What is the main shift happening in how infrastructure should be viewed?

Infrastructure is transitioning from an invisible utility to a competitive differentiator. Driven by AI, organizations must now maximize computing yield per dollar, treating infrastructure as a strategic portfolio rather than a cost center.

Why are traditional PPM tools inadequate for infrastructure portfolio management (IPM)?

Traditional PPM tools force persistent assets like data centers into a 'project' construct with fixed start and end dates. This prevents accurate management of lifecycles, depreciation, and ongoing operational resilience.

How does ValueOps address the challenge of shared costs?

ValueOps, via Clarity, uses allocation tables to ingest raw spending data and distribute correlated costs (computing, storage, networking) across the specific applications that use them, revealing true Total Cost of Ownership.

What is the benefit of 'fiscal awareness' in an IPM solution?

Fiscal awareness aligns infrastructure spending with actual financial planning cycles and quarters. This allows leaders to see spend in context of budgets rather than just viewing isolated bills.

Financial Management: The "Sub-Ledger" Is the Missing Link in SPM

Create a sub-ledger to bridge the materiality gap between corporate accounting and execution.
Establish granular traceability to fully leverage capitalization opportunities and address auditing requirements.
Avoid simple project tools, which lack the required fiscal calendar awareness and accounting-grade ledger capabilities.

Let’s be honest about the disconnect between the corporate general ledger and the reality of product delivery.

From a corporate accounting perspective, the level of "materiality"—the threshold where expenses become significant enough to track individually—is often too high to be useful for daily operations. For example, the general ledger may show a massive bucket of money allocated to a department. It reveals the "what." It rarely details the "how" or the "why" at the execution level.

What is the "sub-ledger" and why is it the missing link in strategic portfolio management?

For the corporate controller, it might not matter how that budget is divided between product A and product B. But for those of us on the ground, that distinction is everything. It defines our capacity for innovation and our ability to achieve specific outcomes.

This is why, in the realm of strategic portfolio management (SPM), financial management is not just about bookkeeping. It is about creating a "sub-ledger" that bridges the gap between corporate accounting and the actual work being delivered.

The materiality gap

Most accounting systems simply do not go down to the level of detail required to actively manage an organization on a day-to-day basis. These systems aren’t built to track the specific ROI of a single feature set or the cost implications of a pivot in strategy.

To budget and plan effectively, we have to insert a layer of accounting underneath the materiality of the general ledger. We need to track cost centers, cost types, and categories—such as labor, travel, and expenses—against the specific investments in the portfolio.

This isn't about creating busy work. It is about visibility. When you have this level of detail, you can move beyond simple tracking to scenario planning. You can adjust plans based on actuals. You can compare the top-down budget allocation against the bottom-up roll-up of actual spending. This is how you spot misalignment before it becomes a crisis.

Capitalization is a strategic lever

There is a very real, bottom-line reason to get this right: capitalization.

How does capitalizing development assets affect a company's bottom line? There is an entire ecosystem within our organizations centered around the ability to capitalize development assets. If you can justify that a particular expenditure resulted in a durable asset—like a piece of software—you can stretch those expenses out over the useful life of the investment.

This provides significant tax advantages and has a direct impact on the bottom line. If you expense everything up front, your budget is hit hard immediately. If you capitalize correctly, you spread that cost, essentially allowing you to do more with your current budget. But auditors require proof. They need to see exactly where the money went and what it produced. A high-level general ledger dump won’t satisfy that requirement. You need the granular traceability offered by Clarity by Broadcom, which is a core component of the ValueOps platform.

The project scheduling tool trap

This is where many organizations fail. They attempt to track this complex data in simple project scheduling tools.

The problem is that most of those tools are not fiscal calendar aware. They don't speak the language of finance. If your tool cannot translate a project schedule into your company’s specific fiscal quarter, you are creating siloed data and a translation layer that is prone to error.

Furthermore, most project tools lack an accounting-grade ledger. In a standard project management app, if a cost is wrong, you just backspace and type over it. That might be fine for a rough estimate, but it is a nightmare for governance.

Why you need a ledger, not a spreadsheet

Why is an accounting-grade ledger necessary for effective SPM? True financial management in SPM requires auditability.

Clarity operates with an accounting-grade ledger. This means you cannot simply "change" a cost once it is posted. You have to post a transaction to adjust it. This creates an unalterable trail of changes and adjustments.

This distinction allows us to move from guessing to knowing. It ensures that the data we use for AI-augmented forecasting—looking for patterns in past costs to predict future behavior—is based on reality, not just someone’s best guess that was overwritten three times.

Financial management in SPM isn't just about satisfying the accountants. It is about giving operations the fidelity they need to execute, while giving finance the governance they require. It turns the details of execution into a strategic asset. Be sure to review our SPM buyer’s guide to get insights for finding the solution that’s best for your organization.

Frequently asked questions

Q: What is the "materiality gap" and how does a sub-ledger address it?

A: The materiality gap refers to the difference between the high-level expense tracking in the corporate general ledger and the granular detail needed for daily operational management. A sub-ledger bridges this gap by tracking specific cost centers, cost types, and categories against the investments in the portfolio. In this way, the sub-ledger provides the visibility needed for effective scenario planning.

Q: Why is capitalization referred to as a "strategic lever"?

A: Capitalization is a strategic lever because it allows organizations to stretch development expenses over the useful life of a durable asset, such as software. As a result, capitalization offers significant tax advantages and has a direct impact on the bottom line. By spreading out costs, teams can do more with their current budget.

Q: What is the main risk of using standard project planning tools for financial management in SPM?

A: The central problem is that these tools are not aware of fiscal calendars and lack an accounting-grade ledger. This introduces the risk of translation errors and creates a governance headache. In these tools, costs can easily be overwritten, which means they don’t meet the auditability requirements needed for proper capitalization. In contrast, a cost cannot simply be changed once it is posted in Clarity. Instead, an adjustment transaction must be posted, creating an unalterable trail of changes. This ensures data integrity for auditing and for AI-augmented forecasting.