![various enterprises, there is a connec- Conclusion
tion between IT investment planning Good governance creates connections
and the relative profit performance of a between all levels of the organiza-
company (Light, Rosser, and Hayward, tion—the company’s strategy, driven by
2005), while industry analyst Al Pas- senior executives; the project portfolio
sori finds that: serving line-of-business executives;
and the project and program manag-
“…CIOs who have already implemented ers working to get results from specific
one or more full cycles of [portfolio initiatives on a day-to-day basis. But
management] have significantly im- governance is only as good as its level
proved their organizations’ return on IT of support.
investment, with some enterprises able
to reduce costs 30%+, while improv- To ensure that your efforts at creat-
ing effectiveness with enterprise wide ing the right governance structure are
asset deployment and management. valued and have an impact on the
Line-of-business (LOB) executives state organization, you have to bring all of
they now have information never seen your skills to bear by putting the right
previously, greatly enhancing their process in place, getting the right
understanding of IT investment impacts people engaged, and marketing it to all
and improving decision quality.” (Pas- stakeholders. Only by employing all of
sori, 2004) these tactics will you be able to show
the kind of bottom-line improvements
The combination of cost savings and in terms of profits and results that will
better profit performance should move make your organization successful.
executives toward action.
References
Several Robbins-Gioia research studies A Guide to The Project Management
have also uncovered the benefits of Body of Knowledge [electronic version
portfolio management to organizations’ 1.3], (2000) Newtown Square, PA:
performance. In a 2004 survey, execu- The Project Management Institute.
tives reported that 80 percent of those Ciliberti, Rachel. (2005) Using Project
organizations that were either profit- Portfolio Management to Improve
able or very profitable have a process Business Value. Posted on http://
in place to align projects and initiatives www-106.ibm.com/developerworks/
to strategy. And in another 2004 study rational/library/apr05/ciliberti/index.
among project and program manage- html April 27, 2005.
ment professionals, Robbins-Gioia Light, Matt, Bill Rosser, and Simon Hay-
found that those organizations with ward. (2005) Realizing the Benefits
established governance processes, of Project and Portfolio Management.
practices, and accountability activities Gartner Group Research Note. Janu-
show the least redundancy in projects ary 4, 2005.
and initiatives (something that cer- Passori, Al. (2004) Project Manage-
tainly drives higher profit). In fact, of ment Essentials: IT’s About Gover-
those organizations with less than 10 nance. Meta Group Research Note.
percent redundancy in projects and June 2, 2004.
initiatives, nearly 75 percent indicate Pastore, Richard. (2002) Governance
an established commitment to gov- Blues. CIO. February 15, 2002.
ernance practices, processes, and Solomon, Melissa. (2002) Project
accountability activities. Portfolio Management: Quickstudy.
Computerworld. March 18, 2002.
Lack of redundancy in projects and Turner, Mark. (2005) The Future of the
initiatives, along with a focus on IT Organization. Computerweekly.com.
results, will ensure that the initiatives February 18, 2005.
undertaken are those that have the Viviers, Paul. (2004) Requirements for
most benefit for the organization as successful enterprise portfolio man-
a whole, and will drive better results agement. ITWeb. October 7, 2004.
at the highest level. This is the case
that must be made to executives and
will improve the level of support from
senior executives.](https://image.slidesharecdn.com/epmo-wp-closing-110807220408-phpapp02/85/Epmo-wp-closing-3-320.jpg)
Epmo wp-closing
- 1. Closing the gap between projeCt ManageMent and governanCe: R-GInsight A RoAdmAp foR G AininG And demonstRAtinG mAximum VAlue foR Y ouR pRoject inVestments In today’s increasingly competitive nance probably has more to do with marketplace, budgets are tight and his or her perspective than with any resources are limited. Consequently, dictionary or professional association making decisions about which proj- definition. Governance talk is on the ects to pursue is vital in supporting rise because technology has become an organization’s growth, vision, and ubiquitous—no longer isolated and value. For this dilemma, there is a contained to the IT folks in the base- powerful cost containment and risk ment, but now essential to hold up mitigation strategy—a combination of nearly every business decision and pro- IT governance and portfolio manage- cess. Unfortunately, this doesn’t mean ment. This approach is highly relevant that technology has become easier to for budget issues state agencies and understand. As a matter of fact, the departments currently face. With the decisions have become more complex, proliferation of technology at greater requiring greater and greater levels of and greater speed, the options that expertise to make the right choices. could bring potential benefit are seem- ingly endless. Gone are the days when For both technology and line-of-business a great technological idea was an end executives, this leads to frustration. in itself. Technology has truly become CIOs want input from line-of-business an enabler across all sizes and types of executives, and those executives just organizations. The challenge now is to want things to work. A column in CIO understand which business goals can magazine sums the dilemma up nicely: be enabled by a technology and choose the best projects to accomplish those …IT governance drives CIOs