Organisations Still Face Significant Challenges Says Survey

August 31st, 2006:Companies lack best practices and technology to mature key IT process areas, especially project and portfolio management.

According to global survey results released by Borland Software (NASDAQ: BORL), organisations are making progress with IT management and governance (ITM&G) but still fall short in key process areas like project management, portfolio management, demand management and resource management.

Borland Australia managing director Peter McAlpine said IT professionals still found a relatively low level of maturity in how organisations define project goals, allocate resources and, most importantly, measure overall success of their IT portfolio.

The Borland Survey, which covered 125 organisations in 29 countries including Australia and New Zealand, found companies' ITM&G efforts are frequently challenged by the inability to integrate their systems for managing application development - which contain vital data and assets - with their overall ITM&G processes. It reported 87% of respondents saying their organisation has been either ineffective or only somewhat effective at integrating their overall ITM&G process with their Application Lifecycle Management (ALM) platform and tools.

Project and Portfolio Management Show Promise but Fall Short

Responses from participants in the study indicated they are making positive strides in portions of project management, such as their ability to plan and track project execution. However, more probing questions show that they still lack many of the rigorous processes established by industry best practices.

For example, more than 80% of respondents said they have some formal launch process for new projects and almost three quarters believe their organisation effectively or somewhat effectively measures and manages project execution. However, only 22% reported that their organisation either effectively or very effectively uses a project plan for managing projects, and only 17% have either rigorous or very rigorous project plans, which include base lining and estimating schedule, cost and business impact.

In terms of portfolio management, which enables companies to collectively analyse costs, benefits and risks of proposed and in-progress IT projects and other investments, the data clearly showed that most organisations are unsuccessful at implementing an effective portfolio management process.

• Only 20% of respondents agreed their organisations monitor portfolio progress and coordinate across inter-dependent projects.
• Only 9% reported their organisation very clearly defined goals and decision criteria for each segment within the portfolio, while 46% had no defined goals, only defined decision criteria.
• When it comes to measuring performance of the overall IT portfolio, the majority of respondents agreed their organisation has no business impact assessment for completed projects, and success is measured only at the project level based on performance against schedule and budget. Just 2% felt their organisation was very effective at measuring performance of the overall portfolio.

"IT leaders understand the value of a balanced portfolio aligned with business objectives, but most lack a well-defined and consistent process for managing the origination, evaluation, and execution of IT investments," Mr McAlpine said.

"Portfolio management enables IT to make fact-based investment decisions in unison with business stakeholders, thus ensuring alignment, improving visibility, and shifting the burden of investment decisions from the CIO to all stakeholders."

Similar to the results from the areas of project management and portfolio management, assessment results for demand management and resource management showed some progress but room for significant improvement. Demand management, which establishes processes for gathering and managing requests for IT resources, is a critical step toward identifying opportunities, managing the IT pipeline, and driving consensus on the best investments.

• Two-thirds of respondents believe their organisation has a somewhat effective process for collecting and managing new projects and major change requests. They agreed that certain request types have assigned owners, but requests are communicated via multiple channels and they lack a systematic mechanism for tracking them.
• Over half of respondents believe their organisation is somewhat rigorous in collecting sufficient information to properly respond, prioritise, and analyse requests. More than one third of respondents felt theirs was not at all rigorous.

Responses in the area of resource management, which involves the processes and technologies used to manage the people related to technology investments, showed that one-third believe their organisation does not effectively allocate resources to projects. Other notable highlights include:

• Only 6% of respondents said their organisations' personnel capacity is regularly analysed against current and future resource needs, putting in place specific plans are made to address gaps, including training, hiring and outsourcing.
• Nearly 20% of respondents reported that their organisations are not detailed when it comes to tracking the time spent by project team members. Many of these do no time tracking.

"These findings show most organisations have an enormous opportunity to improve how they are approaching and executing on key process areas related to IT management and governance.

"The most successful organisations are taking a holistic view of focusing, managing, and measuring their IT efforts with an integrated combination of best practice processes, training and technology. Unfortunately, most organisations today still aren't taking this approach,", Mr McAlpine said.

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