Though it was written seven years ago, the relevance of this article in today’s economic scenario could not be understated. In the light of, what we have seen in last two years, Enron’s bankruptcy has receded to the back corners of most everyone’s mind. Diversification of portfolio has been a widely used concept of the financial world for a long time. But it has been a lifeline for investors in the midst of crashing industry giants like Ford, GM, Lehman Brothers, Freddie Mac and Fannie Mae.
Project portfolio management manages projects in the same manner as an investor would manage his stocks, bonds and mutual funds. It is much easier to balance resources and control the project when executives have an overall view of the project portfolio. More and more organizations are focusing on projects as portfolio of investments to produce maximum possible return on investment. In other words, money is allocated on necessary projects and redundant projects are eliminated.
Project portfolio management software is being increasingly used to simplify the process of building a portfolio. Portfolios can be assembled and assessed based on how they meet strategic needs of a particular business. The success of a portfolio is measured by metrics describing important milestones. The achievement of milestones is naturally tied to performance evaluation and bonuses.
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