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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
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Digital Innovations Assets Projects
Tactical Digital Innovations Applications Initiatives
Strategic Digital Innovations Infrastructure Projects
Transformational Digital People, Information, Programs
Innovations (i.e., the Discovery Processes, Services
再ppl 吋ransformational
同eople Digital Innovations
同rocesses cations
吁trategic Digital
吋actical Digital 匈nformation
匈nfrastructu re 同rograms
For example, using IT portfolio management to analyze the application portfolio might unearth an enormous financial waste and strategic alignment opportunity. If it were discovered that four versions of SAP with overlapping functionality and data stores existed in the current baseline, there would be a high likelihood that three systems would be decommissioned, improving governance, increasing data quality, and possibly reducing licensing and maintenance fees.
Digital innovations are IT-driven changes to short-, medium-, and long-term business strategy. If the IT organization lacks credibility in the eyes of the business, which it does at least 70% of the time, a discovery portfolio is most probably inappropriate. Most organizations begin with projects, skipping the discovery phase altogether. Specifically, they apply the IT portfolio management process to initiatives being proposed for funding. It is the least complex approach to derive benefits from IT portfolio management. Applying IT portfolio management to initiatives tends to be timed with a funding cycle (i.e., traditional budget planning process).
If IT portfolio management is being instituted after a completed budgeting
cycle, projects and programs tend to be the next logical starting point. They are more complex than initiatives because they are generally funded and underway, but they are less complex than decommissioning assets in production. Adjusting the project mix to align it better with organization strategy and tolerance for risk tends to positively impact the business. This is because 80% of project portfolios are out of alignment with business objectives and strategy.
Additionally, in most instances, applying IT portfolio management to an existing project portfolio can identify 15% to 20% in excess spending. IT spending on average is between 1.5% and 7.0% of revenues. Roughly 25% of IT spending can be tied to projects; in research surveys, 22% of IT spending was devoted to transforming the business and 26% was capitalizedtwo facts supporting the reasonableness of the 25% estimate. Thus, on average, applying IT portfolio management to an organization can save a hard dollar percentage between 0.5% and 1.25% of the firms revenue. The magic, however, is not in the technique itself but in how and where it is appliedit must be to an area or subportfolio that would benefit.
Defining Portfolio Management Objectives
By now, a thorough understanding of capabilities exists. Pain points that might be alleviated through IT portfolio management have been identified. Ideally, the business vision has been supplied to the IT portfolio management team as an input to assist with prioritization of IT portfolio management. This business vision can come from the enterprise architecture group, the IT strategy group, or the CIO. Ah, but if only the world were perfect. Often, the IT portfolio management team must explore strange new worlds . . . seek out new life and new civilizations . . . boldly go where no IT professional has gone beforethe IT portfolio management team must extract the business vision from existing documents or facilitate the development of a business vision.
With the business executives, the spirit of a business vision within the IT portfolio management effort is to find agreement between IT and business management on a common and cohesive vision of the business and key business challenges, as well as the opportunities and problem corridors the company expects to encounter in a defined planning horizon. The focus will be on the most important driving strategies influencing significant change in the enterprise. Unlike a traditional set of strategies commonly generalized in corporate communications, the business vision applied to IT portfolio management is a key input for the IT portfolio. If those involved in balancing the IT portfolio can do so in the context of the business vision, a key objective of IT portfolio management has been metalign-ment between business and IT.
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