Troux Staff

By: Ben Geller, VP Marketing, Troux

 

The term “Black Swan” was coined by University of Oxford, Saïd Business School professor Nassim Nicholas Taleb to describe high-impact events that are rare and unpredictable but in retrospect seem not so improbable. In the world of IT, black swan projects reap catastrophic effects and even result in a complete corporate meltdown. According to Taleb’s colleagues, Bent Flyvbjerg and Alexander Budzier, “IT projects are now so big, and they touch so many aspects of an organization, that they pose a singular new risk.”1 Flyvbjerg and Budzier go on to state “The CEOs of companies undertaking significant IT projects should be acutely aware of the risks. It will be no surprise if a large, established company fails in the coming years because of an out-of-control IT project. In fact, the data suggest that one or more will.”

They reached this bleak conclusion after conducting the largest global study ever of IT change initiatives. The pair examined 1,471 projects, comparing their budgets and estimated performance benefits with the actual costs and results. The IT change initiatives ran the gamut from enterprise resource planning to management information and customer relationship management systems. Their study sample drew heavily on public agencies (92%) and U.S.-based projects (83%), but they found little difference between them and projects at the government agencies, private companies, and European organizations that made up the rest of their sample.

When the University of Oxford team broke down the projects’ cost overruns, what they found surprised them. The average overrun was 27% — but that figure masked a far more alarming one. Graphing the projects’ budget overruns revealed a “fat tail” — a large number of gigantic overages. Fully one in six of the projects they studied was a black swan, with a cost overrun of 200%, on average, and a schedule overrun of almost 70%.

Their findings highlighted the true pitfall of IT change initiatives: It’s not that IT projects are particularly prone to high cost overruns on average, as management consultants and academic studies have previously suggested. It’s that an unusually large proportion of IT projects incur massive overages — that is, there are a disproportionate number of Black Swans. By focusing on averages instead of the more damaging outliers, most managers and consultants have been missing the real problem.

According to University of Oxford researchers, any company that is contemplating a large technology project should take a stress test designed to assess its readiness. Leaders should ask themselves two key questions as part of IT black swan management: First, is the company strong enough to absorb the hit if its biggest technology project goes over budget by 400% or more and if only 25% to 50% of the projected benefits are realized? Second, can the company take the hit if 15% of its medium-sized tech projects (not the ones that get all the executive attention but the secondary ones that are often overlooked) exceed cost estimates by 200%? Though these numbers may seem comfortably improbable, their research showed they occur with uncomfortable frequency.

Even if a company passes the stress test, smart managers need to take other steps to avoid IT black swans. They should consider breaking big projects down into ones of limited size, complexity, and duration and make contingency plans to deal with unavoidable risks.

That’s where Enterprise Portfolio Management (EPM) comes in to help. By leveraging EPM techniques, CIOs can take a step back, see the bigger picture and truly understand how IT resources are spread across and utilized by the business. An EPM approach can help CIOs, CFOs and CEOs assess what they have in terms of Applications, Technologies, Information and Projects/Investments. It can then connect these assets back to and support key business capabilities as well as corporate goals and strategies. An EPM effort can show decision-makers what Applications, Technologies, Information and Projects are needed, which are not, and how to safely retire the assets or cancel the projects that do not provide value to the business. This level of visibility equips enterprise leadership with the ability to make well-informed investment and divestment decisions and helps them avoid becoming another example of good IT intentions that turn into an infamous IT Black Swan.

1. Bent Flyvbjerg and Alexander Budzier, “Why Your IT Project May Be Riskier Than You Think”, Harvard Business Review. Vol. 89 (2011), No. 9, pp. 23-25.

 

Ben Geller, VP Marketing, Troux

 

At our recent customer conference we took a moment to share the common characteristics we see in our most successful customers.  Since this was so well received by the conference attendees we thought it would be a good idea to share with a wider audience.

