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Information Technology Project Methodology (ITPM)

Information Technology Project Methodology (ITPM). Methodology. A strategic level plan for managing and controlling IT projects A template for initiating, planning, & developing an information system Recommends in support of an IT project: phases deliverables processes tools

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Information Technology Project Methodology (ITPM)

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  1. Information Technology Project Methodology (ITPM)

  2. Methodology • A strategic level plan for managing and controlling IT projects • A template for initiating, planning, & developing an information system • Recommends in support of an IT project: • phases • deliverables • processes • tools • knowledge areas • Must be flexible and include best “practices” learned from experiences over time

  3. An IT Project Methodology

  4. Phase 1: Conceptualize and Initialize • Defining the overall goal of the project • Defining scope • Evaluating the project’s success • Identifying alternatives • Analyzing • Costs & benefits • Feasibility & risks • Summarizing a recommended alternative (business case)

  5. Phase 2: Develop the Project Charter and Detailed Project Plan • Define project’s objectives in terms : • Scope • Schedule • Budget • Quality standards

  6. Phase 3: Execute and Control the Project • Use an approach such as the SDLC • Must ensure that the environment and infrastructure to support the project are included

  7. Phase 4: Close Project • Prepare final project report and presentation • Document and verify that all project deliverables have been completed • Determine the final cost • Invoice the client for any remaining payments • Close all project accounts • Archive all project documents and files • Release project resources

  8. Phase 5: Evaluate Project Success • 4 areas for evaluation • Post mortem by project manager and team of entire project • Evaluation of team members by project manager • Outside evaluation of project, project leader, and team members • Evaluate project’s organizational value

  9. Project Management Processes Initiating processes Planning processes Executing processes Controlling processes Closing processes Project Objectives Tools support both the processes and product of the project. Tools and technique for estimation, development and management e.g. CASE Infrastructure Project Management Knowledge Areas IT Project Management Foundation

  10. Organizational Infrastructure Influences how project resources are allocated, the reporting relationships of the project manager and the project team members, and the role within the organization Project Infrastructure Support team in terms of Project Environment Roles and Responsibilities of team members Processes and Controls Technical Infrastructure Provides the hardware and software tools to support the project team Project management software E-mail Voice mail Word processor Access to Internet IT Project Management Foundation

  11. Concerned with defining and coordinating the activities and controls needed to manage the project  project management processes Require specific domain knowledge, tools, and techniques in order to complete the work  product-oriented processes Project Management Processes

  12. Project Management Processes and ITPM Phases

  13. Project Management Process • 5 Project Management Process Groups • Initiating • Planning • Executing • Controlling • Closing

  14. Initiating the IT Project

  15. The Business Case • Definition of Business Case: an analysis of the organizational value, feasibility, costs, benefits, and risks of the project plan. • Not a budget or project plan • To provide senior management with all the information needed to make an informed decision as to whether a specific project should be funded. • Must document the methods & rationale used for quantifying the costs and benefits.

  16. The Business Case • Attributes of a Good Business Case • Details all possible impacts, costs, benefits • Clearly compares alternatives • Objectively includes all pertinent information • Systematic in terms of summarizing findings

  17. Process for Developing the Business Case

  18. Developing the Business Case • Step 1: Select the Core Team with a goal of providing the following advantages: • Credibility • Alignment with organizational goals • Access to the real costs • Ownership • Agreement • Bridge building

  19. Developing the Business Case • Step 2: Define Measurable Organizational Value (MOV) the project’s overall goal • MOV must: • be measurable • provide value to the organization • be agreed upon • be verifiable • Aligning the MOV with the organizational strategy and goals.

  20. The IT Value Chain

  21. Project Goal ? • Install new hardware and software to improve our customer service to world class levels • Respond to 95% of our customers’ inquiries within 90 seconds with less than 5% callbacks about the same problem. versus

  22. A Really Good Goal • Our goal is to land a man on the moon and return him safely by the end of the decade. John F. Kennedy

  23. MOV Step 1 - Identify the desired area of impact Strategic customer financial operational social MOV Step 2 - Identify the desired value of the IT project Better Faster Cheaper Do more Steps to Develop MOV

  24. Steps to Develop MOV MOV Step 3 - Develop an Appropriate Metric • provide target • set expectations • enable success/failure determination • common metrics • Money ($ £¥) • Percentage (%) • Numeric Values MOV Step 4 - Set a time frame for Achieving MOV • When the project’s MOV will be evaluated

