The promise of IT portfolio management is the portfolio management system pdf of previously informal IT efforts, enabling measurement and objective evaluation of investment scenarios. Debates exist on the best way to measure value of IT investment. IT investments and yet the headlines of mis-spent money are not uncommon.
IT industry and academia by positioning IT as an expense similar to utilities such as electricity. IT portfolio management started with a project-centric bias, but is evolving to include steady-state portfolio entries such as infrastructure and application maintenance. IT budgets tend not to track these efforts at a sufficient level of granularity for effective financial tracking. Finally, assets in an IT portfolio have a functional relationship to the organization, such as an inventory management system for logistics or a human resources system for tracking employees’ time. IT portfolio management is distinct from IT financial management in that it has an explicitly directive, strategic goal in determining what to continue investing in versus what to divest from. Management of this portfolio focuses on comparing spending on established systems based upon their relative value to the organization. The comparison can be based upon the level of contribution in terms of IT investment’s profitability.
Additionally, this comparison can also be based upon the non-tangible factors such as organizations’ level of experience with a certain technology, users’ familiarity with the applications and infrastructure, and external forces such as emergence of new technologies and obsolescence of old ones. Infrastructure management is sometimes divided into categories of systems management, network management, and storage management. In the rush to reduce costs, increase IT quality and increase competitiveness by way of selective IT sourcing and services, many organizations do not consider the management side of the equation. The predictable result of this neglect is overpayment, cost overruns, unmet expectations and outright failure. This type of portfolio management specially addresses the issues with spending on the development of innovative capabilities in terms of potential ROI, reducing investment overlaps in situations where reorganization or acquisition occurs, or complying with legal or regulatory mandates. The management issues with project-oriented portfolio management can be judged by criteria such as ROI, strategic alignment, data cleanliness, maintenance savings, suitability of resulting solution and the relative value of new investments to replace these projects. IT planning and governance as a whole.