Portfolio Management (Program & Project) by Rahmat Mulyana at OMM 43 PMI Indonesia Chapter

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A portfolio is a collection of projects and programmes and other work that are grouped together to facilitate the effective management of that work to meet strategic goals.
Portfolio management is the centralised management of one or more project portfolio, which includes identifying, prioritising, authorising, directing and controlling projects, programmes and other work to achieve specific strategic goals.

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Portfolio Management (Program & Project) by Rahmat Mulyana at OMM 43 PMI Indonesia Chapter

  1. 1. 12/18/2013 Portfolio Management: Standard, Best Practice & Case Study in Business-IT Context By: Rahmat Mulyana, MT,MBA,PMP,CISA,CISM,CGEIT,CRISC,ITIL-F OMM 43rd – December 18th, 2013 Portfolio Management: Standard, Best Practice & Case Study in Business-IT Context, Dec 18 2013 Agenda • Introduction • Portfolio Management: Related Standard & Best Practice • Project & Portfolio Management Application Review: Gartner & Forrester • Process Maturity/ Capability Assessment: CMM, ISO 15504 & OPM3 • Case Study: Strategic Planning & Architecting • Case Study: Value, Risk & Resource Optimization • Case Study: Process Maturity/ Capability Assessment Portfolio Management: Standard, Best Practice & Case Study in Business-IT Context, Dec 18 2013 1
  2. 2. 12/18/2013 Brief Profile: Rahmat Mulyana, MT,MBA,PMP,CISA,CISM,CGEIT,CRISC,ITIL-F • Interest: “Business & Technology Alignment” • Education: MBA, Information Systems, Computer Engineering (ITB) • Association: PMI, ISACA, IIA, IASA, AIS • Specialties: Strategic & IT Master Planning, Business & IT Architecting, Enterprise Governance & Management of IT, Information Security & IT Auditing & Assurance • Clients: Banking, Telco, Insurance, Airport, Seaport, Hospital, Pawnshop, Plantation, Forestry, Energy, Ministry, University • Experience: – – – – – Co-founding & managing ComLabs ITB (2000-2007) Co-founding & managing Transforma (2008-now) Facilitator @ ComLabs Training (2000-now), Transforma Institute (2008-now) Professional lecturer @ Tel-U & Public lecture @ universities (2010-now) Working group @ SNI development related to Business-IT (2013-now) • Mobile: +62-812-246-8446 • Email: rahmatmoelyana@transforma.co.id • Profile: http://www.linkedin.com/in/rahmatmulyana Portfolio Management: Standard, Best Practice & Case Study in Business-IT Context, Dec 18 2013 Events Documentation OJK Chief Audit Executive Forum, 2013 ISACA Conference feat Erik Guldentops, 2013 PMI Branch Launching, 2013 IT Master Planning @ Transforma Institute, 2013 Public Lecture @ UIN SGD, 2012 Strategic Planning @ Unsri, 2013 Portfolio Management: Standard, Best Practice & Case Study in Business-IT Context, Dec 18 2013 2
  3. 3. 12/18/2013 Agenda • Introduction • Portfolio Management: Related Standard & Best Practice • Project & Portfolio Management Application Review: Gartner & Forrester • Process Maturity/ Capability Assessment: CMM, ISO 15504 & OPM3 • Case Study: Strategic Planning & Architecting • Case Study: Value, Risk & Resource Optimization • Case Study: Process Maturity/ Capability Assessment Portfolio Management: Standard, Best Practice & Case Study in Business-IT Context, Dec 18 2013 Business & IT Relationship Paradox! • IT Investment will never stop grow! – 1995: US$ 527.9 billion (OECD), estimated growth 9.7% pa – 2011: US$ 3.6 trillion (Gartner), actual growth 13,5% pa Unfortunately the facts showed…. • IT Productivity Paradox: – “You can see the computer age everywhere but NOT in the productivity statistics” • IT Investment Paradox: – “large sums are invested in IT and seem to be swallowed by a large black hole without rendering many returns” Portfolio Management: Standard, Best Practice & Case Study in Business-IT Context, Dec 18 2013 3
