Optimizing Applications and Project Portfolios in Volatile Times
by Phil Murphy and Margo Visitacion
The current global economic instability is forcing organizations to make tough decisions: some will cut costs; some will proceed with business-as-usual; while still others will take a predatory stance to gain market share from weakened competitors. However the economic crisis affects your organization, Forrester offers this four-step process to optimize your application and project resources in 2009:
Step One: Begin With Information Collection
"We cannot manage what we don't measure" is a basic truism taught to every first-year management student, yet our applications and projects have few usable metrics. So begin by collecting information that will feed measurement.
Even though projects account for some 20% or more of the IT budget, management-level project information tends to be siloed, insular, and grossly insufficient—resulting in a severe lack of transparency that prevents good management of the portfolio of projects. To create transparency, gather an inventory of all known project activity, and augment it with staff activity metrics—who is working on what? Don’t get overly bogged down in time collection categories that track accuracy down to the person-hour.
Scant though it may be, the volume of project information typically dwarfs the information collected about application portfolios—even though IT spends approximately 80% of the budget for "lights-on" IT. Transparency into existing applications—including operational and infrastructure costs—will expose wasted resources, redundant and obsolete applications and platforms. To create transparency that will expose the waste, create an inventory of basic application metrics using automation wherever possible, and map staff effort against the applications.
Step Two: Consolidate Information For Analysis, Map It To A Business Context
IT tends to treat existing applications and projects as wholly different—yet they are both simply categories of work performed by IT on behalf of the business. As such, the collected information can’t remain siloed—it is critically important to combine the information and expose what’s being currently being spent, what is planned, by whom, and how that maps to business units and functions. This is a serious departure from typical IT reporting that focuses on SLAs, storage and CPU costs—IT must articulate IT expenditures and staff consumption in a way that makes sense to business people.
Step Three: Act On The Information
Present the mapped information to business leaders to share the newly created transparency. Involve business executives with the authority to prioritize across business unit concerns to avoid parochial interests subverting the process. Start by talking about work to avoid semantic arguments about projects versus maintenance, versus enhancements. Assume that no work is sacred—zero-base the budget and some of the most important work (to the whole organization). Assess the impact on resources, then repeat for directly dependent work. Repeat until the resources are mostly earmarked, leaving some room for contingencies, then stop. It is critically important for IT to act as educator and counselor in these discussions, not as dictators—the business leaders must own the decisions.
Step Four: Repeat The Process And Make It Continuous
Avoid the common mistake of taking a snapshot approach to this process—snapshots are only effective in a world without change. In the best of times, change is constant and dynamic, so our management processes must follow suit. Embrace a model that continuously collects a finite set of metrics that can guide behavior when, not if, change affects your organization. Access to an on-demand set of metrics will allow business leaders to quickly react to unanticipated change and better plan for anticipated change.
Featured Blogger Phil Murphy
Phil Murphy is a principal analyst at Forrester Research, where he serves the Application Development & Program Management Professional.
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