Lecture 19 Chapter 10 A Portfolio Approach to Managing IT Projects

2 Final Exam Outline 12 – 3pm, Wednesday June 14 Half short and long answers on theory and principles from course Half case-study

3 Question 1: Find New Zealand on a world map…

4 Final Exam Sample Questions Short answer: What is the difference between security and reliability? Give three advantages and three disadvantages of centralized IT support (as opposed to decentralized within the same organization) In what ways is IT infrastructure different from other infrastructure resources? Cite an example from one of the cases we studied that shows how customization can be implemented using IT

5 Final Exam Sample Questions Long answer Discuss what risks are associated with major IT projects, and what a company can do to mitigate against them Describe the evolution of IT outsourcing over the past 30 years.

6 IT Portfolio Management

7 IT Disasters are still common Companies fail to realize risk of project Multiple projects lead to larger aggregate risk Different projects require different management

8 Sources of Implementation Risk Project Size Experience with Technology Requirements Volatility See fig 10.1

9 Fig 10.1 Effect of Adding Risk Factors on Project Risk

10 Project Categories and Degree of Risk

11 Risk Assessment Figure 10.3 Risk profile questionnaire Higher risk score, higher management approval required Repeated several times throughout project Different perspectives on risk expectation can lead to disaster

12 Project Implementation Dip Most projects don’t go smoothly all the way New system going live common point Expectations not always realistic Short term downward shift may be necessary All happens in middle of business cycle and worker turnover Need to focus on end goal to get through value of change when people are complaining Ideally see it before it comes and get people ready

13 Fig 10.4 Expectations vs. reality

14 Portfolio Risk Multiple projects can add or reduce risk Low-risk not always good All high-risk is vulnerable Identify risks in all projects, then consider combined portfolio of risks See fig 10.5

15 Fig 10.5 Risk and Return Distribution for Portfolio of Projects

16 Project Management No single correct plan Management Tools –External integration tools –Internal integration tools –Formal planning tools –Formal result controls See table 10.1: Tools for project management

17 Influences on Tool Selection Low requirements volatility/low tech projects –Easy to manage –Least common –PERT (program evaluation review technique) –CPM (critical path method) Low requirements volatility/high tech projects –Difficult to manage –Eg. Converting mainframe system, developing web access –Outputs well defined –Technical complexity drives characteristics of successful manager –Formal planning not likely to add as much value

18 Influences on Tool Selection (ctd) High requirements volatility/low tech projects –Involve users in design, development and implementation –Develop user support –Formal planning and control tools help –Close, aggressive management of external integration –Leadership from management not technologists High Requirements Volatility/high-tech projects –Managers need technical expertise –Ill-defined projects common –Formal tools useful once clarity is reached in direction –Cross effects of different factors becomes important

19 Project Management Relative Contribution of Management Tools –Depends on specific project –Results-oriented tools work in structured/formal environment –Depends on corporate culture Emergence of Adaptive Project Management Methods –Approaches to design, deployment, implementation and investment that assume a need to gather information and learn as one goes. –Not really effective universal methods yet Software Development Life Cycles –SDLC breaks down development into stages: –Analysis and design –Construction –Implementation –Operation and maintenance

20 Project Management (ctd.) Adaptive Methodologies –Quickly build rough preliminary version –Iterate through stages rather than finish every stage –Fast cycle through stages –Aim to deliver limited functionality fast –Require skilled staff Adaptive Methods and change management –Intensely involve users in evaluating outcomes –Strictly control migration of system features from development, testing to production –Separating stages avoids major problems

21 Process Consistency and Agility in Project Management Balancing tension between process consistency and process agility Tools useful one place shouldn’t necessarily be applied to everything Success in balance often includes minimal formalization Flow –Understand interrelationships between projects Completeness –Keeping track of all tasks in project Visibility –Getting info on status of rest of project

22 Survey