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© 2007 EPK Group, LLC. All Rights Reserved
Fast Track ROI For Fast Track ROI For Portfolio, Project, And Portfolio, Project, And Resource Resource ManagementManagementRich MurphyFounding PartnerEPK Group LLC
© 2007 EPK Group, LLC. All Rights Reserved
Prioritizing Initiatives across the organizationDo we have the right people working on the right things?Are we spending effort on projects that should be cancelled?Do we have the skills and capacity to achieve our long term goals?Do we have the right mix of “operational efforts vs. major projects”
© 2007 EPK Group, LLC. All Rights Reserved
Foundation 47%Utility 21%Enhancement 21%Frontier 11%
Bill Rosser – Gartner PPM Summit Keynote, June 2007
32% produces identifiable business value
© 2007 EPK Group, LLC. All Rights Reserved
Which projects best support the corporate strategy? Where should the resources from a project nearing completion best be allocated?Which programs, projects, and infrastructure support efforts are currently behind schedule, over budget , and why?Do we have enough of the right people to successfully take on a key initiative?How is the resource plan impacted when a new project is added to the portfolio?
……is a is a processprocess …something we do, to answer …something we do, to answer questions like:questions like:
© 2007 EPK Group, LLC. All Rights ReservedSource: PMI draft Portfolio Management
Standard
Vision, MissionStrategic plan
Portfolio Performance review
Identification, categorization, evaluation, selection, prioritization, balance and authorization of Portfolio components
Project / Program performance reviewProject / Program
management process
Delivering completed Project / Program to operations
Project ProgramRequests
Strategic Objectives
OperationsOperations
StrategicStrategicPlanningPlanning
PortfolioPortfolioManagementManagement
Project/ProgramProject/ProgramManagementManagement
© 2007 EPK Group, LLC. All Rights Reserved
G
overn
an
ce
Govern
an
ce
People, Process & TechnologyPeople, Process & Technology
ProjectMgmt.ProjectMgmt.
Consistent, Repeatable Delivery
Integrated Delivery
Portfolio Mgmt.
Portfolio Mgmt.
Investment & Prioritization Decisions
Alignment with Objectives
ProgramMgmt.
ProgramMgmt.
Program & Project Dependencies
© 2007 EPK Group, LLC. All Rights Reserved
Project Management Challenges (what worries you most?):
IssuesIssues FY1FY1 FY2FY2
Changing Organizational PrioritiesChanging Organizational Priorities 43%43% 50%50%
Change ManagementChange Management 35%35% 40%40%
Risk Assessment and ManagementRisk Assessment and Management 37%37% 36%*36%*
Alignment between project and Alignment between project and organizational goalsorganizational goals
20%20% 21%21%
Project Management Skill LevelProject Management Skill Level 34%34% 33%*33%*
Scope ClarityScope Clarity 50%50% 49%*49%*
Source: BIA and Giga Information Group
* Showed slight improvement (just 1% year on year)* Showed slight improvement (just 1% year on year)
© 2007 EPK Group, LLC. All Rights Reserved
There have been slight improvements in PM practicesBut, most still aren’t buying into the concept of organizational project managementResult is that reactive behaviors stemming from habit and external pressures tend to preside over proactive ones.Personal and political preferences decide priorities more than alignment with business goals
© 2007 EPK Group, LLC. All Rights Reserved
Selection Selection Criteria & Criteria & CategorizatioCategorizationn
Projects Projects ““Killed” for Killed” for risk and non-risk and non-strategic strategic alignmentalignment
Portfolio Portfolio Performance Performance Oversight Oversight
Business Business Needs Needs DrivenDriven
Project Project ScoringScoring
Financial Financial Justification Justification
AuthorizatioAuthorization Board n Board
Stage 1
Stage 2 Stage 3 Stage 4
Strategic Strategic Roadmap Roadmap (Business/IT)(Business/IT)
Balanced Balanced PortfolioPortfolio
Clear and Clear and communicatecommunicated ROI and d ROI and business business benefitsbenefits
Politically Politically DrivenDriven
Ad hoc Ad hoc
Fire FightingFire Fighting
Budgeting Budgeting ProcessProcess
© 2007 EPK Group, LLC. All Rights Reserved
SCORING MODEL EXAMPLE
List of Criteria Weight Low Medium High Score Total
Financial Return 20% 0 5 10 10 2
Asset Leverage 20% 0 5 10 10 2
Operational Impact 10% 0 5 10 5 0.5
Strategic Alignment 15% 0 5 10 10 1.5IT Standards Alignment
10% 0 5 10 5 0.5
Project Complexity 10% 0 5 10 10 -1
Risk of Failure 15% 0 5 10 5 -0.75
100% 6.50
-1.75
4.75
Evaluation
Va
lue
Ris
k
Total Score
Value
Risk
Source: PMI draft Portfolio Management Source: PMI draft Portfolio Management StandardStandard
© 2007 EPK Group, LLC. All Rights Reserved
Lack of executive support – ineffective GovernanceOrganizational Barriers – incentives lead business unit leaders to compete for resources rather than optimizeLack of clear objectives – strategy not articulatedLack of IT awareness – business not understanding technology impacts on businessReactionary mindset – fire fighting rather than planning
© 2007 EPK Group, LLC. All Rights Reserved
It’s about much more than “project” managementIts about more than a “tool”
© 2007 EPK Group, LLC. All Rights Reserved
Portfolio managementIdentify all the effortsEstablish a stage-gate control process
Budgeting/cost managementResource planning, “capacity vs. demand”Project ManagementTimekeeping
Approach the first 3 in that order.Timesheets can come anywhere in your implementation.
© 2007 EPK Group, LLC. All Rights Reserved
Don’t assume you have a complete list because management has a list they useCategorize as:
Major projects (approved)Operations/supportNew initiatives (not yet approved)
Gather some common information about every effort:
Planned start and finishOverall manpower budget (must be time-phased)What business goals does it support?Who’s in charge?
© 2007 EPK Group, LLC. All Rights Reserved
What type of costs?BudgetProject ForecastActuals
Cost categoriesLabor
In-houseContract
HardwareOverheadContingency
Fiscal reporting periods
© 2007 EPK Group, LLC. All Rights Reserved
“Stage-gates” are NOT “phases” of a projectThey are the approval/review process steps that all major efforts should pass throughEach “stage-gate” has business rules regarding the required data to move to the next stage.IT Governance Board should be directly involved in certain stage-gate reviews based on a published criteria.
© 2007 EPK Group, LLC. All Rights Reserved
Start with resource planning at high levelInstitute a formal “negotiation” processMaintain “commitments” and detail project assignments separately
© 2007 EPK Group, LLC. All Rights Reserved
Carefully consider reporting needsException based reportingOrient reports to management levelsExtensive graphical viewsLimit number of reports any person receives
© 2007 EPK Group, LLC. All Rights Reserved
Don’t go for the “big-bang” approach to implementation.
Start with an inventoryIntroduce stage-gates for all effortsEveryone does NOT have to become a project managerTimesheet (if required) can be introduced at any point in the overall implementation
Implementing a system requires review of your processes and change managementResource management is the key problem for most organizations
© 2007 EPK Group, LLC. All Rights Reserved
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