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CANVASSED in a Business (IT) Strategy Canvas: Design, Build, Transform

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Flevy.com Best Practices
Flevy.com Best Practices

This Slideshare presentation is a partial preview of the full business document. To view and download the full document, please go here: http://flevy.com/browse/business-document/canvassed-in-a-business-it-strategy-canvas-design-build-transform-292 The "Deliver Business Value with IT" series provides a good overview and actionable material of the ways a CIO can provide valuable and effective support to your company strategy and leverages business model concepts to deliver business value from IT. Martin Palmgren propose an extremely solid piece of work that comes across as the A-Z reference of how to execute and implement IT strategy from a CEO and CIO level perspective." Executive Summary: The CIO and the IT Department need to position as premium provider of IT services and focus on value to cost.

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. Copyright 2012 COMMUNICATE! Build an effective IT Delivery Model to meet Business Needs! - To deliver to set business strategy and objectives ! !! By Martin Palmgren, IT Strategy and Transformation Executive @ .COMMUNICATE 1  
. Copyright 2012 COMMUNICATE! The material in this presentation is derived from identified “best in class practise” used by some of the worlds largest groups (Fortune 100 and 1000) and top performers within the IT domain. This walkthrough is a part of a set of reports proposed to provide pragmatic guidance on how to develop and execute your IT Strategy to support the Business Strategy and Business Objectives. Reference! 3  
. Copyright 2012 COMMUNICATE! We work with a number of large French and International groups on the Business IT roadmap;  that is how do we (as CIO, IT Department) support business objectives and processes leveraged by IT and an effective IT Services strategy.! .COMMUNICATE! 5  
. Copyright 2012 COMMUNICATE! Martin Palmgren, EVP  .COMMUNICATE  – Deliver Business Value with IT / martin.palmgren@pscommunicate.com (mail)! Deliver Business Value with IT (the book) https://www.smashwords.com/books/view/290604  (the blog) http://deliverbusinessvaluewithit.wordpress.com /! CONTACT! 7  
. Copyright 2012 COMMUNICATE! Business (IT) Value Proposition! (IT) Business Model! “This is how we support business objectives with services in a time to market perspective” ! “This is how we deliver IT services to the business” ! Business Strategy:! Business Architecture :! IT Strategy:! IT Architecture:! -  -  -  -  -  -  -  -  Vision! Articulate! Deliver! Strategy Execution! IT Vision! Baseline! Roadmap! Design! Build ! Time to Market (Governance: Performance & Conformity)! Deliver effective (IT) Performance Management! 9  
. Copyright 2012 COMMUNICATE! Design, Build, Transform! •  Design ()! •  Build ()! •  Transform () ! 11  
. Copyright 2012 COMMUNICATE! Design! •  Design the Business (IT) Value Proposition ()! •  Articulate Governance Principles ()! •  Design Key Performance Indicators () ! 13  
. Copyright 2012 COMMUNICATE! Vision! Articulate! Deliver! IT Vision! Baseline! Roadmap! Design! Build! Transform the Business Model! Design! Design:! -  -  -  -  -  -  -  -  Design the IT Value Proposition! Design the service strategy! Articulate governance principles! Define project teams! Engage customer ʻbuy inʼ ! Design KPIʼs ! Define & validate service pricing! Design the performance measurement system! Design the IT Value Proposition! 15  
. Copyright 2012 COMMUNICATE! Cost Effectiveness! Cycle Time! Time to Market!   Develop vision and strategy! Define the business concept and long-term vision
 Develop business strategy
 Manage strategic initiatives
 ! ! ! ! ! ! ! ! ! ! ! Develop and manage products and services! Market and sell products and services! Deliver products and services! Manage customer services! Develop and manage Human Capital! Manage information technology! Manage financial resources! Acquire, construct and manage property! Manage environmental health and safety ! Manage external relationships! Manage knowledge, improvement and change
 Develop Vision and Strategy! 17  
. Copyright 2012 COMMUNICATE! Time to Market!   ! Cost Effectiveness! Cycle Time! Develop vision and strategy! Develop and manage products and services
 Market and sell products and services
 ! Understand markets, customers, and capabilities
 Develop marketing strategy
 Develop sales strategy
 Develop and manage marketing plans
 Develop and manage sales plans! ! ! ! ! ! ! ! ! ! Deliver products and services! Manage customer services! Develop and manage Human Capital! Manage information technology! Manage financial resources! Acquire, construct and manage property! Manage environmental health and safety ! Manage external relationships! Manage knowledge, improvement and change
 Market and Sell Products and Services! 19  
. Copyright 2012 COMMUNICATE! Cost Effectiveness! Cycle Time! Time to Market! ! Develop vision and strategy! Develop and manage products and services
 Market and sell products and services! Deliver products and services! Manage customer services! ! ! ! Develop customer care/customer service strategy! Plan and manage customer service operations! Measure and evaluate customer service operations
 ! ! ! ! ! ! ! Develop and manage Human Capital! Manage information technology! Manage financial resources! Acquire, construct and manage property! Manage environmental health and safety ! Manage external relationships! Manage knowledge, improvement and change
   ! ! Manage Customer Services! 21  
. Copyright 2012 COMMUNICATE! Time to Market!   ! ! ! ! ! Cost Effectiveness! Cycle Time! Develop vision and strategy! Develop and manage products and services
 Market and sell products and services! Deliver products and services! Manage customer services! Develop and manage Human Capital! Manage information technology! Manage the Business of Information Technology
 Develop and Manage IT Customer Relationships
 Manage Business Resiliency and Risk
 Manage Enterprise Information
 Develop and Manage Information Technology Solutions
 Deploy Information Technology Solutions
 Deliver and Support Information Technology Services
 Manage IT Knowledge! ! ! ! ! ! Manage financial resources! Acquire, construct and manage property! Manage environmental health and safety ! Manage external relationships! Manage knowledge, improvement and change
 Manage Information Technology! 23  
. Copyright 2012 COMMUNICATE! Time to Market!   ! ! ! ! ! ! ! Cost Effectiveness! Cycle Time! Develop vision and strategy! Develop and manage products and services
 Market and sell products and services! Deliver products and services! Manage customer services! Develop and manage Human Capital! Manage information technology! Manage financial resources! Acquire, construct and manage property! Design and construct/acquire nonproductive assets
 Maintain nonproductive assets
 Obtain, install, and plan maintenance for productive assets
 Dispose of productive and nonproductive assets
 Manage physical risk
 ! ! ! ! ! Manage environmental health and safety ! Manage external relationships! Manage knowledge, improvement and change
 Acquire Construct and Manage Property! 25  
. Copyright 2012 COMMUNICATE! Time to Market!   ! ! ! ! ! ! ! ! ! Cost Effectiveness! Cycle Time! Develop vision and strategy! Develop and manage products and services
 Market and sell products and services! Deliver products and services! Manage customer services! Develop and manage Human Capital! Manage information technology! Manage financial resources! Acquire, construct and manage property! Manage environmental health and safety ! Manage external relationships! Build investor relationships
 Manage government and industry relationships
 Manage relations with board of directors
 Manage legal and ethical issues
 Manage public relations program! ! Manage knowledge, improvement and change
 Manage External Relationships! 27  
. Copyright 2012 COMMUNICATE! Design! •  Articulate Governance Principles ()! ! ! ! !! !! !! ! ! ! ! ! !! !! ! ! - To the business strategy ()! - Executive Management ()! - Risk ()! ! - IT Organisation () ! ! ! ! ! ! 29  
. Copyright 2012 COMMUNICATE! ! ! Articulate Governance principles! ! ! ! ! ! - Does IT support the achievement of business objectives? ! - What value does the expenditure on IT deliver? ! - Are IT costs being managed effectively? ! - Are IT risks being identified and managed? ! - Are targeted inter-company IT synergies being achieved? ! Executive management! 31  
