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RJ MeehanChief Technology Officer
27 April 2010V1.1
Producing Metrics to Measure Strategy-Execution Alignment During ADM Phase E
Producing Metrics to Measure Strategy-Execution Alignment During ADM Phase E | 27 April 2010 2
Agenda
Key benefits of deriving these metrics
How to derive alignment metrics using traceability modelling
Key lessons learned and observations from using this approach "in the field"
Producing Metrics to Measure Strategy-Execution Alignment During ADM Phase E | 27 April 2010 3
•
Why phase E?−
That’s where you compile your candidate project portfolio (draft “Implementation and Migration Plan”)
•
TOGAF ADM v9 states:−
“When this phase is approached from an enterprise strategic change perspective, the identification of opportunities and solutions is done in a top-down fashion…”
−
However, in some circumstances the organizational environment does not allow for a top-down approach. In these circumstances this phase is approached in a tactical opportunistic way.” – i.e. bottom-up
•
Question - How do we know how well this project portfolio moves us towards the business vision?
TOGAF ADM Phase E – Opportunities & Solutions
What does TOGAF ADM v9 have to say about strategy-IT execution alignment?
Producing Metrics to Measure Strategy-Execution Alignment During ADM Phase E | 27 April 2010 4
Alignment – an often used term
What are the symptoms of poor alignment that we see?
Introduction
What’s the opportunity?
“If you treasure it, measure it”−
What does this enable?
−
Is the target to have 100% alignment? Not necessarily –•
This is not an academic exercise for fun, it’s not a game•
Desired outcome is achievable, sensible alignment•
Stop once you’ve got the value from the process, until next time
Images: Salvatore Vuono / m_bartosch / FreeDigitalPhotos.net
Producing Metrics to Measure Strategy-Execution Alignment During ADM Phase E | 27 April 2010 5
In this case, we mean the alignment of…
•
We do not mean: measuring current IT estate alignment to business strategy, hence the words “alignment to execution”
•
Other parts of TOGAF ADM should identify these misalignments and derive a candidate project portfolio to address these gaps
Introduction
So what do we mean by business strategy-execution alignment?
Producing Metrics to Measure Strategy-Execution Alignment During ADM Phase E | 27 April 2010 6
Agenda
Key benefits of deriving these metrics
How to derive alignment metrics using traceability modelling
Key lessons learned and observations from using this approach "in the field"
Producing Metrics to Measure Strategy-Execution Alignment During ADM Phase E | 27 April 2010 7
•
Projects should not exist unless they support business strategy, i.e. if there is no traceable “business value”, then why are we doing it?
•
Two possible explanations:−
The declared strategy is wrong in some way, e.g. missing something
−
The project is a sub-optimal use of resources which would be better invested in some other way
•
Needs to be repeated at intervals, which depends on your TOGAF ADM EA refresh “cycle”
Deriving alignment metrics using traceability modelling
Fundamentals of the approach
Producing Metrics to Measure Strategy-Execution Alignment During ADM Phase E | 27 April 2010 8
Traceability Method
An overview…
Potential Discontinuity
req Traceability
Manage Costs
(from Corporate Strategy)
Diversify
(from Corporate Strategy)
Exit some markets
(from Corporate Strategy)
Decommission duplicate systems
(from Manage Costs)
Close London office
(from Manage Costs)
Acquire Company X
(from Diversify)
Launch product Y
(from Diversify)
Market products in Asia
(from Diversify)
Centralise operations centres
(from Exit some markets)
Provide all warranty support from US
(from Exit some markets)
Sell division Z
(from Exit some markets)
Name: TraceabilityAuthor: RMeehanVersion: 1.0Created: 16/04/2010 18:09:12Updated: 23/04/2010 08:03:54
Decommission System A
(from Projects1-10)
Network upgrade
(from Projects1-10)
Sales management tool implementation
(from Projects1-10)
Vision - Be a world class, market leading organisation
(from Corporate Strategy)
Image: djcodrin / FreeDigitalPhotos.net
0
1
2
3
4
No of times project realises a strategy
Strategy item A, $17.446m49%
