The document discusses developing a new framework for assessing the value of IT projects beyond just financial measures. It proposes using a spectrum of value measures that include both financial and strategic/qualitative measures. A new methodology is presented that quantifies strategic impacts on metrics like customer satisfaction, competitive advantages, and strategic priorities. This would provide a more holistic view of project value for portfolio management decisions.

1. IT Value Assessment
Seeing Beyond Dollars

2. Agenda
 The Context: IT & Business Disconnects
 Focusing In: From Portfolio Management To
Project Assessment
 IT Project Value Spectrum
 A New Framework – Variable Metrics
 Quantifying Non-Financial Value
 Integrating with IT and Business Management

3. Problem Statement
Defining the value of IT work solely by using financial measures
is suboptimal, and leads to decisions that do not support the
firm’s stated strategy and priorities:
 Inability to recruit any early SOA adopters, as designing for services is
more costly early in the process
 Reluctance to invest in infrastructure and update platforms
 Reluctance to move to new, more nimble technology without an immediate
payback
 Poor decision-making around purchased versus developed systems
 „ROI and NPV do not isolate and measure a project‟s ability to grow and
transform the business.‟ (AEC, 2004)
It is more important to select projects that propel the corporate strategy
forward than to choose solely based on ROI.

4. IT Project Value Spectrum
Large businesses tend to grow in an ad hoc manner, creating a vast landscape of
distributed assets, including incompatible hardware, different software implementations,
different versions of the same software brand, and different enterprise configurations.
(Paigankar, 2008)
Financial Measures Value Measures

5. A New Framework: Variable Metrics
Core Metrics (Standard Corporate Metrics)
3-5 Year Variable Measures
Our Focus
Short Term Priorities
“Say you‟ve got 20 projects and can‟t decide
which to fund. So you underfund all of them.
As a result, everything is delayed, and
accomplishments are lessened. That‟s called
the “Sprinkle Theory,” and it‟s a colossal
drag.” –Lawrence A. Bossidy (Honeywell)
Regardless of maturity level, each company
creates and maintains a standard set of
corporate measures, either integrated with IT or
disaggregated.

6. Quantifying Strategic Impact – Keeping Priority
Measures Quantifiable (EXAMPLE)
 Customer Satisfaction
 Improves satisfaction for a significant number of customers
 Improves satisfaction for a small number of customers
 Impact to satisfaction is not significant or N/A to investment
 Addressing Gaps with Competitors
 Addresses significant, pressing gaps with competitors
 Addresses non-pressing gap with competitors
 Does not address significant, pressing gaps with competitors or N/A to investment
 Provides Competitive Advantage
 Provides significant competitive advantage
 Provides some competitive advantage
 Does not provide significant competitive advantage or N/A to investment
In addition to core metrics, the secondary and tertiary metrics (above) should
be weighted appropriately and included in a business case. A final numeric
score that includes this criteria provides a better view of project VALUE.

7. Zooming In: Portfolio Management
Definition
IT Portfolio Management is the application of systematic management to
large classes of items managed by enterprise information technology
capabilities.
1.Portfolio 2. Portfolio 3. Portfolio 4. Portfolio
Analysis Prioritization Consolidation Management
1.Portfolio Analysis Portfolio Analysis displays the data as summary dashboards and, combined
with business value assessments, provides Portfolio Views.
Portfolio Prioritization identifies the process by which Projects are selected for
2. Portfolio Prioritization inclusion in the cycle plan within budget available within Function.
Portfolio Consolidation is the combining of Functional Project Portfolios within
3. Portfolio Consolidation
the Business.
Portfolio Management monitors projects and ensures development follows the
4. Portfolio Management
direction of benefit; facilitates project adds and deletes during the course of
the year driven by business and IT demands.

8. A New Methodology for Identifying Value
 This is a new method!
 Developed by several portfolio managers in Ford.
 Designed as a prototype; not intended to be fully launched using
Excel macros!
 Piloting illuminated these key issues:
 There is little patience for implementing a structured approach to a
portfolio managers believe they already know well.
 There are some weaknesses in the assessment questions we devised…
Focused attention on the assessment with SMEs would be helpful.
 The next few slides capture the output of the tool, not the
input.

