GDS International - FST - Summit - US - 9

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Troux and Enterprise Portfolio Management - White Paper 1.0

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GDS International - FST - Summit - US - 9

  1. 1. Business Technology Management and theEnterprise PortfolioA Troux White PaperFebruary 2012Confidential
  2. 2. White Paper ContentsExecutive Summary ................................................................................................................................. 3Introduction ............................................................................................................................................ 4Business Technology Management .......................................................................................................... 5The IT Planning Ecosystem....................................................................................................................... 6The Journey to BTM ................................................................................................................................ 9The Enterprise Portfolio......................................................................................................................... 10The Enterprise Portfolio is Critical to High Priority Initiatives ................................................................. 14 Application Portfolio Management .................................................................................................... 15 M&A .................................................................................................................................................. 15 Cloud Planning................................................................................................................................... 16 Investment Management .................................................................................................................. 17 Solution Architecture ......................................................................................................................... 17 Change Management ........................................................................................................................ 18The Troux Approach .............................................................................................................................. 19Appendix: A Parable that Enlightens ...................................................................................................... 232 CONFIDENTIAL
  3. 3. White Paper Executive SummaryCIO’s can better respond to the needs to reduce cost, improve compliance, and be more agile incountering competitive threats by applying the principles of Business Technology Management(BTM). Foundational to BTM is the Enterprise Portfolio. The Enterprise Portfolio is arepository that contains information about the sum of all IT portfolios (Applications, Projects,Technologies and Information) and their relationships to each other and to the BusinessPortfolios (Business Architecture and Business Strategies).The Enterprise Portfolio delivers analytics that greatly improve the processes that constitutethe BTM program. Furthermore an Enterprise Portfolio approach is critical to success for highpriority CIO initiatives such as Application Portfolio Management, Cloud Migration, M&A, etc.Troux provides a solution that implements an Enterprise Portfolio approach to BTM that offersa combination of software and know-how that insures customer success and self-sufficiency.3 CONFIDENTIAL
  4. 4. White PaperIntroductionCIO’s are faced with three major challenges: Cost, Compliance, and Competitive Threats.We know that for most enterprises the IT budget allocated to “keep the lights on” is large --- upto 80% of the IT budget. These costs are directly tied to sprawl & complexity that have comeabout due to M&A or simply undisciplined growth over time.Compliance is on everyone’s mind and since it is the IT systems that at the end of the day thatimplement most of the business processes --- understanding those systems and how theysupport the business is paramount to being responsive to compliance mandates.Competitive Threats come about because the complexity of IT hinders agility and soaks upinnovation dollars that would be better spent improving the competitive stance.It is these business drivers that are behind the strong interest in improving how IT supports thebusiness through Business Technology Management (BTM).4 CONFIDENTIAL
  5. 5. White PaperBusiness Technology ManagementWikipedia1 defines Business Technology Management (BTM) as: “Business technology management (BTM) is a management science that seeks to unify business and technology decision-making at every level in an enterprise. … BTM builds bridges between previously isolated tools and standards for business technology management by strategically incorporating both operational and infrastructure levels of technology management to ensure that an enterprise’s business strategy can be realized by the technology it deploys.”Simply put, BTM brings together IT technology planning tools, processes and investments todeliver improved business value. Of course this raises the question of what are these tools,processes and investments and how can they best be orchestrated to deliver on the promise ofBTM?1 http://en.wikipedia.org/wiki/Business_technology_management5 CONFIDENTIAL
