Lecture 19

Chapter 10
A Portfolio Approach to Managing
IT Projects
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Announcements
Final Exam overview today

Business Plans returned today

Grades for presentations etc. on Thursday

Group project due Thursday
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Final Exam Outline
8 11am, Wednesday June 13
Exam is CLOSED book
No notes or text allowed
Three sections:
Short answer questions
Long Answer questions
Case study questions
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Question 1: Find New Zealand on a
world map
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Final Exam Sample Questions
Short answer:
What is the difference between security and
reliability?
How does standardization affect business
opportunities?
In what ways is IT infrastructure different from
other infrastructure resources?
Cite an example from one of the cases we
studied that shows how IT professionals with
experience in one industry can bring changes to
another industry
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Final Exam Sample Questions
Long answer (1 page, ~250 words)
Discuss what risks are associated with major IT
projects, and what a company can do to
mitigate against them

Describe the challenges associated with
educating users of IT in a company, and what
IT-focused companies can do to help their
employees
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Case study questions
You will receive a copy of a case in class
Thursday

Prepare in advance ie read case before
exam!

Questions will be short and long answer from
the case

Identify and analyze core issues
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IT Portfolio Management

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IT Disasters are still common
Companies fail to realize risk of project
Multiple projects lead to larger aggregate risk
Different projects require different management
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Portfolio View of IT
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Financial Perspective
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Sources of Implementation Risk
1. Project Size
2. Experience with Technology
3. Requirements Volatility

See fig 10.1
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Fig 10.1 Effect of Adding Risk Factors
on Project Risk
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Barriers to Perspective
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Governance
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Strategic Grid and Governance
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Project Categories and Degree of Risk
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Risk Assessment
Figure 10.3 Risk profile questionnaire
Higher risk score, higher management approval
required
Repeated several times throughout project
Different perspectives on risk expectation can
lead to disaster
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Portfolio Risk
Multiple projects can add or reduce risk
Low-risk not always good
All high-risk is vulnerable
Identify risks in all projects, then consider
combined portfolio of risks
See fig 10.5
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Fig 10.5 Risk and Return Distribution
for Portfolio of Projects
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Project Implementation Dip
Most projects dont go smoothly all the way
New system going live common point
Expectations not always realistic
Short term downward shift may be necessary
All happens in middle of business cycle and
worker turnover
Need to focus on end goal to get through value
of change when people are complaining
Ideally see it before it comes and get people
ready
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Fig 10.4 Expectations vs. reality
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Questions, Presentations, Break

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Project Management
No single correct plan
Management Tools
External integration tools
Internal integration tools
Formal planning tools
Formal result controls
See table 10.1: Tools for project management
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Table 10.1 Tools for Project
Management
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Influences on Tool Selection
Low requirements volatility/low tech projects
Easy to manage
Least common
PERT (program evaluation review technique)
CPM (critical path method)
Low requirements volatility/high tech projects
Difficult to manage
Eg. Converting mainframe system, developing web access
Outputs well defined
Technical complexity drives characteristics of successful
manager
Formal planning not likely to add as much value
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Influences on Tool Selection (ctd)
High requirements volatility/low tech projects
Involve users in design, development and implementation
Develop user support
Formal planning and control tools help
Close, aggressive management of external integration
Leadership from management not technologists
High Requirements Volatility/high-tech projects
Managers need technical expertise
Ill-defined projects common
Formal tools useful once clarity is reached in direction
Cross effects of different factors becomes important
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Project Management
Relative Contribution of Management Tools
Depends on specific project
Results-oriented tools work in structured/formal environment
Depends on corporate culture
Emergence of Adaptive Project Management Methods
Approaches to design, deployment, implementation and
investment that assume a need to gather information and
learn as one goes.
Not really effective universal methods yet
Software Development Life Cycles
SDLC breaks down development into stages:
Analysis and design
Construction
Implementation
Operation and maintenance
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Project Management (ctd.)
Adaptive Methodologies
Quickly build rough preliminary version
Iterate through stages rather than finish every stage
Fast cycle through stages
Aim to deliver limited functionality fast
Require skilled staff
Adaptive Methods and change management
Intensely involve users in evaluating outcomes
Strictly control migration of system features from
development, testing to production
Separating stages avoids major problems
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Process Consistency and Agility in
Project Management
Balancing tension between process consistency and
process agility
Tools useful one place shouldnt necessarily be
applied to everything
Success in balance often includes minimal
formalization
Flow
Understand interrelationships between projects
Completeness
Keeping track of all tasks in project
Visibility
Getting info on status of rest of project

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Business Plan Feedback
Lots of interesting ideas

Make sure the highlights stand out dont make
a VC look for the main points

Simple presentation improvements go a long
way spell check, section headings,


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Grading for Business Plan
Exec summary /10
Bus opportunity articulated /10
Strategy and milestones /10
Marketing /5
Operations plan /5
Management /5
Financials /5
Convincing case /10
Presentation /20

Total /80
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Grade summary (out of 80)
Lower quartile: 55
Median: 62
Upper quartile: 67

Mean = 60.33
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Business Plan Grades Distribution
scores out of 80
Business Plan Grades
0
0.5
1
1.5
2
2.5
3
3.5
4
4.5
0 3 6 9
1
2
1
5
1
8
2
1
2
4
2
7
3
0
3
3
3
6
3
9
4
2
4
5
4
8
5
1
5
4
5
7
6
0
6
3
6
6
6
9
7
2
7
5
7
8