Project Portfolio Management Market Size, Share & Trends Analysis Report By Deployment Type (Cloud, On-premise, By Type, Solution, Services), By End-User Verticals (IT and Telecom, Healthcare and Life Sciences, Manufacturing, Construction, Retail and Consumer Goods, BFSI, Other End-user Verticals) and By Region(North America, Europe, APAC, Middle East and Africa, LATAM) Forecasts, 2023-2031

Market Overview

The global project portfolio management market size was valued at USD 5.09 billion in 2022. It is estimated to reach USD 7.18 billion by 2031, growing at a CAGR of 3.9% during the forecast period (2023–2031). The demand for digital transformation in several organizations to increase efficiency is expected to be a major market driver. Long-term cost benefits enabled by the timely use of planning and scheduling tools, coupled with growing demand for cloud-based PPM, are also expected to boost global market expansion.

Project portfolio management (PPM) relies on various tools and solutions to manage project-related tasks and analyze associated returns. It is efficient and cost-effective, enhancing visibility, governance, and transparency. It provides real-time project updates and controls the organization's workload management effectively. Project portfolio management monitors and evaluates changes closely, eliminates inefficiency, and maximizes returns.

PPM also enhances decision-making, increases accountability, and facilitates the monitoring of business priorities. It aids in the forecasting of risks and returns to maintain the portfolio's balance and concentrate on increasing productivity. It also facilitates the alignment of an organization's portfolio with its business strategy, objectives, and goals. PPM is useful for predicting problems, managing budgets, improving communication, and accelerating project completion.

Market Dynamics

Global Project Portfolio Management Market Drivers

Growing Demand for Digital Transformation in Organizations

The rising demand for digital transformation initiatives is expected to drive PPM market expansion. In contemporary business environments, enterprises increasingly prioritize digital transformation as a crucial endeavor to enhance their operational efficiency, customer experience, and competitive edge. This strategic focus on leveraging technology is observed across diverse industries. PPM also plays a crucial role in the effective management and execution of digital transformation projects.

PPM solutions enable organizations to evaluate digital transformation projects' potential impact, risks, and benefits and ensure that resources are allocated to the most essential projects. PPM solutions assist businesses in maximizing resource allocation by identifying resource gaps, capacity management, and resource alignment with high-impact projects. This increases the overall success of efforts to implement digital transformation by ensuring the efficient use of resources and the support of essential projects. Thus, the rising demand for digital transformation among organizations is expected to boost market growth.

Robust Demand for Cloud-Based PPM Technologies

The emergence of cloud computing has substantially revolutionized the project portfolio management (PPM) sector and bolstered its appeal as a result of its myriad benefits. Cloud-based PPM systems offer scalability because an organization's project management capabilities can be expanded or contracted as needed. They can instantly add or delete users, adjust storage capacity, and use additional capabilities without investing heavily in hardware or going through complicated configuration processes.

In addition, the vast majority of cloud-based PPM systems are subscription-based, allowing businesses to pay only for the services they employ. As a result, expensive upfront expenditures for infrastructure maintenance, software licenses, and hardware are no longer required. Organizations can also obtain the most recent capabilities, bug fixes, and security patches due to the service provider's ongoing updates for cloud-based PPM solutions. This removes the need for manual software updates and reduces the IT staff's workload, enabling them to focus on other crucial tasks. All these benefits of cloud-based PPM are driving market growth.

Global Project Portfolio Management Market Restraint

Challenges About Security

Numerous firms exhibit caution in allocating resources toward adopting project portfolio management (PPM) systems, primarily driven by apprehensions surrounding security. Cloud technology has been integrated into various professional applications, including project portfolio management (PPM). The issue of security accompanies the increased flexibility and productivity of the system. Data security concerns are heightened when the data is situated within a foreign country's data center and fails to meet established standards, such as ISO 27001. These factors impede the expansion of the market.

