Strategic financial management in portfolio and project management is a process by which financial resources are allocated to projects among others based on their strategic value.
The goal is to optimize the organization’s financial resources and achieve its strategic objectives.
This process includes identifying the right projects, determining their strategic value, assessing their financial viability and allocating financial resources based on this assessment. The process also includes monitoring the performance of projects to ensure they are on track and financial resources are used effectively.
Using a new financial grid available in portfolios and projects, the three levels are linked together. Different types of financial projections can be easily compared, such as ‘Budget versus Forecast’ or ‘Planned versus Spent’. Using scenario planning, the impact of various scenarios can be analyzed before they are implemented. This provides clear insight and the opportunity for financial control at all levels.