Task 1 PFMP Practice Questions (Page 4)

Questions 16–20

1. 16application · medium

   A portfolio manager identifies that a high-priority project to develop a new product line is consuming 40% of the portfolio's budget but is projected to generate only 10% of the portfolio's expected value. The organization's strategy emphasizes 'maximizing value and innovation.' What is the most appropriate recommendation?

   • AReduce the project's budget and reallocate funds to higher-value initiatives.
   • BIncrease the project's budget to accelerate its completion and realize value sooner.
   • CContinue the project because it is innovative and may lead to future value.
   • DKeep the project as is because it is a strategic priority.
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2. 17expert · hard

   A portfolio manager is reviewing a portfolio that includes a project to upgrade the company's IT infrastructure, a project to launch a new marketing campaign, and a project to develop a new product. The organization's strategy is 'innovation and market leadership.' The IT upgrade project is essential for the new product but is not directly linked to any strategic objective. What is the most appropriate recommendation?

   • AMap the IT upgrade project as an enabler to the new product development project, which supports innovation.
   • BContinue the IT upgrade project without any changes because it is necessary for operations.
   • CReplace the IT upgrade project with a new project that directly supports innovation.
   • DTerminate the IT upgrade project because it is not aligned with the strategy.
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4. 18application · medium

   A portfolio manager has developed recommendations to realign the portfolio, including terminating a project that is no longer strategic. The project sponsor is a senior executive who strongly supports the project. What is the most effective communication strategy?

   • AAsk the sponsor to voluntarily withdraw the project to avoid conflict.
   • BInform the sponsor that the project will be terminated regardless of their input.
   • CAvoid discussing the recommendation with the sponsor until the steering committee makes a decision.
   • DPresent the recommendation to the sponsor with data on the project's misalignment and the benefits of realignment.
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5. 19foundation · easy

   Which of the following is a typical output of an alignment assessment?

   • AA communication plan for stakeholders
   • BA list of all organizational risks
   • CA list of components ranked by their strategic contribution
   • DA detailed project schedule
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6. 20application · medium

   A multinational retailer's portfolio includes a high-priority initiative to modernize its e-commerce platform, a compliance project for new data privacy regulations, and a low-priority experimental project exploring drone delivery. The CEO has asked the portfolio manager to ensure the portfolio reflects the company's strategic focus on 'customer experience and regulatory readiness.' Which action best demonstrates strategic alignment in this context?

   • AContinue all projects as planned because the portfolio is already balanced across innovation, compliance, and growth.
   • BRank the e-commerce modernization and compliance projects as top priorities and deprioritize the drone delivery project.
   • CReplace the drone delivery project with a new project that improves the mobile app's user interface.
   • DAsk the project managers of each initiative to justify their project's alignment in writing before any prioritization changes.
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