  6. 6. White PaperThe IT Planning EcosystemFigure 1 is a representation of the common IT planning systems deployed in most enterprisestoday. In this diagram these systems are depicted in an ecosystem based on the types ofinformation they contain and the processes they enable. The horizontal ordinate representsthe spectrum of “run the Business” information to “change the Business” information and thevertical axis represents whether the information is operational in nature or strategic in nature.The positioning of the various systems is subjective, but generally speaking relative placementrepresents the nature of each of these systems and the types of processes they support. Forinstance, an enterprise’s ITSM investments are largely established to support ITIL processes andto achieve IT operational excellence with a very limited viewpoint of future state strategicinformation or processes. STRATEGIC INFORMATION Financial Management GRC CHANGE THE BUSINESS RUN THE BUSINESS EA Modeling BPM Project and Portfolio Data Management Management ALM ITSM OPERATIONAL INFORMATION Figure 1 The IT Management EcosystemThe collection of the information found in this eco-system represents the “Enterprise Portfolio”which we will discuss further in the next section. It’s also worth noting that for most6 CONFIDENTIAL
  7. 7. White PaperEnterprises this IT Management ecosystem requires multiple venders, each providing best ofbreed solutions and processes.Enterprises have invested in their current IT management systems to support a wide variety ofIT processes. Today most of these processes are silo-ed within a particular system, but in fact ifwe step back and take a “big picture” view of these processes it is possible to identify a set ofinteracting planning value chains that span IT in its entirety. These BTM value chains can becharacterized into four fundamental planning processes as shown in Figure 2. 1. Business and IT Planning: The process of business and IT strategic planning and roadmapping. 2. IT Portfolio Governance: The processes of managing the risk, health, standards and compliance of the IT assets such as infrastructure, applications, and services. 3. IT Demand to Delivery: The process of managing business demand , funding, solution architecture, governance, and delivery. 4. IT Financial Management: The processes of IT financial budgeting, measurement, reporting, and forecasting. Business & IT Planning Business and IT strategic planning and roadmapping IT Portfolio Governance Risk, health, standards and compliance management IT Demand to Delivery Business demand , funding, solution architecture and delivery IT Financial Management IT financial budgeting, measurement, reporting, and forecasting Figure 2 The BTM Value Chains7 CONFIDENTIAL
  8. 8. White PaperThese value chains do not exist independently, but instead create a value network through theirinteractions. Figure 3 depicts an example showing how they interact. In this case a newbusiness need identified in the Business/IT planning value chain drives budget needs in the ITFinancial Management value chain resulting in a new program request in the Demand toDelivery value chain that needs to be coordinated with investment needs (for example anapplication modernization need) coming from the IT Portfolio Management value chain. IT Portfolio Portfolio Assess risks, Plan to Measure and Management Stewardship opportunities improve Communicate IT Demand Capture Evaluate Execute Measure and Management Demands Communicate IT Financial Budgeting Allocation Reporting Forecasting Management Manage Manage Plan Measure and Business/IT Planning Business Assess Gaps of Action Align. Context Figure 3 The BTM Value NetworkAs can be seen, the BTM space is comprised of a broad set of rich information sources and anumber of interacting value chains and processes that are each dependent on the other. It isclearly a complex system and due to that complexity it can be chaotic and subject to the “ITbutterfly effect” where small changes in the environment can have unexpected and potentiallydisastrous results.8 CONFIDENTIAL
  9. 9. White PaperThe Journey to BTMThe promise of BTM is to seamlessly automate the collection of IT value chains by leveraginginformation found across the multi-vender IT management ecosystem. Given the complexity,mission criticality, multi-vender and evolving nature of the IT eco-system, it’s unlikely any singlevender can deliver BTM in totality. That said, we at Troux have a single focus to help ourcustomers improve their BTM programs by providing out of the box analytics that span theirmulti-vender eco-system and inform the IT value chains. To that end we approach thechallenge by integrating the IT eco-system into what we call the Enterprise Portfolio whichrepresents the dynamic, centralized repository that a true BTM solution requires (see Figure 4).The complexity of the relationships between these systems is represented leveraging EnterpriseArchitecture foundations. Furthermore both current and future states are represented.9 CONFIDENTIAL