9. 1.Portfolio 2. Portfolio 3. Portfolio 4. Portfolio
Analysis Prioritisation Consolidation Management
Determine Variable
and Core metrics
Scores. Select
Portfolio Analysis Toolkit v2 dimensions to use
• Process Analysis Business Process Dashboard
in the assessment
BG: Variable Marketing Programme System (FoG PROMATA)
BI: VISTA - Common Vehicle Ordering System (New VISTA)
grid.
AC: eStatements - Access to Statements of Accounts
BF: TELEIMMAT - Ford France Vehicle Registrations
BJ: VISTA - New Vehicle Ordering/Tracking (Europe)
AZ: PENTA - Pan European National Type Approval
L: Customer View Point Quality Operating System
C: APPA: Accessories Planning & Publishing App
F: CDS CUPID - CDS Customer Module (VISTA)
AD: European Dealer Portal (DealerConnection)
AF: eUsed (FDO2 and gebrauchtwagen)(Eur)
Y: e Batch Communications Module (e BCM)
N: DBP - Dealer Business Planning (Europe)
T: DEALIS: Distribution and Logistics Inf Sys
Q: Dealer Performance Management Report
A: Accessory Marketing Information System
BD: Remotely Accessed Parts Info System
S: Dealer Standards Assessment Toolbox
AV: MPS: Retail/Fleet Marketing (Europe)
AX: Online Technical Information System
B: AFRL - Registration & Licensing (UK)
AM: Ford Batch Communication Module
M: Customer Viewpoint Portal (Europe)
AH: Extended Service Business Online
BE: Sales Data Analyzer Ford of Spain
AG: Exchange Core Tracking System
BH: VIPS (German Version of MPS)
AR: Integrated Diagnostics System
U: Divisional Campaign Database
AU: Marketing Program System 2
R: Dealer Personnel Certification
AN: Ford Direct Stock Exchange
P: Dealer Information Database
BA: Polish Registration System
BC: Remarketing Database II
H: Commodity Web Ordering
AT: Manual Invoice Tracking
AE: European Parts Catalog
AQ: Global Warranty Entry
G: CDS Security Manager
AA: Electronic Catalogue
AB: Environmental Label
AJ: FFE DealerBLESS II
W: DWS - Global Beach
X: DWS Dealer Locator
AI: FFE DealerBLESS I
J: CRM LOCA Loyalty
D: Boutique (Poland)
AK: FFE Telepartner
I: CRM Core -CuPID
AL: FOCALpt (eur)
E: CAFT (Poland)
K: Cust Price Info
O: Dealer Demos
AP: FORDMATE
Z: EASYPARTS
AY: PC-VMACS
BK: WebSelling
AS: KineoCam
AO: FordEtis
AW: NDSA
BB: React
V: DSA
Commonality (PIT)
Processes
10.5.2 Perform compliance audit S
12.2.1 Conduct performance assessments Q
12.2.4 Conduct competitive benchmarking Q
3.2.3 Develop sales forecast N BE
3.3.3 Develop and manage placement and campaign management U
3.3.4.2 Execute pricing plan K BB
3.3.5.3 Execute direct to consumer promotional activities J AB AF
3.3.5.6 Define trade to consumer promotional concepts AU AV BG BH
3.3.5.7 Plan and test trade to consumer activities BG BH
3.3.5.8 Execute trade to consumer promotional activities A C D E K X BG BH
3.3.5.9 Prepare/analyze/evaluate trade to consumer promotional performance metrics AU AV BG BH
3.4.1 Manage Dealer Relationships O P R S V W X AD AM AP AW
3.5.1.2 Identify priority customers AL
3.5.1.7 Prepare/analyze/evaluate sales results BE
Plot results.
3.6.1.1 Accept and validate sales orders H AH AI AJ AK BI BJ
3.6.1.2 Collect and maintain customer account information F I
3.6.1.3 Determine stock availability O AN BC BD BK
3.6.1.4 Determine logistics and transportation AY
