What is IT Portfolio Management

IT program management and IT portfolio management

Since IT program management and IT portfolio management represent two different areas that are, however, closely interlinked, they should be considered together. They specify how the range of IT services should be designed in terms of the IT strategy as well as the business strategy. The point is to combine the strategy with the operational services (in the form of processes or projects) and with the organizational structure.

The task of IT program management is to summarize various IT services using certain criteria into service areas, such as application development, network operation or innovation consulting, in which certain services are later provided. The IT portfolio management in turn evaluates planned and already provided services using a fixed scheme. This evaluation makes it possible to select the services that are suitable for the company.

The criteria for this evaluation are the following:

  • the risk associated with the performance
  • the benefit arising from the service
  • the integration of the performance into the business strategy, i.e. how well the performance fits into the business strategy
  • the integration of the service into the IT strategy, i.e. how well the service fits into the IT strategy

These criteria are then divided into two main dimensions: The project evaluation is about the evaluation of the performance itself. The environmental assessment, on the other hand, assesses how well the performance fits in with the business strategy and the IT strategy.

It must be admitted at this point that the evaluation model outlined here is only one possible variant. In practice there are numerous different types of representation and criteria for the evaluation and no uniform standard solution.

At the end of the evaluation measures, an overall portfolio is created. Those performance ideas that were selected after the evaluation can now be implemented in the form of processes or projects. IT program management then divides these services into various service programs.

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