POSTER 19
Section 7 · Portfolio Management — How It Runs
Performance Domains, Selection & Balancing
Portfolios are run through six performance domains and a recurring cycle that selects and balances components: categorise → evaluate → select → prioritise → balance → authorise → review. The defining skill is balancing the mix against value, risk and capacity — then rebalancing as strategy moves.
Visual Map — The Component Selection & Balancing Pipeline
Identify▸
Categorise
group by type/strategy▸ Evaluate
score vs criteria▸ Select▸ Prioritise▸ Balance
optimise mix vs capacity & risk▸ Authorise▸ Review↺
group by type/strategy▸ Evaluate
score vs criteria▸ Select▸ Prioritise▸ Balance
optimise mix vs capacity & risk▸ Authorise▸ Review↺
Categorisation enables apples-to-apples comparison; evaluation uses weighted scoring against strategic criteria; balancing optimises the whole mix — not each component in isolation. The loop never closes.
Balancing Tool — Risk vs Reward Bubble Chart
The Six Performance Domains
- 1 Strategic Management — align to strategy; portfolio roadmap & value proposition.
- 2 Governance — decision framework; authorise / terminate components; oversight & optimisation.
- 3 Capacity & Capability — balance resource & funding demand vs supply.
- 4 Stakeholder Engagement — engage decision-makers & sponsors.
- 5 Value Management — define, maximise, deliver & measure value.
- 6 Risk Management — manage aggregate risk & the risk/return balance.
Balancing & Optimisation Tools
- Weighted scoring models against strategic criteria.
- Prioritisation matrices & ranking.
- Bubble / quadrant charts (risk vs reward, above).
- Efficient frontier — best value for a given risk.
- Portfolio roadmap & dashboards for transparency.
Exam Concepts
- Portfolio management continuously balances & reprioritises.
- Governance authorises & terminates components.
- Capacity management = demand vs supply of resources/funding.
- Value & risk are managed at the aggregate level.
Executive View
- Rebalance as strategy shifts — the mix is never "done".
- Governance kills the zombies that drain capacity.
- One dashboard for the entire investment.
Industry Example
Defence
- The prime scores bids & programs against strategic criteria, balances naval vs land vs air, checks engineering capacity, and the board authorises the optimal mix — re-reviewed each quarter.
Memory Hooks
- Pipeline — C·E·S·P·B·A: Categorise, Evaluate, Select, Prioritise, Balance, Authorise.
- "Pick · balance · fund · review — forever."
- Bubble chart = risk vs reward; size = cost.
60-sec Review
Name the 6 domains
Recite the C-E-S-P-B-A pipeline
Sketch a risk/reward chart
Capacity = demand vs ?
What governance authorises
PMI Visual Wall · Poster 19 · Portfolio — Domains, Selection & Balancing · original instructional design · A3 landscape