crazy. Right goals. The best way to ensure and dem- now at companies across the planet, sup- onstrate value to the organization is to posedly sane executives responsible for know how these projects are supporting the fate of companies refuse to take part the organization financially and opera- in such pivotal IT and business decisions tionally. Implementing sound project as architecture choices, standards and management practices along with a infrastructure platforms. And to add in- governance framework can enable this jury to this insult, they lay all the account- kind of visibility and control. ability for the decisions’ success (or more likely, lack of success) on the IT group. Integrating Portfolio Management From (Pastore, 2002) Top to Bottom In recent years, there’s been a lot of To make matters worse, many of the talk about governance, but very little players involved in these choices simply discussion of what that really means. don’t speak the same language. So At its most basic level, governance is how can they be expected to effectively simply oversight and control—the often weigh the benefits of any given course overlooked skill of basic good manage- of action? ment. But of course, that’s not all there is to it. If it were that simple, it wouldn’t Enter the rising tide of governance pro- Solution used: generate such buzz. cesses, such as project portfolio man- agement and the affiliated disciplines What any individual is trying to achieve of project and program management. when espousing the merits of gover- When employed correctly, a portfolio
- 2. management process linked with ro- Taking a Results Mindset Building Bridges to the Executive Team bust project and program management So let’s assume you’ve got the depart- For a governance framework to be suc- rigor can truly be a silver bullet. The ment strategic plan in hand and every- cessful, it can’t be only a bottom-up or problems is, many of those “suppos- one agrees on the key goals for the a top-down approach. The champion of edly sane executives” and frantic CIOs next couple of years. You’ve got the the initiative must have visibility and cited above are in such a hurry to get right people at the table. You’re certain influence at all levels of the process, to a solution that the examples of suc- that your project management process be willing to put in the hard work to es- cessful governance processes are too is working and it’s consistent across tablish project management discipline few and far between: departments and divisions. You’re if it doesn’t exist, and get agreement home free, right? Not so fast. on corporate strategy if it isn’t already “In the US, the mandate for portfo- there before he or she has a real lio management is clear, the overall Another step where governance can chance of success. The success of any processes and steps to maturity are in fall down is at the point of defining IT governance practice will be dictated place, and in most cases the investment project goals. Intuitively, project owners by the level of dedication and com- inventory is well described. Yet few or- usually know what they expect from mitment that executive management ganisations are realising the benefits—in their projects. But how does that reso- makes to the discipline. It will be up to terms of objective, consistent, repeat- nate with the executive team? What those leaders to introduce the concept able and effective processes for select- do those goals mean for them? A to the organization, help it understand ing, managing and evaluating projects— business case process is often part of why it is important, help develop a that even rudimentary management by the evaluation criteria for adding new culture that supports it, and develop portfolio can bring.” (Viviers, 2004) projects to a portfolio, and it’s likely a messaging campaign that lets staff you’ll conduct an ROI analysis during members know how IT governance One of the major inhibitors to success- that step. But is that enough? ultimately empowers them by removing ful adoption of portfolio management, roadblocks and building a more effec- which can certainly provide many of the CIOs now understand that server down- tive and efficient workplace. governance benefits sought around the time and call center response simply boardroom table, is a lack of integra- aren’t good enough metrics on their As the decision making process is tion with other processes. The aspira- own. The old “count anything you can” pushed down to the lower levels of an tions of these executives in terms of strategy simply won’t work anymore. organization it begins to change the benefits often outstrip their manage- It’s more and more critical for owners culture and impact the way of doing ment infrastructures. of IT, portfolio management, and pro- business. Without executive manage- gram and project management to be ment commitment and consensus the Project portfolio management adds fully versed in the language executives process will not work. Once employees significant value to decision making by speak. But this goes beyond jargon or realize the executive management sup- tying project goals to the organization’s buzzwords. The essential language of ports the new process, they will realize strategy framework. This step can be top executives is results. It is critical its importance and follow it. a stumbling block, but isn’t the most to determine what results your ex- common area where organizations fall ecutives will be judged upon and only Why Should They Care? down. Assuming executive buy-in is in communicate about activities that Ask any executive if they’re in favor of place and the organization’s strategy impact those results. If you can’t find a good project portfolio governance, and is well defined, that part is a piece of way to