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Applying The 80/20 Principle To Portfolio Management

By |October 9th, 2014|Categories: time|Tags: , , , , , , , |Comments Off on Applying The 80/20 Principle To Portfolio Management

The 80/20 principle posits that 80% of organizational value comes from 20% of your projects. The 80/20 allocation seems to hold true for a lot of things: I know I wear 20% of my clothing 80% of the time, and I use my pots and pans the same way. Nevertheless, the 80/20 principle is a particularly handy concept when thinking about managing the projects in your portfolio.

First, using the 80/20 principle, think about which projects are critical, must-haves, and core to your mission (about 20% of the whole array), and set aside those that are discretionary or not vital. During this exercise, projects that should be eliminated altogether should be obvious. (Be ruthless.) Of the mission-critical projects, decide which should proceed and which should be deferred based on urgency and capacity. Considerations during your deliberations should include:

Second, having decided which projects should proceed, it is time to collaborate with the entire range of managers, from line managers to senior managers, to prioritize them. Each will contribute something to the debate, and it is better to debate now than waste valuable resources (time, money, and people) later. Line managers will have first-hand knowledge of processes and capacity; middle management will have a better view of the interplay and inter-relationships between departments and activities, and top management will possess the long view that encompasses the overall organization direction and strategy. And obviously, inviting greater participation overall means greater cooperation and commitment.

Third, once your projects have been prioritized, it is time to figure out who will be doing what. Streamlining your projects down to the vital few has the added benefit of not stretching the capacity you have, but concentrating it where it is needed most. Here I …
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Cutting Your Project Portfolio Down to Size

By |July 10th, 2014|Categories: Planning|Tags: , , , , , , |Comments Off on Cutting Your Project Portfolio Down to Size

That big project portfolio of yours is your biggest headache. It’s true. If you are like most companies, your portfolio has grown to an unwieldy size, which means you have way too many projects competing for the same resources. Here’s what to do.

First, inventory ALL projects and activities that require any kind of IT resources, making sure to include non-obvious ones like SMEs and user training time. According to Gartner, 60% of IT’s budget is spent on operational, “keep the light on” activities, so it is important that these are included to ensure correct allocation of project resources. Projects that pull resources from core operations can create business risk.

Second, decide who will comprise a governance committee, i.e., who will make decisions concerning the portfolio. This should be a mix of IT and business leaders with the authority to make decisions for the organization. The governance committee will determine which projects should continue, which should be delayed, and which should be terminated. These decisions will be made based on determining which projects have the potential to create the most value for the company. Each project in the portfolio should align with business goals and be ranked on the strength of its business case outlining benefits, costs and risk. Keep this simple, but also be on the lookout for project interdependencies. You certainly don’t want a critical project bungled because it relied on deliverables from another project that was killed or delayed.

The importance of strong governance in the portfolio process cannot be overstated. Projects that are nice but not essential drain away resources that could be used more productively. Focus on cutting unnecessary demand and don’t start new projects until you know for certain that …
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Cost Optimization – It’s The Principle Of It…

By |February 20th, 2014|Categories: Optimization|Tags: , , , , , , , |Comments Off on Cost Optimization – It’s The Principle Of It…

Groucho Marx once joked “Those are my principles, and if you don’t like them…well, I have others.” This is great for getting a laugh, but decision making without guiding principles is like a ship’s captain navigating the wind and current without a compass.

The same can be said about an IT organization’s approach to cost optimization. After years of one-off tactical cost cutting, many businesses are facing the challenge of ongoing and continuous cost optimization. For many, this is no longer the exception but the new reality.

The usual approach to cutting costs is the purely tactical. Problem is, when the clear cost culprits have been identified and reduced or eliminated, future optimization initiatives can become more arbitrary and problematic. Even the low-hanging fruit that appears to be an obvious candidate for reduction to some may not be to others—like your business clients.

In a recent Gartner survey, CIO’s were asked, “What are the main barriers preventing organizations from achieving continuous optimization of IT costs?” Sixty-five percent of the respondents indicated that it was a matter of mindset—that is, creating the environment necessary for all resources to work together, move in the same direction, and agree on the same strategy.

We agree. TransAccel believes there’s a better approach to determining cost optimization decisions—one based on four “Guiding-Principles.” The benefits of using this method include a more consistent alignment with the company’s strategic drivers, a consensus among business leaders, a long-term framework for ongoing cost optimization initiatives, and a correct way to maintain what is most important to the organization.

The Four Principles are:

Transparency – IT and business leaders need to explicitly agree on what IT provides the business, and what the business needs from IT. Often, basic cost optimization …
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Mark that project APPROVED…

By |October 17th, 2011|Categories: Planning|Tags: , , , , , , , , |Comments Off on Mark that project APPROVED…

Today, every company is pursuing more projects than it can successfully handle, and that puts your project at risk of not getting the approval it needs to move forward. So, what can you do to make sure that a governance committee review doesn’t leave you and your project on the outside looking-in? Follow these steps to give your project an advantage over other projects in the queue for review.

 

Understand and communicate the business case for your project.
This starts with understanding the business strategy and business drivers that prompted your project in the first place. If you don’t understand what the business is trying to accomplish, you have very little chance of your project hitting the mark.Once the business strategy and drivers are clear, identify very specifically—and quantitatively where possible—exactly how your project will provide benefit relative to the business drivers and business strategy.

Work with key people in the business area to develop and review the business case to ensure that it is sound and strong.

Creating a solid, strong business case is the most important factor in not only getting the project approved, but also in ensuring that the project team clearly understands what is to be accomplished, why, and how it will help the business.
Identify resourcing needs by role.
Resources, especially people, are always in high demand, and you need to be very clear about the resources that your project will require (people, facilities, equipment, etc.). Clearly identify your resource needs by being specific. Assuming that your request for two technical analysts you will get you what you actually need might be a mistake. Having the right skills, expertise and individuals detailed on a project can greatly improve the probability of project success.
Identify project interdependencies.
As …
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