Bob Walker EPM TSP - PowerPoint Presentation

Slide1
Slide2

Bob Walker EPM TSP

The Importance of Organisational Portfolio ManagementSlide3

Agenda:

In this session we will be discussing and reviewing

The importance of aligning Project and Programme Portfolios to key business goalsFormulating and executing sound business processesIdentifying key metricsHow to identify and select the right portfolio Microsoft HR use of Portfolio Management

The Importance of Organisational Portfolio ManagementSlide4

Vision

(Short- and long-term strategy)

Strategic Performance Indicators

(Key drivers & metrics for assessing progress)

Key Structures & Capabilities

(Organisation, Business & Technical Architecture, Performance Mgt)

Business Activities

(Projects, new initiatives, day-to-day work)

Skills, Competencies & Behaviours

(Training & Development, Reward Structure)

The strategic context for effective portfolio management:

Holistic, inclusive, top-down

World-class companies can demonstrate a clear alignment throughout their organisation and studies have shown exponential performance improvements for those who adopt this approach

Investment in activities and initiatives that do not clearly align with strategic

goals is wasted

.

5 Key Elements of Effective Strategy

Initial focus on issues, not numbersInclusive, open discussion – involving unit heads as well as CXOs – to promote communication and understanding of final targetsIn-built ‘what-if’ and scenario planning, with reviews and updates as necessary, not dictated by the calendarAgreed ‘strategic’ metrics to track progress – not necessarily all financial – reviewed regularlyLinked to performance management / compensation package

Primary Source: McKinsey, 2004Slide5

50% of projects are still evaluated independently rather than as part of a portfolio

45% of projects only go ahead because a senior executive insists

21% of projects, in hindsight, should have been approved but lost out to those with more vocal support

40% of organisations don’t conduct any kind of post-implementation review

36% of projects are found to have over-stated their potential benefits

The business context:

The track record is disappointingly poor

Significant Issues

Regulatory requirements (SOX etc) necessitate greater

transparency in decision-making

Need to cope with growing organisational complexity

Ever-more challenging business climate:

- requires demonstration of effective results, quicker

- need for greater agility and flexibility

Pressure to minimise spending while investing in value-added activities

84% of organisations remain unable to demonstrate the link between IT or capital budgets and business needs

69% of major capital projects are neither on time nor on budget

Industry average for ‘successful’ investments is 50% or lessPrimary Source: Standish Group, 2006Primary Source: McKinsey Survey of 2500 global executives, 2007Slide6

4 Key Reasons Why Organisations Turn To Portfolio Management:

To save money / budget

To demonstrably add value in the programme / project investmentsTo improve transparency – usually at the behest of external stakeholdersAs a catalyst for significant process improvement, usually in one of the following areas:Business case / project approval

Business agility (‘what if’/ scenario planning)

Delivery control and benefits management

Confidence, Transparency and FlexibilitySlide7

Creates a

common currency

for comparing investments and making better-informed decisionsEnsures decisions made according to verifiable data

, not politics or ‘noise’

Creates a

clear and quantifiable link

between strategic objectives and initiatives undertaken

Uses a benefits-led approach

to delivering strategic projects.Reduces management time spent on decision-making through greater focus on high value initiatives

Reduces overall spend by eliminating low value investments

Promotes organisational agility through modelling of ‘what-ifs’ and other detailed scenario analysis - decisions to change taken within minutes

Generic BenefitsSlide8

Define your strategyPrioritise your strategy

Capture your investment

proposalesAlign your investmentsMake good decisionsReview & renewHow to identify and select the right PortfolioSlide9

“The plans made or the actions taken in an effort to help the organisation fulfil its intended purpose“

Drives Competitive Advantage

A strategic organisation can choose to be tactical, a tactical organisation cannot choose to be strategic!What is Strategic?Slide10

All your intentions may now be strategic........

.....but not all strategies are equal!

Create a prioritisation based on reality not emotionStrategic PrioritiesSlide11

Standard criteria for measuring:

Costs

BenefitsResource requirementTimeRiskCommon processBuild a “book”Where are my projects?Slide12

Who shouts loudest?Boss’s prerogative?

It got passed over last time?

Everyone else has one!Compliance and regulation?How do you Choose!Slide13

Be flexibleKill quick

Review regularly

Be provocativeChange is a ConstantSlide14

Microsoft HR and Portfolio ManagementSlide15

Previous fiscal years had ~80 projects in the pipe Organizational overload

Prior business framework attempt did not achieve desired results

No measurable link of projects to strategyHR Operational Excellence Team established in FY07 to address planning issues:HR Leadership team sponsorship 2 Program ManagersProject Delivery Framework virtual global team ~ 14 peoplePortfolio Management Office virtual global team ~ 18 people

Business SituationSlide16

Prior IT project selection was more of a funding process because projects were pre-determined by the business

IT receives disparate IT project requests from each HR area – not a consolidated list

IT budget is allocated to each HR area based on prior year’s budget instead of by rationalizing the strategic impact of projectsIT had no governance or focus around IT investment ROI or project rationalizationIT Personnel did not feel “strategic” to the organizationIT Business Architecture and Foundation Solutions Team established in FY07 to address portfolio and integration issues:Business architect

Six Sigma Black Belt Process Engineer

PMO Program Manager

Integration Solution Manager

IT SituationSlide17

PainConfusion

Costs

BlameNot consistentRe-inventionSummary of HR & IT SituationSlide18

Learn from the pastTake small steps – phases and quick wins

Strong emphasis on change management and stakeholder management

New ApproachSlide19

Think globallyProgram manage it like a project/establish cross functional team

Leverage the Project Portfolio Server 2007 tool to help facilitate the process (focus on the process vs. tool)

New ApproachSlide20

Portfolio went from 84 projects to 14

Portfolio aligned to HR and IT drivers and goals

On-track to deliver dialed movement to business driversBetter HR and IT resource allocationResultsSlide21

Improvements led to:

Better communication

Clear governance and accountabilityStreamlining of the project selection processFocus on business and shareholder valueClear rationalization of IT investmentResultsSlide22

Executive sponsorshipClear Strategy to make trade-offs

Phased approach

Leverage best practices and expertise in process, change management and program managementDiversity of cross functional team Project Portfolio Server enabled real time decision makingSuccess FactorsSlide23

Measure strategy and portfolio outcomes

Complete project framework to enable consistent execution

Manage change and on-going project status updates Refine planning for fiscal year ’09Expand scope to include “small” projectsIncorporate gap analysis on business capabilities Move organization bandwidth from “As Is” to “Aspire to”Next Steps: Continuing the JourneySlide24

Secure leadership team sponsorship

Keep it simple

Take small steps to demonstrate quick winsCommunicate often along the wayLeverage technology like Project Portfolio Server to enable data driven decisions/trade offsRecommendationsSlide25

Portfolio Management involves all parties

Do not try and take on everything

One persons Strategic is another persons tacticalExecutive Sponsorship from Business and IT is essentialTake Away’sSlide26

Chris Mills – CxO

Consulting

Paul Major – Program FrameworkMicrosoft – Carol Bubar, Senior Director Operational Excellence, Microsoft HRFrancis Gan, Senior Director HR Business Architecture and Foundations Solutions, Microsoft IT

http://technet.microsoft.com/en-us/library/cc297284.aspx

ThanksSlide27