. Copyright 2012 COMMUNICATE! ! ! Articulate Governance principles! ! ! ! ! ! - Are we developing the professional competencies needed for successful service delivery? ! - Are we creating a positive workplace environment? ! - Do we effectively measure and reward individual and team performance? ! - Do we capture organizational knowledge to continuously improve performance? ! - Can we attract/retain the talent we need to support the business? ! IT Organisation! 33  
. Copyright 2012 COMMUNICATE! ! ! Design Key Performance Indicators! ! ! ! ! ! - Control of IT expenses percentage, over or under IT budget, allocation to different budget items ! - IT budget as a percentage of turnover ! - IT expenses per staff member ! - Business value of the IT function percentage of the development capacity engaged in strategic projects relationship between new developments/infrastructure investments/replacement investments ! - Business value of new IT projects financial evaluation based on ROI, NPV, IRR, PB business evaluation based on information economics ! Corporate contribution! 35  
. Copyright 2012 COMMUNICATE! ! ! Design Key Performance Indicators! ! ! ! ! ! ! ! ! ! ! ! ! - Efficient software development ! - Average days late in delivering software ! - Average unexpected budget increase ! - Percentage of projects performed within SLA ! - Percentage of maintenance activities ! - Efficient computer operations ! - Percentage unavailability of network ! - Response times per category of users ! - Percentage of jobs done within time ! - Efficient help desk function ! - Average answer time of help desk ! - Percentage of questions answered within time ! Operational excellence! 37  
. Copyright 2012 COMMUNICATE! Build! •  •  •  •  Build the Business (IT) Value Proposition ()! Strategy execution support business drivers ()! Control IT ()! From a strategical, Tactical and Operational perspective () ! 39  
. Copyright 2012 COMMUNICATE! Vision! Articulate! Deliver! IT Vision! Baseline! Roadmap! Design! Build! Transform the Business Model! Build! Build:! -  -  -  -  -  -  Build the IT Value Proposition! Implement the project portfolio! Engage Organizational change! Control IT (measure outcome to set objectives)! Capture KPIʼs & Measure performance! Enforce governance! Build the IT Value Proposition! 41  
Manage product and service portfolio
 Develop products and services
 Develop and manage products and services
 Define the business concept and long-term vision
 Develop business strategy
 Manage strategic initiatives
 Develop vision and strategy
 Deliver products and services
 ! ! ! ! ! Acquire, construct and manage property
 ! Create and manage organizational performance strategy
 Benchmark performance
 Develop enterprise-wide knowledge management (KM) capability
 Manage change! Manage knowledge, improvement and change
 Build investor relationships
 Manage government and industry relationships
 Manage relations with board of directors
 Manage legal and ethical issues
 Manage public relations program
 Manage external relationships
 Determine environmental health and safety impacts
 Develop and execute environmental health and safety program
 Train and educate employees
 Monitor and manage environmental health and safety management program
 Ensure compliance with regulations
 Manage remediation efforts
 Manage environmental health and safety ! Design and construct/acquire nonproductive assets
 Maintain nonproductive assets
 Obtain, install, and plan maintenance for productive assets
 Dispose of productive and nonproductive assets
 Manage physical risk
 Perform planning and management accounting
 Perform revenue accounting
 Perform general accounting and reporting
 Manage fixed-asset project accounting
 Process payroll
 Process accounts payable and expense reimbursements Manage treasury operations
 Manage internal controls Manage taxes
 Manage international funds/consolidation
 Manage financial resources
 Manage the Business of Information Technology
 Develop and Manage IT Customer Relationships
 Manage Business Resiliency and Risk
 Manage Enterprise Information
 Develop and Manage Information Technology Solutions
 Deploy Information Technology Solutions
 Deliver and Support Information Technology Services
 Manage IT Knowledge
 Manage information technology
 Develop and manage human resources (HR) planning policies, and strategies
 Recruit, source, and select employees
 Develop and counsel employees
 Reward and retain employees
 Redeploy and retire employees
 Manage employee information
 ! ! Develop and manage Human Capital
 ! Develop customer care/customer service strategy
 Plan and manage customer service operations
 Measure and evaluate customer service operations
 Manage customer services
 ! Plan for and acquire necessary resources (Supply Chain Planning)
 Procure materials and services
 Produce/Manufacture/Deliver product
 Deliver service to customer
 Manage logistics and warehousing
 Understand markets, customers, and capabilities
 Develop marketing strategy
 Develop sales strategy
 Develop and manage marketing plans
 Develop and manage sales plans
 Market and sell products and services
 ! !   . Copyright 2012 COMMUNICATE! Business Drivers & Processes! Cost Effectiveness! Cycle Time! A Confirmed Business (IT) Value Proposition! 43  
. Copyright 2012 COMMUNICATE! Link Strategy and Operations! 1.  2.  3.  4.  Develop the Strategy! Translate the Strategy! Plan Operations! Monitor and Learn! 5.  Test and Adapt the Strategy! Execute Procedures and Initiatives! ! ! !! !! ! ! ! ! Business (IT) Strategy, link to operations! 45  
. Copyright 2012 COMMUNICATE! Define Market Position! 1.  2.  3.  4.  New entrants! Suppliers! Substitute products or Services! Buyers! 5.  Existing Competitors! ! ! !! !! ! ! ! ! Business (IT) Context! 47  
Strategy Execution! IT Infrastructure Portfolio Management! Application Portfolio Management! Service Portfolio Management! Enterprise Portfolio Management:! Process based IT Architecture! Project Portfolio Management ! Performance Management:! Process based Business Architecture ! Product / service life cycle management! Business Strategic Intent! Strategy Articulation! . Copyright 2012 COMMUNICATE! Business Drivers & Processes! Cost Effectiveness! Cycle Time! Time to Market (Governance: Performance & Conformity)! Strategy execution support business drivers ! 49  
Vision, Principles and strategy : Strategic Intent: set by the Board, Executive Management, Business operations management with objectives on a: Strategic, Tactic & Operational level! ! •  Strategic Intent: Product / service life cycle management: Interprets, models and articulates the strategic intent in to business strategy! •  Business Strategy: Process based Enterprise Architecture: Interprets, models and articulates the business strategy and ensures capability! •  Business & IT objectives: Project Portfolio Management: Interprets, models and articulates the business objectives and ensures capability! •  IT Strategy: Process based IT governance: Levers formulated operating processes with best in class IT solutions! •  Aligned on business requirements: Service Portfolio Management: Levers formulated operating processes with portfolio management! •  Software Asset Management: Application Portfolio Management: Levers formulated operating processes application portfolio management solutions! •  Infrastructure Asset Management: IT Infrastructure Portfolio Management: Levers formulated operating processes with IT infrastructure portfolio management ! . Copyright 2012 COMMUNICATE! •  A confirmed business (IT) Value proposition ! 51  
Product / service life cycle management: Interprets, models and articulates the strategic intent in to business strategy.! ! BA provide an architectural print of how the situation should/will/might look like as we engage on the execution of strategic intent. 
 . Copyright 2012 COMMUNICATE! ! IT Governance can be used to set controls to see how well you do against that strategic intent i.e. the critical path must determine to what extent controls are required and on what level they must inform and in the same light, which processes are required to deliver the level of performance that needs to be "controlled". 
 It is imperative to know first "what" needs to be achieved (strategic intent), "how" that can be enabled & measured (controls & objectives) and "how" that can be delivered through operational processes. Such processes can then be designed and run through several different frameworks, processes and best practices. 
