IT portfolio management – an instrument for corporate growth and value contribution-based planning

Sandra Rehle
02.10.2023
7 Min.
In a nutshell

Which measures and projects are important for the company’s success? Which measures add the most value to your company? How do you react to market changes with regard to measures and projects? How do you maintain an overview between prioritizations and rolling changes?

It portfolio management is far more than just a method for managing IT investments – it is a strategic tool for achieving corporate goals, utilising resources efficiently and reacting flexibly to changes.

Why is IT portfolio management so important?

The overarching management of the IT project landscape poses considerable challenges for many organisations:

  • Increasing demand from the business: More and more business areas require IT support, which increases the pressure on IT departments..
  • IT as a perceived cost driver: Without a clear strategy and transparency, IT expenditure can quickly get out of hand and cement the IT department’s reputation as a cost driver.
  • Maximise added value: Companies must ensure that the IT budget is utilised in such a way that it brings the greatest possible benefit.

In order to meet these challenges sensibly and sustainably in terms of increasing the value of the company, it is necessary for IT portfolio management to be the central control instrument. This is because it creates a clear overview, sets priorities and helps to increase the value contribution of IT for the company.

What exactly is IT portfolio management?

IT portfolio management is the central coordination of all IT investments – including projects, systems, services, infrastructure and existing IT resources. The aim is to optimise these investments in line with the company’s objectives without overloading the available resources.

The task of IT portfolio management is to ensure that the right measures are prioritised and implemented in order to achieve strategic corporate goals. This involves balancing short-term measures, long-term strategies and reacting to unforeseen market changes.

The central questions that ITPM answers:

Well-organised IT portfolio management provides answers to a large number of critical questions:

  • How do we maintain control over prioritisation and changes?
  • Especially in a dynamic environment, it is important to maintain an overview of decisions and their effects.
  • Which measures and projects are decisive for the company’s success?
  • The aim here is to define strategic priorities and ensure that IT investments optimally support the company’s objectives.
  • Which measures add the most value?
  • Not all projects are equally important. The ITPM helps to identify projects that offer a high return on investment (ROI). How do we respond to market changes?
  • Flexibility is crucial in order to be able to react quickly to market changes without completely discarding existing prioritisations.
  • How do we keep control of prioritisation and changes? Especially in a dynamic environment, it is important to maintain an overview of decisions and their effects.

Benefits and added value of IT portfolio management

Effective IT portfolio management offers far-reaching benefits. Defined processes for portfolio management can increase the transparency of planned and ongoing IT investments, support the implementation of strategic objectives and realise the overarching coordination of complex IT projects. For example, the automation of processes and visualisation via dashboards makes handling manageable and tangible in real time.

Practical implementation and best practices

In order to maximise the benefits of IT portfolio management, well thought-out planning and implementation are required. This includes:

  • Defined processes: Clear guidelines and workflows for prioritising and managing projects.
  • Use of technology: Modern tools and software solutions can increase transparency and facilitate control.
  • Stakeholder involvement: Close collaboration between IT and business units is crucial in order to fully understand and realise the needs of the company.
  • Regular review: Continuous monitoring and iterative adjustment of the portfolio ensure that it always remains aligned with the company’s current objectives.

Conclusion

IT portfolio management is an indispensable tool for companies that want to strategically manage their IT investments and maximise their value contribution. It not only offers transparency and control, but also enables dynamic and value-orientated corporate management.

You can find further insights in our blog article on IT product portfolio management, which looks at tried-and-tested approaches and successful applications. Benefit from the experience of the BAMAC Group and use IT portfolio management to sustainably promote your company’s growth.

About the author

Sandra Rehle is an experienced author in both academic writing and online content creation. Her major strength lies in making complex subjects understandable. After many years in academic and special interest publishing, she pursued a master's degree in History and Education Science. This multidisciplinary education enabled her to critically analyze complex topics and hone not just her research skills but also her ability to communicate in writing. Sandra Rehle has authored various publications, distinguished by clear language, thorough research, and innovative approaches. She is now responsible at BAMAC GROUP for presenting our topics in a relatable, clear, and evident manner, thanks to her unique perspective.

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