1. Start with the end in mind.  Seek business value and outcomes that materially impact the top and bottom-line.  If delivering business value is not your top priority – it should be.  Delivering anything less ensures your effort will be regarded as not being relevant.  Ignore an approach that puts business value at it’s heart more than once and you can be sure your Enterprise Architecture (EA) program will be destine to sit on the shelf along with all of the enterprise models and charts that have been created.  Our most successful customers always tie their efforts back to answering key questions business stakeholders want to address.  Take a look at one of our recent blogs titled ‘Doing the Right Thing vs. Doing Things Right’ – for more details.   
2. Gain the Right Level of Sponsorship.  Another common trait we see in our most successful customers is their ability to obtain executive management support for their Enterprise Portfolio Management (EPM)/ EA initiatives.  Executive sponsorship is absolutely crucial.  Organizational change management is one of the hardest things in business.  If you don’t have executive sponsorship, you just aren’t going to get the organization to change its behaviors. For an EPM/EA program to be successful, you need participation from people outside the EA program. The executive sponsor does not need to be an EA expert or even care about the discipline of EA. But he or she must care about the results.  To read more about this condition for success see our blog titled ‘How to avoid common mistakes with your EA program – Part I’.
3. Start Small and Market Internally.  A common mistake many EPM/EA teams make is based on a ‘Boil the Ocean’ approach to information gathering.  Gathering and assessing data can be quite seductive. But if taken too far it’s the equivalent of modeling the universe, and it’s a recipe for disaster. In fact if we see any problem today in our deployments, it’s that people get so excited they want to gather all their data at once.  It is also important to market your success internally. You secured support from the organization by promising something good for them, so make sure you go back and tell them you did it.  Then the organization as a whole can share in your success.  Read more about these success criteria in our blog titled  ‘Just say no to modeling the universe’.
4. Collaborate Rather Than Dictate.  In a recent Wall Street Journal (WSJ) blog¹ Michael Krigsman stated, “Modern CIOs must reconcile the gap between their role as protector of corporate information assets and the need to drive organizational innovation and openness.   We all are quite aware that promoting collaboration inside a large organization doesn’t just happen; it requires a thoughtful plan, coordination, and effort.  Enterprise Portfolio Management can help CIOs change the unwanted behavior that often is manifested by information hoarding and create a culture of collaboration by giving CIOs the means to shift the conversation from technology to business strategy and innovation.  See our blog ‘Lessons Learn from Social Networking’ to read more about EPMs role in institutionalizing collaboration. 
5. Seek Value Early and Often.  Instant gratification is something we all have grown accustom.  The same holds true for business.  Programs and projects that deliver their intended results in short order are often viewed as benchmarks for other efforts to come.  Delivering value early and often should become a key part of any EPM/EA project teams battle-cry.  Our most successful customers have been able to go from project start-up to delivering quantifiable business results in a few short weeks.  Take a look at the case study from Scottish Widows Investment Partnership – a 2012 InfoWorld/Forrester EA Award winner to see how they delivered results in just 12 weeks. 
6. Institutionalize and Embed in Process.  We have found that the organizations that achieve “best in class” results from their EPM/EA efforts are those that recognize that it is lifestyle change, not a one-time “crash diet.  To make EPM/EA a lifestyle change rather than a crash diet, an organization must commit first to “instrumenting” the business to measure the performance and business value of key enterprise assets such as applications, technology, business capabilities, investments and information.  By tying EA/EPM to key processes and initiatives such as application portfolio management, cloud migration, mergers and acquisitions, to name a few, EA/EPM teams will ensure the lifestyle change they deliver will have positive impacts across the enterprise.  For more examples of how to embed EPM in key processes read our blog titled ’Application Portfolio Management: Crash Diet or Lifestyle Change’.

 

Ben Geller, VP Marketing, Troux

With an average tenure of 4.6 years, CIOs are under pressure to bring meaningful change and demonstrate to the board that they are impacting both the top and bottom line. Enterprise Portfolio Management (EPM) solutions allow CIOs to manage IT strategically, optimize IT in the context of the business, support goals by driving innovation and turn IT into a competitive advantage. So with all that pressure, why aren’t more CIOs saying yes and adopting EPM solutions? To help understand the answer to this question we’ve noted the three most common objections to adopting an EPM solution and tips for how CIOs can overcome these hurdles and gain unprecedented transparency and visibility they need to steer IT in the right direction.