 All strategic intent or objective are not critical, be selective in the first span of controls. An Executive Manager (CxO) would need to be able to visualise critical objectives, impact, control and delivery. He must be able to see how and where IT (under) perform based on hopefully a few exceptions. That said unless the organisation understands and implements processes, frame works and methodologies (maturity) to stabilise the performance of the IT organisation to meet set targets (bottom up) the realisation might be difficult. And the level (maturity) of implementation, the design of the processes and the amount of stabilisation will depend on the role the process and its activities play towards the intent (2). To Map the intent down to processes and controls is necessary to understand what performance needs need to be stabilised.! Strategic intent! 53  
. Copyright 2012 COMMUNICATE! ! Project Portfolio Management: Interprets, models and articulates the business objectives and ensures capability.! ! Most IT organisations are under increased pressure from the board of directors, Executive Management (CxOs) and business unit managers to demonstrate and improve the business value of their IT investments. But IT organisations struggle to measure business value and position their services as value added versus cost sunk. Attempts to do so have been focused on ROI measures on the front end as part of developing a business case for the IT portfolioʼs proposed investments, but these are only estimates of the expected business value. ! ! Actual delivered business value can only be measured by a life – cycle approach: to work with the business to measure actual benefit after the project is complete. This practice has started to gain traction but not consistently nor broadly. Firms that strive for best practice in IT portfolio management need to apply a credible standard methodology across the enterprise to measure the business value of investments, both when proposed and when delivered. The good news is that a number of IT value methodologies have emerged that can be employed in the portfolio management process. Business value measures as both tangible and intangible benefits. Benefits are assessed based on a set of weighted criteria that include: customers need, business and technical risks, strategic fit, revenue potential, level of required investment and quantification of innovation and learning generated. Each project is given a numerical score for each criteria and the weighted totals are summed up to give a single quantitative number. ! ! Business and IT Objectives! 55  
Process based IT Architecture: Levers formulated operating processes with best in class IT solutions.! ! These methodologies should go beyond to calculate a return on investment (ROI): ! ! The the business case: is an operational tool that must be updated throughout the economic life cycle of the investment and then be used to support the implementation and execution of a program benefits realisation included. A business case is used initially at the individual program level to determine if it is strong enough to be evaluated at the portfolio level. At the portfolio level, the business case is evaluated against other active and proposed programs.! ! How do we align and lever operating, management and support processes through the effective implementation of IT:! . Copyright 2012 COMMUNICATE! ! ! Do we do the right things? - The strategic question ! -  The investment: Is in line with our vision, Is consistent with our business principles, Contributes to our strategic objectives, Provides optimal value, at affordable cost, at an acceptable level of risk.! ! ! ! ! IT Strategy! 57  
Application portfolio management: Levers formulated operating processes with best in class application portfolio management solutions.! ! Once the business case is developed and summarised, key points and metrics from the business case are captured in an easily accessible and widely distributed format. If a project begins to struggle, to evaluate its current state against the original business case can prove invaluable. The same should be done with any risk assessments that were performed. The project can be assessed against identified risk on a regular basis, which can serve as an early warning sign that the project is in danger. ! ! Analysis of the internal or external business environment should be retained and reviewed on a regular basis. If the project was given the green light based on certain assumptions about the business environment, care should be taken to monitor these external factors, and if they change, modify the project or cancel it if there is risk that it will become irrelevant: Identify current operational problems. These are the areas in which IT spends most of its time in reactive mode, be the systems, projects, or ʻʻexternally forcedʼʼ problems like hacker attacks or failing infrastructure. 2. Determine the IT organizationʼs capabilities in terms of human resources, budget, and how focused your staff is on technical skills versus more general business process expertise. 3. Transition “run” operations to a trusted group of managers, for the focus of the CIO can shift to build relationships within the Executive suite and larger business community, and optimization of the organizationʼs project portfolio can begin. ! . Copyright 2012 COMMUNICATE! ! Software Asset Management! 59  
. Copyright 2012 COMMUNICATE! Build! •  Control IT ()! ! ! ! ! ! ! !! !! !! !! !! !! ! ! ! ! ! ! - IT Organisation ()! - Corporate contribution ()! - User orientation ()! - Operational excellence ()! - Future orientation ()! ! 61  
. Copyright 2012 COMMUNICATE! ! ! Control IT! ! ! ! ! ! - Control of IT expenses percentage, over or under IT budget, allocation to different budget items ! - IT budget as a percentage of turnover ! - IT expenses per staff member ! - Business value of the IT function percentage of the development capacity engaged in strategic projects relationship between new developments/infrastructure investments/replacement investments ! - Business value of new IT projects financial evaluation based on ROI, NPV, IRR, PB business evaluation based on information economics ! Corporate contribution! 63  
. Copyright 2012 COMMUNICATE! ! ! Control IT! ! ! ! ! ! ! ! ! ! ! ! ! - Efficient software development ! - Average days late in delivering software ! - Average unexpected budget increase ! - Percentage of projects performed within SLA ! - Percentage of maintenance activities ! - Efficient computer operations ! - Percentage unavailability of network ! - Response times per category of users ! - Percentage of jobs done within time ! - Efficient help desk function ! - Average answer time of help desk ! - Percentage of questions answered within time ! Operational excellence! 65  
. Copyright 2012 COMMUNICATE! •  From a strategic, tactical and operational perspective ()! Build! ! ! ! ! ! ! ! ! ! ! ! ! !! !! !! !! !! !! !! !! !! !! !! !! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! - We focus on time to market ()! - A Governance Office aligned with ()! - Strategic Intent ()! - Leveraged with Best Practise ()! - With an Effective (IT) Business Model ()! - A Stakeholder Strategy Map & Canvas ()! - Collaboration Theme Scorecard ()! - Product / Service life Cycle Management ()! - A Portfolio Management Office ()! - Plan, Organise, Direct, Control ()! - Project Portfolio Management ()! - Service Portfolio Management ()! - Application Portfolio Management ()! - Captured in a Strategy Map () ! - & Canvas, articulated in a ()! - Collaboration Theme Scorecard ()! 67  
Strategic! Tactic! Operational! . Copyright 2012 COMMUNICATE! IT! The Governance Office! Stakeholder Strategy Roadmap! Collaboration Theme Scorecard! Strategic! Product / service life cycle Management! Portfolio Management Office! Tactic! Project Portfolio Management! Service Portfolio Management! Operational! Application Portfolio Management! Time to Market (Performance & Conformity)! Operating Processes! A Governance Office aligned with! 69  
Strategic! Tactic! Operational! . Copyright 2012 COMMUNICATE! IT! Zackman! Nomenclature CIGREF! IC - dVAL! IDEAL! COSO! Governance Office! ISO 38 500! Val IT! Risk IT!Cob IT! IT Balanced Scorecard! ISO 20 000, 27 002! AGILE! Strategic! BA! TOGAF, EAF, CEISAR, PEAF! SCRUM! eSCM! CMMI! ITIL! MAGENTA! Mareva! Tactic! PMBOK, Prince 2! Operational! TD ABC! Six Sigma! Time to Market (Performance & Conformity)! Operating Processes! Leveraged with Best Practise! 71  
Strategic! Tactic! Operational! . Copyright 2012 COMMUNICATE! IT! The Governance Office! Stakeholder Strategy Roadmap! Strategic! Tactic! Operational! Time to Market (Performance & Conformity)! Operating Processes! A Stakeholder Strategy Map & Canvas! 73  
Strategic! Tactic! Operational! . Copyright 2012 COMMUNICATE! IT! The Governance Office! Product / service life cycle Management! Strategic! Tactic! Operational! Time to Market (Performance & Conformity)! Operating Processes! Product / Service life Cycle Management! 75  
