Sustainable Portfolio Management

This report discusses the implementation of sustainable portfolio management at Reliance Industries Limited (RIL). It covers the situational context, change management, organizational project management, challenges, and benefits management. The report also explores the importance of a project management office (PMO) and improving decision-making through project portfolio management (PPM).

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Sustainable Portfolio Management
Name

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Sustainability Portfolio Management
Introduction
Increased competition and the need to better utilize scarce resources means that
organizations are increasingly seeking ways to become more efficient and more judicious in the
projects they undertake (Adams, 2017). Apart from efficient operations, organizations increasingly
seek to have a positive impact in the environment in which they operate. When organizations are
seeking to make investments, there is always the need to make the best decision and select the
project that brings the greatest benefits with the least environmental footprint; usually it involves
selecting a project from a choice of other competing projects (Dixon-Woods, McNicol and Martin,
2012). The process of making decisions in selecting the best investment matrix is both an art and
science and requires matching investments with company objectives, allocating assets efficiently,
and balancing risk against performance (Kahraman, Kerre and Bozbura, 2012). This report is about
implementing a project portfolio management function at Reliance Industries Limited (RIL), having
convinced the organizations’ management about the need to introduce it. The situational context for
implementing the project portfolio management function is discussed, and a suitable method
chosen, with justification. This paper also explains how it is to be implemented as well as how
portfolio management will be achieved along with an appropriate model for project maturity, all in
the context of the establishment of a project PMO (portfolio management office) at RIL.
Situational Context
Reliance Industries Limited is a conglomeration based in Mumbai with several business
interests spread across India in various sectors including energy, textiles, petrochemicals, retail,
natural resources, and telecommunications. The sheer size of the company, its variety of business
interests and the fact that it has businesses spread out across the country means that the company
must develop a way to better manage its portfolio of businesses such that it achieves the best returns
and the most efficient allocation of resources. The focus of portfolio management is doing the right
work; a portfolio pertains to an aggregation of projects / programs or any work that can be jointly
aggregated together in order to make the management of the work effective to meet an
organizations’ strategic objectives. Reliance Industries Limited (RIL) has a strategic framework of
attaining consistent growth, delivering value, attaining sustainable transformations in society, and
driving innovation (Reliance, 2019). these objectives must be matched to its portfolio management,
hence the initiative to introduce and operationalize a project portfolio management function in the
organization.
Change Management

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The modern business world is becoming ever more complex rapidly than has ever been
experienced before due to significant shifts in the business and economic environment as well as
technology. These shifts come with several opportunities and with equally many challenges so
organizations must adapt in order to thrive, and this requires effective change management
strategies. Change management is the support and preparation required for successful organizational
change (Browning, 2015); in this case, the implementation or an organizational portfolio
management strategy. Its implementation shall follow standard project management strategies,
including stakeholder management, effective communication,and involving relevant staff in its
implementation to achieve higher uptake and support. The change management process will ensure
the teams and individuals at Reliance Industries Limited (RIL) change their attitudes, approaches,
responsibilities, and position in the context of the implementation of the sustainability portfolio
management.
Organizational Project Management
PMM (Project management maturity) pertains to the dynamic development of management
methodologies, strategies, approaches, and decision-making processes to be used enterprise-wide in
managing projects; the maturity model varies for each organization. This is achieved via a robust
organization PMM; OPM (organizational project management) refers to the systematic process of
managing projects, programs, and portfolios within an organization consistent with the attainment
of the organizations’ strategic goals (PMI, 2013). It works on the premise that a reciprocal relation
between an organizations’ capabilities in managing portfolios, projects, and programs and its
effectiveness in implementing strategies. The level to which a business/ organization can practice
this approach to managing projects constitutes its organization project management maturity
(Crawford, 2017). Attaining maturity in OPM and assessing the maturity level requires the use of a
suitable model; for this case, the OPM3 (Organizational Project Management Maturity Model), a
standard developed by the Project Management Institute (PMI) to offer a way that organizations can
use to understand organizational project management as well as to measure their maturity against a
broad based, comprehensive set of best practices in organizational project management (Claudia et
al., 2017). OPM3 has also been selected among the available options because it aids organizations
such as Reliance, that wish to better their organizational PMM in order to make plans for further
improvements.
OPM3 Implementation Tools and Techniques
There are two main techniques for implementing OPM3; either through a product suite or
online; implementing the OPM3 requires an understanding of the standard, using for for assessing
the organization, using results of the assessment to identify missing outcomes and capabilities,