  10. 10. White PaperThe Enterprise PortfolioAn Enterprise Portfolio contains descriptions of all assets, both tangible and intangible, forwhich IT is responsible and their relationships, not only to each other, but to the Business aswell. In addition to current state information, future state roadmaps are represented. Business Architecture Projects Applications Information Technology Business Goals & Strategy Enterprise Portfolio Management Troux 9 Business Technology Management Platform Figure 4 The Enterprise PortfolioThe assets for which IT has stewardship responsibilities can be broken down into the followingfour portfolios:  Application portfolio: Applications are the touch point between the Business and IT. The applications represent a substantial IT asset that requires continuous ongoing management. Ultimately the Application portfolio collectively becomes in itself a10 CONFIDENTIAL
  11. 11. White Paper sustainable asset with many stakeholders, leveraged for many use cases and periodically referenced by almost everyone in the enterprise.  Project portfolio: Program and Project Portfolio Management (PPM) is a mature capability practiced by many leading Enterprises today. Also referred to as Demand Management, it’s the process by which Business stakeholders make decisions about investment funding and execution of a change to the current IT or business operations. When combined with an Enterprise Portfolio perspective, better decisions are enabled across the entire portfolio of projects.  Technology portfolio: The Technology portfolio represents all the “hard” or “Physical” IT assets the Enterprise has invested in. In addition it also contains the catalog of all technology standards, their status in the Enterprise (approved, denied, etc.) and the roadmap for each catagory item.  Information portfolio: The Information assets are critical in identifying information risks and how existing data can be leveraged within the enterprise. Pro-actively managing Information assets and their policy status such as sensitivity rankings helps keep those assets under proper control. Using a portfolio approach to the management and policy classification of information assets provides a comprehensive understanding of what common information assets exist and how they relate to other portfolios, most notably the Business and Applications.Additionally, an Enterprise Portfolio will contain descriptions of the Business which can berepresented in two additional portfolios:  Business Strategy portfolio which captures all the intangible aspects that drive the Business decisions going forward. This critical portfolio, referred to by Gartner as “Business Context”2 , contains all the external drivers, strategies, requirements, principles, goals and objectives affecting the Enterprise as a whole.  Business Architecture portfolio which describes the Business capabilities, processes, products and organization2 Gartner, “EA Must Include Defining Your Enterprise Context”, Publication Date: 2 March 2011 ID Number:G0020997611 CONFIDENTIAL
  12. 12. White PaperCapturing and managing these business-oriented portfolios is a critical component in providingvisibility into the business alignment of the IT portfolios and investments. It is these elements,the Business viewpoint, that enable a movement from an “IT Portfolio” view to a full“Enterprise Portfolio” view.For a different perspective on why the integrated multi-portfolio approach is important, thereader is referred to the Appendix at the end of this document.Much of the information that describes the IT portfolios exists today in repositories thatsupport IT processes such ITIL, ALM and PPM. As previously stated, the promise of BTM is tointegrate these silo-ed processes. The first step in this integration is the aggregation of thevarious planning repositories into an Enterprise Portfolio.As previously mentioned, Figure 1 is a representation of the various existing sources ofinformation about the IT portfolio. Each of these repositories is the authoritative source forone aspect of the Enterprise Portfolio, but none are well suited as the Enterprise Portfoliobecause they are purpose built to support well established critical processes such as ChangeManagement or Project Management.As shown in Figure 5, what is required is an integration approach that aggregates informationfrom each repository and then enriches that information --- using enterprise architecturefoundations --- to describe relationships between the portfolios. Additionally, many of these ITplanning systems are solely focused on the current operational state, so, future plans orroadmaps need to be defined for each portfolio so that effective planning can be accomplishedacross multiple portfolios.12 CONFIDENTIAL
