Innovation And It Alignment 121510 Abbreviated

ALYNDe LLC

“Managing The Pace of Change and Complexity of
Innovation by Aligning Your Business Strategy and IT
Factory to Achieve Results”

By:
Glenn A. Bunker
Partner

Agenda ALYNDe LLC

 Review Marketplace Dynamics
 Leadership Challenges: Understanding Your Strategic Direction
 The Value Proposition for Innovation Lifecycle Management
 Solution Management Approach and Common Challenges

Transforming Innovation © 2009 ALYNDe, LLC 2

1

ALYNDe LLC

Review Marketplace Dynamics

Introduction ALYNDe LLC

Key contributors see Innovation Lifecycle Management (ILM) activities a little differently:
 The Strategist sees ILM solutions as a way to improve the
allocation of resources across the enterprise and to develop a
strategically correct portfolio to support the corporate vision.
 Finance looks to ILM solutions to improve the allocation of
scarce financial resources more effectively while optimally
achieving maximum shareholder value.
 IT views ILM solutions as a means to prioritize and select the
right projects to support business strategy, foster
accountability and deliver results with a highly skilled but
constrained workforce.
 Business Units (LOB’s) see ILM solutions as the framework
within which to manage the processes, collaboration and
work needed to deliver products to customers faster -
improving time to market performance, operational
effectiveness and ROI.

CEO’s, CIO’s, COO’s, CFO’s and LOB Executives should look to ILM frameworks to
deliver big wins with positive financial impacts within a climate of rapid change.

2

There Are Pressures For Change… ALYNDe LLC

External Pressures
Pace of Technology Resource Issues
Change Margin Zone (Supply and Demand
Constraints for Skilled
Workers)

Constrained Performance
Workforce Pressures
Internal Pressures Business Climate
Mergers & (New Markets,
Acquisitions Innovation Complexity)

Reduced Budgets

New Competitors Regulatory

Causing Operational Concerns... ALYNDe LLC

Including:

 Disruptions to launch schedules and budgets for new business solutions,
regulatory changes and demand complexity (managing dynamic
demand)

 Poor project planning, management and communications regarding issues
that affect timely delivery of programs, products and services (time to
market)

 Shortages of critical resource skills, especially for emerging technologies,
methodologies and business processes; Lack of tools for human resource
capacity planning and optimization (workforce management)

 Inefficient, “silo’ed” and redundant program and project management tools
and procedures (program and project management)

 Ineffective knowledge capture, search and distribution capability to improve
problem solving and team performance (knowledge management)


3

Forcing Consideration Of Solutions That... ALYNDe LLC

Enable partners, employees, managers and executives to perform everyday
activities themselves, anytime and anywhere in order to:

 Create a culture that is comfortable with collaboration
 Establish the concept of an integrated/virtual community
 Manage the impact and complexity of innovation on your competitive
posture
 Streamline decision-making processes for new development opportunities
 Allow management to focus on executing the company’s overall business
strategy with the support of an agile IT operation

 … Support “proactive” vs. “reactive” decision-making

The ultimate goal is to combine Process, People, Portfolio and Project Management
best practices to help people improve the way they do their jobs.


ALYNDe LLC

Leadership Challenges: Understanding Your
Strategic Direction

4

Leadership Challenges ALYNDe LLC

Executive Leadership is facing increasing pressure to control costs and improve
operational performance for future business growth and profitability

External Forces – Customers, Planning, Building & Integrating
Competitors & Technology Business Solutions
Trends  Define effective strategic planning and
 Capitalize on emerging technologies governance processes.
to achieve a competitive advantage.  Meet capital planning requirements for
 Provide IT-enabled products and effective innovation.
services before competitors. Create an ILM  Break down business unit silos and
 Adapt to changing business models Framework for identify common applications and IT
and partnerships. Managing services needed to eliminate NVA
work.
Organizational
Performance
Measuring & Reporting
Controlling & Managing Improvement
Operations  Calculate the return on investment for
proposed IT investments by determining
 Manage Product/Service portfolios the expected business and technology
and IT investments needed for costs and benefits.
effective support.
 Establish an Innovation Management
 Identify strategic cost savings. Office to monitor status and manage
 Define and monitor performance risks.
metrics and service level agreements.  Develop an effective Governance
program that involves business and
Transforming Innovation © 2009 ALYNDe, LLC technology leaders. 9