  4. 4. 12/18/2013 IT Contribution Failed! Many research show that most organizations were failed to deliver value from their IT investments BUT…… Include: Portfolio, Programmes & Projects Management Portfolio Management: Standard, Best Practice & Case Study in Business-IT Context, Dec 18 2013 What is Portfolio Management? • A portfolio is a collection of projects and programmes and other work that are grouped together to facilitate the effective management of that work to meet strategic goals. Source: ISO 21500:2012 • Portfolio management is the centralised management of one or more project portfolio, which includes identifying, prioritising, authorising, directing and controlling projects, programmes and other work to achieve specific strategic goals. Portfolio Management: Standard, Best Practice & Case Study in Business-IT Context, Dec 18 2013 4
  5. 5. 12/18/2013 Portofolio, Program & Project: Comparison • Portfolio management is about “to do the right things” • Programs and projects management are about “to do things right” Source: The Standard for Portfolio Management, PMI, 2013 Portfolio Management: Standard, Best Practice & Case Study in Business-IT Context, Dec 18 2013 Portofolio, Program & Project Relationship • Cascaded from Strategy into Operations • It’s all about Optimizing Value, Risk & Resources Source: Organization Project Management Maturity Model (OPM3), PMI, 2013 Portfolio Management: Standard, Best Practice & Case Study in Business-IT Context, Dec 18 2013 5
  6. 6. 12/18/2013 Value Analysis Tools Payback Period Net Present Value Profitability Index Discounted Cash Flow Internal Rate of Return Real Options Cost Benefit Analysis Portfolio Management: Standard, Best Practice & Case Study in Business-IT Context, Dec 18 2013 Do business measure IT value often enough? Source: CIO Magazine, July 2006 Portfolio Management: Standard, Best Practice & Case Study in Business-IT Context, Dec 18 2013 6
  7. 7. 12/18/2013 What COBIT 5 says about Portfolio, Program & Project? Governance Management APO-05 Manage Portofolio BAI-01 Manage Programmes & Project • Accountability: – Governance: Board – Management: Business & IT Management Source: COBIT 5, ISACA, 2012 & ISO 38500:2008 Portfolio Management: Standard, Best Practice & Case Study in Business-IT Context, Dec 18 2013 APO-05: Manage Portfolio Source: COBIT 5, ISACA, 2012 Portfolio Management: Standard, Best Practice & Case Study in Business-IT Context, Dec 18 2013 7
  8. 8. 12/18/2013 BAI-06: Manage Program & Project Source: COBIT 5, ISACA, 2012 Portfolio Management: Standard, Best Practice & Case Study in Business-IT Context, Dec 18 2013 BAI-06: Manage Program & Project Source: COBIT 5, ISACA, 2012 Portfolio Management: Standard, Best Practice & Case Study in Business-IT Context, Dec 18 2013 8