We’re not mature enough as a company to adopt an EPM solution. Both large and small organizations may feel that they’re not ready to take on an EPM solution, yet acknowledge that they are spending a significant portion of their IT dollars in the wrong places. Continuing with ‘status quo’ can cost more than just hard dollars—an organization’s reputation can be damaged if CIOs aren’t managing IT strategically. The sooner CIOs start down the EPM path, the quicker they will be in strategic control of their IT assets. Industry experts have identified a set of 150 questions that—once answered—will provide a sufficient high-level view of the current state of your IT landscape in the context of the business. These questions can be prioritized based on business goals. Once CIOs get their arms around the current IT landscape, they can start to make fact-based decisions to determine which IT assets and investments are needed and which are not. And if an asset is not needed, CIOs will be able to develop a plan to remove it quickly and securely.

We haven’t got the data. Collecting data to give the CIO sufficient strategic IT visibility can feel like a monumental task, equivalent to ‘eating an elephant’ or ‘boiling the ocean.’ Organizations probably have more of the data than they realize, they just don’t know which of it is important and how good it is. Most companies haven’t successfully tackled the issue of data quality; and their enterprise data may not be in great shape, but it can be easily fixed. An EPM technology partner can help identify gaps, extract the data and get it into good shape before implementing a governance process around it to help steward and manage the information, keeping it up to date and accurate for continued program support. Sticking a head in the sand on this issue is not an option; this limited set of data is probably the most valuable data any enterprise could possibly collect and manage. It could save or repurpose a significant amount of an organizations IT budget, and an EPM solution provider can help get it under management quickly while helping you to fill in any data gaps.

How do I know that all this will benefit my organization? Having clear, fact-based strategic visibility over IT assets will always be a benefit to an organization, but CIOs need to assess whether an EPM solution will produce quantifiable benefits and therefore deliver value for money. An EPM solution provider will want to understand business goals and strategies, take a look at the state of the strategic IT management information flow as it exists today, and determine the quality of this information. It is not uncommon for an assessment to uncover an opportunity to repurpose as much as 30 percent of an organization current IT operations budget towards innovation.

An EPM solution delivers rich visualizations, analytics and reporting that show how IT can support corporate goals, strategies and core business processes. These insights will help CIOs develop a plan that can truly align IT with the rest of the business and effectively enhance the reputation of the IT department within your organization. The result is an IT department that can make decisions based on facts, and a CIO with strong career opportunities and a reputation that precedes them.

By: Bill Cason, CTO, Troux

A key ingredient to achieving Business and IT alignment is the development of a common lexicon that all parties can use to describe and manage change.  This sounds like a fairly simple requirement, but in practice it can often prove to be difficult.  Your enterprise has this problem if you hear comments like these:

• “We aren’t all on the same page in describing the business and its needs.”
• “We have difficultly having fact based conversations about priorities.”

I’m reminded of the quote from “Cool Hand Luke” in which the Captain says to Luke “What we’ve got here is … failure to communicate.”  We do have a failure and if we can’t overcome it then all our efforts are going to be for naught.

Why do we have this problem?   Many times those of us in IT exhibit too much “inside out thinking”.  We speak of services we deliver to the business.  We speak about applications or technologies or architectural domains.  This terminology is ours and it is effective when we speak amongst ourselves, but it is ineffective when we need to communicate to business leaders.  Our customers are not going to change so in this case we are going to have to “go to the mountain” because the mountain is not going to come to us.

So what language do business leaders understand?  At Troux we have found that having a discussion with the business about “portfolios” is much more productive simply because it uses business language.  To that end we find that describing the enterprise as a set of interconnected portfolios greatly facilitates business conversations.  In fact, an “enterprise portfolio management” approach has direct analogies in to classical investment portfolio management.  Investment portfolio Management is defined as “The art and science of making decisions about investment mix and policy, matching investments to objectives, asset allocation for individuals and institutions, and balancing risk against performance.” ¹ Likewise, at the end of the day, managing the enterprise is also about making investment decisions to manage risk and improve performance. 

