Transparency: Enterprise IT Governance and Establishing a Portfolio Management Office

Transcription

1 State of Minnesota Minnesota State Colleges and Universities System Transparency: Enterprise IT Governance and Establishing a Portfolio Management Office 2008 NASCIO Recognition Award Nomination Category 10:

2 Section B - Executive Summary For most organizations, the largest investments they make are in projects. Yet, many projects risk failure to achieve objectives, timely implementation and return on investment (ROI) because of a lack of governance and management. In fact, the most frequently cited reason for major initiatives success or failure is the degree of project management applied from initiation to completion. 1 The Minnesota State Colleges and Universities System Information Technology Services (MnSCU ITS) lacked a structured project management process. Additionally, because of chronic underfunding, all resources and budget were completely dedicated to keeping the lights on and only addressing issues with the current applications and environment. Since no new projects or improvements were being initiated, there was no need or capability for prioritizing new project requests. An independent study revealed the need for expanded information technology investment and after being granted legislative funding, it was decided that a Portfolio Management Office (PMO) and a transparent governance process be established to prioritize, maximize and track the allocation of those funds, and the results achieved. MnSCU ITS is organized as a shared services center for 32 colleges and universities. In conjunction with these institutions and across four centralized business units, MnSCU ITS developed and launched an enterprise governance process and PMO. Together, the governance process and PMO provide structured, transparent investment prioritization, along with scoping and management for all projects with technology implications. They ensure the funding and delivery of projects that best support the overall enterprise strategic plan and technology investment plan. Preference is given to those initiatives that best provide direct value to students, faculty and learning. As a result, MnSCU is able to allocate funding to the highest business and academic priorities for the entire enterprise. By engaging representatives from all constituencies, the process encourages collaboration across business units and campuses, fosters innovation, mitigates scope expansion, and promotes the optimal allocation of MnSCU ITS resources. 1 Frank Winters, Gantthead.com, August 11, 2003 NASCIO 2008 Page 2

3 Section C - Description of the business problem and solution In 2006, an analysis of MnSCU ITS systems and equipment revealed the need for a major increase in information technology funding. State funds were granted for the biennium to shore up the information technology infrastructure. Being taxpayer dollars, the funding brought great pressure to provide maximum value for every investment. Consequently, MnSCU ITS committed to deploying a process to prioritize and manage all technology-related business projects. Challenged by a previously abandoned attempt at implementing a PMO, user resistance, an accelerated timeline, and increased public scrutiny, MnSCU ITS realized an improved approach was required one that demanded a significant cultural shift within the organization. The PMO formally launched in June 2007 with a mission of providing the oversight, management, and communication of the MnSCU ITS investment portfolio. The PMO, which reports to Ken Niemi, MnSCU CIO and Vice Chancellor of Information Systems, was initially responsible for project management and charged with developing and deploying the governance model and an enterprise technology investment management process. The objectives were to: Improve project delivery through better planning by enhancing the organization s project management core competencies Foster leading practice project management by putting in place disciplined processes, reporting, tools and techniques for guiding projects from initiation through delivery Demonstrate to the legislature, governor, taxpayers and the MnSCU community that the State s investment in MnSCU ITS is producing tangible benefits to students, faculty and learning Ensure transparency by creating a central online repository that depicts who is working on what, why, for how long and at what cost Enable the enterprise to optimally allocate funds and resources to the highest business and academic priorities Maintain a longer-term focus (including required maintenance) Mitigate the risk of scope expansion, last-minute reprioritization and over-allocation of ITS resources NASCIO 2008 Page 3