  9. 9. 12/18/2013 Agenda • Introduction • Portfolio Management: Related Standard & Best Practice • Project & Portfolio Management Application Review: Gartner & Forrester • Process Maturity/ Capability Assessment: CMM, ISO 15504 & OPM3 • Case Study: Strategic Planning & Architecting • Case Study: Value, Risk & Resource Optimization • Case Study: Process Maturity/ Capability Assessment Portfolio Management: Standard, Best Practice & Case Study in Business-IT Context, Dec 18 2013 Source: Forrester, Q4 2012 Latest PPM Application Capability While PPM has historically been seen as a tool for either: • top-down forecasting & planning • project management organizations rarely use a single tool for both purposes Portfolio Management: Standard, Best Practice & Case Study in Business-IT Context, Dec 18 2013 9
  10. 10. 12/18/2013 Forrester Wave: Strategic Planning Source: Forrester, Q4 2012 Portfolio Management: Standard, Best Practice & Case Study in Business-IT Context, Dec 18 2013 Strategic Planning Capabilities Source: Forrester, Q4 2012 Portfolio Management: Standard, Best Practice & Case Study in Business-IT Context, Dec 18 2013 10
  11. 11. 12/18/2013 Forrester Wave: Work Execution Source: Forrester, Q4 2012 Portfolio Management: Standard, Best Practice & Case Study in Business-IT Context, Dec 18 2013 Work Execution Capabilities Source: Forrester, Q4 2012 Portfolio Management: Standard, Best Practice & Case Study in Business-IT Context, Dec 18 2013 11
  12. 12. 12/18/2013 Gartner Magic Quadrant: IT Project & Portfolio Applications Source: Gartner, June 2010 Portfolio Management: Standard, Best Practice & Case Study in Business-IT Context, Dec 18 2013 Gartner Magic Quadrant: IT Portfolio Analysis Applications (IIPA) CIO magazine: The market for project management software and services totals about $1.2 billion annually, according to Forrester Research. The market for project portfolio management (PPM) software stood at $2.9 billion in 2008, according to IDC, which expects the PPM software and services market to reach $4.2 billion by 2013. "The IIPA software market helps IT leaders link, monitor, analyze and communicate their activities on a single portfolio-level software platform, providing CIOs and other executives with holistic views of the IT portfolio while IT plans and executes in response to business and IT strategies." Portfolio Management: Standard, Best Practice & Case Study in Business-IT Context, Dec 18 2013 12
  13. 13. 12/18/2013 Agenda • Introduction • Portfolio Management: Related Standard & Best Practice • Project & Portfolio Management Application Review: Gartner & Forrester • Process Maturity/ Capability Assessment: CMM, ISO 15504 & OPM3 • Case Study: Strategic Planning & Architecting • Case Study: Value, Risk & Resource Optimization • Case Study: Process Maturity/ Capability Assessment Portfolio Management: Standard, Best Practice & Case Study in Business-IT Context, Dec 18 2013 Process Assessment Framework Source: Process Assessment Model, ISACA, 2013 Portfolio Management: Standard, Best Practice & Case Study in Business-IT Context, Dec 18 2013 13
  14. 14. 12/18/2013 Measurement Framework: CMM & ISO 15504 CMM • Began from Process Maturity Framework 1989, 1993, 1995 by Watts Humphrey in “Managing the Software Process” • Initiator = Software Enginerring Institute (Carnegie Mellon University) • Sponsor = US. Department of Defense • Maturity = “degree of formality & optimization of processess” • Early goal = improve software dev process ISO 15504 • Began from SPICE (Software Process Improvement and Capability Determination) as result from working group since 1993 • Early reference from ISO/IEC 12207 (Software Lifecycle Processes) including many maturiy model such as Bootstrap, Trilium dan CMM • Developed into 6 business area: organizational, management, engineering, acquisition supply, support, operations Portfolio Management: Standard, Best Practice & Case Study in Business-IT Context, Dec 18 2013 The Organizational Project Management Maturity Model (OPM3) Source: OPM3, PMI, 2013 Portfolio Management: Standard, Best Practice & Case Study in Business-IT Context, Dec 18 2013 14