. Copyright 2012 COMMUNICATE! ! The Portfolio Management Office: Business & IT Strategy ! ! Plan the selection process of projects to launch, Organise the process of resources assignment to projects, Direct the process of managing ongoing projects, Control the key performance indexes to manage.! ! Key objectives: To gather and distribute information, Monitor, report and analyse performance, Provide specialised business management expertise, Facilitate communications, coordination and collaboration, Identify, analyse, and communicate significant issues and support their solution, Actively coordinate and manage complex activities across the organisation, define, deploy, measure, improve the enabling network of business processes. ! ! ! ! ! Activities: Work and resource management: Portfolio/ Program/ Project Management, PM trainings and development, Scope Management, Issue Management, Internal consulting, Risk Management, Staffing organisational capacity management. ! Plan, Organise, Direct, Control! 77  
Strategic! Tactic! Operational! . Copyright 2012 COMMUNICATE! IT! The Governance Office! Strategic! Project Portfolio Management! Tactic! Operational! Time to Market (Performance & Conformity)! Operating Processes! Project Portfolio Management! 79  
Strategic! Tactic! Operational! . Copyright 2012 COMMUNICATE! IT! The Governance Office! Strategic! Tactic! Operational! Application Portfolio Management! Time to Market (Performance & Conformity)! Operating Processes! Application Portfolio Management! 81  
. Copyright 2012 COMMUNICATE! ! ! The Stakeholder Strategy Map: Formalises stakeholder outcomes to deliver value for all parties.! ! ! ! The strategy canvas allow the teams to articulate and formulate objectives on a project / program basis for improved execution with an extended GAP, risk and added value analysis captured in a DARCI (Decision taker, Accountable, Responsible, Consulted & Informed).! & Canvas, articulated in a! 83  
. Copyright 2012 COMMUNICATE! Transform! •  To perform effective IT Governance ()! •  We focus on demand and cost drivers ()! 85  
. Copyright 2012 COMMUNICATE! Vision! Articulate! Deliver! IT Vision! Baseline! Roadmap! Design! Build! Transform the Business Model! Transform! Transform:! -  -  -  -  -  -  -  -  Transform the Business Model! Measure KPI trends and targets! Meet business objectives! Control costs! Measure Delivery performance! Manage change! Continuous service & process improvement! Process roll out (articulation & integration)! -  Execute strategic intent! To Perform Effective IT Governance! 87  
. Copyright 2012 COMMUNICATE! The IT service proposition is aligned to the business strategy as:! •  ! •  •  •  •  Stakeholder expectations are understood and IT propose a ! ! service portfolio that correspond to Demand and Cost drivers ! Business Contribution, Cost, Consumption & Chargeback is identified! Focus is on perfect order business transactions! Services are effective (demand and cost drivers identified)! Services are competitive (Benchmark Industry Market Forces)! •  New technological solutions that could change how current business is performed are explored, proposed and implemented.! ! ! IT contributes to business objectives! 89  
Service strategy ! Delivery capability! Architecture! Security! Strategy Execution! “This is how we support business objectives with services in a time to market perspective” ! “This is how we deliver IT services to the business” ! Business (IT) Value Proposition! . Copyright 2012 COMMUNICATE! (IT) Business Model! ! Develop vision and strategy
 ! Develop and manage products and services
 ! Market and sell products and services
 ! Deliver products and services
 ! Manage customer services
 ! Develop and manage Human Capital
 ! Manage information technology
 ! Manage financial resources
 ! Acquire, construct and manage property
 ! ! Manage environmental health and safety ! ! Manage external relationships
 ! Manage knowledge, improvement and change
 ! Time to Market (Governance: Performance & Conformity)! Business (IT) Strategy Road Map (How)! To leverage business strategy with IT! 91  
. Copyright 2012 COMMUNICATE! We align and lever operating, management and support processes through the effective implementation of IT.! - Do we perform them in the right manner? - The architecture question! - The investment:! ! ! ! ! - Is in line with our architecture,! - Is consistent with our architectural principles,! - Contributes to the population of our architecture.! - Do we perform them well? - The delivery question! - We have: ! ! ! ! ! - Effective and disciplined management, delivery and change management processes,! ! - Competent and available technical and business resources to deliver:! ! - The required capabilities,! ! - Organisational change required to lever capabilities.! Process Management! 93  
. Copyright 2012 COMMUNICATE! Industry structure! •  •  •  •  •  New entrants! Suppliers! Substitute products or Services! Buyers (customers)! Existing Competitors! ! ! ! ! Defined Market Position! 95  
. Copyright 2012 COMMUNICATE! There is a understanding of:! •  •  •  •  Political,! Environmental,! Social,! Technological! ! ! ! ! External environment! 97  
. Copyright 2012 COMMUNICATE! Appreciation of the implications for the strategy of:! •  •  •  •  •  •  •  Resources,! Skills and competencies,! Appropriate development / recruitment plans,! Shared direction,! Extent of buy-in to shared vision by key managers,! Barriers / commitment to change,! Structure of the organisation! ! ! Talent! 99  
. Copyright 2012 COMMUNICATE! There is a understanding of the:! •  Extent to which long term plans are coherent and logical,! •  Extent to which short term plans are appropriately costed and timetabled,! •  Consistency with overall goals and objectives! ! ! ! ! Objectives and Plans! 101  
. Copyright 2012 COMMUNICATE! There is a understanding of the:! •  Extent to which the strategy has been communicated,! •  Extent to which staff performance towards the business IT strategy is recognised! ! ! ! ! Communication and buy in! 103  
. Copyright 2012 COMMUNICATE! Transform! ! !! ! ! ! ! ! ! ! ! ! ! ! !! !! !! !! !! !! !! !! !! !! !! •  We focus on demand and cost drivers ()! ! - Provide best in class services ()! ! - And solutions as needed ()! ! - To leverage competitive advantage ()! ! - To the Strategic Plan ()! ! - To support the Business Architecture ()! ! - To Leverage competitive advantage ()! ! - Business (IT) Strategy, link to operations ()! ! - Business (IT) Tactics ()! ! - Business (IT) Context ()! ! - Captured in a Strategy Map ()! ! - & Canvas, articulated in a ()! ! - Collaboration Theme Scorecard ()! ! ! - Conceived in to a solid story ()! ! ! ! 105  
. Copyright 2012 COMMUNICATE! To business needs! 2. Market definition! •  Customer base and demand is clearly defined: - Who is consuming what services! •  Prices / SLAʼs for services are established and Internal rates compared to outside marketplace for IT (Make or Buy)! ! ! We provide best in class services ! 107  
. Copyright 2012 COMMUNICATE! Provide clear guidelines! ! ! 4. Governance is in place! Best practices processes continuously improved! Governance blueprint designed and operating! IT investments reflect:! •  •  •  •  The strategic intent of the Board, ! Business goal and priorities, ! A clear IT portfolio of projects and services, ! A Service Portfolio alignment to business goals and priorities! IT investments deliver a good return on investment! The IT Steering Committee will initiate a strategic IT competitive analysis! To leverage competitive advantage ! 109  
Strategic! Tactic! Operational! . Copyright 2012 COMMUNICATE! Strategy! ! Business & IT Vision Articulated! Process! Strategic! ! Business Architecture & IT Architecture Aligned and delivered to Strategic Intent! Tactic! Operational! Time to Market (Performance & Conformity)! Application support ! Vendor Driven! Execute Business Strategy! Business Architecture! To support the Business Architecture! 111  
. Copyright 2012 COMMUNICATE! Link Strategy and Operations! 1.  2.  3.  4.  Develop the Strategy! Translate the Strategy! Plan Operations! Monitor and Learn! 5.  Test and Adapt the Strategy! Execute Procedures and Initiatives! ! ! !! !! ! ! ! ! Business (IT) Strategy, link to operations! 113  
. Copyright 2012 COMMUNICATE! Define Market Position! 1.  2.  3.  4.  New entrants! Suppliers! Substitute products or Services! Buyers! 5.  Existing Competitors! ! ! !! !! ! ! ! ! Business (IT) Context! 115  
. Copyright 2012 COMMUNICATE! ! ! The Stakeholder Strategy Map: Formalises stakeholder outcomes to deliver value for all parties.! ! ! ! The strategy canvas allow the teams to articulate and formulate objectives on a project / program basis for improved execution with an extended GAP, risk and added value analysis captured in a DARCI (Decision taker, Accountable, Responsible, Consulted & Informed).! & Canvas, articulated in a! 117  
. Copyright 2012 COMMUNICATE! In order to do so we need to:! Objectives: ! -! Levers: ! ! !! -! ! ! ! Conceived in to a solid story! 119  
. Copyright 2012 COMMUNICATE! At the end of the day Business Executives take the decision to out / cloud source when:! •  •  •  •  •  IT is not perceived to understand stakeholder expectations,! IT is not perceived to contribute to business objectives,! IT is not perceived to deliver value to cost, ! IT is not perceived to deliver services to business needs,! The IT department is unable to deliver services in a time to market perspective,! •  IT propose an effective service portfolio that correspond to Demand and Cost drivers ! Deliver IT services to business needs! 121  
