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The Mutual Relationship between Performance Management and Project Management

Performance management is not just a function of human resource. Project and portfolio management is another great context for this process.

Projects are the engine that drive an organization toward its vision. As such, a mature organization with rigorous KPIs can map value from that vision all the down to technical execution on the project level and back up again.

Every initiative should have a business case with stated benefits that justify the project. This sets the priority for selecting it in the portfolio and gives a value the project team is accountable to.

Working from the ground back up, every execution activity is a piece to the puzzle that gets the project completed. In turn, every project is a brick in the wall of the portfolio that stands up the vision.

A portfolio priority requires a lot of pieces coming together. It takes a project budget, timing, resource demand, and people making themselves available even when they’re sometimes overworked. So whenever a project team member gets a task assignment, they can measure their contribution to the project. That contribution is a multiplier on the value of the project itself.

This allows the team members to have an effective way of demonstrating how their work contributes to the organization’s goal.

Of course, this can come full circle with performance management’s most common usage: human resources. The reality is if you a team hits its target ROI, then the people who deserve credit can get some big bonuses. Even in a relatively small consultancy, every “one-man department” knows what it has to do to hit that number, which focuses their activity toward that business value.

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