1 expect the best Briefing to the IT Project Review Committee December 8, 2004 ITIB Recommended Technology Investment Projects (RTIP) Report for 2005 Preparation for the January Workshop

2 expect the best Purpose of This Presentation To prepare ITPRC members for the January RTIP Workshop To improve understanding of the RTIP IT Investment Management (ITIM) process To define the desired outcomes for the 2005 RTIP Report Information Technology Investment Management (ITIM) is an integrated approach to managing IT investments that provides for the continuous identification, selection, control, life-cycle management, and evaluation of IT investments. ITIM uses structured processes to minimize risks and maximize return on IT investments.

3 expect the best Background: IT Investment Management (ITIM) Framework We are moving from Stage 2 into Stage 3

4 expect the best Background: Portfolio Management (PfM) and Project Management (PM) Top Down Portfolio Mgmt (Doing the right Things) Strategic (PfM) Bottom up Project Mgmt (Doing things Right) Operational (PM) RTIP Report Senior Management Summary Budgets, Capacity, Milestones, Risks, Benefits, Prioritization, Selection, Oversight, Evaluation Models Management Decision Process Delivery of individual projects Organizational Detail Source: Artemis Infrastructure Applications Information Enterprise Business Strategies

5 expect the best Savings in executing better price/performance Savings in consolidating and reducing redundancy Savings in Contract Consolidation Example Cost Savings Operational Services 70–80% of IT Spend Legacy Systems, Assets, Maintenance Projects, Contracts etc. Capital Projects 20-30% of IT Spend IT Budget (before) Savings in choosing right projects Savings in executing more effectively Savings in pulling plug quicker on errant projects Additional FUNDS SQUEEZED from Operational Budgets Example Outcomes Better Alignment of entire IT Spend to Goals Vendor Management considerably simpler Bring tremendous value to Agencies, Legislature, Governor New systems deployed faster and better aligned to strategic goals $$ Saved from Ops and Maintenance can be used to fund Highly Strategic new Projects Background: Portfolio Analysis Objective Source: Artemis

6 expect the best Recap: VITA Transformation,the Value Picture “Best Quality Service & Best Value” TODAY IT Infrastructure 1.4B Agency Citizen Services 1.2B TOMORROW IT Infrastructure.9B Agency Citizen Services 1.7B 6 YR Baseline Which investments (assets & projects) help VITA accomplish this goal?

7 expect the best Background: Purpose of the RTIP Report Top Down Portfolio Mgmt (Doing the right Things) Strategic (PfM) Bottom up Project Mgmt (Doing things Right) Operational (PM) Senior Management Summary Budgets, Capacity, Milestones, Risks, Benefits, Prioritization, Selection, Oversight, Evaluation Models Management Decision Process Delivery of individual projects Organizational Detail Source: Artemis Enterprise Business Strategies Information Applications Infrastructure RTIP is the communication mechanism between PfM and PM to transform government

8 expect the best Background: Purpose of the RTIP Report To reflect the investment decisions made by the ITIB to achieve a transformation in state government Satisfy the legal requirement that the IT Investment Board provide ‘each year a list of recommended technology investment projects and priorities for funding such projects to the Governor and the General Assembly’ Incorporate the IT Investment Management (ITIM) best practices into the process of preparing the RTIP Report Meet the code mandated requirements for evaluation criteria Support the DPB planning process and the ITIB defined evaluation criteria Incorporate lessons learned from the prior year

9 expect the best Recap: 2004 RTIP Report Selection Process Code of Virginia Enterprise Architecture Strategic Plan for Technology Enterprise Business Plan (Council on Virginia’s Future) VITA Transformation Targets Best Practices DefineCollectPrioritizeScoreRankSelect The current process is sound and is based on IT Investment Management (ITIM) best practices as documented in Gartner, Meta, and GAO.