  13. 13. White PaperFurthermore, in order to manage and govern the information in the Enterprise Portfolio,ongoing stewardship and governance has to be established and automated, via workflows, foreach portfolio, addressing data quality, currency and completeness criteria that can be trusted.Lastly, integrations with other sources of record must be automated to the extent possible toinsure currency as a onetime “import” is insufficient to support on going the decision supportneeds. Process Simulation Process Business Roadmaps Execution Strategy Process Governance Design BPM Resource Management Process Costing Analysis Process Demand Management Enterprise Monitoring Applications Architecture Standards PPM Investment Change Planning Projects Management Current State Project Architecture Time Scenarios Incident Planning Tracking Future State Management Architecture CMDB Service Level Management Availability Management Configuration Management Figure 5 Enterprise Architecture Integrates Silos of Information13 CONFIDENTIAL
  14. 14. White PaperThe Enterprise Portfolio is Critical to High PriorityInitiativesWhen Troux is established as the Enterprise Portfolio, a number of critical new use cases areunlocked enabling cross portfolio planning in support of BTM the vision (see Figure 6). STRATEGIC INFORMATION Enterprise Financial Portfolio Management Management (Troux) Asset Mgmnt CHANGE THE BUSINESS RUN THE BUSINESS EA Modeling Business Process Management Project MDM and Portfolio ALM Management ITSM OPERATIONAL INFORMATION Figure 6 Troux Delivers the Enterprise PortfolioTo that end it is useful to move beyond the theory of an Enterprise Portfolio and betterunderstand how it would be used in delivering supporting high priority BTM initiatives. It is alsoimportant to note that an Enterprise Portfolio cannot by itself deliver BTM, but rather it candeliver critical analytics that improve the planning and decision making across all IT portfoliosand processes. The examples that follow are just a few of the numerous high value use casesan Enterprise Portfolio approach to BTM enables.14 CONFIDENTIAL
  15. 15. White PaperApplication Portfolio ManagementIT organizations are under constant pressure to better align to the business, optimize resourceusage, identify and redirect wasted spending, improve compliance, and increase agility. Inmany organizations basic application maintenance expenditures account for over 80% of annualbudgets so finding efficiencies in the application portfolio can yield significant benefits.Since the application portfolio is the touch point with the business it is essential that anApplication Portfolio Management program is a sustainable and continuous. It has a largeaudience of users and is foundational to a large number of use cases beyond cost savingincluding compliance, impact analysis, risk management, modernization, and investmentplanning. What IT and business needs is complete visibility into the application portfolio withdetailed understanding of the upstream dependencies (business processes, functions andstrategies) and downstream dependencies (infrastructure, software, servers) of applications,services and projects. IT organizations need the appropriate capabilities to effectivelycommunicate cost-optimization efforts, change impact, risk management plans and secure buy-in from business partners as well as provide real-time reporting on the application portfoliorisk, health, compliance and alignment.Troux solutions enables businesses to analyze and gain insight into how best to manage andoptimize the Application Portfolio through the understanding of the of the entire enterpriseportfolio. Troux provides an integrated and automated out-of-the-box application forapplication portfolio managementM&AExecuting a M&A transaction requires companies to understand business, operational and ITramifications of consolidation and integration. In addition, acquiring or merging with anotherenterprise requires understanding of how new portfolios align to business goals and strategies.15 CONFIDENTIAL
  16. 16. White PaperHow those portfolios create new or enhancing existing business capabilities is key to asuccessful M&A event.IT infrastructures are not always assessed during the formative stages of a M&A project. Thiscan lead to serious business and technology misalignments when integrating two organizations.. The key to successful acquisitions is to develop a successful integration plan thataccommodates business, operational and IT aspects.Troux solutions allow enterprises to assess these potential pitfalls and help align theorganizations strategies, operating models, and IT assets, – ultimately helping the enterprisegain a business- centric view of the necessary IT transformations by considering the entireenterprise portfolio within context of the acquisition or merger.Cloud PlanningThe cloud creates opportunities for IT and business --- improvements in