. Copyright 2012 COMMUNICATE! As the IT department delivers effective IT Services and innovative technology solutions to improve competitiveness, demonstrated and articulated in:! •  An IT Business Model “This is how we deliver IT services to the business”! •  and a Business IT Value proposition This is how we support business objectives with services in a time to market perspective” ! ! ! and provides competitive leverage! 123  
. Copyright 2012 COMMUNICATE! •  •  •  •  •  •  Build an effective IT Delivery Model ! Leverage Business Strategy execution with IT! Build an IT Service Strategy leveraged by ITIL V2 & 3 Design, Build, Run ! Logics for IT Sourcing (Internal, Shared service center, Out, Cloud) ! Get your cloud strategy right ! How to build a CIO Office ! “Canvassed” in a Business (IT) Strategy Canvas:! •  “Canvassed” Business Strategy and Architecture: Business Vision, Architecture (Articulate, Deliver) ! •  “Canvassed” IT Strategy: IT Vision ! •  “Canvassed” IT Strategy: IT Baseline, Road Map ! •  “Canvassed” IT Architecture: Design, Build, Transform ! Design, Build, Transform! 125  
. Copyright 2012 COMMUNICATE! CEO, CFO, CIO, CTO, SVP, Architects, Strategy, Business Executives and the IT function in general. ! Target Audience! 127  
. Copyright 2012 COMMUNICATE! BrightTalk Thought Leadership: http://www.brighttalk.com/community/it-service-management/webcasts?q=martin+palmgren ! Get your cloud strategy right: http://www.brighttalk.com/community/it-service-management/webcast/534/29211 ! Get your IT Service Strategy right: http://www.brighttalk.com/community/it-service-management/webcast/534/23630! Leverage Strategy with IT: http://www.brighttalk.com/community/it-service-management/webcast/534/22934 ! Cloud Computing: Fluff or Lightening? http://www.brighttalk.com/community/it-service-management/webcast/534/21892 ! Run IT as a Service Business! http://www.brighttalk.com/community/it-service-management/webcast/534/21389 ! In French: ! Cloud Computing : La tête dans les nuages?: http://www.brighttalk.com/community/it-service-management/webcast/534/21919 ! Baseline: Coût, Consommation, chargeback et contribution IT aux objectifs de l'entreprise : ! http://www.brighttalk.com/community/it-service-management/webcast/534/21388! Deliver Business Value with IT (the book) https://www.smashwords.com/books/view/290604  (the blog) http:// deliverbusinessvaluewithit.wordpress.com /! I also share perspective @ some of the top French Business Schools, notably EDHEC! International Thought Leadership! 129  

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CANVASSED in a Business (IT) Strategy Canvas: Design, Build, Transform

  • 1. . Copyright 2012 COMMUNICATE! Build an effective IT Delivery Model to meet Business Needs! - To deliver to set business strategy and objectives ! !! By Martin Palmgren, IT Strategy and Transformation Executive @ .COMMUNICATE 1  
  • 2. . Copyright 2012 COMMUNICATE! The material in this presentation is derived from identified “best in class practise” used by some of the worlds largest groups (Fortune 100 and 1000) and top performers within the IT domain. This walkthrough is a part of a set of reports proposed to provide pragmatic guidance on how to develop and execute your IT Strategy to support the Business Strategy and Business Objectives. Reference! 3  
  • 3. . Copyright 2012 COMMUNICATE! We work with a number of large French and International groups on the Business IT roadmap;  that is how do we (as CIO, IT Department) support business objectives and processes leveraged by IT and an effective IT Services strategy.! .COMMUNICATE! 5  
  • 4. . Copyright 2012 COMMUNICATE! Martin Palmgren, EVP  .COMMUNICATE  – Deliver Business Value with IT / martin.palmgren@pscommunicate.com (mail)! Deliver Business Value with IT (the book) https://www.smashwords.com/books/view/290604  (the blog) http://deliverbusinessvaluewithit.wordpress.com /! CONTACT! 7  
  • 5. . Copyright 2012 COMMUNICATE! Business (IT) Value Proposition! (IT) Business Model! “This is how we support business objectives with services in a time to market perspective” ! “This is how we deliver IT services to the business” ! Business Strategy:! Business Architecture :! IT Strategy:! IT Architecture:! -  -  -  -  -  -  -  -  Vision! Articulate! Deliver! Strategy Execution! IT Vision! Baseline! Roadmap! Design! Build ! Time to Market (Governance: Performance & Conformity)! Deliver effective (IT) Performance Management! 9  
  • 6. . Copyright 2012 COMMUNICATE! Design, Build, Transform! •  Design ()! •  Build ()! •  Transform () ! 11  
  • 7. . Copyright 2012 COMMUNICATE! Design! •  Design the Business (IT) Value Proposition ()! •  Articulate Governance Principles ()! •  Design Key Performance Indicators () ! 13  
  • 8. . Copyright 2012 COMMUNICATE! Vision! Articulate! Deliver! IT Vision! Baseline! Roadmap! Design! Build! Transform the Business Model! Design! Design:! -  -  -  -  -  -  -  -  Design the IT Value Proposition! Design the service strategy! Articulate governance principles! Define project teams! Engage customer ʻbuy inʼ ! Design KPIʼs ! Define & validate service pricing! Design the performance measurement system! Design the IT Value Proposition! 15  
  • 9. . Copyright 2012 COMMUNICATE! Cost Effectiveness! Cycle Time! Time to Market!   Develop vision and strategy! Define the business concept and long-term vision
 Develop business strategy
 Manage strategic initiatives
 ! ! ! ! ! ! ! ! ! ! ! Develop and manage products and services! Market and sell products and services! Deliver products and services! Manage customer services! Develop and manage Human Capital! Manage information technology! Manage financial resources! Acquire, construct and manage property! Manage environmental health and safety ! Manage external relationships! Manage knowledge, improvement and change
 Develop Vision and Strategy! 17  
  • 10. . Copyright 2012 COMMUNICATE! Time to Market!   ! Cost Effectiveness! Cycle Time! Develop vision and strategy! Develop and manage products and services
 Market and sell products and services
 ! Understand markets, customers, and capabilities
 Develop marketing strategy
 Develop sales strategy
 Develop and manage marketing plans
 Develop and manage sales plans! ! ! ! ! ! ! ! ! ! Deliver products and services! Manage customer services! Develop and manage Human Capital! Manage information technology! Manage financial resources! Acquire, construct and manage property! Manage environmental health and safety ! Manage external relationships! Manage knowledge, improvement and change
 Market and Sell Products and Services! 19  
  • 11. . Copyright 2012 COMMUNICATE! Cost Effectiveness! Cycle Time! Time to Market! ! Develop vision and strategy! Develop and manage products and services
 Market and sell products and services! Deliver products and services! Manage customer services! ! ! ! Develop customer care/customer service strategy! Plan and manage customer service operations! Measure and evaluate customer service operations
 ! ! ! ! ! ! ! Develop and manage Human Capital! Manage information technology! Manage financial resources! Acquire, construct and manage property! Manage environmental health and safety ! Manage external relationships! Manage knowledge, improvement and change
   ! ! Manage Customer Services! 21  
  • 12. . Copyright 2012 COMMUNICATE! Time to Market!   ! ! ! ! ! Cost Effectiveness! Cycle Time! Develop vision and strategy! Develop and manage products and services
 Market and sell products and services! Deliver products and services! Manage customer services! Develop and manage Human Capital! Manage information technology! Manage the Business of Information Technology
 Develop and Manage IT Customer Relationships
 Manage Business Resiliency and Risk
 Manage Enterprise Information
 Develop and Manage Information Technology Solutions
 Deploy Information Technology Solutions
 Deliver and Support Information Technology Services
 Manage IT Knowledge! ! ! ! ! ! Manage financial resources! Acquire, construct and manage property! Manage environmental health and safety ! Manage external relationships! Manage knowledge, improvement and change
 Manage Information Technology! 23  
  • 13. . Copyright 2012 COMMUNICATE! Time to Market!   ! ! ! ! ! ! ! Cost Effectiveness! Cycle Time! Develop vision and strategy! Develop and manage products and services
 Market and sell products and services! Deliver products and services! Manage customer services! Develop and manage Human Capital! Manage information technology! Manage financial resources! Acquire, construct and manage property! Design and construct/acquire nonproductive assets
 Maintain nonproductive assets
 Obtain, install, and plan maintenance for productive assets
 Dispose of productive and nonproductive assets
 Manage physical risk
 ! ! ! ! ! Manage environmental health and safety ! Manage external relationships! Manage knowledge, improvement and change
 Acquire Construct and Manage Property! 25  
  • 14. . Copyright 2012 COMMUNICATE! Time to Market!   ! ! ! ! ! ! ! ! ! Cost Effectiveness! Cycle Time! Develop vision and strategy! Develop and manage products and services
 Market and sell products and services! Deliver products and services! Manage customer services! Develop and manage Human Capital! Manage information technology! Manage financial resources! Acquire, construct and manage property! Manage environmental health and safety ! Manage external relationships! Build investor relationships
 Manage government and industry relationships
