Portfolio Budget

It is rare that an organization has only one project going on at a time. To make the best decisions regarding Budget and Costs, Managers often attach Projects to Portfolio Folders.

In Sciforma, those Budgets are expressed in terms of Cost Centers, and each of them can be defined as Cost and/or as Effort.

While the level of definition may vary from one company to another, Portfolio Managers all have the same goal when defining their budget for the years to come:  find the best balance/distribution between Projects and Portfolios to optimize the budget utilization. Usually, this review process is done once or twice a year.

Portfolio Managers could encounter the following situations:

  • Update the Portfolio budget definition – For example, Stakeholders could decide that capital expenditures (known as Capex) should be reduced over the next two years. Therefore, Portfolio Managers will need to determine which one of the planned investments they will need to cancel or postpone.

  • Update the Projects budget definition – For example, Portfolio Managers need to consider the budget changes the Project Managers have requested. Thus, they will need to make sure that these changes are still fitting in the overall Portfolio Budget.

  • Add a Cost Center to the Portfolio or a Project – For example, a company might want to diversify the business and invest in R&D activities. Therefore a new Cost Center should be defined at the company level and a budget should be allocated to a Portfolio Folder managed by a Portfolio Manager. In that case, he will need to add this new cost center at the Portfolio level and distribute these budgets over the Projects.

  • Reserve some budget for future projects – For example, a Portfolio Manager might want to identify a budget bucket to put aside for future initiatives that would come on top of the ongoing projects.

All of these situations described above have at least one point in common. In each case, the Portfolio Manager has to make changes to find the right balance between Projects and Portfolio budgets.

To help him take into consideration multiple situations and possible solutions, Sciforma offers the following capabilities:

  • Giving access to a sandbox where the Portfolio Manager will be able to play with the budgets, update the inputs without interfering with the live data.

  • Having the possibility to create multiple scenarios where the Portfolio Manager will be able to consider all the potential solutions to balance Portfolio and Projects budgets, with the objective of finding the most optimal one.

  • Creating a Budget bucket to support the definition of budget for future projects not already launched but for which it is necessary to save budget.

In this section