Portfolio management is a structure your business can use to align its resources and strategy to achieve and sustain peak performance. At its most sophisticated, it also factors in risk, uncertainty and the fact that multiple projects and goals interrelate.

In short, portfolio management is a proven path to better business decisions, especially in strategy development and business investment analysis.

Portfolio management can help you:

• define corporate strategy or business unit performance targets;
• manage business investment decisions and business performance;
• evaluate the impact of mergers, acquisitions and divestitures; and
• communicate externally to analysts and shareholders, or internally to business units.

First conceived in the 1950s by Dr. Harry Markowitz as a way to manage risk and reward in stock and bond portfolios, portfolio management was introduced and used in many industries in the 1980s. As new approaches and tools were introduced, the definition of portfolio management widened and its use proliferated.

Today, many people associate portfolio management with mathematically complex modeling tools. While these tools are essential, portfolio management is more than math and computer modeling. It is a process for learning more about your business and a structure for better decision making.