 Manage relations with board of directors
 Manage legal and ethical issues
 Manage public relations program! ! Manage knowledge, improvement and change
 Manage External Relationships! 27  
  • 15. . Copyright 2012 COMMUNICATE! Design! •  Articulate Governance Principles ()! ! ! ! !! !! !! ! ! ! ! ! !! !! ! ! - To the business strategy ()! - Executive Management ()! - Risk ()! ! - IT Organisation () ! ! ! ! ! ! 29  
  • 16. . Copyright 2012 COMMUNICATE! ! ! Articulate Governance principles! ! ! ! ! ! - Does IT support the achievement of business objectives? ! - What value does the expenditure on IT deliver? ! - Are IT costs being managed effectively? ! - Are IT risks being identified and managed? ! - Are targeted inter-company IT synergies being achieved? ! Executive management! 31  
  • 17. . Copyright 2012 COMMUNICATE! ! ! Articulate Governance principles! ! ! ! ! ! - Are we developing the professional competencies needed for successful service delivery? ! - Are we creating a positive workplace environment? ! - Do we effectively measure and reward individual and team performance? ! - Do we capture organizational knowledge to continuously improve performance? ! - Can we attract/retain the talent we need to support the business? ! IT Organisation! 33  
  • 18. . Copyright 2012 COMMUNICATE! ! ! Design Key Performance Indicators! ! ! ! ! ! - Control of IT expenses percentage, over or under IT budget, allocation to different budget items ! - IT budget as a percentage of turnover ! - IT expenses per staff member ! - Business value of the IT function percentage of the development capacity engaged in strategic projects relationship between new developments/infrastructure investments/replacement investments ! - Business value of new IT projects financial evaluation based on ROI, NPV, IRR, PB business evaluation based on information economics ! Corporate contribution! 35  
  • 19. . Copyright 2012 COMMUNICATE! ! ! Design Key Performance Indicators! ! ! ! ! ! ! ! ! ! ! ! ! - Efficient software development ! - Average days late in delivering software ! - Average unexpected budget increase ! - Percentage of projects performed within SLA ! - Percentage of maintenance activities ! - Efficient computer operations ! - Percentage unavailability of network ! - Response times per category of users ! - Percentage of jobs done within time ! - Efficient help desk function ! - Average answer time of help desk ! - Percentage of questions answered within time ! Operational excellence! 37  
  • 20. . Copyright 2012 COMMUNICATE! Build! •  •  •  •  Build the Business (IT) Value Proposition ()! Strategy execution support business drivers ()! Control IT ()! From a strategical, Tactical and Operational perspective () ! 39  
  • 21. . Copyright 2012 COMMUNICATE! Vision! Articulate! Deliver! IT Vision! Baseline! Roadmap! Design! Build! Transform the Business Model! Build! Build:! -  -  -  -  -  -  Build the IT Value Proposition! Implement the project portfolio! Engage Organizational change! Control IT (measure outcome to set objectives)! Capture KPIʼs & Measure performance! Enforce governance! Build the IT Value Proposition! 41  
  • 22. Manage product and service portfolio
 Develop products and services
 Develop and manage products and services
 Define the business concept and long-term vision
 Develop business strategy
 Manage strategic initiatives
 Develop vision and strategy
 Deliver products and services
 ! ! ! ! ! Acquire, construct and manage property
 ! Create and manage organizational performance strategy
 Benchmark performance
 Develop enterprise-wide knowledge management (KM) capability
 Manage change! Manage knowledge, improvement and change
 Build investor relationships
 Manage government and industry relationships
 Manage relations with board of directors
 Manage legal and ethical issues
 Manage public relations program
 Manage external relationships
 Determine environmental health and safety impacts
 Develop and execute environmental health and safety program
 Train and educate employees
 Monitor and manage environmental health and safety management program
 Ensure compliance with regulations
 Manage remediation efforts
 Manage environmental health and safety ! Design and construct/acquire nonproductive assets
 Maintain nonproductive assets
 Obtain, install, and plan maintenance for productive assets
 Dispose of productive and nonproductive assets
 Manage physical risk
 Perform planning and management accounting
 Perform revenue accounting
 Perform general accounting and reporting
 Manage fixed-asset project accounting
 Process payroll
 Process accounts payable and expense reimbursements Manage treasury operations
 Manage internal controls Manage taxes
 Manage international funds/consolidation
 Manage financial resources
 Manage the Business of Information Technology
 Develop and Manage IT Customer Relationships
 Manage Business Resiliency and Risk
 Manage Enterprise Information
 Develop and Manage Information Technology Solutions
 Deploy Information Technology Solutions
 Deliver and Support Information Technology Services
 Manage IT Knowledge
 Manage information technology
 Develop and manage human resources (HR) planning policies, and strategies
 Recruit, source, and select employees
 Develop and counsel employees
 Reward and retain employees
 Redeploy and retire employees
 Manage employee information
 ! ! Develop and manage Human Capital
 ! Develop customer care/customer service strategy
 Plan and manage customer service operations
 Measure and evaluate customer service operations
 Manage customer services
 ! Plan for and acquire necessary resources (Supply Chain Planning)
 Procure materials and services
 Produce/Manufacture/Deliver product
 Deliver service to customer
 Manage logistics and warehousing
 Understand markets, customers, and capabilities
 Develop marketing strategy
 Develop sales strategy
 Develop and manage marketing plans
 Develop and manage sales plans
 Market and sell products and services
 ! !   . Copyright 2012 COMMUNICATE! Business Drivers & Processes! Cost Effectiveness! Cycle Time! A Confirmed Business (IT) Value Proposition! 43  
  • 23. . Copyright 2012 COMMUNICATE! Link Strategy and Operations! 1.  2.  3.  4.  Develop the Strategy! Translate the Strategy! Plan Operations! Monitor and Learn! 5.  Test and Adapt the Strategy! Execute Procedures and Initiatives! ! ! !! !! ! ! ! ! Business (IT) Strategy, link to operations! 45  
  • 24. . Copyright 2012 COMMUNICATE! Define Market Position! 1.  2.  3.  4.  New entrants! Suppliers! Substitute products or Services! Buyers! 5.  Existing Competitors! ! ! !! !! ! ! ! ! Business (IT) Context! 47  
  • 25. Strategy Execution! IT Infrastructure Portfolio Management! Application Portfolio Management! Service Portfolio Management! Enterprise Portfolio Management:! Process based IT Architecture! Project Portfolio Management ! Performance Management:! Process based Business Architecture ! Product / service life cycle management! Business Strategic Intent! Strategy Articulation! . Copyright 2012 COMMUNICATE! Business Drivers & Processes! Cost Effectiveness! Cycle Time! Time to Market (Governance: Performance & Conformity)! Strategy execution support business drivers ! 49  
  • 26. Vision, Principles and strategy : Strategic Intent: set by the Board, Executive Management, Business operations management with objectives on a: Strategic, Tactic & Operational level! ! •  Strategic Intent: Product / service life cycle management: Interprets, models and articulates the strategic intent in to business strategy! •  Business Strategy: Process based Enterprise Architecture: Interprets, models and articulates the business strategy and ensures capability! •  Business & IT objectives: Project Portfolio Management: Interprets, models and articulates the business objectives and ensures capability! •  IT Strategy: Process based IT governance: Levers formulated operating processes with best in class IT solutions! •  Aligned on business requirements: Service Portfolio Management: Levers formulated operating processes with portfolio management! •  Software Asset Management: Application Portfolio Management: Levers formulated operating processes application portfolio management solutions! •  Infrastructure Asset Management: IT Infrastructure Portfolio Management: Levers formulated operating processes with IT infrastructure portfolio management ! . Copyright 2012 COMMUNICATE! •  A confirmed business (IT) Value proposition ! 51  
  • 27. Product / service life cycle management: Interprets, models and articulates the strategic intent in to business strategy.! ! BA provide an architectural print of how the situation should/will/might look like as we engage on the execution of strategic intent. 
 . Copyright 2012 COMMUNICATE! ! IT Governance can be used to set controls to see how well you do against that strategic intent i.e. the critical path must determine to what extent controls are required and on what level they must inform and in the same light, which processes are required to deliver the level of performance that needs to be "controlled". 
 It is imperative to know first "what" needs to be achieved (strategic intent), "how" that can be enabled & measured (controls & objectives) and "how" that can be delivered through operational processes. Such processes can then be designed and run through several different frameworks, processes and best practices. 
