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Topic : Managing the IT Workload
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Industry : Asset Management Functional Area : Capital Management
Activity:  1 comments  607 views  last activity : 07 06 2010 20:18:04 +0000
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I found an interesting article in CPMA which highlights on the resolutions  IT portfolio vendors will adopt, Found it quite interesting , hence sharing it with all.

 

Stop saying things like "Manage your corporate portfolio like a portfolio of stocks"

 

This oversimplified comment is dangerous in addition to being meaningless.  Dangerous because the corporate portfolio is made up of investments aka projects whose valuation, risk-reward profile, diversification benefits and other characteristics are much less known.  While stocks and mutual funds have a great deal of historical data, 'corporate projects' don't have this.  That said, even with the data that exists for stocks and funds, personal portfolios are still prone to mismanagement.  Heck, even 50% of the people/firms we consider smart money aka mutual fund managers underperform the market.  Managing like a portfolio of stocks might not be such a simple idea.

 

 

Stop hawking software that doesn't force data integrity on investment projections 
 
  We are yet to see an IT or project portfolio management tool which uses driver-based models to develop the cost-benefit analyses which should underly an investment.  Instead of having some amount of consistency and rigor by which ROI, profit, revenue, NPV, etc are derived, the tools generally let you hardcode these fields.  What good is trying to optimize on a portfolio when someone can enter an ROI of 1000%.  There has to be some consistency in how the data is created to enable comparison across investments, business units, etc and truly balance the portfolio.
 
 
 
Actually, let expanding on #2 - stop hawking software altogether
 
The entire IT and project portfolio management space has become synonymous with "solutions", but having built a portfolio management discipline at a massive organization, that the tool is actually quite irrelevant.  Instead, these vendors should tell their clients that IT and proejct portfolio management have more to do with (1) a process to value investments (applying modern portfolio theory and its valuation techniques to a corporate setting) along with (2) efforts to change the culture and behavior so that people will provide resources to the best ideas.  At some point, a software might be useful, but until the process and culture/behavior are where they need to be, the software is a nice way to make software companies wealthy.
 
 
Stop oversimplifying portfolio optimization 
 
How many times have we  heard a consultant or vendor say, "Our PPM (or IT Portfolio Management) framework, software, etc lets you identify, select and focus on those investments with the best ROI."  The portfolio cannot be optimized on one dimension and ROI, while useful, fails to consider strategic, risk, cash flow timing, innovation, and other important investment parameters.  Portfolio optimization is a bit like enlightenment.  You can aspire to achieve it, but you actually can never optimize a portfolio.  Advocating that it can be done on the basis of a single metric is dream-weaving at its best.
 
 
Refrain from sending out jargon-laden press releases which say absolutely nothing
 
We're glad to know that you have an on-demand, best-in-class solution that enables transparency, agility, compatibility, portability and that it has endless possibilities, abilities and capabilities, but do you really think anyone is buying this cr^p?  Sure you've been recognized by some random IT research organization, but how about actually saying something in your press release that demonstrates some understanding of IT or project portfolio management? 

 
Don't make up idiotic titles for people in your organization like "Portfolio Management Evangelist" 
 
Given the recent trend in many large organizations to appoint meaningless Chief (anything) Officers,  It sounds a lot better to be an evangelist than a boring old product manager or something more conventional and perhaps even descriptive of your role, but please stop calling folks evangelists. 
 

 
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