Business Case Scoring - Template

Just wanted to share this quick business case scoring template. 

In evaluating various business cases, individuals can score each based on the following:

- Business Justification
- Analysis of Alternatives
- Technical Alignment
- Feasibility of Implementation Strategy
- Funding/Resource Availability

The ratings are done with 1 being the lowest and 5 being the highest. 

The scoring sheet calculate average, and identifies highest and lowest scores.

Then the individual scores can be summarized and used to rank the projects in your portfolio. 

Based on overall funding, you can determine how many of the top-ranked projects are doable in the year, and then roll over the others for reevaluation along with new business cases next go around. 

Capisce? ;-)

(Credit Graphic: Andy Blumenthal)

Business Case Scoring - Template

Types of Project Management Office

This is a quick breakdown of the 3 types of Project Management Offices (PMOs).

• Enabling (Supportive) — Provides best practices, templates, and tools “as needed,” and compliance is voluntary.

• Delivery (Controlling) — Adopts framework or methodology, policy, and repeatable procedures, and a certain level of the standards are enforced.

• Compliance (Directive) — Establishes strict standards, measures, and control over projects, and these are highly regulated.

A good place to start is with an enabling/supportive PMO and then progress to a more delivery/controlling model. Generally, a compliance/directive PMO is for more highly regulated organizations.

(Credit Graphic: Andy Blumenthal and concept via CIO Magazine and Gartner)

Types of Project Management Office

Why EA and CPIC?

Note: This is not an endorsement of any vendor or product, but I thought this short video on enterprise architecture planning and capital planning and investment control/portfolio management was pretty good.

Why EA and CPIC?

IT Portfolio Management and Enterprise Architecture

“IT portfolio management is the application of systematic management to large classes of items managed by enterprise information technology (IT) capabilities. Examples of IT portfolios would be planned initiatives, projects, and ongoing IT services (such as application support). The promise of IT portfolio management is the quantification of previously mysterious IT efforts, enabling measurement and objective evaluation of investment scenarios.” (Wikipedial)

IT portfolio management is a way of categorizing IT investments and analyzing them to ensure sound IT investment decisions. IT portfolios are frequently evaluated in terms of their return, risk, alignment to strategy, technical merit, and diversification.

Why do we need IT portfolio management—why not just assess each project/investment on its own merit?

The added value of developing and evaluating IT portfolios is that you can ensure the diversification of your investments across applications and infrastructure; new systems/major enhancement to existing systems and operations and maintenance; new R&D, proof of concepts, prototypes, and pilots; between strategic, tactical, and operational needs, and across business functions.

ComputerWorld Magazine, 7 April 2008, reports that Hess Corp., a leading global independent energy company, developed creative IT portfolios based on three types of initiatives:

1. Bs—“business applications or business process improvement effort that’s aimed at increasing revenue or generating cost savings.”
2. Es—“enablers” or projects to support business applications such as business intelligence, analytical systems, master data management, systems integration.
3. Ps—“process improvement within the IT organization itself” such as standardizing the approach to applications development (systems development life cycle), project management, performance management, IT governance, and so on.

From an enterprise architecture perspective, we develop the target architecture and transition plan and assess IT investments against that. Again, rather than develop targets and plans and conduct assessments based solely on individual investment alone, EA should look at the aggregate investments by IT portfolios to ensure that the EA plan and subsequent investments are properly diversified. An EA plan that is overweighted or underweighted in particular IT investment categories can have a negative to disastrous effect on the organization.

IT investments represent significant expenditures to organizations and IT is a strategic enabler to mission, so messing up the IT plan with poor investment targets and decisions is costly to the enterprise.

IT Portfolio Management and Enterprise Architecture

Portfolio Management and Enterprise Architecture

Enterprise architecture and portfolio management are closely linked activities. EA drives IT investment management (including the IT portfolio select, control, and evaluate phases) by conducting technical reviews of proposed new IT projects, products, and standards, and IT investment management provides important information updates to the EA (baseline, target, and transition plan).

In Architecture and Governance Magazine, Issue 3 Volume 2, Nuttall and Houghton provide an overall framework that goes “Beyond Portfolio Management to Comprehensive Application Governance.”

