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The Role of IT Portfolio Management

The Role of IT Portfolio Management . Yong Mai BADM 559 – Enterprise IT Governance . Background. Organizations can easily devote up to 50% of their capital investment in IT projects.

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The Role of IT Portfolio Management

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  1. The Role of IT Portfolio Management Yong Mai BADM 559 – Enterprise IT Governance

  2. Background • Organizations can easily devote up to 50% of their capital investment in IT projects. • About 75% of the IT organizations still have limited supervision over their project portfolios and employ dysfunctional planning processes. • Lack defined processes for initialing projects and reviewing project proposals • Fail to look at the entire IT budget as a unified set of investments. • More projects are executed than capable of managing

  3. Why IT Portfolio Management? • Companies need proper processes and systems to evaluate the performance of IT services • IT Portfolio Management helps companies • Gain greater control over their IT projects • Provide meaningful value to the business. • Making sure that the funds are assigned to the most suitable project that generates the greatest return and value

  4. Why IT Portfolio Management? • Annually, companies that fully utilize integrated IT portfolio management show saving of 2%to 5% in their IT budgets. • Companies can generate up to 40% greater return than their competitor if they oversee the entire lifecycle of the portfolio management. • There’s no single right way to do IT portfolio management, the challenge, however lies in doing it well.

  5. Integrated Portfolio Management Process • Initiation • Proposed IT applications are initially reviewed in terms of their values as potential investments • Evaluation • Interdependencies between projects need to be identified and understood. • Identify redundant projects or projects that will yield low returns.

  6. Integrated Portfolio Management Process • Prioritization • Takes into consideration the financial cost and benefits, risk, business value, and strategic alignment of the project. • “What If” Analysis • Graphical analysis • Scoring or Categorizing

  7. Integrated Portfolio Management Process • Monitoring • Projects are constantly observed until they are completed • Summary information about the status of each project is regularly updated. • This information would be used to update the portfolio financial information to complete the portfolio analytical cycle. • Companies would be able to respond quickly to market changes.

  8. Take Away • When implemented correctly, IT portfolio management guide the companies’ allocation of IT resources in support of their mission and programs. • Greater visibility • More control over IT processes • Better focus on quality • Delivers direct results, which add greater value to the business

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