega projects is to find a balance between managing projects and managing programs due to its size next let’s discuss what portfolios are another word for portfolio is group or collection so let’s not talk about projects were a little bit some of you who are very rich are going to have a portfolio of cars a collection of cars so if I had three cars then I have let’s say the three cars are a Bentley Maserati and Ferrari yeah why not since we’re dreaming things up might as well just include them so let’s say I have these and a BMW and Mercedes and so on and so forth and you know I’m talking about these two a friend I will discuss the portfolio of cars that I have you could also have a portfolio of assets or real estate investments you may have a couple of buildings why not two buildings three villas and six apartments that’s your portfolio of real estate investments so in other words a portfolio is a collection of whatever it is so a project portfolio is a collection of projects the definition here goes into programs also so we say it’s a collection of projects programs and subsidiary portfolios and operations that the organization has and those that collection will be managed as a group to achieve strategic objectives programs include projects inside of them subsidiary portfolios are sub portfolios of the whole so if the organization has a high-level portfolio then at the lower level they could break it down so for example if I had a portfolio of investments real estate investments maybe I could break it into two sub portfolios one in Boston and another one let’s say in New York so I can call one the Boston portfolio the other one in New York portfolio and the contents of these portfolios would be the real estate investments that I have and the projects in those portfolios do not have to be related okay they’re not necessarily related they just happen to be there for ease of management when we sort things out in a portfolio I will break it down into subsets we do it because it makes it easier to manage but it also tells us that this one piece of the portfolio satisfies maybe a slice of the overall strategy of the organization and the other one here satisfies a different slice and so on and so forth so when an organization wants to achieve its strategic objectives it typically would initiate projects and when these projects are related we call them a program and sometimes some of the other activities would be operational and a collection of everything is called a portfolio so an organization could have a portfolio of initiatives including operational work so let’s go back to the example of Starbucks has retail locations the coffee shops and that would be considered part of its operational work and also they have their headquarters where operational work is happening they probably do a lot of research on coffee and muffins and I don’t know what and on an ongoing basis they’re building new locations so these are ongoing projects and they may dissect these projects into different territories so there you have subsidiary portfolios so just remember these things a portfolio is the collection of all of the activities that an organization is busy working on that portfolio could be broken down into sub portfolios as I’m showing here on the right and in the portfolios you’re gonna have either projects or programs the programs themselves are going to have projects underneath there is another chart that I’ll show you in a little bit that includes all of these on this chart you can see the structure and hierarchy of the organizational strategy and how it’s executed via projects at the highest level you can see that we have organizational strategy when the management or the c-level people or senior executives meet on an annual basis they determined that some changes would have to happen to take them from the current state into a future States or current future and they develop a strategic plan which is executed through projects along the way so if this is a one-year strategy then along the 1-year strategy these projects will be executed these are the projects that sit down here these are the projects what you will see is that some of these projects roll up to program so this one program includes these two projects but that one program is actually a sub program of a bigger program which is this one here do you see that all right so that is the that’s the bigger program here and it includes a sub program which includes its own projects so at the lowest level it’s always going to be the projects all right and then inside this one portfolio here if you go down here you see that there is an independent project that does not sit in a program over here the portfolio breaks down into a sub portfolio and in the support for you see that it includes a program which includes projects and operations programs can have Project Work and operations portfolios can have programs they can have sub portfolios they can have projects and projects can only have sub projects and activities so projects here cannot have programs or portfolios because projects are the smallest piece right now when an organization executes on all of these projects that you see down here these two projects will complete this one program this one project and others like these three here will complete this one program completing these here with that one there will complete that one portfolio and what you’re going to see me do eventually is that I’m going to shade all of these and as we execute them let’s cross them off and at some point the whole portfolio would have been executed on which should help the organization achieve its organizational strategy so we plan from the top down we plan from the top down we execute from the bottom up right every project counts to delivering that organizational strategy one last thing that I want to point out is that all of these that you see here they rely on shared resources and stakeholders at the lowest level so you can’t have the same resource on two projects for two foot for one full day so you can’t have the same one work 24 hours on two projects if they’re here they cannot be there typical person would work for about 8 hours so if they’re working 8 hours on one project they’re not going to be on another project if you’re using a crane in one project then you can’t use it on the other project at the exact same time if using a warehouse to store products you cannot use it to store other products if it’s full so basically resources are going to be limited and we have to figure out the best way to use these resources that is the job of portfolio managers portfolio managers have the responsibility to use organizational resources to the for the best outcomes but what do managers focus on return on investment programs focus on achieving benefits and KPIs and projects focus on delivering products services or results one-off product services and results and that’s the sequence that happens and that’s the relationship between portfolios to programs to projects one last slide before we end this session is to discuss what portfolios are intended to do number one they help the organization figure out where they should best invest their resources money and people they decide on the best mix of programs and projects to meet the strategic objectives so on an annual basis the role of the portfolio manager is to help the organization determine where they should put their resources and that’s because as we discussed resources will be limited they provide decision-making transparency they use formulas they use business cases they calculate the benefits and the cost and therefore when an organization needs to make a decision on where it’s going to invest it’s funds or money or resources they have all the numbers to help with that decision and because they have all the numbers were able to prioritize where the resources should go they know that something needs to happen at a certain point because there are dependencies and it’s their job to advise the management of that because they do all these calculations and considerations and because they tie the initiation of projects to strategic goals we can say that they’re going to increase the likelihood of the organization realizing the return on investment that they’re aiming for finally they centralize the management of aggregate risk profile of all components if we go back to the chart where we were looking at all of these things that happen down here they roll up to the return on investment ROI of the organization they also roll up to the level of risk that that is in that is built in into this collection of projects so if we have a few risky projects and there are you know high dollar value there’s a very good chance that that risk is going to flow upwards and affect the organization so the role of the portfolio manager is to make sure that the level of risk that they have in all of these projects that they’re running is acceptable as per the thresholds of the organization this brings us to the close of this video I hope you liked it and enjoyed it and found it to be informative and enjoyable if you enjoyed it please subscribe like share and let us know show us some love let us know that you enjoy this so that we can continue to produce the rest of the videos and one more thing please turn on the notifications so that you’ll know when the next video is out we look forward to seeing your feedback on this one session and we hope to see you on the next video thank you and goodbye