agility, efficiency, costand simplification. Every enterprise needs to look at cloud transformation initiatives to not onlyunderstand the business benefit and operation differentiation they can provide, but t alsounderstand the ramifications and implications to the business of making such a transformation.In answering the question “what and how to move to the cloud” IT organizations have anumber of facets they needs to assess including multiple deployment options, project andbudget risk, security risks, elasticity of demand, regulatory implications, SLA’s and auditchallenges and finally the expected ROI of the various cloud transformation initiatives.Troux solutions allow enterprises to understand their enterprise portfolios, to identify andassess application candidates for migration to a cloud environment within the context oftechnology risk, application suitability, security considerations and alignment to business goalsand strategies. By understanding the cloud opportunity through the lens of all the affectedenterprise portfolios, businesses can build better cloud transformation initiatives.16 CONFIDENTIAL
  17. 17. White PaperInvestment ManagementLarge enterprises are faced with an ever increasing array of investment demands. To makeeffective, impactful decision about which investments to pursue and which to reject requires adeep understanding of those investment proposals within the context of the overall enterpriseportfolio.Investments and program proposals need to be evaluated as part of the business and ITplanning process. To make the right decision, executives need to understand the alignment ofthe potential investment landscape to the strategic goals and intent of the business. Forexample, a proposed investment in application modernization or cloud transformation needs tobe evaluated with respect to the impacted enterprise goals, strategies and business capabilitiestogether with an understanding of existing application and technology roadmaps.Troux solutions allow enterprises to assess investment and program proposals using a business-centric view of the impacts and align these proposals to business goals and businesscapabilities. New understanding of the investment with respect to the impact on theApplication, Technology, Process and Information Portfolios is gained.Solution ArchitectureDelivering on time and on budget is always a top CIO priority and CIOs need to make best use ofscarce project funding. Key to delivering projects on time that meet the business need isexcellent solution architecture. Solution architecture is an architectural abstraction of an end-to-end solution consisting of applications, information and technology to support specificbusiness capabilities and business strategies. Without insight to the enterprise portfolio it isproblematic to design a successful solution architecture.Solution Architecture must understand the current state the new solution will integrate withand leverage opportunities for re-use in the current portfolio. Additionally, solution17 CONFIDENTIAL
  18. 18. White Paperarchitectures must adhere to the published catalog of technology standards and patterns andarchitecture governance boards will use these catalogs to govern project compliance. Goodsolution architectures inform deployment teams so they can better understand how thesolution fits into the enterprise, how it integrates with other aspects of the IT portfolio and howit supports the business.Troux offers a purposed product based on The Open Group’s TOGAF approach to enterprisearchitecture that supports the full TOGAF ADM insuring that solution architectures address allaspects of the enterprise portfolio.Change ManagementMost CMDB/ITSM systems implement data models that represent elements of the businessarchitecture such as CI owners and the business processes supported. In practice however, thisinformation is not populated because it is not the remit of the Operations teams to manage thistype of information. Hence it is difficult for operation change teams to understand risks andbusiness impacts of change requests.As the business becomes more and more dependent on IT to run all business processes thedirect impact to the business of SLA failures becomes more and more acute. Betterunderstanding of impacted business capabilities and organizations improves the operationsteam’s ability to mitigate risk and improve SLA’s.Troux provides integrations with leading ITSM products. These integrations allow businessarchitecture portfolios to augment the ITSM tools being used by the operations teams. Byproviding the ITSM tools with access to the enterprise portfolio, the business architecture canbe automatically provisioned to the ITSM tools enabling Change Teams to better managechange impacts and improve SLA’s.18 CONFIDENTIAL
