How to Prioritize Projects Within a Business Portfolio
A project portfolio needs specific management attention to ensure that portfolio projects are managed and meet the organizational strategic vision. Quoted in the CIO magazine: "A portfolio management approach attempts to take the politics out of investment decisions by taking a bird's-eye view." Using the bird's-eye view, senior managers can focus on the essential projects and prioritize them as needed by the organization. Project prioritization within a portfolio is an on-going activity; although a project might have been approved at the beginning of the year, if the company takes a different direction then project priorities need to be re-evaluated.
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Instructions
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Establish prioritization criteria by reviewing the company/department goals. List and number the goals by priority. Examples of goals can be: 1) reduce expenses; 2) improve customer service; 3) increase revenue through technology; 4) improve order fulfillment.
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Order all projects within the portfolio by project budget size. The best method to do this is to list them in a spreadsheet with the highest funded/budget at the top.
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Add beside the budget number, the number associated with the company goals in Step 1. The key here is to only pick one priority number.
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Add beside the company goal number the number of individuals assigned to the project in whole numbers. This will give you an idea how many resources are associated with this project.
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Sort the list of projects by the company goal number and review the projects at the top. Using this list, you can review the priority projects in your portfolio. And by having the budget and resource information, re-assignment of funds and resources can be made to match your portfolio priorities.
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