Determining strategic benefits
Portfolio decisions are complex. They involve many elements, and require making decisions in
an environment that by definition contains conflicting objectives and involves both quantitative
and qualitative factors. To effectively select, measure and manage the performance of a portfolio,
each objective must have a mathematically sound relative importance with respect to each of the
other objectives in achieving the overall strategic goal, and each project must have a
mathematically sound relative benefit with respect to each of the other projects and the strategic
goal. Many commonly used decision methods and ranking and scoring models for project
selection fall short, meaning they are not mathematically sound, for reasons we will describe.