Simply put business stakeholders understand what the business does and what the business does can be described in Business Capabilities.   Don’t confuse business capabilities with business processes, which are a description of “how” things are done.   And don’t think that you are speaking the language of the business when you only speak of organization structure.   Organization structure is important but as we all know it is subject to change fairly often whereas business capabilities remain a fairly stable, albeit abstract, description that establishes a commonly understood business context.  It’s worth noting that Forrester Research speaks of them as “The Rosetta Stone.” ²

Let’s consider an example — in this case we know for a fact that a set of applications need to modernized as they are implemented on obsolete, unsupported technology and have security risks.  One approach would be to propose a project to improve our technology architecture domain that will result in improved business services.  Depending on whether or not our customer understands what we said, that project may or may not easily get approved.  Now consider a different proposal: “Our business capability for customer provisioning is at risk because we have under invested in our technology portfolio.   We propose adding this project to our investment portfolio to reduce risk and improve performance of this key capability.”   This is the same proposal but will very likely yield different results, because we changed the nature of the conversation.

In practice, business capabilities can make the complex simple and enable what we at Troux call “fact based conversations.”  For a discussion of practical applications of business capabilities, attend our upcoming webinar “Speaking the Language Of The Business”.  You can register here.

[1] http://www.investopedia.com/terms/p/portfoliomanagement.asp#axzz2Jacaoaej

[1] “Business Capabilities Provide The Rosetta Stone For Business-IT Alignment”,  July 06, 2009, By Jeff Scott with Alex Cullen, Mimi An

By: Chuck Keffer and Jes McPhee 

APM (application portfolio management) identifies which applications an organization needs, which it doesn’t, and helps the organization plan for the safe removal of the redundant applications.  It also helps organizations manage the costs of the remaining portfolio through hardware refreshes, license renegotiation, moves to new platforms or to the cloud, and outsourcing. Done consistently, it assures the application portfolio continues to provide the proper functionality as technology and business needs change.

When many companies first think of APM, they think of dramatic short-term cost reductions. This
is good and proper, and a well-executed APM program will deliver these results. A best-in-class APM initiative, however, reflects an enterprise context that provides much more value over time.

This enterprise context includes an understanding of the dynamic relationships among the application portfolio and five other enterprise portfolios: Business goals and strategies, the business architecture (including people, processes, capabilities, and organizations), investments, information and the underlying information technology infrastructure.

This broader enterprise portfolio management (EPM) context ensures better decision making in a number of ways. Only by understanding, for example, which geographies the business is expanding in (from the goals and strategies portfolio) can managers know which applications they will need today and in the future. Only with an understanding, for another example, of the investment portfolio can business managers know which applications are already on track for modernization and thus avoid wasted repeated effort.

The key to implementing APM in this necessary broader EPM context is to focus the data gathering around the needs of the business. Rather than wasting time and effort gathering every last bit of information or data to the last degree of detail, successful organizations focus on the specific information they need to meet their most critical challenges. Implementing APM with the broader EPM perspective is the only way to make the best-informed APM decisions, and to deliver incremental value from APM while paving the way for the longer-term benefits of EPM.

The initial driver for many APM efforts is reducing costs by eliminating those applications that are not delivering value, are especially costly to maintain, involve a high degree of risk or perform the same function as other applications.  The more significant and long-term benefit of APM is refining the application portfolio on an ongoing basis to reduce risk, increase agility to meet changing business needs, and spend less on maintaining daily operations and more on ”transformational business” initiatives.

At Troux we have found that the organizations who achieve this “best in class” APM are those that recognize that it is lifestyle change, not a one-time “crash diet,” and that APM is part of a broader EPM program taking into account all six enterprise portfolios. While APM requires an up-front investment of time and effort, when executed correctly with an understanding of the full enterprise portfolio, it delivers long-term benefits not only through lower costs, but increased business effectiveness and reduced risk.

To learn more about ‘Achieving Best-in-Class APM’ please tune into our webinar and download our White Paper.

By: Ben Geller, VP Marketing, Troux

“Management is doing things right; leadership is doing the right things.”1 Businesses have always had tremendous decision-making challenges due to lack of relevant, complete, accurate, and timely information.  And this problem has become more acute as businesses expand or down-size, the pace of change increases, and the breadth of change expands.

