Process helps create budgeting visibility, crystallize strategic priorities, and fund high value initiatives

1. Challenge
The CFO of a £12.6 billion division within a world leading communications provider wanted to gain a clearer under-
standing of requested development and capital spend from his business areas. With only £120m of capital budget ex-
pected to be available, the CFO needed a robust and structured framework to select from the proposed £150m of initi-
atives, including a mandatory regulatory initiative requiring approximately £35m of the capital budget (projects, actions
and tasks) for 2006/07, taking into consideration the division’s business strategy and the capital constraints. The cur-
rent process of presenting initiatives individually, making a funding decision, and then reducing available budgets, did
not provide a clear, consistent or comparable method of evaluating requested initiatives.
The company, headquartered in the UK, provides local, national and international telecommunications, broadband and
internet services, serving over 30 million business and residential customers in the UK alone.. In this fast moving, highly
competitive industry, it was essential that capital was allocated to initiatives that helped deliver business strategy .
Solution
The business division of the company partnered with UMT to embrace this challenge. A dynamic team of UMT and cli-
ent employees was created to help define business drivers (determining the key elements of strategy) and facilitate a
pairwise comparison workshop (to stimulate discussions on the relative importance of business drivers).
To create a complete picture of all the initiatives, structured meetings and interviews were conducted to gather rele-
vant and consistent project information. Project dependency diagrams were created and risk profiles were calculated
to analyze the initiatives going forward from additional dimensions.
Combining the different outputs enabled the creation of a dynamic scenario optimization workshop to evaluate and
discuss potential portfolios in real time. The sessions offered insight into what could be achieved with different portfo-
lio selections, highlighting initiatives of concern and those that should be selected. With just two more ‘light’ iterative
sessions, using better qualified data, a proposed plan for the following year’s initiatives was created.
World leading Telco Provider
Implements a Robust, Structured Approach for
Portfolio Planning
Process helps create budgeting visibility, crystallize strategic priorities, and fund
high value initiatives
A UMT Case Study

2. Results
The key to success in this case was the integration of com-
pany management's project knowledge with the process
defined by the UMT team. The establishment of business
drivers provided important insight into the group's strategic
objectives, as well as fostering insightful discussion within
company management as to both current and long-term
priorities. This insight was vital in communicating to project
groups the strategic significance of their work to the compa-
ny's overall goals. The ability of management to see a con-
sistent view of business unit initiatives across the board al-
lowed for far more effective gap analysis than had been per-
formed previously.
The overall culmination of all of these process improve-
ments was an optimization workshop, in which the UMT
team demonstrated how each current initiative impacted
strategic goals, allowing for a more structured analysis of
ongoing projects than the previous project selection method. The capabilities of the UMT solution allowed manage-
ment to select the following year's projects based on the company's strategic needs, resulting in alignment of project
selection with strategic goals for the first time. Going forward, the company's management expects far higher per-
formance from their streamlined project portfolio.
# # #
1 Battery Park Plaza, 4th Floor, New York, NY 10004, (212) 965-0550, www.umt.com
Create Select Plan
Man-
age
Contributors: CFO, Head of Strategy Deployment, 3
team members, 1.5 UMT Consultant,
and 1 UMT Account Manager
Time to Success: 16 weeks
Deliverables: Create a robust and structured pro-
cess; Determine strategic drivers and
KPIs; Assess initiatives to strategic
alignment
Key Benefits: Clear understanding of initiatives;
weaker initiatives identified; initia-
tives costs contained less ‘fat’