Johannesburg, 07 Oct 2004
Critical to effective decision support and governance of any organisation are the processes and tools that facilitate analysis based on timely data that enable visualisation of complex information in meaningful formats to promote effective responses.
In the US, the mandate for portfolio management is clear, the overall processes and steps to maturity are in place, and in most cases the investment inventory is well described. Yet few organisations are realising the benefits - in terms of objective, consistent, repeatable and effective processes for selecting, managing and evaluating projects - that even rudimentary management by portfolio can bring.
A similar situation in SA is also occurring. Why is this? A recent article by Doug Lynn et al. ("Portfolio Management: Driving with Both Hands," METAgroup, 14 March 2004) provides an enlightening perspective: "The success of portfolio management in business and IT has come predominantly through the availability of software that visually depicts scenarios and optimal responses. Indeed, portfolio management can be applied through the use of spreadsheets, presentations and other documents. However, this approach will constrain if not stop portfolio management adoption, particularly as executives expand the discipline into such areas as finance, supply chain, new product development and product lifecycle management. Clearly, a decision-modelling process instantiated in a software tool with defined roles and responsibilities enable controllable consistency, repeatability, speed, quality and frequency of decision-making, which managers will rely on."
The foregoing underscores the importance of having an enabling tool in place to support the portfolio management process. Key features of an enabling portfolio management tool should be:
* Although business cases represent the core of any portfolio management process, it is clear that one size does not fit all. A flexible, easily configured, modifiable application has distinct advantages. Since business conditions change frequently, the ideal application will not require significant or ongoing vendor support, even when major changes or new (ad hoc) reports are desired.
* Collaboration and communication are critical to successful portfolio management, so the tool should be Web-enabled, and provide intuitive, reusable forms for data entry.
* Although project-level data (phases, deliverables, schedule, budget, etc) are required for effective portfolio management, not all projects require a detailed project plan and not all users are trained project managers. Therefore, in addition to interfacing with a project management tool, the portfolio management enabler also should support a "light" version of project management that ensures that this information will be available to decision-makers.
* Portfolio management inevitably requires a synthesis of complex information and "What-if" planning scenarios, so the tool should support multidimensional and reusable views, including bubble charts, dashboards, Gantt charts and scorecards, plus analytics and navigation aids that facilitate identification of patterns and comparisons across organisations and budget cycles.
* The tool should have an open architecture and work with industry standard databases, to ensure that information from other databases can be easily uploaded.
* The tool should be easily configured with hierarchical, role-based security/entitlements to support the diverse groups and organisations providing data to the system.
* The tool should be self-contained, to enable centrally managed implementation and control of lifecycles, security settings and entitlements (hierarchical, role-based), business cases, status reports, stage-gate reviews and approvals, analytics for resource, schedule and budget management, etc. A self-contained tool also will reduce maintenance complexity and ensure that all the analytics required to support portfolio management are integrated, regardless of the data source.
Portfolio management produces significant and measurable benefits in the form of improved process efficiency, increased returns on investments, streamlined data collection, more repeatable processes with reusable components, identification and elimination of duplicative or redundant investments, and more effective budget-performance integration.
AST, in conjunction with Microsoft and ProSight, will host a "Strategic IT Governance - Finding the Value of IT" breakfast on 13 October. Register now by e-mail (saevents@microsoft.com) to confirm a seat for this event. If you have further questions regarding this event, please call 0860 22 55 67.
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