Introduction to PALMA™: A Tool for Portfolio Investment Analysis

By Patricia Salamone , Elaine Goyette

The PALMA toolset can help you determine the set of investments that gives the most “bang for the buck.”

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MITRE’s Portfolio Analysis Machine (PALMA) is a graphical and computational framework to help decision-makers select the best portfolio of investments, based on cost and operational benefit, so they can best leverage limited resources. PALMA is built on the principle that the process of making investment decisions should begin by asking basic questions such as:

  • What is the decision to be made (e.g., what is the need to be met?)
  • How well is the need being met today? What gaps or shortfalls exist?
  • What investment options should be considered to fill the gaps or remediate the shortfalls?
  • How much do they cost and how much benefit do they provide?
  • How do these investments contribute to the organization’s overall goal?

PALMA provides (1) a language in which the answers to these questions can be expressed and (2) a framework for combining information to gain insight into the investment problem. This framework provides a structured, repeatable approach to investment planning.