Good question. The quick answer from my perspective is that we're typically trying to allocate a specific shared resource pool across multiple departments. Therefore, it makes sense to treat as a single portfolio all projects using the same shared
resource pool.
For departments with their own dedicated resources, I would treat them as their own resource pool with their own optimization models.
PPS is designed for specifically that configuration, as you can prepare multiple models based on your portfolios.
The real question is overarching though. It sounds like your question is how do we allocate funds across multiple distinct resource pools. That's not necessarily a tool question per se, but more a stategy development methodology question.
To me, it's highly dependent on the values of the organization. Strategy is derived from those values, whether they be home grown or purchased off the shelf in the case of ITIL, Six Sigma, Lean, TOC, etc.
The best overview I've seen on strategy development (which is not to say it's the best out there, but someone recommended it to me) is
Strategy Safari by Mintzberg, Ahlstrand, and Lampel - although apparently Mintzberg is kind of a controversial name in some circles.
For something with a bit more Microsoft flavor that is more aligned with the specific tool in question, you may want to look at Simon Moore's
Strategic Project Portfolio Management.
