PROJECT PRIORITISATION

A PRESENTATION FOR ITSMF AUSTRALIA

THE PROBLEM
Extremely high demand for Corporate IT projects / services Very lean teams / low capacity

Business unwilling to increase capacity without evidential justification

Low-levels of project governance
No central portfolio management Each business unit demanding priority from IT

No formal ability for IT to push back

When we did push back, it often resulted in business doing it themselves and circumventing IT

In other words, the usual circumstance IT finds itself in.

EXISTING PROJECT & PORTFOLIO MANAGEMENT

Network business and IT had formalised project management methodologies based on PMBOK Immature portfolio management process for major network projects, but process too network centric not suitable for adoption by IT.

THE APPROACH

RESEARCH, RESEARCH & MORE RESEARCH

We hit the books and read everything we could get our hands on about best-practice portfolio management
White papers, case studies, etc. Found lots of useful Gartner resources to help here.

We followed up our research with analyst queries and spoke about our findings with Gartner experts to confirm our understanding. We spoke with our peers to validate our findings. The results?
We didnt believe the business was ready for full-blown project and portfolio management a progressive journey would be required. We determined the most value would be delivered by focussing only on project prioritisation and selection / scheduling.

SET KEY PRINCIPLES EARLY

Before designing the process, we set some key principles to guide us:
Keep the process simple Make the process transparent Keep the process objective Make the process collaborative Make the process business driven Make the business calibrate the process Ensure the process aligns with / supports existing processes.

Lack of transparency about how proposals are scored is the end of buy-in. Mark Raskino, Research Director, Gartner

THE SOLUTION

WEIGHTED CRITERIA
Assess every project against a standard set of (objective) criteria Score each criteria using the same scale (out of 10) Apply a weighting to each criteria, based on how important that criteria is Calculate the priority of the project by adding up the weighted criteria

Example: 3 criteria, each assessed out of 10 (a, b, c) A = 5, B = 6, C = 2 Priority = 5 20% + 6 50% + 2 30% Priority = 1 + 3 + 0.6 Priority = 4.6

Criteria A B C Total

Weighting 20% 50% 30% 100%

SOUNDS EASY, BUT WHAT CRITERIA?

The basic approach is fairly straight-forward, the key is to select the right criteria to assess projects against. Some important principles to apply when defining your criteria:
They must be relevant to the business You need to be able to assess them relatively easily They need to be as objective as possible

TRANSENDS CRITERIA
We used the following criteria:
Financial costs / benefits Intangible / usability improvements Support of strategic corporate objectives (from corporate plan) Business risk and compliance Project risk * Project dependencies *

* These two are special, well explain why later

FINANCIAL COST / BENEFITS

The first criteria we identified and the hardest to implement well Broke this criteria down into 3 sub-criteria (Return on Investment, Gross profit, Payback period) Sub criteria weighted If no financial benefit from project the criteria score is zero (no negative scores)

At this point we realised it was getting complicated electronic forms for the win!

Sub-criteria Return on Investment Gross profit Payback period Total

Weighting 40% 20% 40% 100%

INTANGIBLE / USABILITY IMPROVEMENTS

The simplest of our criteria:
Common-language choices to identify the scale of the changes and the number of users affected Simple matrix converts those selections to a score

CORPORATE STRATEGIC PERFORMANCE OBJECTIVES

The corporate plan defines a series of corporate objectives Each corporate objective becomes a subcriteria The business weights each objective Common-language options used to asses the importance of the project to achieving that objective Corporate objective Shareholders value Safety & work environment Organisational efficiency & effectiveness Market & regulatory framework Customer service Asset operations & management Business development Environmental excellence Enterprise architecture * Total Weighting 12% 15% 12% 10% 8% 17% 8% 10% 8% 100%

BUSINESS RISK & COMPLIANCE

Process requires business to identify business risks and compliance obligations the project helps manage
Uses risks and compliance obligations from the official corporate risk & compliance register Common-language options used to identify how important the project is to the management of each risk / compliance obligation Matrix used to combine risk/compliance rating and project contribution into a score Criteria assigned the highest score of any risk or obligation

PROJECT RISK

First of 2 special criteria used to adjust project score of particularly risky projects ONLY criteria to reduce the priority of a project Various project risks are identified and assessed. Highest risk rating is used

Greater the risk, the more the priority score is reduced

Uses corporate risk framework for assessing risks

DEPENDENCIES

We realised early on that some projects are enablers for later projects the primary benefits are delivered by different projects (e.g. implementing a platform that is required for a later high-value project)

Process acknowledges this by linking such related projects and taking the highest priority score (this is a little simplistic, but works and avoids making the process too onerous)

IMPLEMENTATION
OR, HOW DID WE MAKE IT SIMPLE ENOUGH TO USE?

SHAREPOINT & INFOPATH

Built a dedicated SharePoint site for the process and made it fully accessible to the business (transparency) Built an InfoPath form for registering projects. It gathers the basic information required and automatically calculates the project priority. InfoPath form allows supporting documents to be attached (estimate spread sheets etc) SharePoint lists track the project backlogs (sorted by priority of course), active projects, fast track requests and scheduling documents

THE SCHEDULING PROCESS

SCHEDULING PROCESS
Executive set all weightings at least once per year (although they are permitted to change these at any point through a vote at one of their regular meetings)
Projects can be added to the backlog at any time Project schedules locked in every quarter

Draft schedules prepared by taking base staff capacity and subtracting leave & public holidays, operational splits, ongoing projects from previous quarter and other impacts (such as projects from other areas of the business)
Draft schedule published and business granted chance to request changes to schedule Final schedule approved by executive (including changes). If changes approved the executive is responsible for either identifying projects to be removed from the schedule to free up capacity, or approving IT to seek additional capacity. Additional capacity can be achieved by outsourcing projects (or parts of projects) or by backfilling positions. The process leaves the decision as to how to best achieve the necessary capacity up to Corporate IT

FAST-TRACKING PROJECTS
Fast-track process included to provide flexibility to manage critical, last-minute projects Fast-track projects must be approved by the business units executive and the business services executive If fast-track approval granted, executive must nominate whether removing existing projects or adding additional resources Guiding principles:
Imminent harm Legal exposure Regulator compliance

20/20
PROCESS REVIEW

PROCESS REVIEW
We conducted a formal review of the process after 12 months of operation and reported back to the Executive

Primary tool as a business survey targeted management and users who had used the process, but encouraged all staff to participate
Response was positive; strong support for the process, perceived potential for bias but business didnt feel that had eventuated. Some tweaks to the criteria recommended, but these were minor:
Update to new corporate objectives Adjust priority weightings