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choose improvement strategies for missing items, and reassess progress (Schlichter, 2009). For this
exercise, the standard OPM3 suite will be used.
Chosen Technique for Portfolio Evaluation with Justification
The evaluation of RIL portfolios will be done using the Analytic Hierarchy Process (AHP);
the AHP is an integrated method used to organize and evaluate complex issues in order to arrive at
the best decisions based on psychology and math. This technique has been chosen because of its
suitability for group decision making in which various criteria, goals, and alternatives are organized
into hierarchies based on the assumption that the elements are independent. The AHP has been
chosen over other techniques such as DSS (Decision Support |Systems), GP (Goal Programming
Problem) or ANP (Analytical Network Process) because it incorporates both psychological and
mathematical tools as well as being a simple but powerful tool for decision making in complex
projects (Caballero, 2014). It also helps in reducing decision bias. It considers relatives factors
priorities and represents the best alternative; it is also very flexible and has a variety of applications
including in planning, effectiveness, risks, and benefits (Transparent Choice, 2019).
Challenges in using the AHP technique in a global environment
When linear equations are developed to help in decision making, the linear equations may
not always have a solution; it requires tremendous computing even for small problems and allows
only the use of triangular and fuzzy triangular numbers. It is also premised on measures of
possibility and probability as well as having a subjective rather than objective nature. An increase in
the hierarchy levels leads to an increase in comparison pairs, making the process long and tedious.
Rank reversal can lead to false conclusions being arrived at (Oguztimur, 2011).
Incorporation of benefits management life cycle
The OPM3 works with supporting processes such as scope, integration, schedule, financial,
human resources, quality, risk, communication, and procurement; these capture information that is
used for implementing the PMM processes and maturing the processes and this enables the project
management life cycle benefits to be assessed and documented as well (Rao and Jagathnarayanan,
2015).
Importance of benefits management
Benefits management is important in helping RIL meet its project deliverables objectives as
they ensure the success of RIL’s projects beyond the simple metrics of time, budget, and scope.
Benefits management as a part of program and project management increases the level of alignment
of the programs and projects with the strategic goals of the organizations that deliver distinct
benefits based on on the outcomes of the most important strategic objectives of the organization
(Davies, 2016).

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Project Management Office
Implementing the PMO3 and using portfolio management approaches to managing projects
at RIL will require the setting up of a project management office to offer the three PMO roles of
directing, controlling, and support. The PMO refers to a department (or group) within the
organization (could be a government or business) that defines as well as maintains standards for the
organizations’ project management. The PMO endeavors to introduce and standardize economies of
repetition when executing projects to ensure efficiency and attainment of objectives seamlessly.
The specific objective of the PMO is to ensure the organization - specific objectives are attained
through standardization and systematic/ methodological use of policies and processes of project
management. The PMO’s role is improving success rates when undertaking projects based on the
company and project in question (Al-Arabi and Al-Sadeq, 2018). The PMO also helps managers an
decision makers identify resources as well as track progress and this leads to the establishment of a
deeper base of knowledge over time; all which work to improve the rates of success for projects.
The PMO ensures there is standardization by setting standards that have to be adhered to by
everyone within the organization; this is done by engaging with different groups within the
organization to create clear standards for performance, monitoring, and measurement. This results
in management standards being developed within the organization that employees support. With
standardization, it is easy for the organization to assess and compare projects and enable people not
meaningfully involved to offer assistance. The PMO also helps an organization complete their
projects within budget and ahead of schedule saving money and freeing up valuable personnel and
IT resources. With time, the PMO becomes an information repository and the go-to -source for
guidance on projects, templates, documentation,a nd hands on project assistance. The PMO also
leads to increased savings and productivity; often, projects encounter roadblocks even though they
have plans for efficiency, lower costs, and productivity as their objectives (Project-Management,
2019).
Improving decision making
Portfolio management requires that competing needs are balanced and decisions can be
improved using tools such as the Decision Knowledge Center in which decisions that can lead to
increased success rates are connected. This is achieved by developing bubble charts using suitable
applications to identify projects with the highest likelihood of meeting business objectives such as
maximizing realized benefits to the customer, maximizing acceptance, maximizing sustainable
competitive advantages, and maximizing alignment to business strategy (Ward, 2015).
Project Portfolio Management (PPM)

