Book Excerpt: Demand Management and Project Prioritization

Excerpted with permission of the publisher John Wiley & Sons Inc. from The Executive’s Guide to Information Technology: 2nd Edition. Copyright (c) 2007 by John Baschab and Jon Piot of Technisource. This book is available at all bookstores, online booksellers and from the Wiley Web site at www.wiley.com, or call 1-800-225-5945.

A most visible, and often cited, measure of the success of the IT department is the business success of the projects undertaken and the completion of those projects in a timely, cost-effective manner. Therefore, the successful selection, prioritization, and execution of IT projects play a large part in determining the overall success of the IT department. Selecting which, and how many projects are allowed on the IT department schedule is a critical determinant of the overall success of those projects.

Project prioritization is a complex process that involves identification of the different projects and assessment of the projects based on factors such as strategic value, financial value, risk, existing system adequacy, time to completion, as well as organizational capacity and technical complexity. These assessments are made to differentiate the high-priority projects on a project list based on relevant factors, particularly financial value. They are used to accurately reflect the priority of IT projects in supporting the business unit priorities—not IT’s self-mandated priorities.

Typically, a struggling IT department has dozens, even hundreds, of projects underway simultaneously. This is a common phenomenon that we have observed in organizations, regardless of size. The overall project inventory, if one exists, is littered with dozens of ill-defined, partially completed projects of indeterminate origin, benefits, goals, and status. Compounding the issue is that the projects are scoped at wildly varying levels of complexity, size, and business impact, producing absurd results such as "fix Martha’s laptop" at the same level as "implement CRM." Further, the project list has multiple dependencies (some identified, some not), internal inconsistencies, conflicting time lines, and unclear ownership on the part of both the business and the IT department.

In most cases, each of these projects is partially completed and in a perpetual state of being slowly shepherded to a fuzzy, indistinct, and elusive finish line by the IT department, with little real hope of solid completion. Indeed, most IT departments have dozens, if not hundreds, of simultaneous projects, each being pushed forward infinitesimally each week. Because IT is attempting to work on multiple competing objectives, in many cases, the original rationale for the project has become obscured by the passage of time, personnel changes, and changes in the business, often rendering the project irrelevant. Xeno’s paradox, which states that if you can achieve half the distance to the goal with each step, you will never arrive, comes to mind. The result of this common dilemma is an IT department that fails to complete, or even identify, the high-value, high-priority technology projects.

Why Good Project Management Is Not Enough

A host of reasons explain why organizations manage individual projects well but fare poorly in project completion overall. Common symptoms of poor demand management include:

Too Many Projects

IT staff tends to be "pleasers" by nature; the managers and developers fundamentally want to help the business and are usually excited about the benefits and solutions technology can bring to a given business problem. Unfortunately, this tendency often leads IT departments to have trouble saying no (or at least "get in line") to new project requests when they should. In the absence of a clear methodology for managing a project backlog, prioritizing the backlog, and chartering new projects, the IT department invariably takes on more than it should. The outcome is usually a pleased business user today and an angry one three months later when the promised results cannot be delivered.

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