Value driven IT program management

Value driven IT program management

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  - Chetan Khanzode
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   Focus onvalue.  Value trees and Value drivers.  Business Case.  Business Case development.  Program Management to deliver value.
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   Business investto achieve the strategic competitive advantage to stay ahead in competitive environment.  Value is worth outcome compared to the effort (or cost) to achieve it.  From Service provider perspective : It is serving the client to make them successful.  From Client perspective : It is value generated based on the service provided and ultimately the what all outcomes/benefits delivered.
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   Program isobtaining the benefits stated in the Business case based on strategy of business .  Both service provider and clients experiences the value of a program in both different and similar ways with common vision resulted in bringing business benefit outcome.
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   Value Deliveredin Telecom Client can be ◦ Reduced time-to-market from initial product/offering concept to availability of product to final customers on the market and ability to bill customer for the product. ◦ Optimized Order-To-Bill lifecycle. ◦ Decreased average time to close a customer ticket. ◦ Increased customer satisfaction index.
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   Focus onValue to benefit to client like ◦ Discounted cash flows. ◦ Delivering a required business capability on time. ◦ Taking the complexity out of delivery. ◦ High return on invested capital to remain competitive in Market. ◦ Increasing economic value add.  What benefit both service provider and client gets ◦ Successful implementation of a program. ◦ Building long-term partnerships. ◦ Quality client service. ◦ Synergy of Operations.
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   ‘Value Tree’is a tree-shaped visualisation of the benefit part of a business case or A value tree is the breakdown of the value generated by a program.  Value trees are used to support complex situations by progressively breaking down high-level subjective goals into low-level measureable objectives. ◦ Value drivers are the operating factors with the greatest influence on strategy execution with end result of value creation.  Financial value drivers  Non-financial value drivers
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   Financial valuedrivers ◦ Economic success factors linked directly to line item(s) on the Income Statement or Balance Sheet.  Increased Revenues from existing customer/clients by up-selling or cross selling to customer  Increased Revenues from New Customers.  Automation to reduce labor cost  Cost reduction by off shoring the work  Continuous improvement by Quality initiative to decrease Maintenance.  Non Financial value drivers ◦ Stakeholder expectation Management with alignment to business case leads to corporate success  Frequent pulse check for Increased Customer Satisfaction  Overall Improved Brand Image as benefit/outcome.
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  Value tree creationsteps 1 Identification • Industry trends • Analysis of stakeholders from business standpoints • Value Analysis to focus on path of economic profitability • Review of Clients Strategic objective and process model • Service provider industry capability model 2 Value analysis method • Understand and Map cause and effect link to financial drivers • Prepare value driver prioritization • Incorporate comments from subject area experts/field • Plan/setup cross-division workshop 3 Prioritization • Conduct cross-division workshop • Prioritize value drivers with Manageability, importance • Critical few drivers • Identify gaps related to • Stakeholders • Financial/non-financial • Leading/lagging • Strategic/operational 4 Accountability mapping • Identify key performance indicators (KPIs) • Assess measures as Simple, Timely and Actionable • Map accountability Individual versus shared • Identify and resolve gaps
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  Consulting Profit Sales Cost Staff Salary SalesEffort Project margin Hourly Rate Consultant Salary Travel Cost Reimbursement Sales of Hours Bid Process Decision – focus on prospectiv e clients Key Account Management Capabilities of service Organisation
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   What isa Business Case? ◦ A Business Case has a direct impact on value. ◦ A Business Case describes the engagement’s ( service provider and Client ) value proposition, ◦ It help to guide management in decision making. ◦ A Business Case must plan how to realize value for each identified value driver. ◦ A Business Case defines and describes how and when benefits will be delivered to the business and accountability for delivering the same.  How does a Business Case help? ◦ Demonstrates how a major investment creates value ◦ Includes both quantitative and qualitative rationale ◦ Supports business decisions by weighing options ◦ Multiple options creation to track performance ◦ Measure success after a decision has been made ◦ Gains alignment and management consensus for a project success  Why is a Business Case needed? ◦ A Business Case is required to understand value to Support decisions and Track performance
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   Business CaseManagement includes: • Confirming value drivers and business goals • Performing cost and benefits analysis of the Business Case • Refining the Business Case and obtaining stakeholder approval • Providing ongoing measurement of value and updating the Measurement Plan as the engagement requires
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  ◦ The keysteps in Business Case development are: ◦ Client Ability Assessment • Assess the client’s ability to generate value, independent of program impacts and Use a value tree to assess the client’s ability to generate value. ◦ Estimate Program Value • Use value drivers and KPIs, already identified and analyzed while developing the value tree, to estimate the value impact for each driver on the basis the program objectives and projects. • Estimate the value generated by the program for each value driver. ◦ Business Cost benefit Justification • Complete the Business Case, providing the client with a cost/benefit justification based on the value generated by the program ◦ Business Case Validation • Share the Business Case with stakeholders to get their feedback and validation on their single areas of responsibility and also on the overall Business Case and cost/benefit analysis. Client Ability Assessment Estimate of Program Value Business Case with cost benefit Justification Business Case Validation
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   Each Programactivity must have • Clear ties to your client’s value drivers and roadmap to achieve the same • Defined roles and accountability for generation of outcome • Metrics to measure the activity’s progress and value ◦ During program execution, the actual value realization results must be monitored and compared to the ones planned in the initial Business Case. In case of significant deviations of actual value realized and related KPIs from initial Business Case KPOs and plans, appropriate corrective actions must be taken to re-orient the program and its projects towards its initially planned targets. ◦ Program Management must drive a program (or business initiative or a set of projects) to realize the value generation opportunities implied in each identified value driver. ◦ For realizing this value, careful Business Case planning can quantify the business results and financial figures. Achieving planned business results is therefore the ultimate goal of Program Management.
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  Thanks You!!