Communicating Effectively With Stakeholders: What Does IT Portfolio Management Success Look Like?

July 6, 2012 By Leave a Comment

Success is relative.  Just yesterday I was working with an organization where the CEO said, “If I could just get a manageable list of the current active projects and their current status that would be the first step to success.” As you can see, this CEO’s idea of success is incremental.  That’s the key.

I’ve witnessed successful and, unfortunately, unsuccessful attempts at implementing IT Portfolio governance models.  Typically most of these failures are:

  • a result of a narrow vision of the end state;
  • implementing a PMO with the exclusive mission of projects and methods. This is a situations where the focus is less on delivery and more on creating the Project Lifecycle Management (PLM) deliverables regardless of the size/duration of the proposed project, i.e., “The Process Police.”
  • And finally, the “Big Bang” approach to implementing technology in an attempt to buy a process out of the box.

Success is more of an organizational change management effort than simply installing a tool. Or, as I like to say “Build it, they will come.”  Unfortunately what really happens is just the opposite: Build it and they will RUN.

This notion of a change management approach is important because success is more about identifying the “change plateaus” and building a strategy to execute those plateaus instead of just implementing a tool that everyone resists 6 weeks after you go-live.  You have to walk before you run.

Key to that is having an understanding of the pain the organization is experiencing. Like the example of the CEO above, his pain was around portfolio transparency.  That was his first change plateau.

So what’s the next plateau?  That’s not always clear. That’s why it is imperative to have access to senior management, because macro-environmental influences can most definitely change any leader’s course of action.

IT Portfolio Management or Governance can be viewed in three categories.

  • Asset Management – this isn’t necessarily the way we currently view assets like servers, PC’s, etc. although they can be part of the asset pool.  For IT, I look at assets more broadly, focused on business outcomes.  It really about applications and how applications influence processes to achieve positive business outcomes.
  • Project Management – we execute projects to create, renew, and divest assets.
  • Resource Management – self-explanatory – we need people (in the right place at the right time) to operate the process/ tools and execute the projects.

The big challenge is to not let the governance of these three categories be developed and operated in silos.

Oh, and by the way, this doesn’t come in a box.  You just can’t buy software and expect the software to immediately solve everything.

So what are the change plateaus for each of these categories?  Every organization is different and each stakeholder will bring a different lens upon that pain.  But here are some ideas:

Like the CEO above, it could simply be an inventory for all three categories and the status of that inventory.

Identifying and implementing standard operating practices and service agreements for your assets, for IT ITIL (Information Technology Library) is a great place to start.

Project Management and Resource Management has really evolved in understanding to Project Portfolio Management (PPM). With PPM we are dealing with:

  • Timeliness – having the right number and the right balance of projects, completed on time without gridlock.
  • High Value – projects that reflects business strategy and are aligned with business objectives
  • Quality – projects are executed with predictable outcomes
  • Right People – having the right person at the right time to execute projects

Success is in understanding your pain points and which ones to take on first for immediate success, recognizing they all can’t be tackled overnight. Success is getting early and quick victories like the CEO example sought. Then build on to those early successes by identify the change plateaus and executing a roadmap with incremental capability and success.

Remember, IT Portfolio Management is transitional NOT transformational!

 

Filed Under: The Business-Driven PMO Tagged With: , , ,

At What Risk?

November 21, 2011 By Leave a Comment

News sources everywhere are streaming reports on the state of today’s economy. There is plenty of speculation, conversation and hyperbolae on the need to invigorate the economy with investment. Businesses and government organizations are being pressured to spend more to create jobs and boost the economy.

But the fundamental question to ask is “At what risk?”

I get this question all the time. Project investments are being made continually. Maybe not at the pace we would like to see, but it’s happening and the state of project execution remains high within organizations.

A colleague of mine and I were recently discussing whether there is a void or opportunity to introduce new thinking in addressing the “at what risk?” question. Let’s examine.

First, let’s examine the statement itself.  What does “At what risk?” really mean? We can look at it in multiple dimensions.

Project execution is a common place where we look at risk and risk management, where risk is anything that could potentially adversely affect the schedule, cost, quality or scope of a project. Basically, how does risk impact your project objectives? PMBOK outlines many processes and techniques for managing risk such as the ‘Probability and Impact Matrix for Qualitative Risk Analysis’ and quantitative risk analysis techniques such as ‘Sensitivity Analysis and Decision Tree Analysis’.

Another perspective to view risk and risk management is from the finance angle. We can look at how cost benefit analysis (CBA) can present a financial perspective of risk and we get that from ROI, NPV, etc. But these dimensions are only at the perspective of the project and the projection of potential value.

There are other dimensions of risk we can discuss, but those have specific vertical applications, like the risk of entering a market or the risk of applying a particular technology.
These all are very valid methods and processes, but can we answer our earlier question “At what risk?”?  I think so and we can simply address this by asking a simple question: “Are we working on the right things?”

Drawing on portfolio management techniques helps identify “At what risk.” But, you may say that risk is already defined as a dimension of portfolio management, and you would be right. Organizations have struggled with implementing portfolio risk models and maintaining them.

I prefer something simpler. Can I answer our question early in the project lifecycle without spending a lot of energy? Yes. Simply put: alignment , through the identification of what is important at the portfolio level and defining the alignment dimension of your portfolio solves our problem.  Why would we ever want to spend any energy at all on a project proposal if it doesn’t fit within the performance objectives and investment goals of the portfolio?

From my perspective, answering the “At what risk” question can be a simple top-down exercise that can deliver great value to the organization. But the first question we should always answer is, “Does it fit?”  Then we can focus on evaluating and managing risk in the financial and project execution domains.

Filed Under: The Business-Driven PMO Tagged With: , ,