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PPM is a strategic alignment process through which the projects of the organization are
analyzed to identify their fit, purpose, and benefits in relation to the goals of RIL after which
projects are grouped into programs on the basis of their similarities and relevance. PPM creates
clarity and the big picture which then helps management classify projects and better align them to
strategic objectives (Alexander, 2019).
Project Management Office
RIL already has a PMO whose role is to standardizing the company’s practices in managing
projects to create efficiency and enhance institutional memory; this enables replication of the best
standardized practices when handling other projects.
Present use of quantitative and qualitative tools for managing its project portfolio
At present, both qualitative and quantitative tools are used for managing project portfolios at
RIL; the qualitative tool being used is the aligning process group that defines what is to be managed
in the portfolio, their categories, and the chosen components and their evaluation. This starts with
identification, followed by categorizing, then evaluation, and selection after which projects are
prioritized and portfolios balanced, then authorization given to proceed. The quantitative
approaches involve monitoring and controlling through periodic portfolio review and reporting and
strategic change implementation based on cost benefit analyses . These tools have, however, not
been fully implemented and requires the entire process to be improved so as to incorporate them.
Maturity Levels
The use of PPM has just recently been adopted at the firm and the present maturity level is
Level 1; at the Level 1 of maturity, the work is organized into projects and then cost tacking done at
project level with decisions on project selection made on a project-by-project basis (Mullaly &
Thomas, 2010). The second level has not been fully attained (it involves force ranking projects after
compiling projects into a project database and responsibilities for management assigned).
Improving PMM at RIL
The PMM level at RIL can be improved by adapting the methodologies used to manage
projects to the most suitable ones, incorporating easy to use document templates to manage various
aspects of the project, training staff on best practices and how to use the OPM3 model, having a
project register and having suitable project plan templates. The project maturity level can best be
improved using the OPM3 model because rather than prescribing the kind of improvements to
make, the OPM3 offers a broad array of best practices in organizational project management
(OPM) (Sargent, 2016). As such, RIL can use it as the basis for self-evaluation and study and make
informed decisions on possible change initiatives aimed at achieving higher maturity levels. OPM3
will help RIL assess and improve its capabilities for project management and also capabilities for

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achieving organizational strategies via projects. OPM3 also will help RIL set excellence standards
in program, project, and portfolio management using best available practices and also state the
requisite capabilities for attaining the said best practices.
Implementing Change
Implementing the changes will first require preparing for and then undertaking an extensive
assessment of RIL using a team of experts to generate metrics that will identify gaps that need
improving. The third step entails planning for improvements based on identified gaps and then
implementing the improvements using the OPM3 framework (Ghorbanali et al., 2011). Because
improvements are continuous, the last step is to repeat the whole process and identify any new gaps
to continuously improve PMM performance at RIL.
Corporate Culture
The Corporate culture at RIL is highly flexible and innovative, and this was introduced
recently through significant changes in the company’s HR policies and approaches where there are
no longer formal dressing codes, sporting facilities have been added for employee use to refresh and
keep fit and can be used at any time of the day. The company is offering five day weeks from six
day working weeks, with many young employees at the company to meet the needs of a much
younger customer base. Decision making is no longer hierarchical and rigid; teams are allowed
greater cooperation and innovation is encouraged and fostered. This corporate culture makes it a
highly receptive organization to implement PMM and OPM3. The company has a unified culture
where strategic goal are clearly defined and shared (Singh, 2018). Change initiatives in portfolio
management for projects will be supported by the various stakeholders as the company has already
adopted a flexible and modernist organizational culture and how things are done at the organization
(Ghorbanali et al., 2011).
A corporate culture that support innovation, cooperation, distributed decision making, and a
horizontal organizational culture where cross functional teams are encouraged to collaborate while
working on different projects is what will be conducive to implementing OPM3 for portfolio project
management to attain higher PMM at RIL (Banister-Hazama and Hazama, 2014).
Challenges will always exist in getting management to support project portfolio management at
RIL; such challenges include knowledge of OPM3 and PPM, internalization of the paradigm, and
continuous support by all senior executives at the company.
Ten projects are reviewed to show their priority for RIL as shown in Appendix I (984477ril).

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