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Level: Intermediate
TCM Section(s):
3.3. Investment Decision Making
2.3. Strategic Asset Management Process Map
Venue: 2021 AACE International Conference & Expo
Abstract: Organizations often struggle to determine their project portfolio requirements, select the right projects to execute, and provide justification for the formation of the capital budget. To combat this, they should develop a portfolio prioritization approach that focuses on ways to quantifiably rank projects against each other while considering risks and priorities of the organization.
A portfolio prioritization approach should include detailed budget information that can be drilled down by program, project type, and appropriation type to enhance transparency in funding allocations, enable rapid development of reports to answer budget questions efficiently and correctly, and inform management for data-driven decision-making. This approach would include existing project information and the application of a scoring methodology to weigh the risks and priorities of a project and determine its eligibility for funding. The output can allow agencies to compare funded and unfunded requirements, make informed decisions on projects to execute, and determine how to allocate or reallocate budget for capital planning.
Such a portfolio prioritization approach has been used at several federal agencies. This paper explores how risk and priority assessment criteria allow for an effective prioritization of projects with quantifiable outcomes and an optimized capital spend plan. Further, this studies the applicability and scalability of these prioritization criteria at other agencies using a predictive analysis.
Level: Intermediate
TCM Section(s):
3.3. Investment Decision Making
2.3. Strategic Asset Management Process Map
Venue: 2021 AACE International Conference & Expo
Abstract: Organizations often struggle to determine their project portfolio requirements, select the right projects to execute, and provide justification for the formation of the capital budget. To combat this, they should develop a portfolio prioritization approach that focuses on ways to quantifiably rank projects against each other while considering risks and priorities of the organization.
A portfolio prioritization approach should include detailed budget information that can be drilled down by program, project type, and appropriation type to enhance transparency in funding allocations, enable rapid development of reports to answer budget questions efficiently and correctly, and inform management for data-driven decision-making. This approach would include existing project information and the application of a scoring methodology to weigh the risks and priorities of a project and determine its eligibility for funding. The output can allow agencies to compare funded and unfunded requirements, make informed decisions on projects to execute, and determine how to allocate or reallocate budget for capital planning.
Such a portfolio prioritization approach has been used at several federal agencies. This paper explores how risk and priority assessment criteria allow for an effective prioritization of projects with quantifiable outcomes and an optimized capital spend plan. Further, this studies the applicability and scalability of these prioritization criteria at other agencies using a predictive analysis.