The purpose of project portfolio management is ultimately to provide a clear answer to this seemingly simple question. Answering it requires an underlying system that can be divided into four areas of activity, which we call Strategize, Collect, Decide and Execute.
Formulating a business strategy is the job of upper management and is not part of project portfolio management. What is a part of PPM is translating the strategy into project selection guidelines. A good project portfolio is aligned with the corporate strategy. Projects with a high strategic contribution should be given higher priority, and projects with a low strategic contribution should be given lower priority, put on ice, or rejected.