The Value Driven Future

The bridge can be built by focusing

on Value & better Portfolio Management

80% of

PMOs are

below level 3

The

competitive

landscape is

in constant

Flux

Organizations

have already

taken all the

easy cost

reductions

The focus

shifts to

competitive

advantage

This makes

the success of

the planned

investment

more

important

Success

therefore isn’t

completion of

the project –

it is Value

Generated

Value

Generated

requires the

project to

deliver the

things that

enable the

value

generation

Maximum

Value

Generation

generally

entails

CHANGE

Unless you know to look for it…

You won’t see the impact of these changes until your organizationhas passed step 4

Then by the time You see the need to change

it’s too late…

4

“I don’t want to see anything about on-time and on-budget

in your reports. Going forward it’s all about value delivered”

Midwestern insurance company CIO

Resources

• Tacit Knowledge

• Thought Leadership

• Commissioned

Research

Curriculum

• Outcome driven

• Execution alternatives

Member Success

• Respect as measured

by press

• Good Compensation

Valu

e C

hain

Portfolio

Focus

Financial

Focus

Product

Focused

Value

The Value Based Portfolio

Transcends IT

IT Centered

Projects

Benefit Centered

Business Projects

Accounting for Value

Enterprise Portfolio

Roadmaps & Blue Prints

S/W Product Development

Benefits Realization PlanProgram Plan

Results Chain

Strategy A Strategy B Strategy C Strategy D

Finance Project 1

Project 5

Project 10

Project 4

Customer Facing Project 3

Project 12

Process

Improvement

Project 2

Project 9

Project 8

Project 13

Project 11

Project 14

Project 6

Project 15

Innovation/

Learning and Growth

Project 7

And no – this isn’t short term thinking – This is real prioritization

This is a simultaneous

equation requiring

optimizing for

Maximum Value across

competing priorities.

Finally remember…

It’s you, rather than Management, who is responsible for the analysis

Re-orient Your PMO to

Successfully Cross the Chasm

• Today everything is either a Project or it’s operations

• Tomorrow there will be:

• Programs for large change

• Projects for Intra-organizational change (which includes IT)

• New Product Develop Efforts for software that touches the customer (and might produce revenue)

• Product Releases for continuous change to maintain business capabilities

• Continuous change efforts (Kaizan, Workouts) and IT bug fixing

• Initiatives – speculative, exploratory work that might produce something new but also might determine that something shouldn’t be done.

Operations/

Production

Product Dev &

Evolving

Shared

Value chain

Control

&compliance

Corporate

CAPEX

Emergent

Responses

within

SBUs &

Functions

18

Traditional PMO Enterprise PMO

Investment FocusResponsible for discretionary spend for

projects

Visibility across all spend, both lights-on

and discretionary

Portfolio FocusResponsible for managing project

portfolios only

Responsible for integrating all portfolios

and mapping to business capabilities

Innovation & Portfolio SelectionDemand is consolidated from bottom up

requests from across the business

Higher quality demand is generated from

analysis of business capabilities /

products

Funding & AllocationFunding allocated by department and

organization utilizes an annual planning

model

Funding allocated by business capabilities

and teams empowered to adopt a dynamic

planning model

Portfolio Tracking & MeasurementA tactical focus on managing schedules,

resources and scope

More emphasis on tracking project

financial performance & maximizing ROI

across the investment portfolio

Benefits TrackingBased on project level ROI and often no

process for tracking actual benefits

Benefits realization framework

established at program or capability level

Take Your PMO to a New Level