4 The guiding principles were to: Focus on end products and outcomes for students, faculty and learning Emphasize support and collaboration while providing leadership Implement adaptable and flexible methods and practices Concentrate on effectiveness while enabling individuality The structure of the organization presented several challenges, as the PMO is not part of a specific university. It is essentially a service provider within the MnSCU ITS operation that has influence, but no ultimate decision-making authority on behalf of its constituents. Individual institutions operate with significant autonomy, resulting in some variance with respect to technology systems, connectivity, applications and processes. Additionally, academic environments are largely consensus driven, and have not historically adapted well to a PMO structure. As such, the essential elements of this endeavor were massive: 1. The process needed to incorporate a change management approach that would first visibly impact MnSCU ITS as the service provider so it could model the behavior for the rest of the organization. 2. Communication was a pivotal need throughout implementation. A multi-faceted communications launch plan was developed to prepare audiences for how projects and priorities would change, and to clarify value, roles, timelines and expectations. 3. Capacity planning was another area of critical need. Previously, there were too many active projects relative to available resources, and the existing staff was so overcommitted that external resources were necessary to temporarily alleviate burden or augment lacking skill sets. The process needed to bring greater focus to aligning skills and availability with prioritized projects, as well as provide MnSCU ITS with a planning mechanism for forecasting additional resource needs. 4. Finally, the process needed to bring more transparency to projects, from identification through selection and prioritization to completion. Since this introduced the potential for additional scrutiny, the bar was being raised. Now the organization had to be willing to visibly shut down underperforming projects or those not prioritized for continued funding. The process is summarized below. (Please also refer to the slide in the executive summary.) 1. User committees submit business cases through one of the four functional business channels. Channels submit top priorities to the PMO. 2. Project business cases for those priorities are presented to a Cross-Functional Advisory Group (CAG). The CAG consists of student, faculty, college and university staff and channel personnel. The CAG serves to provide input and advice on the merits of each to the EIC. NASCIO 2008 Page 4

5 3. Business cases are then formally presented to the EIC. The EIC collectively determines investment priorities and recommends them to the Leadership Councils and ultimately the Chancellor for final approval. 4. The Board of Trustees is informed of priorities and is charged with providing broad oversight of the PMO and portfolio of projects. 5. The PMO communicates the results from the EIC back to the CAG, all four channels and to individual project sponsors and owners. 6. The PMO meets with the business owners of prioritized projects to discuss project manager assignments, project team assignments, status reporting methods and schedules, operations, financials and communications. 7. Work commences on the prioritized projects in accordance with project plans. This governance process was developed in direct support of the enterprise-wide priorities. Each project was considered in relation to the strategic direction outlined in the MnSCU five-year plan. Committed to transparency, the PMO placed all documents related to the prioritized projects and their progress on a SharePoint platform. This innovative Web-based tool fosters integration and collaboration, and provides up-to-the-minute status reporting without being cumbersome to users. Today, the role of the PMO has evolved to include delivering enterprise-wide project coordination, standards and templates. It also provides assistance with business case development, benefits calculation and cost estimation, as needed. Additionally, the PMO: Offers training and coaching Administers required reporting and budget tracking on all projects Tracks and manages the portfolio of approved projects Produces frequent communications to stakeholders Provides project managers or supports existing project managers when requested The next generation of the PMO is anticipated to broaden the reach of the function, migrating toward the oversight of all projects, not just those with ITS funding implications. It will continue working toward reducing dependencies on external resources, and leverage its growing archive of historical information to improve through analysis, honed approaches and enhanced forecasting abilities. Section D - Significance Consistent with Governor Pawlenty s Drive to Excellence reform initiative, the MnSCU ITS governance process easily translates and is repeatable for its campuses, as well as other state offices and agencies. This process would enable all entities to do the best possible job of investing limited resources and public dollars for maximum value to the state. In fact, based on NASCIO 2008 Page 5

