2009
To cut or to keep? That is the toughest IT question
Deciding which projects must be shelved to rein in costs
is the CIO’s thorniest dilemma, writes Chris Mills.
Written by Chris Millls
Computing,
23 Apr 2009
IT projects are critical to a company’s ability
to grow, drive cost efficiencies and ensure robust corporate
compliance. However, significant budget restrictions
reflecting the dire state of the economy mean that today’s
chief information officer (CIO) faces a harsh reality:
financial and other resources just won’t stretch
to cover all the projects they would like to do. And,
if cuts are inevitable, how can a CIO decide where to
wield the knife most effectively?
Traditionally, hit lists have been based on perceived
corporate priorities. However, these can be and
indeed have been –influenced by factors such as
lack of clarity around the strategic goals of the business;
lack of reliable information relating to what certain
projects are really expected to deliver; and the force
of personality exerted by some key boardroom players
to ensure their own pet projects survive, come what
may.
In today’s economy, that is both unacceptable
and potentially suicidal.
So what is the answer? Enterprise portfolio management
(EPM) – the practice of aligning the complete
portfolio of projects and programmes to an organisation’s
strategy. EPM is not new, but it is the most accurate,
considered and transparent way of prioritising a portfolio
and, as IT leaders ponder the consequences of cutting
the wrong project under current cost pressures, it is
becoming standard practice, globally, for companies
of all sizes.
EPM involves articulating an organisation’s strategy
into a collection of well-defined and agreed business
drivers. Every project’s contribution to each
of these drivers is assessed and then additional constraints
such as budget, resourcing and timing are factored in,
as are inter-project dependencies. Following detailed
analysis, an optimised portfolio can be produced, which
should deliver the strategy in the most efficient and
effective way.
Decisions based on fact and insight, not personality
and prejudice. Surely a better way for CIOs?
Chris Mills is a partner at consultancy PIPC
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