The framework includes three main areas and one supporting process area, as follows:

1. Application and License Management (tactical)—“It manages the demand side and user requests, the contract and compliance aspects of determining the number of licenses that are contractually allowed, along with the projects that bring new products into the portfolio while retiring older products that have been removed. In many ITIL organizations, a help desk/service desk would handle the demand for applications, while the license management aspects are often assigned to the procurement and/or configuration management functions.”
2. Application Portfolio Management (strategic)—“determines the appropriate mix of applications in the portfolio. It s highly dependent on the strategic business drivers for the corporation and includes: portfolio strategy development, optimization, and planning.” Portfolio strategy development determines the drivers and priority of those. Portfolio optimization determines the right mix of applications to support those goals. And portfolio planning determines the risks and constraints in implementing the portfolio, such as architecture, infrastructure, and resource constraints.
3. Financial Management—“budget and forecasting, account management, and allocations management;” these enable the planning of what money is available for the portfolio and what money is spent for applications.
4. Supporting Processes—other process areas that impact portfolio management include: “knowledge management, communications management, management reporting, architecture strategy, risk management, operational delivery, and support management.”

“One thing is certain, though, as technology continues to drive productivity, comprehension of application governance will become an even more essential step for companies wishing to manage their risks and costs while continuing to gain strategic value from their portfolios.”

I think this model is very helpful in decomposing the traditional definition of governance from the strategic functions of portfolio selection, control, and evaluation to the additional tactical, strategic, and financial aspects involved in managing it. Particularly, I believe it is useful to separate out the business demand (licenses, new systems and technologies) from the portfolio development and optimization (“the right mix” to satisfy user needs). Additionally, the breakout of financial management from the portfolio development is important in making the distinction between the roles of the Investment Review Board/Enterprise Architecture Board and the financial or resources group that actually budget and accounts for the funding aspect of IT spend.

Nuttall and Houghton do not go into any depth with the supporting processes, so these are presented as high level touch points or supporting processes without any particular explanation of how they support portfolio management and governance.

One critical item, the authors did not include, but should have included is the Systems Development Life Cycle, which take the IT portfolio and governs it from planning through analysis, design, development, testing, deployment, operations and maintenance, and ultimately to disposition. The success of moving systems projects through the SDLC will impact the make-up of future portfolio decisions.

Portfolio Management and Enterprise Architecture

Use Cases and Enterprise Architecture

User-centric EA fulfills many different needs (as portrayed through Use Cases) in the enterprise.

In the Journal of Enterprise Architecture (JEA), August 2007, the authors of the article “Analysis and Application Scenarios of Enterprise Architecture: An Exploratory Study” (Winters, Bucher, Fischer, and Kurpjuweit) provide a variety of these “application scenarios” for EA.

Use Cases can help us understand the importance and benefits of Enterprise Architecture by showing its application to real-world scenarios. Below is a list of key use cases for EA (adapted from JEA):

1. Adoption of Commercial and Government Off-The-Shelf Software (COTS/GOTS)—informs on enterprise IT products and technical standards for integration, interoperability, and standardization.
2. Business Continuity Planning—identifying the dependencies between business processes, application systems, and IT infrastructure for continuity of operations.
3. Business Process Optimization—reengineering or improving business processes based on modeling of the business processes, the information required to perform those, and the technology solutions to support those.
4. Compliance Management—helps verify compliance with legal requirements such as privacy, FOIA, Section 508, records management, FISMA, and so on.
5. Investment Management—supports Investment Review Board; determines business and technical alignment and architecture assessment of new IT investments.
6. IT Business Alignment—aligning IT with “business, strategies, goals, and needs.”
7. IT Consolidation—“reveals costly multi-platform strategies and wasted IT resources originating from personal preferences of certain IT stakeholders and/or a lack of enterprise-wide coordination.”
8. IT Planning—develops target architecture and transition plan; develops or supports IT strategic plan and tactical plans.
9. Performance Management—Management of IT Operations Costs through the development of IT performance measures to manage IT resources.
10. Portfolio Management—categorizes IT investments into portfolios and prioritizes those based on strategic alignment to the target architecture and transition plan.
11. Post Merger and Acquisition Integration—identifies gaps, redundancies, and opportunities in business processes, organizational structures, applications systems, and information technologies.
12. Procurement Management—aids sourcing decisions; specifies standards, provides reviews of new IT investments.
13. Project (Initialization) Management—specifies projects requirements, looks at the potential for existing systems to meet user needs, and avoids redundant development activities.
14. Quality Management—document business processes, information requirements, and supporting IT; helps ensure performance.
15. Risk Management—managing technology risks; understanding which technology platforms support which business processes.
16. Security Management—documenting business and IT security and defining user roles and access rights.

When done right, EA helps to create “order out of chaos” for the execution of business and IT in the organization.

Use Cases and Enterprise Architecture