  15. 15. 12/18/2013 Not only Process but Seven Enabler! Source: COBIT 5, ISACA, 2012 1. Principles, policies and frameworks—Are the vehicles to translate the desired behaviour into practical guidance for day-to-day management 2. Processes—Describe an organised set of practices and activities to achieve certain objectives and produce a set of outputs in support of achieving overall IT-related goals 3. Organisational structures—Are the key decisionmaking entities in an organisation 4. Culture, ethics and behaviour—Of individuals and of the organisation; very often underestimated as a success factor in governance and management activities 5. Information—Is pervasive throughout any organisation, i.e., deals with all information produced and used by the enterprise. Information is required for keeping the organisation running and well governed, but at the operational level, information is very often the key product of the enterprise itself. 6. Services, infrastructure and applications—Include the infrastructure, technology and applications that provide the enterprise with information technology processing and services 7. People, skills and competencies—Are linked to people and are required for successful completion of all activities and for making correct decisions and taking corrective actions Portfolio Management: Standard, Best Practice & Case Study in Business-IT Context, Dec 18 2013 Agenda • Introduction • Portfolio Management: Related Standard & Best Practice • Project & Portfolio Management Application Review: Gartner & Forrester • Process Maturity/ Capability Assessment: CMM, ISO 15504 & OPM3 • Case Study: Strategic Planning & Architecting • Case Study: Value, Risk & Resource Optimization • Case Study: Process Maturity/ Capability Assessment Portfolio Management: Standard, Best Practice & Case Study in Business-IT Context, Dec 18 2013 15
  16. 16. 12/18/2013 Strategic Planning in Business-IT Context: Where Portfolio Created 1 2 Arsitektur Bisnis Visi, Misi dan Nilai Strategi, Obyektif dan Indikator Profil Strategis Organisasi Informasi dan Pengetahuan Jaringan Organisasi Regulasi, Pasar dan Pesaing Produk dan Jasa Strategi dan panduan implementasi SDM, Struktur, dan Kultur Peran Strategis TI Kebijakan, Standar & Prosedur Information Governance 6 Strategi Implementasi Review dan Assessment Strategis Pada Organisasi Portofolio Program dan Proyek Analisa Kebutuhan Sistem Informasi Organisasi Rencana Anggaran dan Investasi Manajemen Implementasi dan Review Portofolio Kebutuhan Sistem Informasi 3 Monitoring Kinerja Portofolio 4 Arsitektur Data Arsitektur Data Arsitektur Aplikasi Arsitektur Aplikasi Arsitektur Infrasruktur dan Perangkat Keras Baseline Manajemen Perubahan Manajemen Portofolio Program dan Proyek Arsitektur Infrasruktur dan Perangkat Keras Stakeholder dan Pengguna Stakeholder dan Pengguna Tata Pamong (IT Governance) Tata Pamong (IT Governance) Assessment Kondisi Eksisting Penyusunan IT Blueprint 5 Analisa Kesenjangan TI TI Masa Depan TI Eksisting Portfolio Management: Standard, Best Practice & Case Study in Business-IT Context, Dec 18 2013 Yearly Strategic Themes Tahun Tema 2013 Basic Capabilities Yaitu kemampuan untuk mendukung layanan medis dasar dan transaksi keuangan