A 3-‐layer Project Portfolio system to align traditional and agile projectsSeptember 2016Thomas Walenta, [email protected]
6 - 8 September 2016 Auckland, NZ
The Company
Founded in 1874Family owned
More than 140 years of tradition and innovation
Leading supplierof intelligent systems for home comfort in Europe
• Branches in 20+ countries, export to 60+• 30 million customers• 340.000 installers• 12.000 employees• 2.000 patents• 8 brands
• 2.3B Euro revenue in 2014
• IT 100+ staff, mix of SAP/Salesforce projects• Approx. 30% agile (SCRUM, Kanban)• Started IT PMO in April 2015, 2 FTE • Implemented IT PPM in July 2015
Problems observed and derived objectives for IT Portfolio Management
Unstructured requests to IT
Divisional and groups wide requests
Surprise requests
IT staff in re-‐active mode / burn outs
Frequently changing priorities
Unclear alignment to strategy
Business dissatisfaction
Lack of visibility portfolio/project
Standardization/channeling of requests
Prioritization based on agreed criteria
Visibility/dashboard of portfolio
Increase efficiency / self management
Increased business satisfaction
Alignment to strategy by categorization
Support increased capacity (+50%)
Less than 50% of requests fulfilledDeliver to
Promise(trust)
Re-‐structure IT to align to business (E2E)
New IT organization: The mapping of business and IT structure reflects the main flows of project demand
Strategy to Stock
Lead to Retention
Enabling processes
Hire to RetireRecord to Report
Shared TechnologyDigital Eco System
Scrum teams
Mixed teams
Service to Retention
Order to Cash
Lead to Order
Develop to ManufacturePlan to Manufacture
Manufacture to Stock
Source to Contract
Finance
Supply Chain
Sales
Product Development
Production
Marketing
HR
Purchasing
Service
Strategy
Group-‐wideCross-‐
divisional Changes
PMO
Project teams
10 End to end (E2E) teams deliver to business requests
Three layers of decision making support project selection and prioritization as well as operational resource alignment – driven by the PMO
Businessdivision
E2E team
PEB Project Entry Board
(3 months)
PfBPortfolio Board
(6 months)
E2E team
E2E team
Key project team
Backlog
Scope
Kanban
Portfolio List
Request list
Categorization
DCCDemand
Coordination
Committee(2 weeks)
Operational layerTeam execution
Tactical layerEnd2end projects
Strategic layerKey projects
Coordina
teRa
te &
prep
are
IT Tower heads are responsible for data collection. IT Process Manager is responsible for data input.
1
2
planIT System
Collect
IT PMO is responsible for data consolidation and review preparation
IT Portfolio Coordination Board will rate the collected Key Projects and recommend priorities for the Portfolio Board as well as constraints.
Customer withIT Process Manager
Directors with IT Tower heads
IT PMO
IT DirectorIT Tower headIT PMOEnterprise Arch.
Key-‐Projects E2E Projects
IT Portfolio Board will review and discuss the recommended prioritiesC-‐Suite will decide about the final project portfolio and project priorities.
3
4 Decisio
n
MD‘sDirectorsIT Tower headIT PMO
Preparation for IT project Portfolio Board Decision making takes approx. 2 months
PfBPortfolio Board
(6 months)
Template ‘categorization’ agreed on to standardize project requests
ROI
Strategic Relevance
Resource fit
Compliance and Legal must
Application Landscape fit
Strategic Relevance (0-‐18 pts):• Increase revenue / profit 2 pts• Increase efficiency 2 pts.• Market penetration / Customer value 2 pts.• Contribute to strategic company goal 2 pts• Special Projects 10 pts.
Financial Impact / ROI Calculation (0-‐10 pts.):(OPEX+CAPEX+Operations) devided by Planned savingsROI <= 1 year: 10 pts.1 > ROI <= 2 years: 8 pts.... 4 > ROI <= 5 years: 2 pts.No ROI or > 5 years: 0 pts.
Compliance and Legal must (0-‐10 pts.)• no relevant 0 pts.• IT Release Update 5 pts.• Mitigate Business Risk 5 pts.• Legal/Tax relevant 10 pts.
Application Landscape fit:• does not fit to current IT landscape 0 pts.• new system, new service required 2 pts.• new component for existing system 3 pts.• extend/modify existing system 4 pts.• use existing system 5 pts• Set new standard 6 pts..
Ranking Pts. = Strategic Relevance + ROI+ Compliance and Legal must+ IT Application Landscape fit
Running projects = 100 pts.