So with all of this change and chaos swirling about, it’s not difficult to understand why some
business leaders get caught in the trap of spending precious human resources, time, and money on doing a lot of things right.  After all, what harm can come about from being efficient?  Efficiency equates to a smooth-running organization.  Efficiency means optimal performance.  Efficiency illustrates competency and expertise.  Certainly all of these attributes represent qualities we expect business leaders to establish within their enterprise.

By: Bill Cason – CTO, Troux

As terminology for the practice of Enterprise Architecture has evolved from Enterprise Architecture to Enterprise Architecture Management or in our (Troux) case Enterprise Portfolio Management, I occasionally hear the term “IT Planning”.  Although IT Planning per se is an important clog in the strategic IT management wheel, it alone is insufficient to a successful Enterprise Portfolio Management (aka EA) program.

Conventional theory defines management as a set of interconnected processes: Plan, Organize, Control, and Direct.  Planning — here too —as you can see is necessary but not sufficient on its on own for successful strategic IT management

Likewise we can think of Enterprise Portfolio Management supporting a set of interconnected processes that include “planning” but extend well beyond to ensure strategic IT management decisions are made with a recognition of the other interconnected management processes.

The IT Management Processes

Enterprises have invested in their current IT management systems (e.g. ITSM, ALM, PPM et al) to support a wide variety of IT processes.  Today most of these processes are siloed within a particular system, but in fact if we step back and take a “big picture” view of these processes it is possible to identify a set of interacting management value chains that span IT in its entirety.   These value chains can be characterized into five fundamental management processes as shownin Figure 2.

1. IT Change Management: The objective of change management is to
   ensure processes are defined for  efficient and prompt handling of all changes to IT infrastructure, in order to minimize the number and impact of any related incidents upon service (paraphrased from Wikipedia).
2. IT Portfolio Governance: The processes of managing the risk, health, standards, and compliance of the IT assets such as technology, applications, and information.
3. IT Demand to Delivery: The process of managing the investment portfolio including business demand, funding, solution architecture, governance, and delivery.
4. IT Financial Management: The processes of IT financial budgeting, measurement, reporting, and forecasting.
5. Business and IT Planning: The process of business and IT strategic planning and roadmapping.

These value chains do not exist independently, but instead create a value network through their interactions.  Figure 3 depicts an example showing how they might interact.  For example, in this case a new business need identified in the Business/IT Planning value chain drives budget needs in the IT Financial Management value chain resulting in a new program request in the Demand to Delivery value chain that needs to be coordinated with investment needs (for example an application modernization need) coming from the IT Portfolio Management value chain – hence Planning is not enough.

Enterprise Portfolio Management comprises of a broad set of rich information sources and a number of interacting value chains and processes that are each dependent on the other.  It is clearly a complex system and due to that complexity it can be chaotic and subject to the “IT butterfly effect” where small changes in the environment can have unexpected and potentially disastrous  results. 

The purpose of Enterprise Portfolio Management is to give insight into the interconnected nature of these portfolios and value chains in order to manage the chaos.  That certainly goes well beyond the requisite “IT Planning”.  To quote an ancient saying: “Planning without action is futile, action without planning is fatal.”  EPM delivers both planning and action.

For more information on EPMs role in the IT Management process click here http://www.troux.com/solutions/ .

By: Ben Geller – VP Marketing, Troux

According to Kerry Bodine and Bobby Cameron at Forrester, we’ve entered the age of the customer (http://tinyurl.com/9jauwhg). “In this new era, past sources of competitive advantage have been commoditized in the face of customers who are empowered by information.  In this age, the only source of competitive advantage is the one that can survive technology-fueled disruption: an obsession with customer experience. And this obsession must extend into the CIO’s organization.” ¹

Good news: it appears CIOs and IT professionals see eye-to-eye with Forrester’s view.  Recently Troux conducted an opinion poll of IT professionals (http://resources.troux.com/tsurvey12).  Our poll asked respondents to rank the priority of 5 investment areas:

• Investments that help retain exiting customers and attract new ones
• Investments that increase efficiency
• Investments that help increase profitability
• Investments that help maintain a competitive advantage
• Investments that help expand into new markets or geographies

The results…more than fifty percent of all respondents agreed; investments that help retain
existing customers and attract new ones are most important when it come to IT priorities.  This sentiment also matches those of CIOs that participated in the Gartner-Forbes CIO Survey² conducted earlier this year. 

