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The words ‘projects,’ ‘programs,’ and ‘portfolios’ are often used interchangeably. However, they are distinct parts of project management. Knowing the difference is key to mastering the basics of project management.
This article clarifies the differences and similarities between projects, programs, and portfolios, providing a practical overview of each.
The Project Management Institute (PMI) defines a project as ‘a temporary endeavour undertaken to create a unique product, service, or result’.
But what does this mean?
It means a project is a one-time job with a clear goal, like building a house, launching a new app, or planning a wedding. It has a start, an end, and a plan to get things done. Unlike daily work, a project is temporary—it finishes when the goal is met.
Project management is the art of making sure the project runs smoothly. It’s about planning, organising, and leading a team to get things done on time, within budget, and without chaos. A project manager keeps everything on track, solves problems, and makes sure everyone knows what they need to do.
A project is a lot like a road trip. You have a destination (project goal), a map (project plan), and a budget. You decide who’s coming (project team), what to pack (resources), and how long it’ll take. Project management is making sure you don’t run out of petrol, get lost, or blow all your money on snacks before you reach the finish line.
To learn more about scope, budget, and timeline, read our article on the ‘Triple Constraint’ of Project Management.
Projects are undertaken in nearly every industry. For example:
For more information, see our article ‘What is a Project? Key Elements Explained for Aspiring Project Managers’.
A program is a collection of related projects, managed in a coordinated way. The goal of a program is not just to complete individual projects, but to deliver broader benefits that align with an organisation’s long-term strategy.
A program is ongoing and adapts to changes in the business environment, which sometimes involves adjusting the scope of its individual projects. However, a program is temporary – the program is complete when all projects within are complete (although the addition of new projects to a program can extend the program timeline).
Click here to learn more about program management.
A portfolio refers to a collection of programs and projects that are grouped together to achieve strategic objectives for an organisation. Portfolios are typically larger in scope and may span multiple areas of an organisation.
The aim of a portfolio is to prioritise and manage resources effectively to ensure the business achieves its long-term goals. Unlike programs, portfolios do not need to be comprised of connected projects and programs, however, portfolios should be aligned with the strategic direction of the business.
Click here to learn more about portfolio management.
Stockland is a leading property developer in Australia. Stockland has constructed a commercial building at 15 Khartoum Road, Macquarie Park, Sydney. This building is an example of a construction project. It has project constraints – a budget, a date for completion in 2025 and a defined scope. The project resulted in a unique product: 10,000 m2 of office and retail space at 15 Khartoum Road. There will be no other building in the world that is identical in these characteristics.
The building at 15 Khartoum Road is part of Stockland’s broader M Park precinct in Macquarie Park, NSW. The M Park precinct, as planned, involves the construction of 10 discrete buildings (including commercial buildings, residential buildings and a data centre). The buildings are located on the same or adjoining blocks of land. Each building in the M Park precinct is a project.
Taken together, these individual projects form a program. The M Park program aims to create a vibrant, green precinct in Macquarie Park. The program will be completed when the last building is constructed (including any additional buildings which have not been announced).
By constructing these buildings in a similar location under a broader timeline, Stockland gains construction efficiencies. For example, Stockland can negotiate contracts with suppliers that provide Stockland with better value for money, and avoid mobilisation and demobilisation costs for each building.
In creating a residential and commercial hub, Stockland also increases the attractiveness of renting space in each of the M Park buildings (including 15 Khartoum Road). This benefit would not be created by any individual building. The M Park program also creates a strategic benefit to Stockland by positioning it as the leading commercial and residential developer in Macquarie Park, NSW.
The M Park Precinct is part of Stockland’s broader property portfolio (as detailed in Stockland’s 2024 Property Portfolio Report). These projects are wide-ranging and unrelated, including 32 logistic properties, 10 workplace assets, 16 town centre properties, 43 master planned communities and 41 land lease communities across Australia. Together, these properties help Stockland achieve its strategic objective of creating ‘thriving communities with dynamic town centres where people live, shop and work’.
Grasping the differences between projects, programs, and portfolios is essential for effective resource management and driving organisational success. Each concept has its role:
Knowing these differences helps in resource allocation, ensuring proper distribution of time, budget, and resources. It improves risk management, as programs and portfolios allow risks to be monitored across multiple projects. Furthermore, applying these concepts ensures better strategic alignment, as projects and programs contribute to long-term business goals within a portfolio.
Clear differentiation enhances communication across teams and stakeholders, making roles and expectations more transparent. This clarity ensures smoother project execution, alignment with objectives, and overall success.
With a clear understanding of these terms, you can approach project management confidently, enhancing both the success of your projects and the strategic growth of your organisation.
Want to expand your knowledge of projects, programs and portolios? Join our free Project Management Community here.
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