Can You Identify With This Manager? ALYNDe LLC


5

“Managing is Harder Than it Looks…” ALYNDe LLC

Integrating and over-customizing Managing simultaneous rollout of multiple
systems/processes to fit current initiatives & scope creep beyond
stove pipes organizational capability to execute

Consolidating data from Automating methodology,
disparate systems and workflows & processes
different sources

Manage the entire investment Managing investment portfolio
portfolio & relevant information costs, benefits & capacity

Managing demand & performing Lack of critical skills at the
‘real time’ what if analysis and right time due to poor
simulations resource planning

Identify losing project and
Improve quality of decisions &
product candidates (go/kill reduce decision lead times
gating criteria)


Given These Challenges, What Is Your
ALYNDe LLC
Strategic Direction?

To meet these business challenges while exceeding performance
goals, an Innovation Lifecycle Management Framework is needed to
enable Operational Excellence, Customer Intimacy and Product
Innovation strategies to levels consistent with your business
objectives.

Let your portfolio metrics reflect your emphasis…


6

Given These Challenges, What Is Your
ALYNDe LLC
Strategic Direction?
 Low (total) price
 Low (total) price
 Emphasis on efficiency and reliability
 Emphasis on efficiency and reliability
 Hassle-free service
 Hassle-free service
 Standardized processes and operations
 Standardized processes and operations
 Management systems that measure and monitor transactions
 Management systems that measure and monitor transactions

Operational Excellence

Customer Intimacy Product Innovation

 Organization built around the customer rather
 Organization built around the customer rather  Focus on invention, creativity and
 Focus on invention, creativity and
than the market
than the market experimentation
experimentation
 Emphasis on flexibility and responsiveness
 Emphasis on flexibility and responsiveness  Willing to make one’s own products obsolete
 Willing to make one’s own products obsolete
 Business structure that delegates decision
 Business structure that delegates decision  Loosely-knit organization based on teams
 Loosely-knit organization based on teams
making to the field
making to the field  Management systems that are results driven
 Management systems that are results driven
 Culture that embraces specific rather than
 Culture that embraces specific rather than
general solutions
general solutions  A culture that encourages innovation
 A culture that encourages innovation


Questions Regarding Your Strategic Direction… ALYNDe LLC

Lost in the process of reacting to market forces and
organizational challenges is the need to extend your strategic
plans to a level of measurable operational effectiveness.

 First and foremost, what existing processes, methods and/or
tools give you confidence in your ability to meet or exceed
performance objectives?
 What do you find to be the greatest challenges regarding your
ability to meet and/or exceed performance objectives? Are
there innovation management, product development, resource
planning & utilization, cross-departmental strategy
coordination, process/workflow enablement and/or program
management concerns?
 What are your experiences to date with organizational
Portfolio, Program, Project and Resource Management
solutions? Positive? Beneficial? Ineffective?


7



 How would you grade your ability to link your organization’s
strategic goals to the various work initiatives (product
development programs, IT projects, application development,
service management) that are planned? ...in process?
 Do you have a well-defined IT Governance model that highlights
the status of cost take-out or revenue-generating initiatives and
the subsequent actions that deliver differentiated products and
services to your customers?
 Do your project teams have the ability to collaborate? …Inform
Management? …Measure Performance?




 How would you grade your position as a “1st-Mover” within the
markets/segments you serve?
 Are consistent valuation methods and measures being used to
determine such things as: 1. earned-value performance, 2.
stage-gate performance, 3. financial impacts to on-going
programs, and 4. post-delivery results for each program,
project or service initiative?
 Can your organization “load balance” the workforce for an
optimal mix of internal (employee) and external (contractor,
supplier, partner) personnel based upon cost and demand
requirements?


