My monthly financial portfolio report came the other day. Over the span of 40 pages, I could see the exact status of my financial well being. The first page offers a dashboard of my investments and lets me see quickly if things are looking good or need some attention. The ensuing pages contain drill-down information on each type of account and the specific investments within the accounts. I can see, for instance, how my kids’ college accounts, or my own personal retirement account, are coming along.

What if you could get such a report that details the status of all your IT applications, projects and people? Would this be helpful to you? You could see which projects are behind schedule or over budget, or which ones have a lot of risk associated with them. You also could see where the projects are humming along nicely, performing as you expect them to perform. And when the business stakeholders want to know what’s going on with their projects, you can easily show them.

This is the notion behind the category of IT application called “IT portfolio management,” which is part of the growing industry focus and awareness of IT governance within organizations. The concept of IT governance stems from corporate governance and deals primarily with the connection between business focus and IT management of an organization. As you may have guessed, a primary reason for the rising interest in IT governance is partly due to compliance mandates, such as Sarbanes-Oxley.

The primary objectives of IT governance are to assure that the investments in IT generate business value, and to mitigate the risks that are associated with IT. Portfolio management forces you to look upon all your IT applications, projects and resources (people) as assets and investments, which should be managed exactly as you would manage purely financial assets and investments. This gives you the ability to establish unbiased criteria for asset performance and investment decision making. Imagine being able to take the “politics” out of the decision of which projects get funded and which ones are canceled!

Having the overall view of your IT portfolio allows you to see the redundancies in your applications, optimize your resources and track progress much more closely. Better still, it allows you to discuss the IT applications and projects in terms of the risks and rewards they will provide to the company, with the ultimate goal of strengthening the alignment of business needs with IT via improved decision making,

Linda Musthaler is a principal analyst with Essential Solutions Corporation.