Be Able to Identify, Analyse and Distinguish Between Appropriate and Inappropriate Application of Portfolio Definition Practices and Techniques to a Scenario MOP-FOUNDATION Practice Questions (Page 1)

Questions 1–5

1. 1application · medium

   A manufacturing company is prioritizing its portfolio. The CEO has instructed the portfolio office to rank all initiatives by the size of their expected cost saving, from largest to smallest, and to fund the top 15. Initiatives that do not deliver direct cost savings are to be removed from the portfolio regardless of their strategic importance. Why is this prioritization approach INAPPROPRIATE?

   • AIt uses a single financial criterion and ignores strategic objectives
   • BIt selects a fixed number of initiatives rather than a fixed budget
   • CIt ranks initiatives by cost saving rather than by total cost
   • DIt does not involve the finance department in the ranking
   Reveal Solution Discussion Select an answer first
2. 2foundation · easy

   An organization completes its portfolio strategy and delivery plan by setting fixed delivery dates for all initiatives without considering resource availability or dependencies. Why is this approach inappropriate?

   • AIt ignores constraints that could make the plan unachievable, leading to unrealistic commitments
   • BIt is inappropriate because delivery dates should be set by the project teams, not the portfolio manager
   • CIt is inappropriate because the plan should not include any dates
   • DIt is appropriate because fixed dates ensure accountability
   Reveal Solution Discussion Select an answer first
4. 3expert · hard

   A transport authority has prioritized its portfolio and is balancing it. The portfolio includes: a safety-critical signalling upgrade, a customer app with high visibility, a cost-saving back-office consolidation, and several small maintenance projects. The available funding covers the signalling upgrade and the maintenance projects, or the customer app and the back-office consolidation, but not all four. The portfolio office has proposed funding the customer app and the back-office consolidation because they have the highest combined return. Which consideration makes this balancing decision INAPPROPRIATE?

   • AThe back-office consolidation should be deferred because it is not customer-facing
   • BThe maintenance projects should be funded because they are small and numerous
   • CThe customer app should be compared with the maintenance projects instead
   • DThe safety-critical signalling upgrade may be non-negotiable and must be prioritized regardless of financial return
   Reveal Solution Discussion Select an answer first
5. 4application · medium

   A technology firm is categorizing its portfolio. The portfolio manager has created categories based on the department that sponsors each initiative: 'Marketing', 'Operations', 'IT', and 'Finance'. Each initiative is placed in the category of its sponsoring department. The CEO has asked for a portfolio view that supports strategic investment decisions. Why is this categorization approach INAPPROPRIATE?

   • AIt reflects organizational structure rather than strategic contribution
   • BIt excludes initiatives that span multiple departments
   • CIt uses too few categories to be useful
   • DIt should have been based on project size rather than department
   Reveal Solution Discussion Select an answer first
6. 5application · medium

   A media company is prioritizing its portfolio. The portfolio manager has ranked all initiatives by their expected revenue contribution and has proposed funding the top 20. The CEO has pointed out that one initiative, which delivers no direct revenue but is required to comply with a new data protection law, has been ranked near the bottom. The portfolio manager responds that the ranking is based on revenue and the initiative should be dropped. Why is this response INAPPROPRIATE?

   • APrioritization must consider mandatory and regulatory requirements, not only revenue
   • BThe top 20 should be selected by revenue but the compliance initiative added anyway
   • CThe compliance initiative should have been ranked higher on revenue
   • DThe portfolio manager should have consulted the legal team before ranking
   Reveal Solution Discussion Select an answer first