3.6.1.5 Enter orders into system and identify/ perform cross-sell/up-sell activity Z BI BJ
3.6.1.7 Handle order inquiries including post-order fulfillment transactions B AZ BA BF BI BJ
4.5.3.6 Track third-party logistics storage and shipping performance AY
4.5.4.2 Track carrier delivery performance T
4.5.5.1 Authorize and process returns AG
4.5.5.4 Manage and process warranty claims AQ
5.3 Perform after sales installations and repairs AA AE AO AR AS AX
5.4.1.1 Solicit customer feedback on customer service experience L M
5.4.1.2 Analyze customer service data and identify improvement opportunities L M
5.4.3.1 Solicit post-sale customer feedback on products and services L
5.4.3.3 Analyze product and service satisfaction data and identify improvement opportunities L
7.3.4.2 Test, evaluate, and implement information security, and privacy and data protection controls G V AW
7.4.3.2 Develop and implement data and content administration P
7.4.4.2 Manage technical interfaces to users of content P Y AM
8.2.3.4 Prepare AR reports AC AT
• Data/Information
Analysis Data Entity Dashboard
“as-is”
14079: Variable Marketing Programme System (FoG PROMATA)
12702: VISTA - Common Vehicle Ordering System (New VISTA)
12333: VISTA - New Vehicle Ordering/Tracking (Europe)
12732: TELEIMMAT - Ford France Vehicle Registrations
assessment grid
6277: eStatements - Access to Statements of Accounts
14011: Customer View Point Quality Operating System
9835: PENTA - Pan European National Type Approval
12700: CDS CUPID - CDS Customer Module (VISTA)
9084: APPA: Accessories Planning & Publishing App
12316: European Dealer Portal (DealerConnection)
13554: e Batch Communications Module (e BCM)
11229: DBP - Dealer Business Planning (Europe)
12345: eUsed (FDO2 and gebrauchtwagen)(Eur)
12733: Dealer Performance Management Report
15092: Accessory Marketing Information System
9072: DEALIS: Distribution and Logistics Inf Sys
13555: Dealer Standards Assessment Toolbox
12684: Remotely Accessed Parts Info System
11240: MPS: Retail/Fleet Marketing (Europe)
11227: AFRL - Registration & Licensing (UK)
13600: Online Technical Information System
14008: Customer Viewpoint Portal (Europe)
12651: Ford Batch Communication Module
12698: Extended Service Business Online
15883: Sales Data Analyzer Ford of Spain
9083: Exchange Core Tracking System
12727: VIPS (German Version of MPS)
12690: Divisional Campaign Database
14954: Integrated Diagnostics System
13556: Dealer Personnel Certification
16800: Marketing Program System 2
12649: Dealer Information Database
12619: Ford Direct Stock Exchange
13788: Polish Registration System
11766: Commodity Web Ordering
13599: Manual Invoice Tracking
13615: European Parts Catalog
9076: Remarketing Database II
12642: CDS Security Manager
12659: Electronic Catalogue
14541: DWS - Global Beach
12712: DWS Dealer Locator
15824: FFE DealerBLESS II
13620: Environmental Label
15759: FFE DealerBLESS I
13635: CRM LOCA Loyalty
169: Global Warranty Entry
12336: CRM Core -CuPID
15561: Boutique (Poland)
15804: FFE Telepartner
12350: FOCALpt (eur)
13607: Cust Price Info
12589: Dealer Demos
13606: EASYPARTS
14600: FORDMATE
13993: PC-VMACS
12640: WebSelling
16442: KineoCam
15183: FordEtis
Business Value
12739: React
