--- title: "Project portfolio management" subject: "ICT Project Management" chapter: 3 key: "semester_7/ict_project_management:portfolio-management" source: https://www.bctengineer.com/q/semester_7/ict_project_management/portfolio-management site: BCT Engineering --- # Project portfolio management ICT Project Management · Chapter 3: Portfolio and Project Management Institutes’ (PMI) Framework - Asked in: year not given - Answer checked by Claude Opus 5.5 (high effort) on 2026-10-14 - Page: https://www.bctengineer.com/q/semester_7/ict_project_management/portfolio-management - Whole chapter: https://www.bctengineer.com/md/semester_7/ict_project_management/chapter-3 ## Question What do you mean by project portfolio management? ## Short answer Project portfolio management is centralised management of a collection of projects and programs to achieve strategic objectives. It involves selecting, prioritising, allocating resources, monitoring and terminating projects based on value, risk and strategic fit. ## Answer **Project portfolio management** is the centralised management of one or more portfolios of projects, programs and related work, so that the organisation's strategic objectives are achieved. A **portfolio** is a collection of projects or programs grouped together to meet strategic business goals; projects need not be related to each other. #### Purpose - Select the right projects (do the right things) rather than only manage them well. - Allocate limited money, people and time to projects with the highest value. - Balance risk, return and strategic fit. #### Hierarchy ```text Organisation strategy | Portfolio / \ Program Program / Projects | Projects ``` #### Key activities 1. **Identify** candidate projects and categorise them. 2. **Evaluate and select** using criteria such as ROI, NPV, payback, strategic alignment, risk and resource availability (scoring models). 3. **Prioritise** and balance the portfolio (short vs long term, high vs low risk). 4. **Allocate resources** across selected projects. 5. **Monitor and review** performance; continue, change or terminate projects. 6. **Report** to senior management. #### Portfolio, program and project | Level | Focus | |---|---| | Portfolio | Strategic alignment, value | | Program | Related projects coordinated for benefits | | Project | Deliver a specific output | #### Benefits Better use of resources, links projects to strategy, improved decision making, early termination of poor projects and transparency. **Example:** A bank's IT portfolio contains a mobile banking app, core system upgrade and cybersecurity project. The management ranks them by strategic value and budget, and delays a low-value project when funds are short. ## Check yourself The answer's key points as multiple-choice questions, with the correct option and why. 1. A portfolio is: A. A single large project B. A collection of projects or programs grouped to meet strategic business goals, not necessarily related C. Only related projects with one manager D. A team of developers Answer: B. Projects in a portfolio need not be related; they share strategic goals. (Key point: Portfolio definition) 2. The main purpose of portfolio management is to: A. Do projects faster B. Reduce the team size C. Select the right projects and allocate resources to those with highest value D. Write the WBS Answer: C. It is about doing the right projects, not only managing them well. (Key point: Purpose) 3. Which criteria are used to evaluate and select projects in a portfolio? A. ROI, NPV, payback, strategic alignment, risk and resource availability B. Team size only C. Colour of logo D. Length of the schedule only Answer: A. Scoring models use financial, strategic and risk criteria. (Key point: Selection criteria) 4. A program differs from a portfolio in that a program: A. Focuses on strategic value of unrelated work B. Contains no projects C. Coordinates related projects for benefits D. Is a single output Answer: C. Program: related projects coordinated for benefits; portfolio: strategic alignment and value. (Key point: Portfolio vs program) ## Related in ICT Project Management - [Project management body of knowledge](https://www.bctengineer.com/question.md?key=semester_7%2Fict_project_management%3Adefine-pmbok) — ICT Project Management, chapter 2 - [General management skills and project management](https://www.bctengineer.com/question.md?key=semester_7%2Fict_project_management%3Ageneral-management-skill) — ICT Project Management, chapter 2 - [Define project management](https://www.bctengineer.com/question.md?key=semester_7%2Fict_project_management%3Adefine-project-management) — ICT Project Management, chapter 4 - [System view of project management](https://www.bctengineer.com/question.md?key=semester_7%2Fict_project_management%3Asystem-view-three-parts) — ICT Project Management, chapter 5 - [Project management methodology](https://www.bctengineer.com/question.md?key=semester_7%2Fict_project_management%3Apm-methodology) — ICT Project Management, chapter 7 - [Project management information system](https://www.bctengineer.com/question.md?key=semester_7%2Fict_project_management%3Apmis) — ICT Project Management, chapter 7 ## Related in other subjects - [Function of project management in Nepal](https://www.bctengineer.com/question.md?key=semester_8%2Fconstruction_management%3Acpm-function-nepal) — Construction Management, chapter 1 - [Types of projects; effect of project management](https://www.bctengineer.com/question.md?key=semester_7%2Fproject_engineering%3Aproject-types-effect-of-management) — Project Engineering, chapter 1 - [Project vs traditional management; external environment](https://www.bctengineer.com/question.md?key=semester_7%2Fproject_engineering%3Aproject-vs-traditional-mgmt-external-env) — Project Engineering, chapter 1 - [Project management and its functions](https://www.bctengineer.com/question.md?key=semester_7%2Fproject_engineering%3Aproject-management-and-functions) — Project Engineering, chapter 1