8

Answers to These Questions Force Strategic
ALYNDe LLC
Choices…

You will confront a set of cascading strategic choices...

What are
your goals
and aspirations?

Where
will
you compete?

How will you win
in your chosen
markets?

What capabilities
must be in
place to win?

What management
systems are
required?


ALYNDe LLC
Choices…


Understanding these choices means:
 Your Strategy will become the pattern or plan that integrates your
major goals, policies and action sequences into a cohesive
measurement-enabled Framework …and positions your business
within your competitive markets …in order to create a sustainable
competitive advantage.
 Where do you play?
- Industry Segment(s)
- Narrow vs. Broad Focus
 How will you win?
- Value Proposition
- Sources of Competitive Advantage (Operational Effectiveness,
Product Innovation, Customer Intimacy?)
 How best to configure your portfolio management framework to
measure business performance against strategy to deliver value to
targeted customers as efficiently and effectively as possible?


9

ALYNDe LLC
Choices…


You should confront these choices to develop actionable
strategies supported by:
 Enterprise and IT Governance Frameworks (CoBIT, ITIL,
etc),
 Effective Innovation Management, Application and Product
Development best practices (Stage-Gate, RUP, etc),
 Workforce Optimization (Capacity Planning, Resource
Leveling, etc), and
 Project and Product Portfolio Management Best Practices


ALYNDe LLC
These Choices Impact Your Strategy

Strategy: “The pattern or plan that
integrates an organization’s major
high Operational
goals, policies and action sequences
into a cohesive whole. A well- Effectiveness
Business Unit 2
Strategic Advantage

formulated strategy helps to marshal
and allocate an organization’s
resources into a unique and viable Business Unit 1

posture based on its relative internal Business Unit 3
Value

competencies, shortcomings,
anticipated changes in the
environment and contingent moves by
intelligent opponents.” *

Business Unit 5
Strategic Advantage: Attained when Business Unit 4
action sequences fit the organization low
and when business processes support
high Relative cost position low
and enforce objectives within a
measurable Governance
Framework. This framework must Operational Effectiveness
support all roles with information that
is needed to make decisions based
upon relevant and timely metrics.
*J.B. (James) Quinn – (Quinn, J. (1980) “Strategies for
change: Logical Incrementalism”, Irwin, Homewood)

10

So, Why is Portfolio Management
ALYNDe LLC
Important?
Because…
 Strategy is affected by choosing high Operational
which activities to perform and how
Effectiveness
to measure them Business Unit 2

Strategic Advantage
 Strategic advantage occurs from
the fit and alignment of those Business Unit 1

activities to your business Business Unit 3

Value
strategy
 Operational Effectiveness is
achieved by performing the right
activities at the right time with the
right people to achieve desired Business Unit 5
performance results Business Unit 4
low

Operational Effectiveness

Effective solutions impact both Strategic Advantage and Operational Effectiveness.
“It’s hard to manage what you can’t measure”


ALYNDe LLC
An Ideal Desired-State Situation
“Allows you to plan today rather
than respond tomorrow...”
high Operational
 Processes, technology and people
across business units are aligned in Effectiveness
Business Unit 2
Strategic Advantage

a coordinated environment to
deliver high value at a low cost
Business Unit 1
 Deliberate strategy to achieve
improvement is sustainable Business Unit 3
Value

All Business Units
 Operating Systems in place to avert
potential threats to competitive
position and financial performance
 A Portfolio Management Framework
transforms operating data into Business Unit 5
Business Unit 4
Insight low

Operational Effectiveness

Effective Business and IT alignment impacts both Strategic Advantage and
Operational Effectiveness.


11

ALYNDe LLC

The Value Proposition for Comprehensive Innovation
Lifecycle Management

Comprehensive Innovation Management ALYNDe LLC
Framework Structure

Solution Framework

Innovation Project and NPD
Portfolio Integration
Governance Program Lifecycle
Management Services
Management Management

Quality & Process Innovation: Portfolio Management, Six Sigma, Product Lifecycle Management Capability
Maturity Indexing, Innovation Lifecycle Management, Stage-Gate.™

Capabilities Framework: Competence Development & Process Excellence, PMI & OPMI®, Lean Six Sigma
(LSS)

Industry Standards: IEEE, ISO, DoD, SEI CMM and CMMI ®, GAAP (SOP 98-1)

Technology Enablers & Alliance Partners: Product Evaluation, Delivery Support & Development.