  25. Steps to Develop MOV MOV Step 5 - Verify and Get Agreement from the Project Stakeholders • To ensure that MOV can be achieved MOV Step 6 - Summarize MOV in a Clear, Concise Statement or Table • Provides an important chance to get final agreement and verification • Provides a simple and clear directive for the project team • Sets explicit expectations for all project stakeholders • Not include any explicit statements about technology

  26. Steps to Develop MOV MOV: The B2C project will provide a 20% ROI and 500 new customers within the first year of its operation Sample MOV Using Table Format

  27. Developing the Business Case • Step 3: Identify Alternatives • Alternatives • Base Case Alternative • Describes how the organization would perform if it did not pursue any of the options described in the business case. • Alternative Strategies • Change existing process sans IT investment • Adopt/Adapt systems from other organizational areas • Reengineer Existing System • Purchase off-the-shelf Applications package • Custom Build New Solution

  28. Developing the Business Case • Step 4: Define Feasibility and Asses Risk • Economic feasibility • Technical feasibility • Organizational feasibility • Other feasibilities Risk focus on • Identification • Assessment • Response • Step 5: Define Total Costs of Ownership • Direct or Upfront costs • Ongoing costs • Indirect costs

  29. Developing the Business Case • Step 6: Define Total Benefits of Ownership • Direct benefits • Ongoing benefits • Indirect benefits • Benefits can arise from • Increasing high-value work • Improving accuracy and efficiency • Improving decision-making • Improving customer service

  30. Developing the Business Case • Step 7: Analyze Alternatives using financial models and scoring models • Payback Payback Period = Initial Investment Net Cash Flow = $100,000 $20,000 = 5 years

  31. Developing the Business Case • Break Even If you sell a golf putter for $30.00 and it costs $25.00 to make, you have a profit margin of $5.00: Breakeven Point = Initial Investment / Net Profit Margin = $100,000 / $5.00 = 20,000 units

  32. Developing the Business Case • Return on Investment Project ROI =(total expected benefits – total expected costs) total expected costs = ($115,000 - $100,000) $100,000 = 15%

  33. Developing the Business Case • Net Present Value NPV = -I0 +  (Net Cash Flow / (1 + r)t) Where: I = Total Cost or Investment of the Project r = discount rate t = time period

  34. Developing the Business Case • Net Present Value

  35. Developing the Business Case • Scoring Model Total Score =  wici Where wi = criterion weight ci = criterion score 0  wi  1 n i=1

  36. Developing the Business Case • Step 8: Propose and Support the Recommendation

  37. Business Case Template

  38. Project Selection and Approval • The Project Selection Decision • Methods include: • focusing on broad needs • categorizing projects • performing financial analyses • using a weighted scoring model • implementing a balanced scorecard

  39. Project Selection and Approval • Focusing on Broad Organizational Needs • IT project must map to organization goals • IT project must provide verifiable MOV • Categorizing IT Projects • One categorization is whether the project addresses • a problem • an opportunity • a directive • Another categorization is how long it will take to do and when it is needed • Another is the overall priority of the project

  40. Project Selection and Approval • Financial Analysis of Projects • Financial considerations are often an important consideration in selecting projects • Three primary methods for determining the projected financial value of projects: • Net present value (NPV) analysis • Return on investment (ROI) • Payback analysis

  41. Project Selection and Approval • Implementing a Balanced Scorecard • Drs. Robert Kaplan and David Norton developed this approach to help select and manage projects that align with business strategy • A balanced scorecard converts an organization’s value drivers, such as customer service, innovation, operational efficiency, and financial performance to a series of defined metrics • See www.balancedscorecard.org for more information

  42. Balanced Scorecard Approach

  43. Reasons Balanced Scorecard Approach Might Fail • Nonfinancial variables incorrectly identified as primary drivers • Metrics not properly defined • Goals for improvements negotiated not based on requirements • No systematic way to map high-level goals • Reliance on trial and error as a methodology • No quantitative linkage between nonfinanacial and expected financial results

  44. MOV and the Organization’s Scorecard

  45. Project Integration Management

  46. Project Integration Management

  47. The Key to Overall Project Success: Good Project Integration Management • Project Plan Development: taking the results of other planning processes and putting them into a consistent, coherent document—the project plan • Project Plan Execution: carrying out the project plan • Overall Change Control: coordinating changes across the entire project

  48. Project Plan Development • A project plan is a document used to coordinate all project planning documents • Its main purpose is to guide project execution • Project plans assist the project manager in leading the project team and assessing project status • Project performance should be measured against a baseline plan • Inputs • Past project • Policies and procedures • Constraints and Assumptions • Tools (structured process)

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