Portfolio Performance Management

Correct Answer: Inform the Portfolio Management about the risks and ask for guidance and decision.

The best course of action when identifying potential risks in a strategic portfolio project is to 'Inform the Portfolio Management about the risks and ask for guidance and decision.' This ensures transparency and allows for expert guidance on how best to handle these risks. It's essential to maintain constant and open communication with the Portfolio Management, as they can provide strategic direction and make necessary adjustments to mitigate risk. The option to 'Ignore the risks as they are part of every project' is incorrect because while risks are inherent in every project, ignoring them could lead to project failure. The third option, 'Try to solve the issues independently without informing the Portfolio Management,' also lacks transparency and could lead to mismanagement of risks that could have been better addressed with Portfolio Management input. Finally, 'Quit the project since the risks are high,' is also not a viable solution, as high risks can potentially be managed and quitting doesn't align with project management principles.

Correct Answer: On projects that are most closely aligned with the organization's strategic objectives and the highest value.

The best possible answer is 'On projects that are most closely aligned with the organization's strategic objectives and the highest value.' This is because the primary purpose of project portfolio management is to ensure that an organization is investing its resources in the right projects; those that contribute to its strategic objectives and bring high value. Focusing primarily on projects managed by the best project managers does not necessarily mean these projects align with the organizational goals. Similarly, while it is important to address problems within projects, focusing only on the problematic projects, regarless of their significance to the portfolio, may not bring strategic benefits to the organization. Lastly, focusing just on projects with the highest budgets doesn't ensure aligning with strategic objectives. Instead, it might mean allocating too many resources where they aren't strategically needed.

Correct Answer: Consider reassessing the portfolio risk management strategy to ensure that it can adapt to the changing project risk profiles.

The best answer is 'Consider reassessing the portfolio risk management strategy to ensure that it can adapt to the changing project risk profiles.' As a Portfolio Manager, it's crucial to have an adaptable risk management strategy that can accommodate varying project risk profiles. This approach ensures that regardless of the changes in individual project risks, the overall portfolio performance is maintained. On the contrary, the other answers are not viable strategies. 'Focus solely on the projects with the highest risk profiles to prevent future performance issues.' This approach may neglect other projects that could potentially pose risks in the future. 'Scrutinize the performance of each project individually, disregarding the implications on overall portfolio performance.' This approach would not be thorough, as it doesn't take into account the collective impact of all projects on the portfolio's performance. Lastly, 'Terminate the projects with high risk profiles to maintain the portfolio's performance.' terminating projects may not always be the best solution as high-risk projects can also bring high returns. Instead, effective risk management should be implemented.