Strategy Item B, $3.066m6%
Strategy Item C, $8.58m18%
Strategy Item D, $7.616m11%
Strategy Item E, $2.028m3%
Strategy Item F, $2.995m4%
Strategy Item G, $2.312m3%
Strategy Item H, $0.375m2%
Strategy Item I, $0.32m4%
Strategy Realisation
Producing Metrics to Measure Strategy-Execution Alignment During ADM Phase E | 27 April 2010 9
A demo of capturing the traceability…
req Traceability
Manage Costs
(from Corporate Strategy)
Div ersify
(from Corporate Strategy)
Exit some markets
(from Corporate Strategy)
Decommission duplicate systems
(from Manage Costs)
Close London office
(from Manage Costs)
Acquire Company X
(from Diversify)
Launch product Y
(from Diversify)
Market products in Asia
(from Diversify)
Centralise operations centres
(from Exit some markets)
Provide all warranty support from US
(from Exit some markets)
Sell division Z
(from Exit some markets)
Name: Traceabil ityAuthor: RMeehanVersion: 1.0Created: 16/04/2010 18:09:12Updated: 23/04/2010 08:03:54
Decommission System A
(from Projects1-10)
Network upgrade
(from Projects1-10)
Sales management tool implementation
(from Projects1-10)
Vision - Be a world class, market leading organisation
(from Corporate Strategy)
Producing Metrics to Measure Strategy-Execution Alignment During ADM Phase E | 27 April 2010 10
Example Results #1
Some strategy objectives barely have any projects to deliver them…
Strategy item A, $17.446m49%
Strategy Item B, $3.066m6%
Strategy Item C, $8.58m18%
Strategy Item D, $7.616m11%
Strategy Item E, $2.028m3%
Strategy Item F, $2.995m4%
Strategy Item G, $2.312m3%
Strategy Item H, $0.375m2%
Strategy Item I, $0.32m4%
Strategy Realisation
Producing Metrics to Measure Strategy-Execution Alignment During ADM Phase E | 27 April 2010 11
Example Results #2
0
1
2
3
4
No of times project realises a strategy
Some projects have no discernable relationship to strategy…
27% of projects not justified?
Producing Metrics to Measure Strategy-Execution Alignment During ADM Phase E | 27 April 2010 12
Agenda
Key benefits of deriving these metrics
How to derive alignment metrics using traceability modelling
Key lessons learned and observations from using this approach "in the field"
Producing Metrics to Measure Strategy-Execution Alignment During ADM Phase E | 27 April 2010 13
Strategy deficiencies
•
Strategy objectives look well defined, but you realise they are not−
not specific enough
−
hard to measure when we are “done” and no timescale defined−
e.g. “Provide a world-class service” needs to be broken down into departmental objectives
•
It is not until the strategy is “tested” in this way that this becomes apparent
•
Strategy items need to be specified in “SMART” terms, i.e.−
Specific
−
Measurable−
Attainable
−
Relevant−
Time-based
Common observations #1
Key lessons learned and observations from using this approach "in the field“…
Producing Metrics to Measure Strategy-Execution Alignment During ADM Phase E | 27 April 2010 14
Project selection in TOGAF Phase E
•
Projects appear that seem to not be traceable to business strategy•
Often this is due to known but unstated strategy decisions−
e.g. “Keeping the lights on”/IT estate maintenance
•
“Personal/pet” projects stand out – there’s nowhere to hide!−
Takes the emotion out of their identification
−
Nothing wrong with pursuing pet projects – maybe the strategy is missing an “innovation” objective?
Common observations #2
Key lessons learned and observations from using this approach "in the field“…
Producing Metrics to Measure Strategy-Execution Alignment During ADM Phase E | 27 April 2010 15
•
Get started! To gain a “benchmark” understanding
•
Measure traceability on a 1-5 scale−
Not all traceability relationships are equal
•
Bring other project metrics into consideration (see phase F documentation)−
Not all projects are considered equal
−
Opportunity cost, risk etc
•
Build this analysis into your organisation’s customised TOGAF ADM framework−
As we know, EA methods need to “live and breathe”, not just be “point in time” endeavours
Where next?
Once you are ready to get more sophisticated…
Copyright © 2010, Smart421. All rights reserved.A copy of this presentation is available on request
RJ Meehan Chief Technology [email protected]
www.smart421.comFor more information, please visit our website