Definition
Portfolio managementis 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 fromAPM Body ofKnowledge7th edition
Buy APM Body of Knowledge
Portfolio
A portfolio is a collection ofprojectsand/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 aportfolio, it is normal for sponsors of projects, to be required to sacrifice their project priorities for the benefit of the wider portfolio.
Watch: What is portfolio management?
This video is hosted by a third party (YouTube.com), you cannot view this video content unless you accept marketing cookies. If the popup doesn't appear, please clear your browser cache and refresh the page.
Portfolio plan
Aportfolio planis 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
This guide illustrates how portfolio management is a key mechanism in enabling an organisation to optimise delivery of its strategic goals, maximising value, and do so in the required time frame.
Buy from bookshop
Related reading
Meeting strategic goals in a consistent and efficient way is extremely valuable... read more.
Portfolio management includes the selection, prioritisation and control of projects and programmes which are aligned with the organisations strategy and objectives... read more.
At a recent SIG event a delegate asked the above question, which caused a few head itching moments for us committee members... read more.
As a Master’s student from WMG, University of Warwick my research dissertation focuses on “ Portfolio management – engaging senior stakeholders”... read more.
This research examines the application of agile project management to project portfolios within large organisations... read more.
The emergence of projects as the economic engine of our times has been quiet, but is incredibly disruptive and powerful... read more.
APM Portfolio Management Interest Network
The Portfolio Management Interest Network ensures organisations invest in the ‘right’ projects/programmes to support their strategic objectives.
Get involved in the community
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.
Buy from the bookshop
You may also be interested in
The APM Learning portal is an online resource which provides members with access to digital guides, modules and other digital learning resources as part of the membership benefit.
Browse our popular project management 'What is ...?' topics for definitions, quick insights, view related case studies, research, blogs and glossary.
Project – APM's official journal – is circulated quarterly for members only, and online for regularly updated news, blogs, opinions and insights for those in the project community.
The APM Community is our online community platform that connects our members faster and easier than ever before.