tie your initiatives to results, it’s you’re most likely to get an enthusi- cake. The difficult part is the link the time to evaluate whether they’re worth astic “of course!” When you get into portfolio manager must forge between spending your time on at all, let alone actually making the investment in that portfolio perspective and the proj- briefing the executive team on them! terms of time and money, however, the ect or program level information that answers get a little tougher. Good gov- may or may not be in a state to bring Building a step into your project initia- ernance is hard to oppose, but easily into the discussion. tion process that determines what killed by lack of decision to implement results will impact the organization at or lack of appropriate investment. While most organizations have pock- the highest level and getting executive ets of disciplined project and program buy-in on those results will smooth It is essential, therefore, to make a management, it’s common to find many activities further down the line. solid case for the value of creating a those practices applied sporadically This goes deeper than just “strategic full governance process that spans the across organizational stovepipes—or plan” goals. How are your executives distance between good project man- not being employed at all in some compensated? What measures are agement and good corporate strategy. areas. Without this critical data about they rewarded for? Is there a way that IT analysts have made an excellent the scope, health, and progress of your initiatives will impact those? If so, case for implementing portfolio man- initiatives, portfolio management can you’re nearly guaranteed to get their agement—the glue holding the gover- only go so far. attention and participation in the gover- nance structure together. According nance process. to Gartner, Inc.’s field research among more than 200 commercial firms in
- 3. various enterprises, there is a connec- Conclusion tion between IT investment planning Good governance creates connections and the relative profit performance of a between all levels of the organiza- company (Light, Rosser, and Hayward, tion—the company’s strategy, driven by 2005), while industry analyst Al Pas- senior executives; the project portfolio sori finds that: serving line-of-business executives; and the project and program manag- “…CIOs who have already implemented ers working to get results from specific one or more full cycles of [portfolio initiatives on a day-to-day basis. But management] have significantly im- governance is only as good as its level proved their organizations’ return on IT of support. investment, with some enterprises able to reduce costs 30%+, while improv- To ensure that your efforts at creat- ing effectiveness with enterprise wide ing the right governance structure are asset deployment and management. valued and have an impact on the Line-of-business (LOB) executives state organization, you have to bring all of they now have information never seen your skills to bear by putting the right previously, greatly enhancing their process in place, getting the right understanding of IT investment impacts people engaged, and marketing it to all and improving decision quality.” (Pas- stakeholders. Only by employing all of sori, 2004) these tactics will you be able to show the kind of bottom-line improvements The combination of cost savings and in terms of profits and results that will better profit performance should move make your organization successful. executives toward action. References Several Robbins-Gioia research studies A Guide to The Project Management have also uncovered the benefits of Body of Knowledge [electronic version portfolio management to organizations’ 1.3], (2000) Newtown Square, PA: performance. In a 2004 survey, execu- The Project Management Institute. tives reported that 80 percent of those Ciliberti, Rachel. (2005) Using Project organizations that were either profit- Portfolio Management to Improve able or very profitable have a process Business Value. Posted on http:// in place to align projects and initiatives www-106.ibm.com/developerworks/ to strategy. And in another 2004 study rational/library/apr05/ciliberti/index. among project and program manage- html April 27, 2005. ment professionals, Robbins-Gioia Light, Matt, Bill Rosser, and Simon Hay- found that those organizations with ward. (2005) Realizing the Benefits established governance processes, of Project and Portfolio Management. practices, and accountability activities Gartner Group Research Note. Janu- show the least redundancy in projects ary 4, 2005. and initiatives (something that cer- Passori, Al. (2004) Project Manage- tainly drives higher profit). In fact, of ment Essentials: IT’s About Gover- those organizations with less than 10 nance. Meta Group Research Note. percent redundancy in projects and June 2, 2004. initiatives, nearly 75 percent indicate Pastore, Richard. (2002) Governance an established commitment to gov- Blues. CIO. February 15, 2002. ernance practices, processes, and Solomon, Melissa. (2002) Project accountability activities. Portfolio Management: Quickstudy. Computerworld. March 18, 2002. Lack of redundancy in projects and Turner, Mark. (2005) The Future of the initiatives, along with a focus on IT Organization. Computerweekly.com. results, will ensure that the initiatives February 18, 2005. undertaken are those that have the Viviers, Paul. (2004) Requirements for most benefit for the organization as successful enterprise portfolio man- a whole, and will drive better results agement. ITWeb. October 7, 2004. at the highest level. This is the case that must be made to executives and will improve the level of support from senior executives.
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