Portfolio Management
Abstract
Complete portfolio visibility helps organizations make informed decisions on where funding should be cut or increased. Storing portfolio-related data in a spreadsheet presents inherent data accessibility issues. There is no simple way to analyze an entire portfolio with different criteria from various sources, thereby limiting the visibility around go/no go decision making. This paper examines how an integrated Portfolio Management product like Oracle’s Primavera Portfolio Manager maintains portfolio information in one location, allowing portfolio managers to prioritize based on strategic business objectives.
What is a Portfolio?
A Portfolio is a collection of investments that aims to maximize value while constraining risk. Some organizations see this collection of investments as projects (temporary endeavors undertaken to create a unique product, asset, service, or result) and/or programs (a group of related projects managed in coordination as a way to obtain benefits and control not available from managing them individually). Other work can also be grouped together to facilitate the effective management of that work to meet strategic business objectives and alignment. The components of the portfolio are quantifiable, in that they can be measured, ranked and prioritized.
A portfolio reflects planned or actual investments that are aligned with the organization’s strategic goals and objectives; it is where priorities are identified, investment decisions are made and resources are allocated. If the portfolio’s components are not aligned to the organization’s strategy, then the organization can reasonably question why the work is being undertaken.
What is Portfolio Management?
Portfolio Management is the centralized management of one or more portfolios which includes identifying, prioritizing, approving, managing and controlling projects, programs and other related work to achieve specific strategic business objectives. Portfolio Management enables the organization to explicitly assess the trade
offs among competing investment opportunities in terms of their benefit, costs, and risks.
Portfolio Management has a broader context than traditional project management since it emphasises a collective response to organizational needs during the planning and execution of these projects. Naturally, in an informed Portfolio Management environment, projects are added to the portfolio, and subtracted from it, based on their overall contributions to the corporate vision and strategic needs. This process is unlike traditional project management, which focuses on only managing a standalone project bounded by a budget, schedule, and scope. Portfolio Management is regarded as a critical discipline for organizational success, especially in multi project environments.
How Organizations Benefit from the Practice of Portfolio Management
Prescience Technology provides integrated project controls services to support large capital intensive projects in the Transport, Infrastructure, Construction, Mining, Oil & Gas, Energy and Water industries, and State and Local Government sectors. We have found that, globally, resources are becoming scarcer, external environments are far more volatile and the rate of change is increasing. The impact is that organisations have to achieve “more with less” and must have a greater capability to be agile in order to respond effectively and efficiently to the challenges they face.
Prepared by Wayne Wilson
Chief Operating Officer,
Prescience
Technology
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