IT portfolio management 101

Proving the business value of technology assets

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The IT Portfolio Focus on People

Critical and often underestimated elements of the success of IT portfolio management are the people and cultural aspects. Research shows that while financial and operational metrics are important, the attitude, perceptions, and measures of customers, employees, suppliers, regulators, and shareholders are the largest differentiators between high- and low-performance companies. At least on a quarterly basis, measuring, analyzing, and creating course-correction action plans based on asking questions and gathering input from end users and managers of the IT portfolio management process are viewed as best practices. Although understanding individual behaviors and outliers is important, group trends and patterns are critical leading indicators.

IT portfolio management engages cross-functional management and endusers, providing information and data to multiple stakeholders to obtain buy-in regarding prioritization of limited investment dollars, allocation of resources, and a plan to proceed forward. According to research, individual productivity is significantly higher when work is proactively structured around goals. Training to improve learning effectiveness, early and prudent risk taking, and employee empowerment also improve productivity and serve as important behaviors for IT portfolio management. However, resistance to adopt IT portfolio management within business units and divisions that have become accustomed to operating within their siloed environments is not unusual. Many people simply despise change, and IT portfolio management for many companies and their employees involves making numerous changes to the status quo.

Currently, many business units are meeting the near-term needs of their customers without having to justify, or perhaps prolong, the decision-making process by adopting a holistic IT portfolio management framework. While operational decisions and measures should be kept locally within business units, strategic decisions and linkages to key performance measures must be centralized in order to create the ideal enterprise architecture. One of the most effective ways to change behavior is to create clear metrics, linking individual performance strategic objectives with incentives based on desired behavior and positive adjustments to meet performance and objectives.

Key performance measures must be clearly defined, well communicated, and reinforced. Measurements must be linked to performance standards, reviewed frequently, and closely tied to reward and recognition systems. Without a clear understanding of how key measures relate to both individual and group performance and accountabilities, resistance to change will be pervasive.

Related Articles:

IT Portfolio Management Step-by-Step: Unlocking the Business Value of Technology

By Bryan Maizlish & Robert Handler (For Gartner Inc.)

ISBN 0-471-64984-8

Copyright © 2005 by Bryan Maizlish and META Group LLC, a subsidiary of Gartner Inc. All rights reserved.

Used with permission from the publisher, John Wiley & Sons Inc.

Copyright © 2007 IDG Communications, Inc.

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