It’s now clear to the corporate IT community at-large that the customer experience (CX) is the last bastion of differentiation and ultimately will determine the difference between market leaders and also-rans.  But the role IT will play in improving the CX will be a difficult one.  Bodine and Cameron state “Although it can sometimes be difficult to see the connections between the customer experience and the systems, processes, and policies that exist — deep behind the scenes — it’s critical for CIOs to understand them.” 

For CIOs and IT professionals ready to take on this challenge there is good news.  Enterprise Portfolio Management (EPM) solutions can help.  EPM can help CIOs illustrate these relationships and ensure the right investments are being made. EPM can help shine a bright light across the complex model(s) that define the customer experience and as a result uncover and expose the relationships between:

• the business architecture/capabilities that support a company’s customer experience goals and strategies,
• the applications that support the customer experience business architecture,
• the technology that underpins the applications that support the customer experience and
• the information that flows between these applications

With the understanding of the connection between the customer experience and the systems, processes, and policies that exist, CIOs will be in an ideal position to guide and counsel other business leaders with the empirical data that is needed to ensure the right customer experience investments are being made.

In order to ensure good CX investment decisions are being made, Bodine and Cameron state,  “[CIOs] must understand [the] customer experience ecosystem – the complex set of relationships among [a] company’s employees, partners, and customers that determines the quality of all customer interactions. The dynamics of the customer experience ecosystem are such that every action and decision of every employee and external partner affects the customer experience in some way. Now consider the extent to which employees and partners rely on technology to do their jobs, and you can quickly draw a line from information technology to customer experience.”

Successful CIOs need the ability to draw (and re-draw) the line from information technology to the customer experience to truly see the connection between technology and business goals and strategies.  This ability will help all executives better prepare for Age of the Customer and the good news is… EPM can help.

1 Kerry Bodine, Bobby Cameron, “How CIOs Can Help Companies Survive the Age of the Customer,” Wall Street Journal CIO Journal (18 September 2012).

2 Jorge Lopez, Mark Raskino, and Dave Aron, “Board of Directors, CEO and CIO Survey Comparisons Point to Actions That CIOs Must Take Now to Prepare,” (28 June 2012).

By: Ben Geller – VP Marketing, Troux

In a recent Wall Street Journal (WSJ) blog¹ Michael Krigsman stated, “Modern CIOs must reconcile
the gap between their role as protector of corporate information assets and the need to drive organizational innovation and openness. Although bridging these two dimensions of the CIO mandate is difficult, this struggle creates perhaps the greatest opportunity that most CIOs will see [in their career].”

Krigsman went on to state, “Todays CIOs need to balance [stakeholder] demand for transparency while maintaining strict controls and governance to protect the organization creates a demanding situation for even the most seasoned leaders. Nonetheless, the cultural changes [brought] about by the introduction of social networking are a lever that forward-thinking CIOs can use to drive innovation and transform their role in the business.”

In the blog the CIO of Intel Corporation, Kim Stevenson, explains that social networking solves an important problem in large organizations: “The flow of information unintentionally becomes gated as an organization grows, creating silos and making it difficult to find the right person who has the information you need.”

The concept of social networking as a means to liberate important information and streamline its dissemination into the hands of the organization at-large is built on the same core premise that drives Enterprise Portfolio Management (see The Secret to Better Decision Making: How EPM Adds Value to Your Organization).  Enterprise Portfolio Management (EPM) seeks to break down the organization into portfolios that categorize and represent the business.  EPM seeks to ensure that information contained within these portfolios (Goals & Strategy, Business Capabilities, Investments, Applications, Information and Technology) establishes the business connection and context to the IT assets spread across the organization.  EPM seeks to offer a more dynamic means to reach into and across the organization to make sure decision-quality information no longer stagnates in silos.  EPM seeks to ensure decision-quality information quickly and efficiently finds its way into the hand of business leaders and decision-makers.