Information Assets
Accounting Transaction : Revenue R
Application : -- R
Brand : -- R
Communication : External Communication CRU-SoR R R R R
Communication : Internal Communication CRU-SoR R R
Consumer : -- CRU-SoR
Consumer : Customer R R RU R R R R R R R
Consumer : Prospect R R R R R
Consumer : Suspect R
Distribution Channel : Dealer R R R R R R R R R RCRU-SoR R R R R R R R R R R R R R R R R R R R R R R R R
Facility : Part Depot R
Finance Account : Dealer Finance Account R
Geographic Location : -- R
Inventory : Part Inventory R RU
Inventory : Vehicle Inventory R RU R R R RU
Market : -- R
Marketing Plan : --
Marketing Program : -- CRU-SoR CRU-SoR R CRU-SoR CRU-SoR
Part : -- R
Payment : Disbursement CR-SoR
Product Creation Definition : Product Configuration
Product Creation Definition : Product Variety R
Product Offering : --
Product Offering : Finance Offering R CRU-SoR CRU
CRU-SoR
Product Offering : Part Offering R R R R R R R R
Product Offering : Service Offering R CRU-SoR R R
Product Offering : Vehicle Offering R R R R R R R R
Product Order : --
Product Order : Service Part Order CRU-SoR CR-SoR R R
Product Order : Vehicle Order R CRU-SoR CR-SoR
CR-SoR CRU-SoR R Application Data
Regulation : -- R R R R
Service Delivery : -- R
Service Delivery : Vehicle Repair CRU-SoR
Service Diagnostics : -- R CRU-SoR R
Shipment : -- RU R
Vehicle : -- RU R R R R R R R R R R R R R R R
Weighting
Vehicle Production Plan : -- RU
• Technology Analysis
Warranty Claim : -- CR-SoR
Workforce : Ford Employee R
13639 6296 6312 6331 11001 11002 11457 13628 6277 6298 17841 13718
SUN eStatements - M-Archive -
Accounting Access to eCash - Cash Deutsche Bank European
Application DRAFTS Euro-AP GAPS CPR II ERES COMPAC NETS Statements Tool Direct Internet Archiving Sys
High High High High Medium High High High Low High Low Low
N N Y Y Y Y Y N N Y N N
rbuettge jderschu jderschu jderschu jderschu jderschu jderschu awuestef rbuettge rbuettge rbuettge rbuettge
zszabla2 lehlers1 lehlers1 lehlers1 lehlers1 lehlers1 lehlers1 cfrings kliesega kliesega 0 kliesega
0 0 0 0 0 0 0 0 0 0 0 0
10.2 Process Finance 10.2.3 Process 10.2.3 Process 10.2.3 Process
and Accounting 10.2.1 Process 10.2.1 Process 10.2.1 Process 10.2.1 Process 10.2.1 Process 10.2.1 Process Accounts Receivable, Accounts Receivable, Accounts Receivable, 10.3 Report
Transactions Accounts Payable Accounts Payable Accounts Payable Accounts Payable Accounts Payable Accounts Payable 10.2.2 Process Payroll Credit, and Collections Credit, and Collections Credit, and Collections Information
Summary Business Value Score 100% 49% 60% 71% 63% 64% 70% 38% 26% 65% 57% 57% 65%
Strategic Alignment Index 20% 7% 7% 87% 87% 65% 87% 27% 0% 37% 7% 37% 72%
Functionality and Usability Index 10% 62% 65% 78% 65% 50% 65% 47% 11% 65% 65% 65% 57%
Reliability & Satisfaction Index 20% 72% 79% 78% 46% 80% 82% 46% 60% 80% 72% 80% 72%
Security Index 10% 25% 75% 25% 25% 25% 25% 25% 25% 38% 38% 38% 25%
Complexity Index 20% 56% 68% 62% 58% 67% 56% 48% 19% 74% 72% 56% 58%
Maintainability Index 20% 69% 79% 79% 81% 72% 81% 34% 32% 81% 81% 63% 80%
Technology Score (% green) 50% 72% 82% 72% 69% 68% 43% 74% 25% 14% 100%
Business Process Score
Information Asset Alignment Score
Variable Metrics scoring

