the digital twin of a project portfolio

When a complex system from the real world can be modeled in a virtual world and optimized quickly and without risk in order to then transfer the results to the real world: that is where a digital twin holds lots of benefits.

In the real world, complex systems usually react very sluggishly, i.e. it takes a long time before the results become apparent. Any adjustment and correction loop afterwards again costs a great deal of time and money.

With a digital twin of a complex system, the effects of changes can be calculated quickly and without risk. Now an optimum can be found within strategic guidelines and allowed room to maneuver.

These ad-hoc simulation and optimization capabilities are a great value of a digital twin.

The concept of the “digital twin” is anything but new. It has been well known in the automotive and aerospace industries for over 30 years, where the physical model of a vehicle or aircraft can be modeled in the virtual world and properties and behavior can be tested long before the product actually exists.

Yet the idea of applying the concept of the “digital twin” to rather abstract systems is relatively new.

A project portfolio organization is such a abstract system. The VISBO digital twin of a project portfolio organization consists of

• the key data of each project with regard to start, end, budget, most important milestones and phases, required monthly resource and skill needs, expected deliverables and resulting revenue / benefit. Such key data exists for any project, independent of project type, planning methodology and used IT tool to describe the detailed plan.
• the list of projects constituting one or several portfolios
• the resource pool and skill structure of the company

With the VISBO digital twin of the project portfolio organization, it is possible to quickly define various variants for projects, portfolios and resource and skill structure. Thus companies may find out quickly and easily what would be the consequences on KPI’s such as resource utilization, shortterm liquidity and longterm profitability, when changes would be done to the digital twin of the project portfolio organization. Such changes are for example:

• changes in the number of projects being worked on in parallel
• changes in the scope, start and duration of of one or several projects
• changes in the setup of the overall portfolio: pause, stop or accelerate selected projects.
• changes in the number of employees and skill structure
• …

In short: There are many different adjusting screws in the project portfolio organization and setup that

• affect short term liquidity and long term profitability
• when in execution might cause resource / process bottlenecks costing lots of money and time

Benefits of a digital twin of a project portfolio

There are many benefits for companies working with a digital twin of a project portfolio, including:

• Improved Efficiency: A digital twin provides a standardized digital representation of a project portfolio and the overall resource pool. This allows stakeholders to visualize projects and their progress, no matter what tool is used to do the detailed planning. This helps for example
  • to identify potential future resource and process bottlenecks in the overall portfolio
  • to identify people having the rights skills and free capacity for a new project without causing resouce conflicts with other active projects.
• Better Decision-Making: A digital twin helps stakeholders make better decisions by providing them with standardized project and portfolio data plus simulation capabilities. This for example helps to easily find the portfolio scenario with the best KPI’s in terms of profitability, liquidity or resource utilization.
• Empowered People: A digital twin facilitates collaboration between different teams and stakeholders involved in the project portfolio. By providing a standardized digital project and portfolio representation, stakeholders, project manager and team are literally always on the same page. This empowers people on all hierarchy levels and facilitates taking corrective actions at the earliest possible time. This eliminates lots of failure cost and reduces the number of top management escalations by an order of magnitude.
• Reduced Costs and accelerated process: digital assistants take care of time-consuming, tedious and error-prone tasks such as
  • Report creation and update
  • Process compliant project creation
  • Making suggestions to start new projects without causing resource conflicts
  • Making suggestions to staff a project team having the right skills and free capacity

Overall, a digital twin provides all participants with a standardized view of a project portfolio and resource pool, allowing them to make more informed decisions, collaborate more effectively, and ultimately, achieve better project outcomes.