To put it simply, Enterprise Portfolio Management offers a more dynamic means of removing organizational silos, improving the flow of decision making information and, as a consequence, boosting collaboration and an organization’s agility.

We all are quite aware that promoting collaboration inside a large organization doesn’t just happen; it requires a thoughtful plan, coordination, and effort.  When it comes to making sure decision-makers have the information they need, the same requirements apply.  Traditional office productivity applications such as Excel, Visio and PowerPoint are thought to be a sufficient proxy for decision-making tools.  But if you take a closer look they just don’t cut it.  While they may be good to capture the inventory of assets that reside within the CIOs’ domain, they fail to capture the connection and relationship of these assets back to the business – in the context of Business Goals and Strategy, Business Capabilities, and Investments.  These applications are typically used to capture static information about an organization’s applications, information, and technology assets.  By the time this information finds it’s way into the decision-making, it has become stale and inaccurate. Furthermore, the very nature of these applications do not promote collaboration.  It’s usually up to the document owner to share the information that has been collected.  Certainly not a step in the right direction for organization’s looking to break down silos.

Enterprise Portfolio Management can help create a culture of collaboration. In the WSJ blog Intel’s Stevenson states social networking is a means to transform critical aspects of her company’s culture, especially in relation to power, influence, and knowledge sharing.

She goes on to say that traditional organizations rely on a “one-to-one anointed expertise model,” in which individuals gain power by hoarding, rather than sharing, their knowledge. In this environment, which dominates the private sector and government, collecting knowledge is an important basis for career advancement and prestige. Power and influence based on withholding knowledge creates information silos and disincentives for cooperation across departments or groups; these silos breed inefficiency and inhibit corporate agility.

Enterprise Portfolio Management like social networking can help CIOs change that type of unwanted behavior and create a culture of collaboration. When it comes to social networking adoption and use in enterprise there are many lessons to be learned.  These lessons can be directly applied to Enterprise Portfolio Management and the role it plays in decision-making.  EPM, like social networking, offers CIOs the means to shift the conversation from technology to strategy and innovation. In addition, because technology inevitably becomes commoditized, focusing on leadership, promoting information transparency, and equipping the organization to make better decisions by seeing IT in the context of business can help CIOs become transformational leaders.

 

By: Ben Geller – VP Marketing, Troux

With all the talk of worldwide double dip recession, the Euro Zone crisis, and the looming specter of falling over a proverbial fiscal cliff, it’s no wonder many CIOs find themselves in a difficult decision-making dilemma.  Should today’s CIO brace for more economic uncertainty by focusing on cost cutting, or should they take a bolder tack and invest funds on new innovative initiatives that will bolster growth and yield a competitive advantage?

No doubt a tough decision fraught with risks and tradeoffs, so why pick one option over the other?  Why not choose to do both?

The recent Gartner-Forbes 2012 Board of Directors and CEO Survey¹ found that, with financial uncertainty around the globe, Corporate Boards and CEOs are hedging their bets. They are trying to figure out how to manage their businesses so a new recession does not find them as exposed as they were in 2008, while being prepared if the downturn is shallow, and rapid growth becomes the norm for the next few years.   Coming out of this survey it is now becoming easier to see that market uncertainty does not just mean organizations will dig-in and cut costs – it means many companies are also looking for ways to fund initiatives to help differentiate themselves and grow market share.

The survey also found that half of the board directors were willing to invest in IT as a means to change the rules of competition, and accordingly, IT had the highest priority for investment in 2012, tied with investments in sales.  That’s a pretty encouraging sign and vote of confidence if you are CIO.  But the ‘hedge your bet’ strategy recommended by many Board of Directors and CEOs is easier said than done.  

How do you execute on such a strategy?  A good place to start is by simply taking inventory of the IT resources (both tangible and non-tangible) spread across the enterprise.  By taking inventory, CIOs will have some very powerful information.  That information when combined with ‘Business Context’ will provide the foundation to answer key business questions such as:  What IT resources exist today?  Which are needed to function, operate and grow the business? Which are not needed? And how can duplicate and obsolete assets be retired quickly and safely?

