The crux of IT Portfolio Management lies in analyzing the right areas/projects a business should invest in, to gain maximum Return On Investment (ROI). The multi-layered methodology for implementing IT Portfolio Management ensures that resources, such as financial and human, are invested in projects which deserve them the most based on the value and criticality of each project towards the smooth functioning of the business as a whole.
It is the effective investment of the organizational resources that result in building and sustaining projects that reap maximum ROI for the business and also give organizations the competitive edge to excel in the respective business areas.
Risk Profile Analysis
A very important aspect of IT Portfolio Management lies in the Risk Management and Mitigation part of the process. As a part of the whole process of managing the portfolio, it is imperative to analyze the risks involved in each venture or project that a business undertakes. It not only helps in determining the potential threats to successful completion of any project but also helps the organization to prepare itself for such eventualities by having a mitigation plan in process.
IT Portfolio Management – Strategic Decision Making Tool
For the overall organization, IT Portfolio Management can provide clear data on the investments made on various projects and help the management make strategic financial decisions at the right time. At any given point in time, a well managed IT portfolio should be able to give clear understanding of the ROI and risks involved in any of the project investments made by the organization. Such a system can help an organization take strategic and informed decisions such as stalling the riskier than anticipated projects, re-budgeting for projects which need financial boost as their ROI is higher than anticipated and so on.
An effectively implemented IT Portfolio Management system serves a crucial role in an organization by providing critical information and raising timely flags to take corrective measures while arresting any eventuality which may cost an organization dearly, if ignored in the absence of any such governance model. Thus, it is important that IT Portfolio is managed by following the industry standard methodology that can be tailored for each organization depending on its business model and requirements. IT portfolio management provides the much needed governance for the investments made by the organization and plays a crucial role in not only maximizing the profitability of each business unit but also helps the organization as a whole gain a competitive edge in the market by being able to deliver on high value projects each time.