IT Project Portfolio Management

March 25th 2014

► Executive Director of EY TMT (technology, media and telecom) industry performance improvement team in Hong Kong

► 15 years of consulting experiences in market strategy, operating model transformation, IT strategy and complex program management

► Advised clients in Asia Pacific, Europe and US.

► Master degree in Computer Science and Information Systems from The University of Hong Kong

Stanley Yung

Agenda

• Project Portfolio Management• Real Life Lessons• Measurement of Success

How IT is Managed

EnablementGovernance & Alignment

Management & Delivery

Business Strategy

IT Capability

Drive• IT Blueprint• Portfolio Investment

Approach• Project Selection

Approach• Business Case

Enable• Capability

Development• Innovation• Portfolio Performance

Metrics

What guides IT decisions

CIO / the “Strategy” unit

Blueprint to direct investment for maximum value

Annual plan to pace with market, priority and organizational changes

Architecture view and initiatives management

Agreed PrioritiesThe IT blueprint will be developed and updated annually based on business priorities agreed with business leaders and endorsed by steering committee.

Short-term (12-18 months) Longer-term (18-36 months)Core Business Needs

• Complete 3G voice network

• Offer mobile data services• Customer service hotline• Enable mobile number

portability

• Capacity upgrade to accommodate new users

• Integrate with fix-line

Other Needs • Strengthen risk management

• Launch new 4G products• Test TD-SCDMA• Implement mobile anti-

virus scanning

• CRM and predictive churn model

Different models of project selection

Tightly Controlled Holding CompanyIntegrated Model

$ $ $ $ $

BU 1 BU 2$ $

$ $ $ $

BU 1 BU 2 $ $$ $

IT investment is centralized at enterprise level.

Minimal IT investment and spending at the BU levels.

Distributed investment.

Investment in common IT at enterprise level.

Investment in specific business applications at BU level.

Heavier investment at the smaller bank or BU level.

Investment in a few common areas at enterprise level.

$ $

Subsidiary 1 Subsidiary 2$ $

IT Spending is Tracked

DiscretionaryCAPEX

Non-Discretionary

OPEX

DiscretionaryCAPEX

Non-Discretionary

OPEX

Company Benchmark

Discretionary expenditure refers to investment for business value creation.

ERP Solution CRM Platform eCommerce

Non-discretionary expenditure refers to expenses on operations, and must-do IT spending.

Data Center Operation Helpdesk Operation

Business Case Driven Project Selection

Business cases must be developed before any investment can be made in IT.

The business case must be owned by a business leader and monitored to real value the investment delivers.

Business cases is usually evaluated based on urgency, value, risk and dependencies.

Business Case

Key Components – Current State, Purpose, Scope / Time, Cost of capital, Capital investment / start up costs, Useful life, Operating expenses, Benefits to be realized

Right Metrics – ROI, Payback periods

Users owned benefits drivers

Simple math with few key assumptions

No One Size Fit All

ProjectGovernance Review Process

Project Registration

Conceptual Design Review

Detail Design Review

Build and Install Review

Production Review

• Ensure enough information for classify full/fast track

• Ensure quality on architectural component level

• Ensure quality on ready for build

• Ensure quality on ready for production

• Ensure quality on sustainable operation

Full Track(for projects with relatively high cost and/or risks)

Conduct depends on previous review results and project needs.

Fast Track(for IT projects with relatively contained cost and/or risks)

Required review steps

Conditional review step

Upgrade Review

Tracks Differentiation

Balanced Project Profiling

Project Profile Filters Hardware + Software + Services > US$ X,

or

Insource Effort > 50 Man Month, or

Project Duration > 1 Year, or

Cross Application Division, or

Introduction of New Technology, or

Strategic (determined by IT Directors)

IT Project N+1(Division C)

IT Project N(Division A)

IT Project 1(Division A)

IT Project 2(Division B)

IT Project 1(Division A)IT Project 2

(Division B)

Match

any of the criteria

IT Project 3(Division B)IT Project N

(Division A)

IT Project 5(Division A)IT Project 6

(Division B)IT Project 7(Division B)IT Project 8

(Division B)IT Project 10(Division A)IT Project 9

(Division B)IT Project 4(Division B)IT Project N+1

(Division C)

Fast Track Review Group

Full Track Review Group

All IT Projects Classification Criteria

Match

none of the criteria

Portfolio is Managed

DiscretionaryCAPEX

Non-Discretionary

OPEX

StrategicX%

EnablingY%

SustainZ%

IT executives are measured by CAPEX / OPEX target

IT executives actively drive usage of discretionary spending to achieve goals agreed with business

Strategic goals Enabling tools Sustain enhancements

Agenda

• Project Portfolio Management• Real Life Lessons• Measurement of Success

Lesson #1 – Human Factors

• Facts– Decisions are made by human– Decision = bias– Enterprise and personal goals not always align

• Strategies– Consider human factors– Build in success factor to kill 2 birds with 1 stone

Lesson #2 – Enterprise Factors

• Facts– Most enterprises are partially business case driven– Initiatives are prioritized predominately based on

budget, difficult to approve big work in one go

• Strategies– Challenge yourself what needs to be done minimally– Structure initiative into phases– Get into the door to demonstrate the benefits

Lesson #3 – User Factors

• Facts– IT is here to support business– Least appealing projects are purely IT capability

projects

• Strategies– Find business buyers on your idea– Test and build business needs– Have business users initiate the needs

Lesson #4 – Government Factors

• Facts– Non-public Sector – Drive revenue and minimize

cost– Public Sector – Drive revenue and keep cost– In conglomerate as well

• Strategies– Know previous year budget– Know what has been left before proposing

Lesson #5 – China Factors

• Facts– Western – IT is top-down– China – IT is bottom-up and then top-down

• Strategies– Create needs in working level– Get executives to hear from internal channel

Lesson #6 – Wrong in Right

• Facts– Having the wrong project approved is worse than

having the right project not approved– Enterprise lost US$ M and personal credibility damned– Cherish your own brand and career

• Strategies– Receptive to opposite ideas– Always ask for second opinion

Lesson #7 – Selling & Exchanging

• Start a question with options

• Start a request with an offer

Agenda

• Project Portfolio Management• Real Life Lessons• Measurement of Success

Measurement of Success

• PMP’s definition of project– A project is a temporary endeavor undertaken to

create a unique product, service or result.

• Quality– No More– No Less– Fit for Use

Discussion

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