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.
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.
Understanding the needs of your client and preparing an investment policy statement represent the first steps of the portfolio management process. Those steps are followed by asset allocation, security analysis, portfolio construction, portfolio monitoring and rebalancing, and performance measurement and reporting.