Global Project Portfolio Management Market Opportunities

Integration of Modules and Add-Ins and Increased Collaboration by Key Players

The market for portfolio management solutions is in transition as users pressure established market players to offer dynamic business operations. In order to enhance the functional capabilities of PPM systems, users have the ability to install additional content add-ins and customize integrations. For instance, Clarity, a PPM platform, offers integration options to work with data from multiple sources. Users have the flexibility to integrate the right set of add-ins and modules as per the business requirement.

Furthermore, in February 2021, Pinnacle Management Systems, Inc., a program and project management consulting and training services provider, and Deltek, an enterprise software and information solutions provider, announced their strategic solutions partnership. Pinnacle offers integration, training, implementation, and support across the Deltek Project and Portfolio Management (PPM) suite of products, and this partner program will enable the company to substantially strengthen its relationship with Deltek and improve the value provided to its customers using Deltek solutions. Such collaborations by key players are creating opportunities for market growth.

Regional Analysis

North America Dominates the Global Market

Based on region, the global project portfolio management market is bifurcated into North America, Europe, Asia Pacific, Latin America, and the Middle East and Africa.

North America is the most significant global project portfolio management market shareholder and is anticipated to exhibit a CAGR of 3.51% during the forecast period. North America is expected to have a significant revenue share compared to other regional markets. Due to the region's financial status, significant investments in cutting-edge technology and resources for effective project execution can be undertaken. Similarly, the strong presence of several well-known project portfolio management solution providers in North America, such as Microsoft Corporation, Oracle Corporation, and Workfront, will likely significantly drive the market's growth in this area. In addition, North America is a considerably developed market, owing to several companies working on project portfolio management tools. Bulk data integration techniques and tools are most efficiently implemented to identify data synchronization patterns in critical end users, such as BFSI or government initiatives.

Furthermore, the growing IT budgets in this region are also one of the key driving factors of the market's growth. According to the research, IT's future state indicates that the number of companies expecting budget increases will soar in 2022, and budget growth expectations have risen significantly higher than in previous years. Overall, 53% of businesses are in North America.

Europe is estimated to exhibit a CAGR of 4.3% over the forecast period. The demand for project portfolio management is increasing in Europe with the ever-increasing penetration of projects to organize work in many organizations, necessitating effective management of multiple projects. This resulted in the greater interest of many sectors, including manufacturing, IT and telecom, and healthcare, in the project portfolio management tools to automate and assist the process. The growing healthcare infrastructure in Europe, e-hospitals, and e-ordering also witnessed an exponential increase in demand for PPM tools. The healthcare IT sector in Europe experienced substantial growth due to recent technological advancements. The rise in digitalization is considered another critical factor for market growth.

In addition, the adoption of healthcare IT systems has increased over the past few years to improve chronic disease management (CDM), owing to the global prevalence of chronic diseases. Continuous enhancements in network infrastructure and growing network coverage further create several growth opportunities for industry players.

The Asia-Pacific regional market is expected to maintain rapid growth because of the presence of emerging nations like India and China. The surging adoption of wireless devices like mobile phones, laptops, and tablets characterizes the growth of the PPM market in this region. The surging complexity of business functions due to multiregional operations and outsourcing activities is expected to accelerate the adoption of project portfolio management solutions in the region. In the future, the Asia-Pacific is expected to have significant revenue growth. Due to multiregional activities and outsourcing practices, the increasing adoption of project portfolio management solutions is expected to propel business operations to become more advanced. The expansion of SMEs in this region is anticipated to accelerate the adoption of such solutions because they offer predictive analytics and effective resource management capabilities that help SMEs manage their financial resources more effectively.

The Middle East is on the verge of massive digital disruption. Several nations, including the UAE, Bahrain, and Qatar, lead the digital consumer charge. Innovative uses of digital technology by various businesses around the Middle East highlight the promising momentum in this space. Governments and companies in the Middle East are starting to recognize the global shift toward AI and cutting-edge technologies due to the fourth industrial revolution. The market's demand for project portfolio management is increasing as the UAE witnessed a significant digital transformation, supported by a government focusing on developing all required digital infrastructure through substantial spending and attracting private investments.

