; Step 1.2 - Mine the Most from Your Project Portfolio
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Step 1.2 - Mine the Most from Your Project Portfolio


A Practical Guide for Making Strategic IT Investments & Creating a Value Roadmap More than ever organizations are compelled to demonstrate how IT cost effectively supports company objectives and priorities. Info-Tech’s Maximizing Your IT Investments program is a practical, step-by-step guide for making strategic IT investments & creating a Value Roadmap for your organization. The purpose of the IT Investment & Value Roadmap is to take all of the improvement opportunities, Applications, Technology and Organization, and: • Evaluate their relative importance based on business value and cost. • Determine interdependencies (e.g., need to develop a new skill-set before adopting a piece of technology). • Combine opportunities into projects. • Set milestones for completing projects over the planning horizon. • Estimate the impact of the investments required on the IT budget.

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									Mine the Most from Your Project Portfolio
You have decided that managing your IT projects using a portfolio approach is the way to go. To
get the most out of this approach, a system of ongoing project analysis is a must. Maximize the
returns on your portfolio by actively managing your IT projects.

Optimizing a Portfolio

When an organization commits to a project, an allotment of money, labor, and resources is
invested. While some of these investments are substantial, many organizations remain passive
investors in the project. They often leave the success, failure, and return on their project
investments to chance. IT departments should actively manage their portfolios to maximize
returns on their investments. With the proper analysis, they can identify, evaluate, and rank their
projects like investment opportunities. As a result, resources can be directed to the highest-
payback projects and culled from marginal ones. The three traditional approaches to analyzing
project value are as follows:

  1. Mathematical programming. Focuses on maximizing value, but does not take strategic
      alignment or portfolio balance into consideration.

  2. Classical. Maximizes the value of a portfolio through either financial or non-financial
      scoring, sorting models, or checklists. This technique has been criticized for relying on
      financial information and not finding an optimal project mix.

  3. Mapping. Displays the links between various projects and strategic alignment, but does
      not consider the balance of the portfolio or how to maximize its financial return.

A Well-Balanced Approach to Project Analysis

To provide a complete picture of a portfolio's current and future viability, your analysis must
include a hybrid of the three traditional techniques by looking at:

  1. Alignment. Measures support for the organization's business strategies and specific

  2. Achievability. Measures your capacity to execute and complete the projects.

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