 All strategic intent or objective are not critical, be selective in the first span of controls. An Executive Manager (CxO) would need to be able to visualise critical objectives, impact, control and delivery. He must be able to see how and where IT (under) perform based on hopefully a few exceptions. That said unless the organisation understands and implements processes, frame works and methodologies (maturity) to stabilise the performance of the IT organisation to meet set targets (bottom up) the realisation might be difficult. And the level (maturity) of implementation, the design of the processes and the amount of stabilisation will depend on the role the process and its activities play towards the intent (2). To Map the intent down to processes and controls is necessary to understand what performance needs need to be stabilised.! Strategic intent! 53  
  • 28. . Copyright 2012 COMMUNICATE! ! Project Portfolio Management: Interprets, models and articulates the business objectives and ensures capability.! ! Most IT organisations are under increased pressure from the board of directors, Executive Management (CxOs) and business unit managers to demonstrate and improve the business value of their IT investments. But IT organisations struggle to measure business value and position their services as value added versus cost sunk. Attempts to do so have been focused on ROI measures on the front end as part of developing a business case for the IT portfolioʼs proposed investments, but these are only estimates of the expected business value. ! ! Actual delivered business value can only be measured by a life – cycle approach: to work with the business to measure actual benefit after the project is complete. This practice has started to gain traction but not consistently nor broadly. Firms that strive for best practice in IT portfolio management need to apply a credible standard methodology across the enterprise to measure the business value of investments, both when proposed and when delivered. The good news is that a number of IT value methodologies have emerged that can be employed in the portfolio management process. Business value measures as both tangible and intangible benefits. Benefits are assessed based on a set of weighted criteria that include: customers need, business and technical risks, strategic fit, revenue potential, level of required investment and quantification of innovation and learning generated. Each project is given a numerical score for each criteria and the weighted totals are summed up to give a single quantitative number. ! ! Business and IT Objectives! 55  
  • 29. Process based IT Architecture: Levers formulated operating processes with best in class IT solutions.! ! These methodologies should go beyond to calculate a return on investment (ROI): ! ! The the business case: is an operational tool that must be updated throughout the economic life cycle of the investment and then be used to support the implementation and execution of a program benefits realisation included. A business case is used initially at the individual program level to determine if it is strong enough to be evaluated at the portfolio level. At the portfolio level, the business case is evaluated against other active and proposed programs.! ! How do we align and lever operating, management and support processes through the effective implementation of IT:! . Copyright 2012 COMMUNICATE! ! ! Do we do the right things? - The strategic question ! -  The investment: Is in line with our vision, Is consistent with our business principles, Contributes to our strategic objectives, Provides optimal value, at affordable cost, at an acceptable level of risk.! ! ! ! ! IT Strategy! 57  
  • 30. Application portfolio management: Levers formulated operating processes with best in class application portfolio management solutions.! ! Once the business case is developed and summarised, key points and metrics from the business case are captured in an easily accessible and widely distributed format. If a project begins to struggle, to evaluate its current state against the original business case can prove invaluable. The same should be done with any risk assessments that were performed. The project can be assessed against identified risk on a regular basis, which can serve as an early warning sign that the project is in danger. ! ! Analysis of the internal or external business environment should be retained and reviewed on a regular basis. If the project was given the green light based on certain assumptions about the business environment, care should be taken to monitor these external factors, and if they change, modify the project or cancel it if there is risk that it will become irrelevant: Identify current operational problems. These are the areas in which IT spends most of its time in reactive mode, be the systems, projects, or ʻʻexternally forcedʼʼ problems like hacker attacks or failing infrastructure. 2. Determine the IT organizationʼs capabilities in terms of human resources, budget, and how focused your staff is on technical skills versus more general business process expertise. 3. Transition “run” operations to a trusted group of managers, for the focus of the CIO can shift to build relationships within the Executive suite and larger business community, and optimization of the organizationʼs project portfolio can begin. ! . Copyright 2012 COMMUNICATE! ! Software Asset Management! 59  
  • 31. . Copyright 2012 COMMUNICATE! Build! •  Control IT ()! ! ! ! ! ! ! !! !! !! !! !! !! ! ! ! ! ! ! - IT Organisation ()! - Corporate contribution ()! - User orientation ()! - Operational excellence ()! - Future orientation ()! ! 61  
  • 32. . Copyright 2012 COMMUNICATE! ! ! Control IT! ! ! ! ! ! - Control of IT expenses percentage, over or under IT budget, allocation to different budget items ! - IT budget as a percentage of turnover ! - IT expenses per staff member ! - Business value of the IT function percentage of the development capacity engaged in strategic projects relationship between new developments/infrastructure investments/replacement investments ! - Business value of new IT projects financial evaluation based on ROI, NPV, IRR, PB business evaluation based on information economics ! Corporate contribution! 63  
  • 33. . Copyright 2012 COMMUNICATE! ! ! Control IT! ! ! ! ! ! ! ! ! ! ! ! ! - Efficient software development ! - Average days late in delivering software ! - Average unexpected budget increase ! - Percentage of projects performed within SLA ! - Percentage of maintenance activities ! - Efficient computer operations ! - Percentage unavailability of network ! - Response times per category of users ! - Percentage of jobs done within time ! - Efficient help desk function ! - Average answer time of help desk ! - Percentage of questions answered within time ! Operational excellence! 65  
  • 34. . Copyright 2012 COMMUNICATE! •  From a strategic, tactical and operational perspective ()! Build! ! ! ! ! ! ! ! ! ! ! ! ! !! !! !! !! !! !! !! !! !! !! !! !! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! - We focus on time to market ()! - A Governance Office aligned with ()! - Strategic Intent ()! - Leveraged with Best Practise ()! - With an Effective (IT) Business Model ()! - A Stakeholder Strategy Map & Canvas ()! - Collaboration Theme Scorecard ()! - Product / Service life Cycle Management ()! - A Portfolio Management Office ()! - Plan, Organise, Direct, Control ()! - Project Portfolio Management ()! - Service Portfolio Management ()! - Application Portfolio Management ()! - Captured in a Strategy Map () ! - & Canvas, articulated in a ()! - Collaboration Theme Scorecard ()! 67  
  • 35. Strategic! Tactic! Operational! . Copyright 2012 COMMUNICATE! IT! The Governance Office! Stakeholder Strategy Roadmap! Collaboration Theme Scorecard! Strategic! Product / service life cycle Management! Portfolio Management Office! Tactic! Project Portfolio Management! Service Portfolio Management! Operational! Application Portfolio Management! Time to Market (Performance & Conformity)! Operating Processes! A Governance Office aligned with! 69  
  • 36. Strategic! Tactic! Operational! . Copyright 2012 COMMUNICATE! IT! Zackman! Nomenclature CIGREF! IC - dVAL! IDEAL! COSO! Governance Office! ISO 38 500! Val IT! Risk IT!Cob IT! IT Balanced Scorecard! ISO 20 000, 27 002! AGILE! Strategic! BA! TOGAF, EAF, CEISAR, PEAF! SCRUM! eSCM! CMMI! ITIL! MAGENTA! Mareva! Tactic! PMBOK, Prince 2! Operational! TD ABC! Six Sigma! Time to Market (Performance & Conformity)! Operating Processes! Leveraged with Best Practise! 71  
  • 37. Strategic! Tactic! Operational! . Copyright 2012 COMMUNICATE! IT! The Governance Office! Stakeholder Strategy Roadmap! Strategic! Tactic! Operational! Time to Market (Performance & Conformity)! Operating Processes! A Stakeholder Strategy Map & Canvas! 73  
  • 38. Strategic! Tactic! Operational! . Copyright 2012 COMMUNICATE! IT! The Governance Office! Product / service life cycle Management! Strategic! Tactic! Operational! Time to Market (Performance & Conformity)! Operating Processes! Product / Service life Cycle Management! 75  
  • 39. . Copyright 2012 COMMUNICATE! ! The Portfolio Management Office: Business & IT Strategy ! ! Plan the selection process of projects to launch, Organise the process of resources assignment to projects, Direct the process of managing ongoing projects, Control the key performance indexes to manage.! ! Key objectives: To gather and distribute information, Monitor, report and analyse performance, Provide specialised business management expertise, Facilitate communications, coordination and collaboration, Identify, analyse, and communicate significant issues and support their solution, Actively coordinate and manage complex activities across the organisation, define, deploy, measure, improve the enabling network of business processes. ! ! ! ! ! Activities: Work and resource management: Portfolio/ Program/ Project Management, PM trainings and development, Scope Management, Issue Management, Internal consulting, Risk Management, Staffing organisational capacity management. ! Plan, Organise, Direct, Control! 77  
  • 40. Strategic! Tactic! Operational! . Copyright 2012 COMMUNICATE! IT! The Governance Office! Strategic! Project Portfolio Management! Tactic! Operational! Time to Market (Performance & Conformity)! Operating Processes! Project Portfolio Management! 79  
  • 41. Strategic! Tactic! Operational! . Copyright 2012 COMMUNICATE! IT! The Governance Office! Strategic! Tactic! Operational! Application Portfolio Management! Time to Market (Performance & Conformity)! Operating Processes! Application Portfolio Management! 81  