  19. 19. White PaperThe Troux ApproachTroux provides industry leading software that delivers rapid and continuous value by utilizing anEnterprise Portfolio approach to BTM, By leveraging out of the box analytics that give insightinto the interconnected nature of the Enterprise Portfolio Troux’s solution delivers rapid andsustainable business value. (see Figure 4).Additionally, Troux also provides a prescriptive approach to ensure customer success and on-going customer self sufficiency. These “Troux Accelerators” are based on an “outside in”approach that focuses on answering a set of business critical questions that are aligned toTroux’s rich set of out of the box analytics (see Figure 7).19 CONFIDENTIAL
  20. 20. White Paper How good is my data and What are the What information is used by business and IT How is IT supporting how do I improve it? what business processes? plans? the business? What is the IT landscape What are the by business area? dependencies? UNDERSTANDING ALIGNING How do I rapidly THE ENTERPRISE BUSINESS AND IT What technology risk does estimate costs of my business have? change What are the AGILITY & RISK What technology impacts of change? INNOVATION MANAGEMENT is about to go out & SECURITY of support? REDUCING THE COST OF IT What are my What are IT’s plans transformation to mitigate risks? plans and options? Where are the candidates How do my run and Where are technology risks for taking cost out? How are my costs change the business associated with roadmap? management plans performing? costs compare? Figure 7 Troux’s Outside in ApproachBased on years of experience working with hundreds of customers, Troux Accelerators deliver astructured, yet agile approach to help you align and synchronize your BTM program to realizebetter execution, control risk, and improve financial performance.Troux Accelerators are a proven prescriptive set of best practices, designed to deliverimmediate value by answering critical business questions, and packaged so your BTM programprovides your decision makers and stakeholders with rich information and analytics. As a result,you can operationalize Program Management, Stewardship, and Governance.The APM accelerator is based on a four step program (see Figure 8) 1. The Success Planning Phase – establishes the foundation for success; defining the vision, goals, targeted value, & stakeholder priorities; level-setting the team, and setting the course forward20 CONFIDENTIAL
  21. 21. White Paper 2. The Data Quality Phase – operationalizes data stewardship; enabling domain stewards through best practices to keep key data current, correct, & complete. 3. The Information Analysis Phase – identifies opportunities; executing key analytics and examining the results for trends and anomalies that illuminate possible change opportunities for consideration 4. The Business value Phase – makes decisions; using the results of analyses in governance body actions & investment planning processes. Figure 8 Troux Accelerator MethodologyTroux recognizes that one size doesn’t fit all and you need to size your approach to youobjectives and business imperatives. To that end, Troux offers three categories of Acceleratorsto meet your needs and budgets: 1. Quick Start Accelerator - Quickly populate a targeted set of out-of-the-box Troux analytics with the data required to get immediate value from your Troux software. Typically time boxed to 2 months. 2. Rapid Answers Accelerator - Provide analytics for a high priority, near-term need within an APM program --- typically within 3 months.21 CONFIDENTIAL
  22. 22. White Paper 3. Program Accelerator - Establish an APM program that is operationalized and sustained through Program Management, Stewardship, and Governance, providing a set of analytics to communicate information centered on one or more functional areas. --- Typically in 4 months. The program accelerator can be implemented on previously executed Rapid Answers or Quick Start Accelerators22 CONFIDENTIAL
  23. 23. White PaperAppendix: A Parable that EnlightensThere is an ancient parable that originated in India about the blind men and an elephant. Eachblind man is given a chance to feel a different part of an elephant and describe what anelephant is like. One man who handles the trunk says it is like a snake, another who feels thetusk says it is like a spear, another who touches the tail says it is like a rope etc. They violentlydisagree about what the elephant is, with no resolution to the debate.The Enterprise Portfolio is much like the elephant in this story. If we don’t see it in its totalityincluding the Business viewpoint we cannot understand how all the parts make a wholeenterprise. Furthermore we risk endless debates that result in no business value.For example, if we are looking to make decisions about the Application portfolio and are onlyanalyzing projects and applications, we are overlooking four additional domains (BusinessStrategy, Business Architecture, Technology and Information). Without analytics that considerall dimensions of the problem space it is highly unlikely the right application decisions will betaken --- and in fact much like the blind men and the elephant --- there can be muchdisagreement and little business value delivered.23 CONFIDENTIAL

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