The Influence of Portfolio Management on Evaluating IT Investments in Digital Transformation: A Systematic Literature Review

This systematic literature review examines how Portfolio Management influences the evaluation of IT investments' effectiveness in digital business transformation. It delves into the multifaceted functions of IT Portfolio Management (ITPM), aligning investments with organizational goals, optimizing resource allocation, and mitigating risks. Covering a wide array of research from macro to micro levels across various industries, the review utilizes instruments like the Balanced Scorecard, extending beyond traditional financial metrics like ROI and TCO. It underscores ITPM's significance in optimizing IT investments, emphasizing portfolio planning, selection, execution, and monitoring for alignment with business objectives. Microlevel dynamics such as IT application orchestration and technical debt prioritization are explored, offering strategies for effective decision-making. The review highlights the transformative potential of digital technologies, drawing insights from the financial sector for innovative portfolio optimization and risk management. It provides practical insights for enhancing decision-making processes, advocating for a strategic approach to risk mitigation and leveraging digital technologies for sustainability and performance improvement. Through synthesizing insights, identifying commonalities, and addressing gaps, the review contributes to literature by advocating for alignment and dynamic capabilities while highlighting the need for tailored strategies in the evolving landscape of IT investments.