Kriteria     Keterpenuhan fungsionalitas dasar kebutuhan utama bisnis Rekam medis yang terintegrasi (satu pasien satu rekam medis) Koneksi dengan jejaring utama dalam transaksi keuangan Sentralisasi Pengelolaan IT 2014 Managed Capabilities Yaitu kemampuan untuk mendukung seluruh layanan medis termasuk pendukung medis yang terintegrasi dan jejaring medis yang utama  Penunjang medis yang terintegrasi  Kolaborasi dalam pelayanan medis  Implementasi integrated clinical pathway  Koneksi jejaring utama layanan medis (rujukan)  Integrasi TI 2015 2016 2017 Extended Capabilities Optimised Value Strategic partnership Yaitu kemampuan Yaitu mengoptimalkan Yaitu TI memjadi untuk mendukung investasi TI menjadi strategic partner seluruh proses di XYZ benefit bagi institusi bisnis untuk membuat dan seluruh inovasi dalam layanan jejaringnya medis maupun manajemen rumah sakit   Keterpenuhan Fungsionalitas semua kebutuhan bisnis Koneksi dengan semua jejaring XYZ     IT Sebagai  Revenue Center Keterpenuhan kebutuhan  informasi pada dukungan strategis Integrated clinical pathway yang  efektif Knowledge sharing antar unit Inovasi layanan rumah sakit menggunakan TI Optimalisasi clinical analytics pada layanan medis Investigasi medis menggunakan TI Portfolio Management: Standard, Best Practice & Case Study in Business-IT Context, Dec 18 2013 16
  17. 17. 12/18/2013 Portfolio (Program & Project): IS Initiatives KATEGORI Sistem Informasi A. Perbaikan aspek keuangan PROYEK TIPE DESKRIPSI 1 Pembangunan sistem akuntansi Sistem Baru Pembangunan aplikasi baru dengan fitur standard akuntansi, setidaknya meliputi buku besar, AR/AP, Laba Rugi, Billing umum (non pasien), akuntansi biaya, manajemen klaim 2 Integrasi semua modul Sistem Baru eksisting ke sistem jurnal akuntansi memastikan semua modul aplikasi eksisting terintegrasi dengan mekanisme jurnal ke akuntansi. Seperti pelayanan IRD, IRI, IRJ, gudang medik, farmasi, IPSRS, Pengadaan, Gizi, pengadaan, gudang non medik, fixed asset management 3 Penyempurnaan Billing Management Upgrade pengisian komponen billing pada unit pelayanan harus tersambung dengan jurnal akuntansi (opsi: langsung maupun batch). Terintegrasi dengan cash management dan modul AR akuntansi. Memungkinkan ditarik ke financial management sebagai bagian untuk financial forecasting 4 Penyempurnaan Cash Management Upgrade cash management ditingkatkan fungsionalitasnya dengan menambahkan fitur pemasukan (cash-in) dan pengeluaran (cashout) untuk semua sumber data yang memungkinkan 5 pembangunan sistem Remunerasi Sistem Baru pembangunan aplikasi baru untuk pengelolaan remunerasi dengan fungsional: monitoring komponen kinerja, kalkulasi remunerasi, integrasi akuntantansi Portfolio Management: Standard, Best Practice & Case Study in Business-IT Context, Dec 18 2013 Risk & Impact Criterias  For every identified initiatives we performed risk & impact analysis to setup priorities  Criterias example: – Risk rated in H, M, L by considering investment value, impacted business processes, impacted architecture and projects duration – Impact rated in H, M, L by considering potential financial benefit and impact to customer Portfolio Management: Standard, Best Practice & Case Study in Business-IT Context, Dec 18 2013 17
