The Executive Guide to Improving Your Business Through IT Portfolio Managementby Jim Varner
Many corporate executives still view technology as a necessary cost of doing business. As a result, CIOs and IT Directors are constantly struggling to justify their positions and maintain their budgets. However, IT Portfolio Management can change this perception and elevate IT to the status of corporate partner. If you manage technology like any other investment and illustrate the returns and benefits to business leaders, IT becomes a driving force for corporate change and growth.
IT Portfolio Management is a process for directly linking technology with business goals. The Executive Guide to Improving Your Business through IT Portfolio Management will walk you through the IT Portfolio Management model, and suggest ways to transform IT and the role of the CIO into the primary supplier of relevant data to business leaders. This process changes IT from a cost center to a division that directly contributes to the bottom line.
Chapter 1: Managing an IT Portfolio
The goal of every business is to generate revenue. Even in the nonâ€profit and federal business sectors, profit and loss statements are common to illustrate what type of return is being produced. Why then are most CIOs managing to a fixed budget or an ROI for their isolated department? Although many organizations are still making technology investment decisions at the department level, IT Portfolio Management (ITPM) makes it possible to discard this outdated view of â€œsiloedâ€ decision making and provide visibility into all of the work of IT. This level of insight allows business leaders to directly link IT with business goals.
By managing technology like any other investment, it is possible to make informed decisions about specific projects and provide hard data to business decision makers. However, change never comes easily. As a CIO, you have the ability and responsibility to champion this change in your organizationâ€”a change that will increase profits and insure that the right decisions are made based on accurate data.
The first chapter of this eBook discusses why you should use IT portfolio management. You will learn how to incorporate business goals into your company's IT objectives. Getting executives from other departments on board viewing IT as an investment can be a challenge; this chapter will discuss how you can clearly communicate IT risks and positive results to these other departments. Lastly, you will learn about the processes involved in the IT investment life cycle, from capturing the IT demands of the business to delivering and tracking your goals in real-time.
Chapter 2: Capturing IT Demand
Chapter 2 illustrates how the shortcomings of current demand collection and management in IT hinder IT demand visibility. By limiting the number of data entry points, collecting relevant data, and supplying role-based views into the IT organization, an ITPM solution can enable the CIO to move from reactive to proactive management. Such role-based views target the executive level, the project-based level, and the financial level, in order to offer a more complete view of IT demand and the costs to meet that demand. Furthermore, once the demand for IT resources is balanced with IT supply, an accurate measure can be taken of your innovation capacity, and you can move IT away from being a cost center.
Chapter 3: Prioritizing Projects and Investment Decision Making
If you are going to elevate the IT organization to the level of a business partner, you must transform IT data into investment data. By identifying where the strategic and operational demands lie, you can focus IT on the projects that align to corporate goals. CIOs must be able to shift resources from operations to strategic investing in order to be a business partner instead of a technical advisor. This balancing act is an excellent first step; however CIOs must use the role of a business advisor to ensure that your organization's technology investments yield the highest possible returns.
In Chapter 3, you will learn how IT portfolio management will help you accurately gauge the success rate of technology implementations, as well as monitor technology in order to set expectations for all technology stakeholders. You will gain an understanding of how ITPM can assist in measuring the true need for certain IT capabilities in order to prioritize technology investments. Lastly, you will learn a set of steps for communicating the value of IT to all colleagues involved in the budgeting and resource allocation processes, from capturing and consolidating IT demand, to final approval and implementation.
Chapter 4: Delivering and Assessing Your IT Portfolio
Many believe that delivering technology to support products and services is the only reason IT exists. Although that is important, CIOs should also focus on furthering corporate objectives by delivering the right technology at the right time. Equally important is knowing when something should not be delivered because it doesnâ€™t align with corporate goals.
In order to make these important technology delivery decisions, CIOs must assess the value of existing IT assets. This assesment process is something that must continue throughout the IT life cycle. If you could view the demand and performance of your companyâ€™s IT investment on a per-application basis, then you would more easily understand which applications needed your focus. A continuous assessment process will illustrate trending information and anticipate business demand for IT services.
In chapter four, learn how ITPM will give you the tools to assess the value of existing applications and IT demand in order to make informed, value-driven decisions when faced with prioritizing the delivery of new technology and allocation of resources.
Chapter 5: Communicating the Hidden Value of IT
As technology workers, we all face the challenge of IT being perceived as a cost center: The work is all done in other departments, and IT provides the tools to make that work easier, faster, and more efficient. Communicating the results of any IT project back to the business can be considered a phase of the project life cycle. However, transforming the role of IT requires constant communication. Technology is a means to make work easier to do, but IT will be successful only by becoming part of the business process.
Project managers, program managers, and implementation personnel are so overloaded that they must focus on the task at hand to succeed. These roles frequently have no access to executive decision makers, other than the CIO. If CIOs don't act as conduit for positive change in IT, who will? You have to understand the business impacts of your investments and move IT into the decision-making process. The guidance of a strong CIO with the right tools can be the most valuable asset in any organization.