{"id":45960,"date":"2021-03-30T11:11:09","date_gmt":"2021-03-30T11:11:09","guid":{"rendered":"https:\/\/staging-mondaycomblog.kinsta.cloud\/?post_type=pm&p=45960"},"modified":"2026-03-22T16:41:21","modified_gmt":"2026-03-22T21:41:21","slug":"portfolio-management","status":"publish","type":"post","link":"https:\/\/monday.com\/blog\/project-management\/portfolio-management\/","title":{"rendered":"The complete guide to portfolio management"},"content":{"rendered":"

Portfolio management ensures that an organization can successfully select, manage, and execute projects on a grand scale.<\/p>\n

According to the Project Management Institute<\/a>, <\/em>it\u2019s \u201ca way to<\/em> bridge the gap between strategy and implementation<\/em><\/strong>.\u201d\u00a0<\/em><\/p>\n

Strategy drives business decisions. It helps organizations identify strengths and weaknesses, and ensure resources are appropriately allocated.<\/p>\n

But without the implementation piece, the strategy is useless.<\/p>\n

Your organization needs a bias towards action.<\/p>\n

One that keeps up with the constant flurry of changes and adapts accordingly. That\u2019s where portfolio management saves the day.<\/p>\n

In this article, we\u2019ll define portfolio management, suggest some best practices, and show you why deploying portfolio management software is essential for your organization to take action and ultimately thrive.<\/p>\n

What is portfolio management?<\/h2>\n

A portfolio is a general term used for grouping things. In project management, a portfolio refers to a group of projects and programs.<\/p>\n

The process of portfolio management is the selection, prioritization, and control of an organization\u2019s projects and programs. That centralized management and oversight help establish a standard of governance across the organization.<\/p>\n

Put plainly, project portfolio management assigns responsibility, so the organization always has someone, or a group of people, closely monitoring the performance of the company\u2019s project investments.<\/p><\/blockquote>\n

If a project is aligned with the company\u2019s strategies, values, and long-term goals and it\u2019s performing well, then it\u2019s more likely to get funded and prioritized.<\/p>\n

If it\u2019s risky, underperforming, or misaligned to the company\u2019s greater strategy, then it\u2019s probably going under the microscope to either pivot or get scrapped altogether.<\/p>\n

Essentially, portfolio management puts you back in the driver\u2019s seat, where you can make more educated decisions about your portfolio\u2019s direction.<\/p>\n

Get started with monday.com<\/a><\/p>\n

What\u2019s the difference between portfolio management, project management, and program management?<\/h3>\n

In the world of portfolio management, think of a project as a unique investment. Portfolio management keeps tabs on each investment decision and ensures they\u2019re consistently aligned with strategic objectives.<\/p>\n

With that in mind, project management is all about executing projects right, and portfolio management is about executing the right projects.<\/p>\n

Program management<\/a> fits somewhere in the middle.<\/p>\n

It\u2019s managing multiple different but related projects. These related projects are connected and require a higher level of monitoring, auditing, and strategizing than a single project would.<\/p>\n

\"Strategic<\/p>\n

(Image Source<\/a>)<\/p>\n

It\u2019s in the execution where things tend to get complicated because the line between all 3 is often blurred. Many organizations will attempt to do all 3 under the guise of project management.<\/p>\n

What does a portfolio manager do?<\/h2>\n

As with most things in life, there\u2019s no one-size-all fits answer to what a portfolio manager does all day. It\u2019ll largely depend on the organization they work for and the industry they\u2019re in. That being said, there are some tried and true project portfolio practices you\u2019ll often see.<\/p>\n

For starters, portfolio managers absolutely treat planned and in-progress projects across the organization as individual investments, much like a financial manager would treat bonds and stocks as investments. From the lens of an investor, they\u2019re carefully considering the company\u2019s risk tolerance and weighing the overall performance of said investments.<\/p>\n

Much like a financial portfolio manager, the goal of project portfolio management is to maximize the value of multiple projects by carefully balancing risk and reward.<\/p>\n

Day-to-day, a portfolio manager is responsible for gathering data, monitoring project performance, closely watching marketing conditions, and influencing the organization on which decisions to make and which projects to prioritize.<\/p>\n

Additionally, portfolio managers track in-progress projects and elevate any known risks or issues which may result in pausing a project or pulling the plug on them entirely.<\/p>\n

If a project isn\u2019t on track to achieve the forecasted value originally promised, then sometimes it\u2019s best to cut losses vs. infusing more cash and resources into it.<\/p>\n

Portfolio management best practices<\/h2>\n

Much like the day-to-day, portfolio management best practices will naturally vary. Each individual project will have its own unique needs, just like every portfolio will as well.<\/p>\n

In an effort to simplify, we\u2019ve gathered some tried and true methods that are applicable to most industries.<\/p>\n

Perform a hands-on, detailed project inventory<\/h3>\n

Taking stock of all your projects provides a level of understanding you won\u2019t get by delegating the task to other project management professionals.<\/p>\n

Include the project\u2019s title, timeline, estimated costs, business objectives, potential ROI, and how it benefits the business.<\/p>\n

That way, you have somewhat of a \u201ccheat sheet\u201d that always gives you the high-level information needed to provide investors with updates or simply make better on-the-spot decisions.<\/p>\n

\"Portfolio<\/p>\n

Now, it\u2019s technically possible to do this by hand or in Excel, but then you\u2019ll miss out on all the advanced features a true portfolio management system provides.<\/p>\n

monday.com, for example, offers in-depth boards and dashboards rich with automation and colorful visuals that make it incredibly simple to simultaneously track your entire investment strategy. More on all that in a minute.<\/p>\n

Evaluate projects through a strategic lens<\/h3>\n

The core criteria for deciding on which individual project or \u201cinvestment\u201d will get funded or prioritized is determining how closely the project meets the company\u2019s strategic objectives for the year.<\/p>\n

For your investment portfolio to succeed, it must align with the overall organizational strategy. Otherwise, you\u2019re making short-term progress and forgoing long-term gains. As an investor, that\u2019s a risky strategy and one that won\u2019t likely pay off in the long run.<\/p>\n

Other factors to consider are how risky a project is and whether the project will involve massive reengineering. To put it plainly, if the investor deems that the project negatively impacts a large number of people or is subject to enormous restructuring, then it may be deprioritized.<\/p>\n

Ultimately, a good portfolio manager will identify overlapping project proposals early and cut off any projects with poor business cases upfront, so there\u2019s better alignment between management and stakeholders.<\/p>\n

Prioritize, categorize, and fund projects<\/h3>\n

Upon completion of the evaluation, most companies have more projects than they can actually prioritize and fund. Cash flow is a finite resource, and meeting your financial goals requires strict financial planning.<\/p>\n

Here\u2019s where a thorough scoring and categorization process comes in handy. Start by pooling projects together by cost and by stakeholder priority. Then decide upon a simple scoring system. For example, you could use 1-5:<\/p>\n