Over the years, I have worked with many different customers and I have seen several successful different ways in which IT organization engages with business. But of the many different successful ways there are two approaches which I have seen more often than others.
In this blog, I will talk briefly about both the approaches and also I will go into details on the first approach and will leave details of the second approach for another blog.
Business relationship Managers led portfolio management
Here, I see customers having a separate organization with dedicated team of business relationship managers. This dedicated organization reports into CIO like application development & support, infrastructure organization etc do. The business relationship managers are constantly interacting with the business users and identifying new opportunities where IT can be used for cost saving or revenue generations.
Annual plan based portfolio management
In this approach, I see customers where they don’t have dedicated business relationship managers but have preiodic review with the business on the annual plan. When making annual plan for next year they will engage with business several times during current year to understand their priorities and their wishes and then roll those into an annual plan after applying resourcing, money, effort and technological constraints.
Business relationship managers led portfolio management
As I mentioned above that in the first approach, business relationship managers are constantly interacting with the business users and identifying new opportunities for cost saving or revenue generations. So, It is important that organization has a seasoned professionals in business relationship managers role. Generally, this team is quite limited in number and is mostly based on broad process areas such as supply chain, finance, demand chain etc. Sometimes there can be additional members in the team if organization is big or there are several different business divisions with different business models which makes it difficult for one person to understand processes & challenges comphresenviely. Organizations generally tend to bring in internal experienced folks from the line business as they will understand the business well and will have required connections/relationships which can leveraged in soliciting project ideas/negotiating delivery of important functionalities etc. I have also seen sometimes organizations bringing in people from the business consulting side to get a new prospective on how they can leverage IT to improve their business processes. I feel, a good mix of these two type of people in the team is better than only one type. The picture below gives a good over of the engagement process.
This business relationship team interacts with business day in and day out and identifies various opportunities. These opportunities get added in the list of other opportunities available organization wide. And then these opportunities get validated through rigorous gated process for below points.
- Detailed business implication for the benefits, change management and organizational impact. Look at the benefits along with associated risks
- Technical feasibility: Whether it is technical possible to build the solution. Also need to check if current IT landscape can support this solution. Whether current software applications be used or need to buy new one etc.
- Next in line is organization’s current execution capability. Do you have resources available with the required skill set to take up this project. If not now then when?
- Also need to analyze the Cost to execute the project. Need to realistics in terms of cost and past experience on similar projects should be havily leveraged
- Most importantly ROI: How long will it take to recover the investment
Only when project is able to clear most if not all the above hurdles only then it will go on to the execution floor. There will always some exception, for example if ROI is really high and business is keen but it is not in line with long term IT strategy but still this 9 out 10 times this kind of project will get green light.
This cycle of identifying opportunities and then taking each credible opportunity those this rigorous gated process will continue on an ongoing basis through out the year and new projects will get added. Depending on resource capacity and technical capability it may be taken up immediately or done bit later. If there is quick ROI and internally capacity or capability is not available then organizations tend to look for external help.