10. 1.Portfolio 2. Portfolio 3. Portfolio 4. Portfolio
Analysis Prioritisation Consolidation Management
Interpreting the Assessment Grid i
Higher
“as-is”
Business ▲Business
Commonality (PIT)
assessment grid
Value Value
IT IT
Core Metrics
Commonality Commonality
Commonality (PIT)
“to-be” Business Value
assessment grid
Business ▲ Business
Business Value Value Value
Lower
▼ IT ▼ IT
Commonality Commonality
Lower Variable Metrics Higher

11. 1.Portfolio 2. Portfolio 3. Portfolio 4. Portfolio
Analysis Prioritisation Consolidation Management
Target Setting for Business and IT
x ▲
candidate from a ▲ x = Variable Metrics
“to-be” assessment grid
▼
▲ Include this data in
y = Core Metrics Business Case
Core Metrics
▼ y
▼
▲
▼
Variable Metrics

12. 1.Portfolio 2. Portfolio 3. Portfolio 4. Portfolio
Analysis Prioritisation Consolidation Management
Candidate from a “to-be”
assessment grid
Explanation of Terms i
▲ r = “length of the line”
090o ▲ = Improvement Rating (IR)
▼ θ = “the angle of the line”
r
▲ = is the Direction of Benefit (DoB)
θ
▲ ▲ 0000 < θ < 0900
Core Metrics
▼ 0o
▼ ▼ ▲ 0900 < θ < 1800
▲ ▲ ▼ 1800 < θ < 2700
▼ ▼ ▼ 2700 < θ < 0000
Variable Metrics
Candidate from an “as-
is” assessment grid

13. 1.Portfolio 2. Portfolio 3. Portfolio 4. Portfolio
Analysis Prioritisation Consolidation Management
Improvement Opportunity for each
candidate
candidate from a 090o Analysis Toolkit calculates r
“to-be” assessment grid and θ for each candidate
▼ ▲
▲ ▲ r
r, θ, $ for
candidate from θ
each candidate
“as-is” assessment grid 0o
▼ ▲
▼ ▼
Candidate #; Project Category; Total
Cost

14. 1.Portfolio 2. Portfolio 3. Portfolio 4. Portfolio
Analysis Prioritisation Consolidation Management
Consolidated Portfolio Demand
w w w w
w w w w
w w w w
w w w w
w w w w
IT Dev Plan
w w w w
Project comparison
Prioritised aligned with
Candidates and selection to Business
in Portfolio optimize spend Strategy
w w w w
across all functions
w w w w
w w w w
w w w w
w w w w
w w w w