Segmental Analysis

The global project portfolio management market is segmented by deployment type, type, and end-user vertical.

Based on deployment type, the global project portfolio management market is divided into cloud and on-premise. 

The cloud segment is the largest revenue contributor to the market and is expected to exhibit a CAGR of 5.3% throughout the forecast period. Cloud PPM, the combination of cloud and PPM, is emerging rapidly; it facilitates collaborative scheduling, planning, and quicker and more effective decision-making. The massive adoption of cloud analytics, which enhances business effectiveness for SMEs, is one of the determinants supporting the growth of this market. The increasing demand for large-scale project management is one of the key growth drivers of the market for cloud-based project portfolio management.

On-premise PPM solutions offer end-users enhanced control over data. These solutions also provide significantly better threat protection compared to cloud deployments. The availability of expertise among staff and the sufficient provision of resources are necessary for deploying on-premise solutions. This kind of deployment, structured in multi-layer or annual plans, removes the requirement of monthly expenses. Similarly, they can be customized to an organization's processes and regulatory requirements. Cloud solutions, which are being progressively adopted, still face the challenge of security concerns. Hence, on-premise solutions are expected to play a significant role in the market soon.

Based on type, the global project portfolio management market is bifurcated into solutions and services. 

The solution segment dominates the global market and is expected to exhibit a CAGR of 3.7% over the forecast period. Diverse verticals widely use PPM solutions, including energy and utilities, IT and telecom, government and defense, BFSI, manufacturing, consumer goods and retail, and healthcare and life sciences. Moreover, owing to the advancements in artificial intelligence (AI) and machine learning, the role of AI in project portfolio management is growing. The data-interpretation competence of AI can deliver real-time insights into project metrics. It can facilitate project managers to make data-driven decisions depending on historical data and experience. For instance, Capgemini utilizes the cognitive computing system IBM Watson to enhance project resource deployment via efficient planning.

The service segment comprises support and maintenance, integration and deployment, and training and consulting services. The service segment is expected to witness growth during the forecast period. The surging demand is due to the rising innovative services offered by market players, such as process improvement, process assessment, and reporting and analysis. Service providers are trying to offer a customized solution either remotely or on-premise. The components of these types of services include assistance at the time of solution implementation and data migration, among others.

Based on the end-user vertical, the global project portfolio management market is segmented into IT and telecom, healthcare and life sciences, manufacturing, construction, retail and consumer goods, BFSI, and other end-user verticals. 

The IT and telecom segment owns the highest market share and is estimated to exhibit a CAGR of 3.6% during the forecast period. PPM enables control, visibility, accuracy, and consistency to protect business alignment with the Enterprise Project Management Office (PMO) ecosystem when many IT projects use agile or hybrid project management disciplines. Software development and IT infrastructure projects in today's PMO require high governance standards. However, most innovative, competitive IT projects often must be delivered using agile project management methods. A PMO with top-down IT project control using built-in governance and integrations with agile PPM tools lends consistent, collaborative, and strategic power to business initiatives.

The healthcare sector is anticipated to experience substantial growth over the forecast period. The healthcare industry faces numerous challenges, including unreliable data quality from complex projects. Therefore, vendors offer PPM solutions to this sector to lessen costs and improve patient care and quality, reduce equipment installation time, decrease readmission rates, accelerate the automation of electronic medical records (EMR), and minimize waiting time to optimize revenue cycles.

Recent Developments

• March 2023: Microsoft entered the project planning market by introducing Loop, a collaboration and workplace productivity application already viewed as a competitor to Notion.
• April 2023: StrategyBlocks, the renowned cloud-based solution for strategic planning, portfolio management, and execution, introduced StrategyBlocks 6, the newest version of its enterprise strategic management platform (SB6).