  18. 18. 12/18/2013 Implementation Roadmap PROGRAM Sistem Informasi A Perbaikan aspek keuangan B Perbaikan mutu dan efisiensi pelayanan C Perbaikan layanan penunjang medis D E F G H 2013 2014 2015 2016 2017 2018 Perbaikan penunjang non-medis Perbaikan administrasi dan proses manajemen operasional Penyajian informasi untuk keperluan strategis Pengembangan Data Mining Pengembangan knowledge management I J Perbaikan Portal Web Pengembangan sistem informasi pendidikan dan penelitian Infrastruktur K Peremajaan Data Center eksisting L Penambahan Segmen Baru M Peningkatan Perangkat Jaringan N Implementasi Disaster Recovery Center Tata Kelola TI O Penguatan Struktur Tata Kelola TI P Penetapan Proses Tatakelola TI Q Peningkatan SDM R Teknologi Pendukung Portfolio Management: Standard, Best Practice & Case Study in Business-IT Context, Dec 18 2013 Investment Plan Estimation PROGRAM Sistem Informasi A. Perbaikan aspek keuangan INISIATIF 1. Pembangunan sistem akuntansi TIPE Sistem Baru 2014 2017 2018 500 800 Sistem Baru 3. Penyempurnaan Billing Management Upgrade 100 Upgrade 600 50 4. Penyempurnaan Cash Management 50 5. pembangunan sistem Remunerasi Sistem Baru Perbaikan mutu dan efisiensi pelayanan 2016 500 2. Integrasi semua modul eksisting ke sistem jurnal akuntansi B. 2015 100 6. pembangunan Modul Integrated Clinical Pathway Sistem Baru 500 7. Pembangunan Sistem Rujukan Sistem Baru 100 500 800 500 300 Portfolio Management: Standard, Best Practice & Case Study in Business-IT Context, Dec 18 2013 18
  19. 19. 12/18/2013 Agenda • Introduction • Portfolio Management: Related Standard & Best Practice • Project & Portfolio Management Application Review: Gartner & Forrester • Process Maturity/ Capability Assessment: CMM, ISO 15504 & OPM3 • Case Study: Strategic Planning & Architecting • Case Study: Value, Risk & Resource Optimization • Case Study: Process Maturity/ Capability Assessment Portfolio Management: Standard, Best Practice & Case Study in Business-IT Context, Dec 18 2013 Feasibility Framework ANALYSIS FRAMEWORK 1. Strategic Alignment Analysis 2. Conventional Investment Analysis 2 1 START INPUT: · Environment Condition · Industry Condition · Internal and External Condition · As Is IT Condition · IT Internal Study PROCESS: · Trend Analysis (PEST) · Industry Analysis (Enhanced Five Forces) · External and Internal Analysis (SWOT) · Corporate Strategy Analysis (TOWS) · IT Strategy Analysis (BSC) · IT Project Analysis (EA & GEIT) 4. Enhanced Investment Analysis 3. Risk Analysis 3 INPUT: · IT Investment Risk Data INPUT: · As Is IT Condition · To Be IT Condition PROCESS: · Cost Analysis · Benefit Analysis · Investment Analysis (NPV, IRR, ROI, Payback Period) METHOD: · Interview INPUT: · IT Investment Analysis Result · IT Investment Risk Profile PROCESS: · Risk Identification · Risk Analysis · Risk Evaluation PROCESS: · Risk-Based Options Identification · IT Investment Configuration Analysis · Real-Options Valuation · Sensitivity Analysis METHOD: · Interview OUTPUT: · IT Investment Risk Profile METHOD: · FGD OUTPUT: · IT Investment Analysis Result OUTPUT: · Decision Recommendation Approved? Yes 4 METHOD: · Interview Approved? Yes 3 No 3 No No 1 Approved? Approved? 2 OUTPUT: · To Be IT Condition Yes Yes END 2 No V.1.0 START Portfolio Management: Standard, Best Practice & Case Study in Business-IT Context, Dec 18 2013 19