10 expect the best Recap: 2004 RTIP Report Selection Process DefineCollectPrioritizeScoreRankSelect ITIB Evaluation Criteria Agency IT Strategic Plans Weighted Ranking Secretariat & CIO Prioritization ITIB Approval Evaluation Criteria Scoring Code of Virginia Enterprise Architecture Strategic Plan for Technology Enterprise Business Plan (Council on Virginia’s Future) VITA Transformation Targets Best Practices

11 expect the best Define: ITIB Evaluation Criteria Strategic Alignment Benefits to the Commonwealth Risk Funding Requirements Past Performance by Agency Technical Feasibility Driven by Code Requirements

12 expect the best Define: ITIB Evaluation Criteria Strategic Alignment –COV Strategic Plan for technology initiatives –COV Enterprise Architecture (Enterprise) Business Strategies –Agency Strategic Direction (Key Activities & Critical Issues) Benefits to the Commonwealth –Benefits chronically underserved stakeholders –Increase public protection, health, education, environment, or safety, improve customer service, or increase citizen access –Positive return on investment –Support legal or regulatory requirements Risk –Cost - Complexity –Risk Management Funding Requirements –Cost reasonableness –Percent of the project funding from Non-state funds –Funding risk Past Performance by Agency –Agency rating average and specific project rating on the Dashboard –Agency ITIM practices Technical Feasibility –Stated Approach –Proposed approach based upon proven technology Supporting Evaluation Criteria Can Be Redefined

13 expect the best Collect: Data Collection for Agency IT Strategic Plans Agency Profile & Strategic Direction – New DPB SP Process –Agency Strategic Plan Mission, Core Business Activities, Key Customers Key Activities & Outcomes -- Critical Issues Major IT Projects – Description, Cost, Dates –Business Case + Evaluation Questions –Funding –Related Procurements –Strategic Alignment Major IT Procurements Non-major IT Projects and Procurements Driven by DPB Planning Process and ITIB Defined Evaluation Criteria IT Vision, Strategies and ITIM Practices

14 expect the best Score: Evaluation Criteria Scoring

15 expect the best Score: Evaluation Criteria Scoring, Cont’d.

16 expect the best Score: Evaluation Criteria Scoring, Cont’d. Ideal Business Cases Align your IT portfolio with business objectives to maximize value creation Evaluate your investments based on your highest priorities and eliminate those returning the lowest value Measure the impact of your investments before they ever receive funding Need Improved Business Cases Source: Artemis

17 expect the best Rank: Weighted Ranking Agency Categories –Strategic Alignment (Weighted by 2) –Technical Feasibility –Benefits to the Commonwealth (Weighted by 4) –Risk (Weighted by 2) –Past Performance by an Agency –Funding Requirements Secretariat –Establish standard selection and ranking criteria for all to follow? ITIB –Weight certain initiatives more than others? –Governor’s Initiatives –Enterprise Initiatives –PPEA –Project Category –Council on Virginia’s future Weighting criteria used in the 2004 RTIP Report

18 expect the best Prioritize: Secretariat & CIO & ITIB Prioritization 7% What is the appropriate mix of projects in the Project Portfolio?

19 expect the best Prioritize: Secretariat & CIO & ITIB Prioritization What is the appropriate mix of projects in the Project Portfolio?

20 expect the best Select: ITIB Approval Continue to include the top 2 or 30% from each Secretariat (Business Owner)? Split planning phase into 2 phases, preliminary planning & detailed planning Include only those projects that have completed detailed planning in the RTIP Report? Focus on projects that support Governor’s Initiatives Enterprise Initiatives PPEA Council on Virginia’s Future Select Top 5 or 10 to lobby for funding from the General Assembly

21 expect the best Next Steps - Proposed Action Plan for Workshop Define/establish IT Portfolio analysis criteria –Data –Thresholds –Project categories/mix –Ranking criteria –Prioritization criteria –Business questions (queries) Develop evaluation criteria –Planning Approval –Business Case Development Funding Approval –Development Approval Identify 2005 RTIP reporting requirements –Project Categories –Data –Business questions (queries)

22 expect the best RTIP Report Points of Contact Judy Marchand VITA Project Management Division or Constance Scott VITA Project Management Division