Administrative Computing Strategy Project Update to Stakeholders June 27, 2005

Agenda Purpose of Project, Goals & Objectives Outcomes & Deliverables Project Process & Status Enterprise Systems Strategies Project Portfolio Management Recommendations Risks Next steps Appendices

Purpose and Goals Purpose of the Project: Focus on key business systems and technology to develop a 3 – 5 year strategic plan for the Administrative Computing group of IS&T Goals and Objectives Inventory and assess the existing enterprise systems portfolio within the area of the Executive Vice President Review existing administrative legacy systems and their long-term viability Evaluate the existing systems against MIT's business and SAP's long-term strategies Assure that existing and future administrative applications are compatible with MIT's systems architecture Identify business needs and new opportunities for Administrative Computing at MIT in collaboration with business process owners Organize and structure a comprehensive plan to best sequence the work Identify and measure risks (resources, process, and technology) associated with this plan

Outcomes & Deliverables Primary Deliverable: Strategic Plan Document for Administrative Computing Components of the Strategic Plan Document: Customer themes and findings Enterprise Systems (Inventory / Health Assessment) Administrative Computing Strategies Strategic planning process Individual business and technical strategies (e.g., Web Portal) Defined process for project portfolio management Project Initiation Process (precursor to project methodology) Tools and templates for project identification and prioritization Risk Management for Strategic Plan Critical success factors Risk to implementing portfolio management Transition and implementation plan

Update and Project Status Strategic Plan Development Since Last Meeting Customer findings and themes have been validated and communicated to EVP areas Findings are included in: Ongoing strategic planning process Individual business and technical strategies Enterprise systems inventory, health, and analysis Process for portfolio management has been drafted (includes related tool-set) IS&T project initiation process has been developed in conjunction with the strategic plan (includes related tool-set) Initiatives identified via the strategic plan have been incorporated into Administrative Computing current project inventory list Continuous business involvement in project Preparation Jan 05 Start Business & Technical Data Collection Phase 1 Check-in with Sponsors Mar 16 Data Analysis & Refinement with Customers Phase 2 Check-in with Sponsors Apr 27 Draft Strategy Strategy Report Check-in with Sponsors Jun 27

Enterprise Systems Overview Administrative Computing will: Continue to expand SAP as primary ERP system over next 3-5 years Where appropriate, develop non-SAP applications (e.g., Events Calendar) Provide an integrated environment for managing complex: Business Transactions Web Services Data integration and integrity Recommend a major system upgrade in the next 18 months Dedicate a percentage of Admin Comp resources to customer support and maintenance Other SAP has been deployed at MIT over the last 9 years with over 20k current users MIT’s implementation of SAP has evolved from desktop-based delivery to web/ESS There are 10 major integration points with over 80 inbound/outbound interfaces to SAP (See Appendix)

Enterprise System Health Analysis Scale Impact 1.0 - 3.5 Needs attention in the next 1 to 3 years   Health Status 3.5 - 4.49 Needs attention in the next 3.5 to 5 years   4.5 – 5.0 + Needs attention after 5 years

Enterprise System Detail Example SAP Appl. Short Description & Primary Function BPO Implem Date (s) Project Life Cycle Status Functional Assessment, Current & Last Major Revision Health Check Sc a l e Support Model Financial Financial and Managerial Accounting: General Ledger, Costing, Accounts Receivable, Sponsor Billing, Travel, Planning, Asset Accounting CAO Sept 96 Operations Current Status: Financials went live with SAP in the Central Offices in Sept. -1996. There have been continuous enhancements and developments since then. e.g., custom reporting to DLCs in 1998; COEUS billing feed April 2000; replaced obsolete SAP billing transaction VA90 with a custom program in Spring 2003; Web JVs; new company codes, etc. to extend/improve SAP usage   Assessment: Stable existing functionality. Original implementation included custom travel and cashier’s solutions, non-standard use of Funds Management (FM) module, and customized transactions and reporting that limit future extendibility and scalability. To reduce customization and utilize standard SAP Public Sector (higher ed) solutions would require use of Business Warehouse and re-implementing FM. Customer Needs Scalability Sustainability 3 5 Admin Comp – Financial Health Check Status - Example Health Check Scale (1-5) - Example 1 Least Healthy and/or work to be done 3 Medium health and/or work to be done 5 Most healthy and/or least effort to complete work Customer Needs -    Current functionality meets customer client needs -    Supports mission and objectives of the organization -    Satisfies regulatory requirements -    End-user satisfaction with process/technology

Strategic Planning Purpose of the Strategic Plan: …is to guide Administrative Computing and Senior Management in the development and management of Administrative Systems that are initiated in Central Administration and used across the enterprise. The plan covers a three to five-year horizon and includes an ongoing process for maintaining the strategic plan, which incorporates periodic planned reviews and assessment. Strategic Planning Process Includes: Prioritization & Decision Making Process Integration with Business Initiatives Strategic & Transition Planning Customer Input Iterative Refinement

Individual Strategies Key Strategic Components Key Strategic Components are business and technical dimensions of core Enterprise Business systems that extend into and enhance business functionality Strategies: Technology Strategy Integration Strategy Application Deployment to Users Reporting Strategy Portal Strategy Document Management eCommerce Strategy Project Delivery Strategy Each strategy includes: Strategic Statement Scope and Definition Peer or industry Analysis Prerequisites and Dependencies Enabling the strategy will involve the participation of DLC community members

Integration Strategy Statement Strategic Statement or Statement of Direction The overarching goals are to make enterprise level data/information commonly understood and readily accessible to authorized users as needed. Additionally, data must be captured/maintained in a single system of record and stored in a common data store. Finally, enterprise level data/information is an Institute-wide asset and must be both leveraged and secured. There are three primary areas of focus to achieve the integration goals, data/information integration requirements, projects/processes and integration tool(s).