  • 42. . Copyright 2012 COMMUNICATE! ! ! The Stakeholder Strategy Map: Formalises stakeholder outcomes to deliver value for all parties.! ! ! ! The strategy canvas allow the teams to articulate and formulate objectives on a project / program basis for improved execution with an extended GAP, risk and added value analysis captured in a DARCI (Decision taker, Accountable, Responsible, Consulted & Informed).! & Canvas, articulated in a! 83  
  • 43. . Copyright 2012 COMMUNICATE! Transform! •  To perform effective IT Governance ()! •  We focus on demand and cost drivers ()! 85  
  • 44. . Copyright 2012 COMMUNICATE! Vision! Articulate! Deliver! IT Vision! Baseline! Roadmap! Design! Build! Transform the Business Model! Transform! Transform:! -  -  -  -  -  -  -  -  Transform the Business Model! Measure KPI trends and targets! Meet business objectives! Control costs! Measure Delivery performance! Manage change! Continuous service & process improvement! Process roll out (articulation & integration)! -  Execute strategic intent! To Perform Effective IT Governance! 87  
  • 45. . Copyright 2012 COMMUNICATE! The IT service proposition is aligned to the business strategy as:! •  ! •  •  •  •  Stakeholder expectations are understood and IT propose a ! ! service portfolio that correspond to Demand and Cost drivers ! Business Contribution, Cost, Consumption & Chargeback is identified! Focus is on perfect order business transactions! Services are effective (demand and cost drivers identified)! Services are competitive (Benchmark Industry Market Forces)! •  New technological solutions that could change how current business is performed are explored, proposed and implemented.! ! ! IT contributes to business objectives! 89  
  • 46. Service strategy ! Delivery capability! Architecture! Security! Strategy Execution! “This is how we support business objectives with services in a time to market perspective” ! “This is how we deliver IT services to the business” ! Business (IT) Value Proposition! . Copyright 2012 COMMUNICATE! (IT) Business Model! ! Develop vision and strategy
 ! Develop and manage products and services
 ! Market and sell products and services
 ! Deliver products and services
 ! Manage customer services
 ! Develop and manage Human Capital
 ! Manage information technology
 ! Manage financial resources
 ! Acquire, construct and manage property
 ! ! Manage environmental health and safety ! ! Manage external relationships
 ! Manage knowledge, improvement and change
 ! Time to Market (Governance: Performance & Conformity)! Business (IT) Strategy Road Map (How)! To leverage business strategy with IT! 91  
  • 47. . Copyright 2012 COMMUNICATE! We align and lever operating, management and support processes through the effective implementation of IT.! - Do we perform them in the right manner? - The architecture question! - The investment:! ! ! ! ! - Is in line with our architecture,! - Is consistent with our architectural principles,! - Contributes to the population of our architecture.! - Do we perform them well? - The delivery question! - We have: ! ! ! ! ! - Effective and disciplined management, delivery and change management processes,! ! - Competent and available technical and business resources to deliver:! ! - The required capabilities,! ! - Organisational change required to lever capabilities.! Process Management! 93  
  • 48. . Copyright 2012 COMMUNICATE! Industry structure! •  •  •  •  •  New entrants! Suppliers! Substitute products or Services! Buyers (customers)! Existing Competitors! ! ! ! ! Defined Market Position! 95  
  • 49. . Copyright 2012 COMMUNICATE! There is a understanding of:! •  •  •  •  Political,! Environmental,! Social,! Technological! ! ! ! ! External environment! 97  
  • 50. . Copyright 2012 COMMUNICATE! Appreciation of the implications for the strategy of:! •  •  •  •  •  •  •  Resources,! Skills and competencies,! Appropriate development / recruitment plans,! Shared direction,! Extent of buy-in to shared vision by key managers,! Barriers / commitment to change,! Structure of the organisation! ! ! Talent! 99  
  • 51. . Copyright 2012 COMMUNICATE! There is a understanding of the:! •  Extent to which long term plans are coherent and logical,! •  Extent to which short term plans are appropriately costed and timetabled,! •  Consistency with overall goals and objectives! ! ! ! ! Objectives and Plans! 101  
  • 52. . Copyright 2012 COMMUNICATE! There is a understanding of the:! •  Extent to which the strategy has been communicated,! •  Extent to which staff performance towards the business IT strategy is recognised! ! ! ! ! Communication and buy in! 103  
  • 53. . Copyright 2012 COMMUNICATE! Transform! ! !! ! ! ! ! ! ! ! ! ! ! ! !! !! !! !! !! !! !! !! !! !! !! •  We focus on demand and cost drivers ()! ! - Provide best in class services ()! ! - And solutions as needed ()! ! - To leverage competitive advantage ()! ! - To the Strategic Plan ()! ! - To support the Business Architecture ()! ! - To Leverage competitive advantage ()! ! - Business (IT) Strategy, link to operations ()! ! - Business (IT) Tactics ()! ! - Business (IT) Context ()! ! - Captured in a Strategy Map ()! ! - & Canvas, articulated in a ()! ! - Collaboration Theme Scorecard ()! ! ! - Conceived in to a solid story ()! ! ! ! 105  
  • 54. . Copyright 2012 COMMUNICATE! To business needs! 2. Market definition! •  Customer base and demand is clearly defined: - Who is consuming what services! •  Prices / SLAʼs for services are established and Internal rates compared to outside marketplace for IT (Make or Buy)! ! ! We provide best in class services ! 107  
  • 55. . Copyright 2012 COMMUNICATE! Provide clear guidelines! ! ! 4. Governance is in place! Best practices processes continuously improved! Governance blueprint designed and operating! IT investments reflect:! •  •  •  •  The strategic intent of the Board, ! Business goal and priorities, ! A clear IT portfolio of projects and services, ! A Service Portfolio alignment to business goals and priorities! IT investments deliver a good return on investment! The IT Steering Committee will initiate a strategic IT competitive analysis! To leverage competitive advantage ! 109  
  • 56. Strategic! Tactic! Operational! . Copyright 2012 COMMUNICATE! Strategy! ! Business & IT Vision Articulated! Process! Strategic! ! Business Architecture & IT Architecture Aligned and delivered to Strategic Intent! Tactic! Operational! Time to Market (Performance & Conformity)! Application support ! Vendor Driven! Execute Business Strategy! Business Architecture! To support the Business Architecture! 111  
  • 57. . Copyright 2012 COMMUNICATE! Link Strategy and Operations! 1.  2.  3.  4.  Develop the Strategy! Translate the Strategy! Plan Operations! Monitor and Learn! 5.  Test and Adapt the Strategy! Execute Procedures and Initiatives! ! ! !! !! ! ! ! ! Business (IT) Strategy, link to operations! 113  
  • 58. . Copyright 2012 COMMUNICATE! Define Market Position! 1.  2.  3.  4.  New entrants! Suppliers! Substitute products or Services! Buyers! 5.  Existing Competitors! ! ! !! !! ! ! ! ! Business (IT) Context! 115  
  • 59. . Copyright 2012 COMMUNICATE! ! ! The Stakeholder Strategy Map: Formalises stakeholder outcomes to deliver value for all parties.! ! ! ! The strategy canvas allow the teams to articulate and formulate objectives on a project / program basis for improved execution with an extended GAP, risk and added value analysis captured in a DARCI (Decision taker, Accountable, Responsible, Consulted & Informed).! & Canvas, articulated in a! 117  
  • 60. . Copyright 2012 COMMUNICATE! In order to do so we need to:! Objectives: ! -! Levers: ! ! !! -! ! ! ! Conceived in to a solid story! 119  
  • 61. . Copyright 2012 COMMUNICATE! At the end of the day Business Executives take the decision to out / cloud source when:! •  •  •  •  •  IT is not perceived to understand stakeholder expectations,! IT is not perceived to contribute to business objectives,! IT is not perceived to deliver value to cost, ! IT is not perceived to deliver services to business needs,! The IT department is unable to deliver services in a time to market perspective,! •  IT propose an effective service portfolio that correspond to Demand and Cost drivers ! Deliver IT services to business needs! 121  
  • 62. . Copyright 2012 COMMUNICATE! As the IT department delivers effective IT Services and innovative technology solutions to improve competitiveness, demonstrated and articulated in:! •  An IT Business Model “This is how we deliver IT services to the business”! •  and a Business IT Value proposition This is how we support business objectives with services in a time to market perspective” ! ! ! and provides competitive leverage! 123  
  • 63. . Copyright 2012 COMMUNICATE! •  •  •  •  •  •  Build an effective IT Delivery Model ! Leverage Business Strategy execution with IT! Build an IT Service Strategy leveraged by ITIL V2 & 3 Design, Build, Run ! Logics for IT Sourcing (Internal, Shared service center, Out, Cloud) ! Get your cloud strategy right ! How to build a CIO Office ! “Canvassed” in a Business (IT) Strategy Canvas:! •  “Canvassed” Business Strategy and Architecture: Business Vision, Architecture (Articulate, Deliver) ! •  “Canvassed” IT Strategy: IT Vision ! •  “Canvassed” IT Strategy: IT Baseline, Road Map ! •  “Canvassed” IT Architecture: Design, Build, Transform ! Design, Build, Transform! 125  
  • 64. . Copyright 2012 COMMUNICATE! CEO, CFO, CIO, CTO, SVP, Architects, Strategy, Business Executives and the IT function in general. ! Target Audience! 127  
  • 65. . Copyright 2012 COMMUNICATE! BrightTalk Thought Leadership: http://www.brighttalk.com/community/it-service-management/webcasts?q=martin+palmgren ! Get your cloud strategy right: http://www.brighttalk.com/community/it-service-management/webcast/534/29211 ! Get your IT Service Strategy right: http://www.brighttalk.com/community/it-service-management/webcast/534/23630! Leverage Strategy with IT: http://www.brighttalk.com/community/it-service-management/webcast/534/22934 ! Cloud Computing: Fluff or Lightening? http://www.brighttalk.com/community/it-service-management/webcast/534/21892 ! Run IT as a Service Business! http://www.brighttalk.com/community/it-service-management/webcast/534/21389 ! In French: ! Cloud Computing : La tête dans les nuages?: http://www.brighttalk.com/community/it-service-management/webcast/534/21919 ! Baseline: Coût, Consommation, chargeback et contribution IT aux objectifs de l'entreprise : ! http://www.brighttalk.com/community/it-service-management/webcast/534/21388! Deliver Business Value with IT (the book) https://www.smashwords.com/books/view/290604  (the blog) http:// deliverbusinessvaluewithit.wordpress.com /! I also share perspective @ some of the top French Business Schools, notably EDHEC! International Thought Leadership! 129