PFMP · Question #621
Your State Governor is fiscally conservative and has limited significantly the financial resources to be provided to each University in the eight Universities in the State's system. Recognizing your U
The correct answer is B. An effective resource assignment process is required. When an organization faces a severe budget reduction (55% in this case), the most critical requirement for effective portfolio management is an effective resource assignment process. With drastically limited resources, the portfolio manager must systematically allocate what littl
Question
Your State Governor is fiscally conservative and has limited significantly the financial resources to be provided to each University in the eight Universities in the State's system. Recognizing your University is going to have a 55% reduction in its budget, your Chancellor is re-evaluating all the work that is under way to see how much it can do with fewer resources. Every department will have layoffs at all levels. However, the University does have a portfolio management process in place, which people support. This means for effective portfolio management:
Options
- AEach portfolio in the University should have the same restrictions in terms of available funding
- BAn effective resource assignment process is required
- CPareto analysis should be used to focus attention on those components with the greatest impact
- DPortfolio maturity should be a factor in determining plans and decisions
How the community answered
(38 responses)- A3% (1)
- B76% (29)
- C8% (3)
- D13% (5)
Explanation
When an organization faces a severe budget reduction (55% in this case), the most critical requirement for effective portfolio management is an effective resource assignment process. With drastically limited resources, the portfolio manager must systematically allocate what little is available to the highest-priority components. Without a disciplined resource assignment process, departments will compete for resources ad hoc, leading to suboptimal outcomes. Option A is incorrect because imposing the same restrictions on every portfolio ignores differing strategic priorities. Option C (Pareto analysis) is a useful analytical tool but is not a foundational requirement for portfolio management effectiveness. Option D (portfolio maturity as a factor) is a valid consideration in some decisions but does not address the core challenge of constrained resource deployment.
Community Discussion
No community discussion yet for this question.