Project Portfolio Management (PPM) Definition A holistic, strategic approach to managing an entire set of projects and initiatives which can be referred to as a project portfolio Objectives Integrate PPM, IS&T Project Management Methodology, the Resource Model tool and the Institute’s budgeting process Develop systematic process to monitor current portfolio, resources and new requests Provide visibility of projects and prioritization process to Business Process Owners, DLC’s and Senior Management Encourage collaboration and awareness of the entire project portfolio to a broad set of constituents Facilitate decision making process around priorities with Stakeholders Ability to balance and diversify the portfolio of projects

Team Recommendations On-Going Strategic Planning MIT Senior Management and Administrative Computing review and work together to mitigate risks outlined in the strategic plan Reaffirmation by Senior Management in support of Administrative Computing’s strategic direction for SAP which states “Administrative Computing will continue to leverage MIT's investment in SAP…” Development of a formal process to collect information from Department Labs and Centers (DLC). The process should be developed over FY 2006 and implemented in the spring of 2006 Assure that IS&T project initiation, project methodology, and Administrative Computing strategic plan are in alignment Build a critical mass of core business and technical skills for the development, support and enhancement of enterprise systems (Administrative Computing and business process owners together) Incorporate enterprise systems inventory and health assessment process into the portfolio management and prioritization cycle

Team Recommendations Cont’d Portfolio and Project Management Commitment from IS&T and MIT Senior Management to using a formal project portfolio management process that is reviewed/executed on a quarterly basis Empower ASPCC to become the governing body for Administrative Computing portfolio management and project intersections Integrate the portfolio and project management process with the MIT budget cycle Annual Strategic Planning Activities Update and renew the Administrative Computing strategic plan document Conduct the enterprise systems inventory and health assessment process Align DLC input process with DLC impact calendar (managed by Administrative Computing) Review and update the Enterprise Architecture Guide (EAG) for Administrative Systems, as defined by the MIT Information Technology Architecture Group (ITAG) Conduct formalized training sessions with Administrative Computing and business process owner staff

Risks to Project Portfolio Management (PPM) Impact Mitigation Project portfolio management is not embraced (PPM necessitates working within well-defined processes and structure) Loss of an ability to view and manage a complete set of projects Increases the likelihood of project failure A champion is assigned to advocate and lead the implementation of PPM. The champion must work closely with business process owners and IS&T project managers to facilitate implementation of the process ASPCC cannot assume responsibility for the project prioritization process e.g. time constraints Opportunity to incorporate Institute level business objectives may be lost Development and presentation of clear and consistent analysis by project managers for ASPCC. Continuous and open self-evaluation of the process Some projects circumvent the project prioritization process Jeopardizes the entire prioritization process and directly impacts the ability to plan projects, resources, and schedules Develop a tight set of controls to manage project initiation process with support from Senior Management Continued use of existing project management tools that are “homegrown” Homegrown toolsets may not integrate into project management tool set and impact ability to measure projects at the portfolio level Apply and enforce the consistent use of project portfolio management tools Lack of skilled business analysts to support development of financial analysis and business cases Leads to inaccurate and inconsistent data, thereby affecting portfolio analysis and decision-making May affect ability to staff projects Skill development in project management becomes a priority for IS&T and process owner staff and is measured by core competencies. Lack of strong project management Leads to failed projects I.e.. over budget, project delays etc. Assess the current skill level in project management and must be willing to develop skill levels or look to external resources for qualified project managers

Complete development of project analysis tools Next Steps Complete development of project analysis tools Develop transition and implementation plans Secure “Buy-in” on strategy document with process owners and MIT groups Integrate strategic plan with Administrative Computing operations Complete and distribute final draft Questions, Comments or Suggestions? Contact: Wturner@mit.edu or x8-8229

Appendices

Project Initiation Process Evaluation Complete Request for Evaluation Form Trigger Event Director Review Analysis Someone (e.g., Business process owner) identifies and defines a project idea for the appropriate IS&T Director to review. All projects complete Evaluation Request Form for review Director either: Approves project for further analysis Approves as internal project Declines / defers project / suggests alternatives Kitimat Tool Analysis Stakeholder Review IS&T LT Review Prioritize Risk / Value analysis prepared IS&T Leadership reviews to determine if project requires formal prioritization Stakeholder review of project to determine if formal business case is warranted Business Case Development Stakeholder Review MIT customized business case Project presented and reviewed for slotting in project portfolio Business Case review will occur quarterly

Project Request for Evaluation Complete Request for Evaluation Form Evaluation Trigger Event Director Review Simple form for requesting new / changes to business or technical functionality A standard approach for identifying all new development requests A document to help understand the request A communication tool to engage the customer in the initiation process Partial Copy

Project Prioritization Tool Kitimat Tool Analysis Analysis Stakeholder Review IS&T LT Review Enable management to make decisions based on established criteria Evaluate requests based on value to business vs. risk of implementation Graphic approach to quickly view the entire portfolio Serves as a filtering mechanism for which projects should have a business case developed Used as a communication tool to provide portfolio visibility to a broad set of constituents Risk Criteria - Example Risk to Project Risk (1–5) 5 = Highest Risk Risk Value Analysis Description Compatibility w/ Enterprise Systems (3) The project integrates with existing enterprise systems, but the interfaces have not been written before 3 SAP has a robust asset management module that needs to be researched to determine if it would meet MIT needs for property management e.g. tracking government property Note: Business case for ‘Prioritize’ phase is under development and not included in this presentation

MIT SAP Applications and Major Integration Points