IT Project Portfolio Management

286 Pages·2005·2.405 MB·English

by  Stephen S. Bonham

IT Project Portfolio Management
ForacompletelistingoftheArtechHouseEffectiveProjectManagementSeries,
turntothebackofthisbook.
IT Project Portfolio Management
Stephen S. Bonham
artechhouse.com
LibraryofCongressCataloging-in-PublicationData
Bonham,StephenS.
ITprojectportfoliomanagement/StephenS.Bonham.
p. cm.—(ArtechHouseeffectiveprojectmanagementseries)
Includesbibliographicalreferencesandindex.
ISBN1-58053-781-2(alk.paper)
1.Informationtechnology—Management. 2.Projectmanagement.
I.Title. II.Series.
T58.64.B65 2004
004’.068’4—dc22
BritishLibraryCataloguinginPublicationData
Bonham,StephenS.
ITprojectportfoliomanagement.—(Effectiveprojectmanagementseries)
1.Informationtechnology—Management 2.Projectmanagement—dataprocessing
3.Strategicplanning
I.Title
658.4’04
ISBN1-58053-781-2
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TomyDad,Charlie,andtomydearwife,Olivia
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Contents
Preface . . . . . . . . . . . . . . . . . . . . . . . . . . xiii
Acknowledgments . . . . . . . . . . . . . . . . . . . . xix
1 Introduction to IT PPM . . . . . . . . . . . . . . . . . 1
1.1 MPT. . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.1.1 FinancialInvestments . . . . . . . . . . . . . . . . . 2
1.1.2 ProjectInvestments . . . . . . . . . . . . . . . . . . 6
1.2 ITProjectManagement. . . . . . . . . . . . . . . . . . . 9
1.2.1 VariableSchedule. . . . . . . . . . . . . . . . . . . 10
1.2.2 VariableCost/Budget . . . . . . . . . . . . . . . . . 12
1.2.3 VariableFunctionality/Scope/Quality . . . . . . . . . . 12
1.2.4 Risk . . . . . . . . . . . . . . . . . . . . . . . . 13
1.3 PortfolioSelection . . . . . . . . . . . . . . . . . . . . 16
1.3.1 Maximization . . . . . . . . . . . . . . . . . . . . 16
1.3.2 StrategicAlignment. . . . . . . . . . . . . . . . . . 17
vii
viii ITProjectPortfolioManagement
1.3.3 Balance . . . . . . . . . . . . . . . . . . . . . . . 19
1.3.4 ResourceAllocation. . . . . . . . . . . . . . . . . . 20
1.4 TheITPMO. . . . . . . . . . . . . . . . . . . . . . . 21
1.4.1 PMORollout . . . . . . . . . . . . . . . . . . . . 27
References 29
Appendix1A:ITPPMinAction—GovernmentRegulations . . . . . 33
1A.1 BaselII . . . . . . . . . . . . . . . . . . . . . . . 33
1A.2 Clinger-CohenAct . . . . . . . . . . . . . . . . . . 34
1A.3 Sarbanes-OxleyAct . . . . . . . . . . . . . . . . . . 34
2 Strategic Alignment . . . . . . . . . . . . . . . . . . 37
2.1 CorporateStrategy . . . . . . . . . . . . . . . . . . . . 37
2.1.1 Problems . . . . . . . . . . . . . . . . . . . . . . 40
2.1.2 Solutions . . . . . . . . . . . . . . . . . . . . . . 41
2.2 ITProjects. . . . . . . . . . . . . . . . . . . . . . . . 42
2.2.1 ChangingDirections . . . . . . . . . . . . . . . . . 42
2.2.2 VectorAnalysis. . . . . . . . . . . . . . . . . . . . 43
2.2.3 ProjectA—Growth . . . . . . . . . . . . . . . . . . 45
2.2.4 ProjectB—Productivity . . . . . . . . . . . . . . . . 47
2.2.5 Lessons . . . . . . . . . . . . . . . . . . . . . . . 48
2.3 StrategicFrameworks . . . . . . . . . . . . . . . . . . . 49
2.3.1 Alignment. . . . . . . . . . . . . . . . . . . . . . 49
2.3.2 PortfolioSelectionandTracking . . . . . . . . . . . . 51
2.4 ReengineeringCumulativeDigression . . . . . . . . . . . . 53
2.5 Summary . . . . . . . . . . . . . . . . . . . . . . . . 55
References 55
Appendix2A:CaseStudy—RoyalCaribbeanCruises—Microstrategies 57
3 Portfolio Flexibility . . . . . . . . . . . . . . . . . . 59
3.1 RiskandMethodologies . . . . . . . . . . . . . . . . . . 60
3.2 Flexibility . . . . . . . . . . . . . . . . . . . . . . . . 61
3.3 InitiativeMethodologies. . . . . . . . . . . . . . . . . . 62
3.3.1 Phase1—UnderstandtheProblemandItsContext . . . . 65
3.3.2 Phase2—Risk/Option/CostAnalysis. . . . . . . . . . . 65
Contents ix
3.3.3 Phase3—PresentationandProjectPreparation . . . . . . 73
3.3.4 Phase4—MetricMapping . . . . . . . . . . . . . . . 75
3.4 ProjectMethodologies. . . . . . . . . . . . . . . . . . . 76
3.4.1 Pitfalls . . . . . . . . . . . . . . . . . . . . . . . 78
3.4.2 AuditPoints . . . . . . . . . . . . . . . . . . . . . 79
3.5 Summary . . . . . . . . . . . . . . . . . . . . . . . . 83
References 85
Appendix3A:CaseStudy—ArtesiaBC—FlexibleBalancedScorecard . 87
4 The IT Portfolio Management Office. . . . . . . . . . 89
4.1 DefiningITPMO. . . . . . . . . . . . . . . . . . . . . 89
4.1.1 ProjectOffices . . . . . . . . . . . . . . . . . . . . 89
4.1.2 ITPMORequirements . . . . . . . . . . . . . . . . 90
4.1.3 TailoredPMOs. . . . . . . . . . . . . . . . . . . . 92
4.2 VirtualPMO. . . . . . . . . . . . . . . . . . . . . . . 93
4.2.1 Committees . . . . . . . . . . . . . . . . . . . . . 94
4.3 PMOStructure. . . . . . . . . . . . . . . . . . . . . . 96
4.3.1 Large,Project-CentricCompanies. . . . . . . . . . . . 96
4.3.2 SmallerorLessProject-CentricCompanies . . . . . . . 102
4.4 OrganizationalChange . . . . . . . . . . . . . . . . . . 104
4.4.1 Impediments . . . . . . . . . . . . . . . . . . . . 104
4.4.2 Benefits . . . . . . . . . . . . . . . . . . . . . . 104
4.4.3 Governance. . . . . . . . . . . . . . . . . . . . . 107
4.5 Summary. . . . . . . . . . . . . . . . . . . . . . . . 112
References 113
Appendix4A:CaseStudies—HCAandHarrah’s—VirtualITPMOs . 115
4A.1 Harrah’s . . . . . . . . . . . . . . . . . . . . . . 115
4A.2 HCA. . . . . . . . . . . . . . . . . . . . . . . . 115
5 Architecture Management . . . . . . . . . . . . . . 117
5.1 TheEBA . . . . . . . . . . . . . . . . . . . . . . . . 121
5.1.1 SupplyandDemand . . . . . . . . . . . . . . . . . 121
5.1.2 ConstraintsandEnablers . . . . . . . . . . . . . . . 124
5.1.3 BusinessSystemModeling . . . . . . . . . . . . . . 125