PFMP · Question #645
Assume your consulting company tried portfolio management in the past, but it was not embraced. Instead, people received bonuses if they were able to acquire new work regardless if it fit the…
The correct answer is C. Deliver the maximum value aligned with strategic objectives. The fundamental purpose of portfolio management is to deliver maximum value aligned with the organization's strategic objectives. The prior failure described-rewarding new-work acquisition regardless of strategic fit-is a classic symptom of the absence of this principle. The…
Question
Assume your consulting company tried portfolio management in the past, but it was not embraced. Instead, people received bonuses if they were able to acquire new work regardless if it fit the company's strategic plan. However, the company was sold, and the new executive team asked you to be the portfolio manager. You explained it did not work in the past, but the new team has pointed
Options
- Aout while a lot of work was won competitively, much of it was for small dollar amounts, and
- BAs chieve the greatest return on investment to the organizationBb. aximize productivity and
- CDeliver the maximum value aligned with strategic objectives
- DFocus on those opportunities that have the greatest likelihood of successful completion
How the community answered
(29 responses)- A7% (2)
- B3% (1)
- C72% (21)
- D17% (5)
Explanation
The fundamental purpose of portfolio management is to deliver maximum value aligned with the organization's strategic objectives. The prior failure described-rewarding new-work acquisition regardless of strategic fit-is a classic symptom of the absence of this principle. The new executive team recognized that winning high-volume but low-dollar, non-strategic work did not serve the organization's long-term interests. Portfolio management corrects this by ensuring every component is selected and prioritized based on strategic alignment and value contribution, not just profitability (A), productivity (B), or completion likelihood (D).
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