6 Fortune 1000 best-practice implementations, this process provides an overall framework and a foundation upon which to build so that with some minor customization, the MnSCU model can allow anyone to demonstrate that they are investing wisely and earning the best possible ROI while providing a stable and secure technology infrastructure. Ken Niemi, MnSCU CIO and Vice Chancellor of Information Systems has a collaborative relationship with Gopal Khanna, State CIO for Minnesota. Ken also works closely with other state agencies and the University of Minnesota. In addition to sharing best practices with these groups, the portfolio model encourages joint projects to be undertaken, leveraging benefits to an even broader group of taxpayers and stakeholders. The process has also accelerated the maturation of MnSCU s governance. For the first time: Enterprise technology is aligned with the overall mission and strategy of the organization All ITS-related projects in progress are documented on one list and are managed as a portfolio with cross-functional integration and progress requirements, as well as gated funding limitations ROI analysis by project is possible because of full project cost tracking and benefits analysis Section E - Benefits of the Project In spite of challenges, the implementation of the PMO and a transparent governance process is credited with several dramatic advancements and firsts for the organization in a very short timeframe. These have resulted in myriad benefits to the public. Fiscal responsibility is paramount to this process. Funding is gated prefaced on the accomplishment of milestone deliverables. Resource planning and forecasting can now be conducted in a meaningful way, and cost tracking allows ROI reporting by project. With a longterm focus on timely completion of required maintenance and critical enhancements, the process also ensures that the cost of regular maintenance can be consistently shouldered each year rather than bulked in a cycle when circumstances are dire. The EIC model makes certain that the entire enterprise perspective is brought to light on the investment decisions, said Laura King, MnSCU CFO and Vice Chancellor of Finance, The resulting benefits to the state of Minnesota and its taxpayers are enormous. With such limited resources, it is imperative that the smartest investments get made to maximize and leverage every dollar for the best service improvement to students and citizens. Whether they can register for classes from their kitchen table while preparing dinner or access mid-career training opportunities, proper technology investments for MnSCU translate to better opportunity and workforce contribution for all. The MnSCU enterprise has also benefited from improved project delivery and reduced project cycle-times, and is saving time and money by having established tools and templates for new initiatives to follow. The process has mitigated firefighting, scope creep, employee frustration and chaotic culture. Internal customer satisfaction is higher based on improved communications; feedback reports suggest that people felt informed and engaged throughout, and thus were more invested in celebrating its success. Positive ripple effects continue to be realized. With the implementation of the PMO, other business units are beginning to implement the practices and approaches learned from this NASCIO 2008 Page 6

7 implementation. They are also building more competitive cases for project prioritization, which allows the limited ITS resources to not only feel more valued, but add more value. More efficient management helps resources deliver better quality outcomes with less waste. This results in ontime, on-budget delivery so ITS personnel are less stressed and more productive. Transparency now exists, ensuring the availability of consistent, current and accessible information. Anyone can see what has been prioritized, where a project is in its implementation and funding, and which resources have been deployed to each project. Dr. Linda Baer, Sr. Vice Chancellor for Academic and Student Affairs and Chair of the Enterprise Investment Committee praises the model, Everyone receiving ITS services had to be addressed and included. The entire strategy has incorporated best practices with input from multiple constituencies. The high level of communication required by the process has greatly added in our success. MnSCU is a learning organization and in the learning environment, continuous improvement is critical. Customized to our culture and environment, the model remains both flexible and adaptive. MnSCU students and faculty benefit from an established means by which to initiate and provide input to information technology related projects. This was a primary goal and is foundational to the process. As a result of this process and structure, they also benefit from improved access across all campuses, greater administrative efficiencies (such as registration, bill payment, financial aid application, etc.) and one-stop graduation planning. The technology MnSCU students are now able to access will help them become stronger workforce assets, sooner. This implementation has also positively affected higher education environment as a whole. The belief that business approaches can t work for academia has been proven untrue and obsolete. Further, MnSCU s thought leadership has paved the way by providing a benchmark and template for other institutions to follow. Dr. Richard Davenport, President of Minnesota State University, Mankato comments on the impact, As President of the largest MnSCU university, I believe that my being a member of the EIC has added credibility to the process because I must represent all institutions. The fact that I can leave an EIC meeting and tell my peers that we have reached true consensus on the enterprise information technology priorities carries a lot of weight. The EIC environment has allowed me to be a genuine advocate of the process. I believe my peers pick that up this isn t forced upon me I believe we are collectively making the right decisions for the entire MnSCU enterprise. Today, we re putting the tough problems and decisions on the table, Davenport continues, Our transparent process calls for the EIC to be alerted to potential problems and we ve directly addressed those that have arisen. This process doesn t allow for issues to be glossed over. The EIC team members speak openly, honestly and directly with one another and when we leave a meeting, we have reached true consensus on the direction and priorities. This allows MnSCU to level the playing field with other college and university systems, both public and private. In fact, not only are we now competitive with other institutions, we may actually be in a superior position to deliver information technology services and benefits to our students. Most importantly, taxpayers can rest assured that dollars allocated to MnSCU ITS investments are being maximized today and leveraged for tomorrow. NASCIO 2008 Page 7