15. Integrating with IT and Business Management
1.Portfolio 2. Portfolio 3. Portfolio 4. Portfolio
Analysis Prioritisation Consolidation Management
Quarterly Portfolio Reviews
Business Process Dashboard
Ensure priority projects
BG: Variable Marketing Programme System (FoG PROMATA)
BI: VISTA - Common Vehicle Ordering System (New VISTA)
AC: eStatements - Access to Statements of Accounts
BF: TELEIMMAT - Ford France Vehicle Registrations
BJ: VISTA - New Vehicle Ordering/Tracking (Europe)
AZ: PENTA - Pan European National Type Approval
L: Customer View Point Quality Operating System
C: APPA: Accessories Planning & Publishing App
F: CDS CUPID - CDS Customer Module (VISTA)
AD: European Dealer Portal (DealerConnection)
AF: eUsed (FDO2 and gebrauchtwagen)(Eur)
Y: e Batch Communications Module (e BCM)
N: DBP - Dealer Business Planning (Europe)
T: DEALIS: Distribution and Logistics Inf Sys
Q: Dealer Performance Management Report
A: Accessory Marketing Information System
BD: Remotely Accessed Parts Info System
S: Dealer Standards Assessment Toolbox
AV: MPS: Retail/Fleet Marketing (Europe)
AX: Online Technical Information System
B: AFRL - Registration & Licensing (UK)
AM: Ford Batch Communication Module
M: Customer Viewpoint Portal (Europe)
AH: Extended Service Business Online
BE: Sales Data Analyzer Ford of Spain
AG: Exchange Core Tracking System
BH: VIPS (German Version of MPS)
AR: Integrated Diagnostics System
U: Divisional Campaign Database
AU: Marketing Program System 2
R: Dealer Personnel Certification
AN: Ford Direct Stock Exchange
P: Dealer Information Database
BA: Polish Registration System
BC: Remarketing Database II
H: Commodity Web Ordering
AT: Manual Invoice Tracking
AE: European Parts Catalog
AQ: Global Warranty Entry
G: CDS Security Manager
AA: Electronic Catalogue
AB: Environmental Label
AJ: FFE DealerBLESS II
W: DWS - Global Beach
X: DWS Dealer Locator
AI: FFE DealerBLESS I
J: CRM LOCA Loyalty
D: Boutique (Poland)
AK: FFE Telepartner
I: CRM Core -CuPID
AL: FOCALpt (eur)
E: CAFT (Poland)
K: Cust Price Info
O: Dealer Demos
AP: FORDMATE
Z: EASYPARTS
AY: PC-VMACS
BK: WebSelling
AS: KineoCam
AO: FordEtis
AW: NDSA
BB: React
are proceeding in
V: DSA
Processes
10.5.2 Perform compliance audit S
12.2.1 Conduct performance assessments Q
12.2.4 Conduct competitive benchmarking Q
3.2.3 Develop sales forecast N BE
3.3.3 Develop and manage placement and campaign management U
3.3.4.2 Execute pricing plan K BB
3.3.5.3 Execute direct to consumer promotional activities J AB AF
3.3.5.6 Define trade to consumer promotional concepts AU AV BG BH
3.3.5.7 Plan and test trade to consumer activities BG BH
3.3.5.8 Execute trade to consumer promotional activities A C D E K X BG BH
3.3.5.9 Prepare/analyze/evaluate trade to consumer promotional performance metrics AU AV BG BH
3.4.1 Manage Dealer Relationships O P R S V W X AD AM AP AW
3.5.1.2 Identify priority customers AL
3.5.1.7 Prepare/analyze/evaluate sales results BE
3.6.1.1 Accept and validate sales orders H AH AI AJ AK BI BJ
3.6.1.2 Collect and maintain customer account information F I
3.6.1.3 Determine stock availability O AN BC BD BK
direction of benefit and
3.6.1.4 Determine logistics and transportation AY
3.6.1.5 Enter orders into system and identify/ perform cross-sell/up-sell activity Z BI BJ
3.6.1.7 Handle order inquiries including post-order fulfillment transactions B AZ BA BF BI BJ
4.5.3.6 Track third-party logistics storage and shipping performance AY
4.5.4.2 Track carrier delivery performance T
4.5.5.1 Authorize and process returns AG
4.5.5.4 Manage and process warranty claims AQ
5.3 Perform after sales installations and repairs AA AE AO AR AS AX
5.4.1.1 Solicit customer feedback on customer service experience L M
5.4.1.2 Analyze customer service data and identify improvement opportunities L M
5.4.3.1 Solicit post-sale customer feedback on products and services L
5.4.3.3 Analyze product and service satisfaction data and identify improvement opportunities L
7.3.4.2 Test, evaluate, and implement information security, and privacy and data protection controls G V AW
7.4.3.2 Develop and implement data and content administration P
7.4.4.2 Manage technical interfaces to users of content P Y AM
8.2.3.4 Prepare AR reports AC AT
on budget
Commonality (PIT)
Opportunity to add or
remove projects
throughout year
Business Value Retrospective
assessment – did
projects deliver
expected value?

16. References
 Align Journal:
 Getting “In Synch”: How Successful Organizations Align Business With IT Using IT Portfolio Management and an
IT Governance Framework, Sushil Paigankar, 2008
 Aligning IT to the Strategic Plan: Why It’s Permanently Number One on Your To-Do List, Stephen C. Hawald,
2007
 Five Simple Rules for Achieving Business Agility, Scott Gaydos, 2007
 Applications Executive Council:
 From Business Case to Business Value: Arresting Value Dissipation Through the Application Life Cycle, Corporate
Executive Board, 2004
 CIO Executive Board:
 Designing Business Focused Metrics of IT Value, Intel, 2008
 Forrester Research, Inc.
 Building the Business Case for APM, IBM, 2005
 Gartner
 Architected Enterprise Portfolio Management, Richard Buchanan, 2008
 Interviews:
 Michael Richards, Director: Enterprise Portfolio Services, Ford Motor Company and IBM
 Stephen Smith, Director: Environmental & Quality Systems, Ford Motor Company
 Jim Smith, Manager: Enterprise Portfolio Service, Ford Motor Company and IBM
 Automotive Strategy Group, Ford Motor Company
 Stephan Mueller-Urbanik, Director: Marketing, Sales, and Services Systems, Ford Motor Company