What is portfolio management?



Definition

Portfolio management is the selection, prioritisation and control of an organisation’s programmes and projects, in line with its strategic objectives and capacity to deliver.

The goal is to balance the implementation of change initiatives and the maintenance of business-­as­-usual, while optimising return on investment.

Definition from APM Body of Knowledge 7th edition  📖

Portfolio


A portfolio is a collection of projects and/or programmes used to structure and manage investments at an organisational or functional level to optimise strategic benefits or operational efficiency. They can be managed at an organisational or functional level.

Where projects and programmes are focused on deployment of outputs, and outcomes and benefits, respectively, portfolios exist as coordinating structures to support deployment by ensuring the optimal prioritisation of resources to align with strategic intent and achieve best value

To shape the portfolio, the sponsor and portfolio manager seek out visibility of plans of the constituent projects and programmes agree how to reshape those constituent parts depending on:

  • The organisation’s ability to resource the whole portfolio.
  • Any changes to strategic direction or pace of strategic implementation.

In a strategic portfolio, governance may be aligned entirely with corporate governance. Where this is not the case, it is vital to establish clear understanding and buy-in to the portfolio prioritisation process from the executive team. In a portfolio, it is normal for sponsors of projects, to be required to sacrifice their project priorities for the benefit of the wider portfolio.

Portfolio plan


A portfolio plan is a depiction in words and diagrams of what the portfolio comprises, its major dependencies, expected timescales and major deliverables, defining how the portfolio will be managed. Supporting analyses may include cost and benefit schedules, key risks and major stakeholders.

Portfolio risks


Portfolio risks would typically cover those internal and external events that will impact on the portfolio overall rather than any single project or programme. They may include such things as resource availability, implementation capacity, investment constraints and regulatory matters.


Portfolio Management –
A practical guide


Portfolio Management – A practical guide

View in bookshop


Blog


Portfolio management? How do I even get that near a meaningful agenda?
Project and programme management are well understood as a means of delivering effective outputs and outcomes; portfolio management still seems to be challenging organisations in terms of...

My journey to portfolio manager
Simon Darby is portfolio manager at APM, discusses his views on portfolio management and how he got to where he is now... read more 

Master strategic goals with portfolio and benefits management
Meeting strategic goals in a consistent and efficient way is extremely valuable. Project managers should help to guide the board to invest money and resources in the right projects and programmes at the right time... read more

Is there a difference between portfolio value and portfolio benefits?
At a recent SIG event a delegate asked the above question, which caused a few head itching moments for us committee members.

Engaging senior stakeholders: challenges in portfolio management
It was an exciting experience to attend the “Shaping your portfolio to realise organisation strategy”- Portfolio Management SIG conference... read more


Research


Projects, programmes and portfolios, so what is the difference?
Merys Hopkins, first looked at portfolios, which APM define as a grouping of an organisations projects and programmes... read more

"Managing the Portfolio" series 
These reports provide a brief and practical insight into the journey to implement and embed portfolio management within an organisation... read more

Project portfolio management in practice and in context
This research advocates new approaches and perspectives on project portfolio management to deepen understanding of its application in the day-to-day business environment... read more

Agile portfolio management: An empirical perspective on the practice in use
This research examines the application of agile project management to project portfolios within large organisations... read more

An exploration of the extent to which project management can be applied across creative industries
This paper investigates whether project management tools and techniques can be used effectively in the creative industries... read more

 


APM Body of Knowledge 7th edition


You can read more about projects, programmes and portfolios in chapter two of the APM Body of Knowledge 7th edition.

The APM Body of Knowledge 7th edition is a foundational resource providing the concepts, functions and activities that make up professional project management. It reflects the developing profession, recognising project-based working at all levels, and across all sectors for influencers, decision makers, project professionals and their teams.

The seventh edition continues in the spirit of previous editions, collaborating with the project community to create a foundation for the successful delivery of projects, programmes and portfolios.

APM Body of Knowledge

 




APM Portfolio Management Specific Interest Group (SIG)


The Portfolio Management SIG ensures organisations invest in the ‘right’ projects/programmes to support their strategic objectives.

APM portfolio management SIG

Could you be a project manager?


A good place to start is to visit our careers section; this provides you with the tools and resources to begin your project management journey.

APM Careers

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