  20. 20. 12/18/2013 Strategic Alignment Analysis Portfolio Management: Standard, Best Practice & Case Study in Business-IT Context, Dec 18 2013 Conventional Investment Analysis Year Parameter Rate Inflation Factor Growth Factor Total Cost Reduction & Avoidance Total Losses Reduction Total Increase Revenue (Forecast) Total Benefit Total Benefit including Inflation IT Infrastructure Cost (DC and 2 Regional Offices Setup, Installation & Configuration) Total Change Management Cost (2 Regional Offices) IT Infrastructure Cost (DC and 2 Regional Offices Network Operations, without DRC) Total Expenses Total Expenses including Inflation EBITDA Capital Used (Weighted Average) Capital Repayment Capital Used Balance Interest (WACC) CAPEX Application Value Amortization CAPEX IT Infrastructure Value Depreciation PBT Income Tax Net Cash Flow IRR NPV ROI Cumulative Net Cash Flow Payback Period 0 2012 1 2013 1.000 1.050 2 2014 3 2015 4 2016 5 2017 6 2018 7 2019 1.103 1.000 Rp0 Rp998,073,771 Rp0 Rp998,073,771 Rp1,100,376,332 1.158 1.162 Rp0 Rp998,073,771 Rp0 Rp998,073,771 Rp1,155,395,149 1.216 1.350 Rp0 Rp998,073,771 Rp0 Rp998,073,771 Rp1,213,164,906 1.276 1.568 Rp0 Rp998,073,771 Rp0 Rp998,073,771 Rp1,273,823,152 1.340 1.821 Rp0 Rp998,073,771 Rp0 Rp998,073,771 Rp1,337,514,309 1.407 2.116 Rp0 Rp998,073,771 Rp0 Rp998,073,771 Rp1,404,390,025 14.75% 20.00% 20.00% 25.00% Rp0 Rp0 Rp0 Rp0 Rp0 Rp0 Rp0 Rp299,711,800 Rp0 Rp0 Rp0 Rp0 Rp0 Rp0 5.00% Rp0 Rp0 5.00% Rp0 Rp0 Rp0 Rp0 Rp0 Rp0 16.17% Rp0 Rp0 Rp0 Rp0 Rp0 Rp0 Rp0 Rp0 Rp0 Rp0 Rp0 Rp0 Rp0 Rp0 Rp0 Rp0 Rp0 Rp0 Rp0 Rp0 Rp0 Rp0 Rp0 Rp0 Rp0 Rp0 Rp0 Rp0 Rp0 Rp0 Rp0 Rp0 Rp0 Rp0 Rp0 Rp0 Rp0 Rp0 Rp0 Rp0 Rp299,711,800 Rp330,432,260 Rp769,944,073 Rp1,875,432,260 Rp0 Rp1,875,432,260 Rp0 Rp1,545,000,000 Rp0 Rp0 Rp0 Rp769,944,073 Rp192,486,018 (Rp967,541,945) Rp0 Rp0 Rp1,155,395,149 Rp1,875,432,260 Rp267,918,894 Rp1,607,513,365 Rp276,640,550 Rp1,236,000,000 Rp309,000,000 Rp0 Rp0 Rp569,754,599 Rp142,438,650 Rp468,397,055 Rp0 Rp0 Rp1,213,164,906 Rp1,607,513,365 Rp267,918,894 Rp1,339,594,471 Rp276,640,550 Rp927,000,000 Rp309,000,000 Rp0 Rp0 Rp627,524,357 Rp156,881,089 Rp511,724,373 Rp0 Rp0 Rp1,273,823,152 Rp1,339,594,471 Rp267,918,894 Rp1,071,675,577 Rp237,120,471 Rp618,000,000 Rp309,000,000 Rp0 Rp0 Rp727,702,680 Rp181,925,670 Rp586,858,116 Rp0 Rp0 Rp1,337,514,309 Rp1,071,675,577 Rp267,918,894 Rp803,756,683 Rp197,600,393 Rp309,000,000 Rp309,000,000 Rp0 Rp0 Rp830,913,916 Rp207,728,479 Rp664,266,543 Rp0 Rp0 Rp1,404,390,025 Rp803,756,683 Rp267,918,894 Rp535,837,788 Rp158,080,314 Rp0 Rp309,000,000 Rp0 Rp0 Rp937,309,710 Rp234,327,428 Rp208,225,600 43.30% (Rp967,541,945) (Rp499,144,890) 25 months Rp12,579,483 Rp599,437,599 Rp1,263,704,142 Rp1,471,929,742 Rp705,413,912 37.61% Rp0 Rp0 3 years Portfolio Management: Standard, Best Practice & Case Study in Business-IT Context, Dec 18 2013 20
  21. 21. 12/18/2013 Risk Analysis Impact Probability High (H) Medium (M) Low (L) Minor (L) Moderate (M) Mayor (H) Medium Low Low High Medium Low High High Medium Portfolio Management: Standard, Best Practice & Case Study in Business-IT Context, Dec 18 2013 Real Options Valuation Parameter q Vmax Vmin Ve rf p t K S x% Description Option success probability NPV maximum from the option NPV minimum from the option Expected value from the option (derived from NPV minimum & maximum of an option and its success probability) Risk-free rate (derived from applicable BI rate) Risk-free probability (derived from expected, minimum and maximum NPV, plus risk-free rate) Project lifetime for the option (in term of year) Cost of the option (derived from its total capital expenditure) Salvage value (calculated residual value derived from capital expenditures and its depreciation/ amortization rate) Contribution Value (adjustable between 0 to 100% in order to maximize the value, either from the salvage value or remaining project value) Portfolio Management: Standard, Best Practice & Case Study in Business-IT Context, Dec 18 2013 21