Built on a foundation of fully integrated solutions designed to drive the creation
of measurable business value through the timely and efficient deployment of
enabling methods, process, and technologies.


12

ILM solutions are “Frameworks”

t

Pe
en

rfo Bud
em

r m ge
ag

an tin
an

ce g
M

-b
io
Value

ol

as
From

rtf

ed
Po ILM Value from
PPM

Execution Management

Innovation Lifecycle Management (ILM) is based upon a framework of fully
integrated Application Components designed to drive the creation of measurable
business value.

This is accomplished through the timely and cost effective deployment of
enabling processes, technologies and resources.

ILM Framework - Value Proposition

What you need to do… What you are able to do…

Improve visibility of all Improve alignment of
t

Pe
en

proposed and active strategy, targets and budgets
rfo Bud
em

investments
Improve collaboration
r m ge
ag

Objectively prioritize among planning, budgeting,
an tin
an

and select investments financial, and program staff
ce g
M

-b
io

Align investments with Value
Capture full costs of all
ol

as

strategy From
rtf

resources identified with
ed

ILM
Po

Improve portfolio balance achieving goals and
objectives
Measure investment
results Establish linkages
between results and
Execution Management resources

What you really can do…

Efficiently allocate critical resources
Improve quality and predictability through standard processes and leading practices
Manage program schedules and costs & Identify and mitigate risks and issues


13

ALYNDe LLC

Solution Management Approach and Common Challenges

Solution Management Approach ALYNDe LLC

4 fundamental principles:

1. Structure change in manageable steps
 Each implementation phase should deliver measurable benefits and build toward your
overall objectives
2. Implement each step-change quickly
 Faster user adoption, reduced risk and quicker business benefits
3. Transfer knowledge with collaborative workshops
 Each phase is delivered through workshops with clearly defined objectives, scope and
deliverables to ensure effective knowledge transfer to your user teams
4. Address all aspects of business change
 Successful change programs address organizational, cultural, and technical aspects.
Effective workshops ensure that each area is aligned to specific business objectives of
the change program


14

Common Challenges for IT Organizations ALYNDe LLC

 Running IT as a business demonstrates that IT can provide value-add in
customer facing, internal facing and shareholder facing functions reliably and at
competitive prices (compared to external providers)

 Effective portfolio management helps to maximize the financial return on new
Innovation investments and actively manages the “tail” of Innovation—the
replacement/retirement of legacy products and services that have reached the
end of their useful lives

 Alignment of business and IT so that IT delivers the right services to the
business at the highest quality and most competitive cost to support
“differentiation through innovation”

 Providing complete, accurate, meaningful and consistent reporting to
customer, internal (corporate, business units, project teams), and shareholder
constituents


Common Challenges for IT Organizations ALYNDe LLC

 Shortening cycle times and reducing costs of key innovation processes
through automation, self-service and elimination of manual, paper-based business
transactions – creating a lean operational infrastructure that strives to
eliminate non value-added work.

 Diffusion and adoption of common information systems which increase
common business processes across the company, reduce information latency,
increase information flow and allow for an “apples-to-apples” comparison of
disparate businesses in a complete, accurate and timely manner without manual
intervention or “one-off” reconciliation processes and reports

 Managing regulatory adherence and compliance transparently so that
performance audits are “non-events”

 Providing “one version of the truth“ by supporting key business performance
drivers, business intelligence maturity, information architecture and stewardship
of information standards


15

Thank You! ALYNDe LLC

This presentation was prepared by:

ALYNDe LLC
Glenn A. Bunker
Partner

1978 Stafford Place Tel: 770.565.4366
Marietta, GA 30062 Fax: 770.565.4366
Mobile: 770.377.7061
E-mail: glenn.bunker@alynde.com


16

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