I’m going to continue on this theme of “Unwritten Rules” as a powerful way to understand what drives behavior, and with that understanding, be able to change the rules, and thereby change behavior.
Yesterday, I posted on the Unwritten Rules that are common to organizations where Program Management is practiced versus those where Project Management is practiced. (I’m ignoring what people in these organizations actually calltheir practices – I’ve seen shops who think they practice program management who are barely practicing project management!) Today I want to explore IT Portfolio Management as a key discipline for driving up Business-IT Maturity, and one that most enterprises struggle with. In fact, as with my comment on language above, there are many more shops who use the term IT Portfolio Management without actually following any real sense of the discipline.
Let’s compare the unwritten rules around IT portfolio management behavior at two different (fictitious) companies – WorstPort, Inc., and BestPort Corporation. While fictitious, the examples I will use are drawn from a composite of real clients I have worked with – with a little “poetic license” to help make my points!
At WorstPoint, Inc., the predominant unwritten rules that impact IT portfolio management behaviors include:
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“You can only change IT investment behaviors for new projects. Everything else is just ‘water under the dam,’ so don’t bother trying.”
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“The business unit heads have all the power and the money – the best we can achieve is to have an IT portfolio for each business unit.”
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“An IT portfolio is simply an inventory of all our projects. Collect the data once a year and get it into the IT Portfolio Management tool so we can report on it.”
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“We draw a line somewhere in the IT portfolio (the project list) each year based upon budget and resource levels – things above the line get done, things below the line get revisited the following year. If you want to score points with your business partner, help them get their pet projects (or projects that you really want to get approved) above the line.”
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“We could never include our steady state services under our IT portfolio – there’s over 200 of them! And our business partners don’t know enough to make decisions about these services, so including these would only complicate our portfolio management efforts and confuse the customers!”
Now let’s look at the kinds of unwritten rules that shape IT portfolio management behaviors at BestPort Corporation:
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“Most of our IT costs are associated with ‘keeping the lights on and trains running,’ so we have to apply the disciplines of portfolio management to everything we do. Making choices between investing in our IT infrastructure and adding new applications are essentially business decisions, with our advice and guidance.”
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“Portfolio management is how we balance investment decisions across the enterprise – what should be common investments that support the enterprise, what should be the investments for given business units or for enterprise process, and so on.”
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“Portfolio management puts factors like risk, payback period, level of investment, and options thinking on the table. This leads to a much richer business discussion than simple ROI or NPV estimates.”
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“Not all customers need 7×24, ‘platinum level concierge service’. They need to understand the marginal costs of premium service levels, and make the right trade-offs as business decisions. That’s why we include our services under the umbrella of IT portfolio management.”
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“Services we expose to our customers must be packed into high level bundles that are meaningful to them, such as ‘Onboard new employee.’ That way, our customers can understand them, and participate with us in a service provider/consumer relationship, and make the appropriate service level trade-off decisions that meet their business needs. This also will help drive appropriate customer behaviors as responsible service consumers”
Think about the unwritten rules around IT portfolio management at your company. Poll you business executives – what do they believe these are? What behaviors do these unwritten rules drive? Are they the behaviors your stockholders would want for long term value generation? If not, how might you go about changing these unwritten rules?
Filed under: Business-IT Governance, Change Management, IT Management, Portfolio Management Tagged: | IT portfolio management, Service Management, unwritten rules
