The balanced portfolio – it starts with your goals

Big Pond

These days, when people think about balancing their portfolio they most commonly worry about their bond to stock ratio but, as a company, your investment portfolio is more likely to be a suite of initiatives.  So, how do you decide which projects fit best in the portfolio so that you maximize your ability to achieve your long-term goals?

In many organizations, a list of initiatives is developed by multiple people across business units based upon both long-term objectives and immediate needs.  Each initiative may seek to achieve a specific objective and, hopefully, these are aligned towards Corporate Goals and have a strong Business Case supporting their need.  What is often missing from this picture is an evaluation across the portfolio to ensure these initiatives will work together to meet your long-term objectives.

Performing Strategic Portfolio Management should provide you with new ways to look at your investment portfolio.  Based upon your Corporate Goals, determine what is important to your organization and then evaluate each project based upon how it will support these goals.  Do you seek to be innovative, reach new customers, launch a new product, support existing products, improve internal efficiency, reduce costs?

A balanced portfolio should allow you to achieve multiple goals.  If you have Corporate Goals that are unsupported by initiatives in your portfolio, how do you plan to achieve them?

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