Portfolio Management Involves Managing Several Projects Essay

Pages: 2 (863 words)  ·  Bibliography Sources: 2  ·  File: .docx  ·  Topic: Business - Management

¶ … portfolio management involves managing several projects each with an aim of maximizing the profits for the organization as you keep the expenditure to the possible minimums. Many organizations have discovered the pros of managing their projects in relation to other departments of the organization instead of treating each project as an isolated unit. There is a growing interdependence of projects in many organizations and the treatment of project-by-project where the Net Profit Value (NPV) was looked into before picking out one project to pursue is dying out.

While the previous method considered the projects to be independent of each other and that the projects had not tight relationship or common factors with the other activities of the organization, the current trend assumes that each department is dependent on the other and that the progress of one department is a concern of the other. This gives the organization the impetus of moving ahead together as a whole unit making the achievement of the strategic goals easier and more coordinated (Tom Adams, 2001).

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The other reason why there must be a link between the project portfolio management and the strategic goals of the organization is to enable the ease of allocation of funds to the various departments with a view of balancing all the departments and creating equality (Siemens Product Lifecycle Management Software Inc., 2011). This is based on the fact that all departments interact and are all affected by some factors like the performance targets, market fluctuations and the technical risks. Even is there is explicit relationships and links between the departments, they still interact in the sense that investing too much on one department may suppress the performance of the other through deprivation of resources hence the appropriate inclusion of the project portfolio into the strategic planning like other departments will help balance the business requirements.

TOPIC: Essay on Portfolio Management Involves Managing Several Projects Each Assignment

Portfolio management can also be viewed as the bridge that connects the company's business strategy or vision and the projects collection that will see the vision into completion or fruition. The corporate strategy and the measurements standards used to measure these strategies together with the long-term targets will form the base of this endeavor to accomplish the vision. For instance the results of the existing base of the company's business can be juxtaposed against the targeted metrics like net cash flow, earnings, reserves and production (Plan View Inc. 2011). All these are factors are significant in the achievement of the organizational strategic plans and goals.

SECTION II

In the past, there had been the common trend of each department specializing in the thing… [END OF PREVIEW] . . . READ MORE

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"Portfolio Management Involves Managing Several Projects."  Essaytown.com.  August 30, 2011.  Accessed October 27, 2021.
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