IT organizations have found much success implementing project and portfolio management (PPM) processes to better align IT projects with business goals. Now, more mature organizations are adopting service portfolio management (SPM) practices to help IT provide more transparency and a better focus on the services that deliver the most value to the business.

Service portfolio management, part of version 3 of the IT Infrastructure Library(ITIL), helps achieive ITIL’s mission of managing the entire service lifecycle, from request to retirement. As outlined in ITIL v3, the SPM approach allows IT to focus on being a service provider to the business, offering and managing a comprehensive set of IT services.

What is service portfolio management?

SPM is one of the 14 processes within the service lifecycle approach of ITIL v3. It’s defined as “the process responsible for managing the service portfolio. Service portfolio management considers services in terms of the business value that they provide.”

Organizations that use service portfolio management are looking for ways to add value to the business and meet customer needs through various technology services. In turn, many IT shops that use SPM find themselves pondering a number of business-based questions they didn’t ask before, such as who is the customer, why should they buy this service from us, and what are our strengths and weaknesses?

A service portfolio includes three categories of services based on the service lifecycle:

  • The service pipeline: For services in the planning or development phase.
  • The service catalog: Includes services that are currently deployed or ready for deployment.
  • Retired services: Those that are no longer active.


In today’s economy, most organizations are doing some form of project and portfolio management. But experts agree that PPM is most effective in organizations that also follow SPM practices.

When companies use PPM without SPM, “the projects run and are delivered into an environment that’s chaotic and less mature,” said DuMoulin. “PPM is an output or child of SPM.”

Some consider PPM the execution arm for SPM. IT uses PPM to select and implement IT projects, but not to manage them once they are delivered. Service portfolio management is an ongoing process and focuses on the entire lifecycle of a service, with an emphasis on continual service improvement.

Barclays Global Investors uses both PPM and SPM. Its project management office uses PPM and the IT group manages SPM, according to Nilesh Patel, director of infrastructure service management, enterprise technology services. Using SPM, “IT’s view is really about transparency and what is coming down the pipeline into IT,” said Patel. “PPM is used for project prioritization and to start and stop projects. And the goal of SPM is to work with the business to see what’s coming.”

For Patel, the difference between PPM and SPM is the business focus. “SPM is about working with the business,” he said. “PPM could be focused on a bunch of IT projects — but not necessarily business projects.”

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