  22. 22. 12/18/2013 Enhanced Investment Analysis Example Operation DC & DRC Pilot Option Rp1,162,511,849 Rp148,759,319,500 Change Mgmt ES 2 (7m) Rp802,210,689,033 Change Mgmt IA (1m) Dev IA (4m) 3 Development ES 2 (18m) Expand S5 2 Follow-up S Stage Option E A Abandon Option No Expand 1 Pilot Rp43,895,090,126 A 3' E Expand Option S3 S1 Scenario Pilot-Abandon Abandon 2' Rp1,162,511,849 S1 Rp950,970,008,533 3 Change Mgmt ES 2 (8m) Rp192,654,409,626 Development ES 1 (12m) 5 Stage 2 Stage 1 (Rp33,482,137,624) A 5' 5 6 3' 12 S4 S5 Scenario Pilot-Follow-up-Expand S6 Scenario Stage-1-Stage-Expand No Expand Rp620,705,615,344 S2 Operation DC & DRC Stage Option Abandon 0 S6 S4 Scenario Stage-1-Stage-2 (Rp23,876,543,264) Rp9,605,594,360 Expand Rp621,868,127,193 E Development ES 2 (12m) 4 S2 Scenario Stage-1-Abandon S3 Scenario Pilot-Follow-up Rp654,187,752,968 P/S Legend: P Pilot Option Change Mgmt ES 1 (1m) Development ES 1 (6m) Rp952,132,520,382 MONTHS 16 17 24 28 29 Portfolio Management: Standard, Best Practice & Case Study in Business-IT Context, Dec 18 2013 Agenda • Introduction • Portfolio Management: Related Standard & Best Practice • Project & Portfolio Management Application Review: Gartner & Forrester • Process Maturity/ Capability Assessment: CMM, ISO 15504 & OPM3 • Case Study: Strategic Planning & Architecting • Case Study: Value, Risk & Resource Optimization • Case Study: Process Maturity/ Capability Assessment Portfolio Management: Standard, Best Practice & Case Study in Business-IT Context, Dec 18 2013 22
  23. 23. 12/18/2013 Process Maturity Assessment (CMM) PO5 Manage the IT Investment Assessment Status Total Weight 1 Weight 1 Value 0,00 0,13 0,53 0,78 0,66 0,42 0,00 Maturity Level = 2,53 x 0,66 Instructions: A relative Weight between 0 and 10 should be allocated for each statement, and then an 'x' is used to indicate which statement is applicable. 2 Initial/Ad Hoc Total Weight 2 Manage the IT Investment Compliance Contribution 0,33 0,00 0,13 1,00 0,53 1,00 0,78 1,00 0,66 1,00 0,42 1,00 Do you agree… x 1 Nr Statement Weight 1 The organisation recognises the need for managing the IT 1 investment, but this need is communicated inconsistently. 2 Allocation of responsibility for IT investment selection and budget 1 development is done on an ad hoc basis. 3 Isolated implementations of IT investment selection and 1 budgeting occur, with informal documentation. 4 IT investments are justified on an ad hoc basis. 1 5 Reactive and operationally focused budgeting decisions occur. 1 Maturity Level Relative Importance Non-existent Nr Statement 1 There is no awareness of the importance of IT investment selection and budgeting. 2 There is no tracking or monitoring of IT investments and expenditures. Maturity Level PO5 Level 0 1 2 3 4 5 To some degree 0 Open Back to Assessment Overview Not at all Maturity Level LINK Completely Management of the process of Manage the IT investment that satisfies the business requirement for IT of continuously and demonstrably improving IT’s cost-efficiency and its contribution to business profitability with integrated and standardised services that satisfy end-user expectations is: A little Process Do you agree… x x 0,33 0,00 x 0,00 x x 0,00 0,33 5 Repeatable but Intuitive Portfolio Management: Standard, Best Practice & Case Study in Business-IT Context, Dec 18 2013 Process Capability Assessment (ISO 15504) Portfolio Management: Standard, Best Practice & Case Study in Business-IT Context, Dec 18 2013 23

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