PfBPortfolio Board
(6 months)
PEB Project Entry Board
(3 months)
(To be implemented)
Semi-‐annual IT Project Portfolio Board (C-‐Suite + 1st line below) decides on priorities
Focus of IT Portfolio Board 03 / 2016
Portfolio Planning§ Resource Capacity
Planning§ Financial Planning§ Prioritization
Portfolio Management§ What-‐if Modeling§ Target Modeling§ Key Driver Analytics
Analyze§ Portfolio Health & Value
contribution§ Exception Management
Analysis Plan
Select
Capture
Collaboration§ Progress Status§ Issue & Risk
Management§ Change Management
Execute
Resource Alignment§ Reallocate Resources§ Remove completed projects§ Cancel / change projects§ Add new projects Manage
Demand Management§ Idea Categorization§ Strategic Initiatives§ Operational work
PfBPortfolio Board
(6 months)
Focus of IT Portfolio Board 09 / 2015
Portfolio Health, risk status and budget achievement are assessed permanently – for key projects
• Established standardized Project reporting (bi-‐weekly)• Established mandatory Project Risk Register • Budget tracking in efforts (person days): plan, outlook, actuals
• Euro Budgets hard to compare due to different rates and uplifts • PMO runs Health Checks with all key projects
• At any time in project lifecycle• Covers all kind of projects (best projects reviewed: Scrum)• Results in RYG status per 7keys, portfolio risks and recommendations to PM
• Portfolio Health presented to IT Management Board bi-‐weekly • Visibility increased• Independent assessments• Corrective/preventive actions are initiated (reduce surprises)
Major success factors for projects
Delivery organization benefits are being realized
Scope is realistic and managed
Business Benefits are being realized
Work & Schedule are predictable Team is high
performing
Risks are being mitigated
Stakeholders are committed
Based on IBM’s 7-‐keys
Based on IBM’s 7-‐keys assessment
Project Entry Boards (PEB) owned by customer run per E2E team
PEB Project Entry Board
(3 months)
PEBs run differently per E2E team and business involved (some are considered agile as part of Scrum backlog grooming)
Input and Output of PEBs is standardizedInput: • Key projects as defined by Portfolio Board which require E2E resources• new/existing E2E projects• use of standard categorization formatOutput: • Prioritized list of E2E projects, requests to other teams
PEBs to run quarterly, every 6 months shortly after Portfolio Board
Short term demand coordinated across all teams and key projects, aligned with bi-‐weekly SCRUM cycle
DCCs run every 2 weeks, just before the 2-‐week standardized Scrum sprint cycle starts. Duration: less than 1 hour.
All E2E teams and key projects with requests participate.
Requests to E2E teams are standardizedand have to be fulfilled within next sprint (2 weeks).
>> ensures E2E teams stay protected during sprints but can support other teams/projects by considering prioritized requests in sprint planning
DCCDemand
CoordinationCommittee(2 weeks)
FROM%Team/Project TO%Team
Action(name%of%employee)
PSP Contact
Benefits Roadmap Portfolio
PfM Process -priorisation
PfM Process –resource alignment
PfM Process -health
PfM Process –demand/planning
PfMList all key projects
PfM toolreporting
PfMPfBoards MD/VGI
PfMScenario Tool
PfMPEB Process/List
Project / Enabler of Benefit Benefit: seen as positive by a stakeholder
(Key) Objective(SMART)
PfM temp -Catagorization sheet
PfM ProcessRes Capacity Mgmt
PfM ProcessRes/demand coord
PfM - templateBenefits Register
PfM - processBenefits Mgmt
PfM - templateBusiness case
PfM –develop skills benefits mgmt
PfM - templateBenefits Report
PfM procDCC process
PMOP05: Project Categorization
1
PMOP01: Establish Portfolio Visibility
1
PMOP06: establish preproject standard
2
PMOP02: Resource planning &
alignment
10
PMOP04: Efficiency by Portfolio
Prioritization
1
PMOP03: Ensure PEB/DCC and x-Team
coordination
4
PMOP07: Customer expectation and benefits management
5
PMOP08: Pool key skills & resources
8
PfM ProcessBottleneck mgmt
PfM - template'IT Value Sheet'
CULTCustomer survey
started doneplanned
Increasestrategical value
Increase efficiency
Increase Customer Satisfaction
Increase visibility
Improvestandardization
started
Crosscheck against ISO 21504 Guidance on Portfolio Management – Managing Portfolio
Define Portfolio
Identify Components (strategic)
Assess & select components
Validate Portfolio to strategic objectives (strategic)
Evaluate performance (strategic)
Balance & optimize Portfolio
Optimize components
Maintain Portfolio (strategic)
Optimize resources (operational)
Manage portfolio risks
Control portfolio change (strategic)started doneplanned started
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