in black and white
Main menu
Share a book About us Home
Biology Business Chemistry Computers Culture Economics Fiction Games Guide History Management Mathematical Medicine Mental Fitnes Physics Psychology Scince Sport Technics

IT Portfolio management step by step - Maizlish B

Maizlish B, Handler R. IT Portfolio management step by step - John Wiley & Sons, 2005. - 401 p.
ISBN.: 978-0-471-64984-8
Download (direct link): itportfoliomanagement2005.pdf
Previous << 1 .. 165 166 167 168 169 170 < 171 > 172 173 174 175 176 177 .. 181 >> Next

Soft benefits are, as the name suggests, somewhat intangible and difficult to measure, yet nonetheless very important. Project planning and business case stages analyze whether a particular project would improve service quality or improve responsiveness to customers, contributing to an enhanced reputation and a stronger brand. Where these benefits can be objectively quantified, they can be counted as hard benefits and included in the project’s EVA. Where such benefits do not flow directly to the bottom line, they are counted toward the project as more of an intangible.
As candidate projects move through these first three stages, the scores earned by each project typically decrease. As ideas are fleshed out and put under the increasingly harsh light of the planning and business case stages, the business value tends to descend from the clouds and the innovation score usually drops as well. This is not viewed as a bad thing, since most ideas of any kind tend to overestimate benefits and underestimate costs and risk. The Xcel Energy PMO puts the emphasis on the relative value of projects being considered. The flip side of declining value scores is the increasing confidence in the accuracy of the scores as more analysis is completed.
Xcel does not treat benefits lightly. Business units are held accountable for realized expected benefits when a business case is approved. To ensure this point isn’t lost, the last stage of the project process—post-implementation—serves to validate that benefits are being realized and costs were as expected. This stage will be discussed later.
As the business case stage nears completion, Xcel Energy Business Systems (IT) performs an independent evaluation before a decision on full funding is made. Each case is evaluated in three areas: project risk, business risk, and financial return. A “perfect” project would score 100, but in practice this is unattainable (example, Exhibit G). The score achieved represents a comparative assessment
against the ideal. This is used to demonstrate that risks and return have been carefully evaluated, and is intended to provide a general “yardstick” on the project’s chances of success at this point. It’s important to remember that all approved projects at Xcel Energy are critical and intended to be successful, so this scorecard is more a metric of how much oversight will be required to ensure the project is successful.
-mJ- -õÖ
Total Possible Achieved
I Financial ãÏ Risk Value
*Note: displays estimated business case value against total possible for the candidate project shown in Exhibit H.
Source: Copyright © Xcel Energy, Inc.
Once a business case is approved for full project funding, it moves forward rapidly into the execution stages. However, on some occasions other projects may need to be delayed or cancelled to fund very high ROI opportunities that Business Systems and the BU sponsors feel should be accelerated.
Project start-up is expected to take no more than five days, as the preparation has really been done in the business case stage. During start-up, contracts are signed, people are brought on board, the scope is rechecked, kick-off meetings are held and the project plan is baselined. This can all be done quickly because the business case stage included development of all required pricing information and estimates, preparation of required contracts, and legal review. These items are incorporated into the business case stage to ensure that cost estimates are as accurate as possible for decision-making purposes. Therefore, for approved projects, all that should be required in the initiation stage are signatures and kick-off meetings.
Throughout this process, all project actions are consistently monitored, enforced, and reported to stakeholders through Mercury dashboards. Project status can be viewed in any number of ways, depending on the requirements and interests of each executive team member. Major projects with multiple independent components are typically termed “programs,” with individual components managed as projects within the program. Each project in a program is managed independently, but tied to the overall program schedule, with all data in the projects automatically rolled up into a single program view.
A typical project dashboard format (see Exhibit H) would include summary information such as business sponsor, project manager, start and end dates, and budget, as well as completion status and detailed performance-to-date against schedule and budget. These dashboards offer drill-down access to more detailed information in each category by clicking on the item of interest.
Xcel Energy uses a measure called “project health” to give a snapshot view of each project’s status (Exhibits I and J). Seven key indicators of project health have been identified that are measured against the plan baseline including budget expended to date, budget expected at completion, milestones achieved to date, tasks completed to date, labor hours expended to date, labor hours expected at completion, and project issues. Using this data, project status is distilled into traffic signal (red—yellow—green) displays to instantly alert executives to the relative health of each project. A 10% variance (over or under) on any of the metrics automatically turns the project yellow; a 15% variance turns it red. Similarly, missing a deadline to submit project status reports immediately turns the project red. The use of agreed-upon metrics to measure project health has replaced a variety of subjective measures used by individual project managers, which made truly objective comparisons impossible.
Previous << 1 .. 165 166 167 168 169 170 < 171 > 172 173 174 175 176 177 .. 181 >> Next