If CIOs and their teams can effectively deliver this level of transparency, they will have the information needed to execute on the cost cutting portion of the ‘hedge your bet’ strategy and limit exposure if a second wave global recession takes hold.  With new insights and visibility over the IT resources spread across the enterprise, CIOs can embark upon a clear cost cutting path by consolidating and centralizing the many layers of different and obsolete technologies that exist in their businesses.  The resulting cost saving can be re-directed towards investments that underpin the second half of the ‘hedge your bets’ strategy and fund promising innovative growth initiatives that increase the top-line and provide a competitive advantage.

Make no mistake: the ability to keep both growth and cost management in focus at the same time is very difficult in business, and will require a mind-set and tool-set that can help CIOs, business leaders, and their organizations to make more informed decisions while shifting from one focus to the other (see EA is Free blog posting, August 21, 2012). CIOs will know that they are effectively managing the ‘CIO dilemma’ and doing their jobs well on cost control when the CEO starts to emphasize that the CIO spend more time on growth initiatives. ²

¹ Jorge Lopez, “Gartner-Forbes 2012 Board of Directors Survey: IT Can Change the Rules of Competition”, July 2012

² Jorge Lopez, Mark Raskino, Dave Aron “Board of Directors, CEO and CIO Survey Comparisons Point to Actions That CIOs Must Take Now to Prepare ”, June 2012

Part III: Just say no to modelling the universe

by: Bill Cason – Troux CTO – July 31st, 2012 

Gathering and assessing data can be quite seductive. But it’s the equivalent of modelling the
universe, and it’s a recipe for disaster. In fact if we see any problem today in our EA deployments, it’s that people get so excited they want to gather all their data at once. This is the last of the Top Three common mistakes Enterprise Architects (EAs) make when starting (or re-starting) a program. I call this “Building the Answer Machine” – and it doesn’t work.

In this scenario, you are asking people for more data than you need, without any scope control or business value focus. Obviously you don’t want to collect data, just to see what you can find.

Instead, consider these three recommendations when embarking on a data gathering effort. They will help you successfully identify and gather the data that is most important to your business.  #1- Leverage a wider team with a focus on business value to help you identify which data is critical.  #2- Automate as much of the data collection process as possible. #3- Market your success internally so that contributors appreciate the fruits of their labor and are more inclined to embrace the data gathering effort moving forward.   

Leverage a wider team

You will have lots of stakeholders and constituencies requesting answers. You can quickly lose sight of being able to deliver value in a timeframe that is acceptable to management. Queuing up priorities and managing scope control is hugely important. Otherwise you will have plenty of stakeholders disappointed by your inability to answer their questions.

The EA team is responsible for creating business value with the information that is collected. But don’t waste EA resources gathering that information. With executive sponsorship in place, the enterprise will see it as a priority to identify data stewards.  The data stewards will then provide the required data you could not automatically collect.  This in turn ensures EA resources are focused on analyzing the quality of the information, and identifying gaps in order to initiate the decision-making process. 

Automate data collection process

Based on my team’s experience, as much as 80 percent of the information required to initiate an EA program already exists in the enterprise. In many cases, you can automatically collect important information from other IT and business planning repositories so you don’t have to expend human resources to find what’s already being managed.  That said, stay focused on collecting only the information necessary to answer the high priority questions  your business wants to address.

Market your success

Don’t forget to market your success internally. You secured support from the organization by promising something good for them, so make sure you go back and tell them you did it. Then the organization as a whole can share in your success. 

When you gather all this information and start to see results – in this case the answers to critical business questions – share those results.

Remember, the data acquisition process is accretive. The data you get to answer the first set of questions becomes foundational for answering the second set of questions. You don’t use information, throw it away and stop asking questions. By involving the wider team, you empower and encourage people to embrace the EA processes and use the output to change the business. 

We already know that organizational change is one of the hardest challenges any company can embark upon. Ensure you are taking the right steps by aligning a wider team to provide information, automating the data collection process, and marketing your success internally. The EA practice can then deliver true organizational change in a focused and organized manner, on a timeline management expects, and with the support of both your executive sponsor and the whole of the enterprise.

Read other articles in this three-part series: How to avoid common mistakes with your EA Program:

• Part I: Overcome the experience gap when initiating a new program
• Part II: Focus on business value, not the tool