LEAN IT GOVERNANCE

THE MOST REALISTIC AND ATTAINABLE APPROACH TO IT GOVERNANCE

“DO YOU WANT JUST TO BE IN COMPLIANCE WITH GOVERNANCE, OR DO YOU

WANT TO RUN A KICK-ASS ORGANIZATION?”
DEMIAN ENTREKIN, CEO, PROJECT ARENA

Main Argument
The most realistic and attainable approach to IT Governance is a “lean” approach via Project Portfolio
Management (PPM). The lean approach requires a light-footprint lifecycle, rapid implementation of proven
practices, and centralized data. The lean approach is based on simplicity and achieve-ability, building on
what works while establishing headroom for continuous improvement.

Sub-Argument 1
In addition to “keeping the lights on,” IT delivers impact through projects; as a result, project performance
impacts IT performance.

Sub-Argument 2
The lean approach to IT Governance focuses on simplicity and achieve-ability. The lean approach creates the
building blocks that drive high performance. Governance and compliance are natural byproducts.

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Sub-Argument 3
For IT to improve performance, IT managers must establish a light footprint lifecycle for managing projects
and resources. This demand-to-deliver process defines the lifecycle for capturing requests for new IT work,
selecting and planning the work, then executing and closing out the work.

Sub-Argument 4
To be achieve-able, the initiative must incrementally build on what works, and fill in the demand-to-deliver
lifecycle where the impact will be greatest. This lean approach will produce results quickly, limit the impact
on existing operations, and mitigate the extent of change on the IT organization.

Sub-Argument 5
Project portfolio data should be centralized for visibility, and automation should support business rules.
Without a centralized system for managing IT projects and resources, IT teams will operate in a vacuum, and
managers will manage with data that is incomplete, inaccurate and out of date.

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Introduction
IT Governance is getting a lot of press now, because it potentially creates “compliance” and
“alignment with the business.” IT Governance concepts promise great efficiencies and
increased returns on IT investments, but they don’t provide useful tools to operational
managers with too much on their plates and not enough resources to meet the constant
demand. IT managers don’t need more wall-sized process flows and magic quadrants.

But let’s face it: IT needs to get better at producing tangible results. To do that, IT managers
need effective management techniques that are easily implemented.

IT Governance is viewed by skeptics as bureaucratic overhead and unnecessary oversight.

The governance models offered by advocates are detailed, but they often neglect a critical
factor: how to implement the models while IT is already running at full speed.

To address the management challenges of IT, the most realistic and attainable solution is
“Lean IT Governance” via Project Portfolio Management (PPM).

Main Argument
The most realistic and attainable approach to IT Governance is a “lean” approach via Project Portfolio
Management (PPM). The lean approach requires a light-footprint lifecycle, rapid implementation of proven
practices, and centralized data. The lean approach is based on simplicity and achieve-ability, building on
what works while establishing headroom for continuous improvement.

The five sections below address the critical elements of this main argument.

Sub-Argument 1
In addition to “keeping the lights on,” IT delivers impact through projects; as a result, project performance
impacts IT performance.

Some of IT’s work is operational, such as system administration and help desk. But it is
through projects that IT enhances organizational performance. IT projects such as
implementing applications, integrating systems and enhancing telecommunications can

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dramatically lower costs, create competitive advantage and increase customer satisfaction.
For IT to be considered a high performer, IT project performance must be high.

Continuously improving IT project performance is a two-fold effort. First, IT managers

must prioritize projects relative to anticipated outcomes, and relative to IT’s capacity to
execute the projects. Second, IT projects must deliver on expectations through better
planning and execution.

Sub-Argument 2
The lean approach to IT Governance focuses on simplicity and achieve-ability. The lean approach creates the
building blocks that drive high performance. Governance and compliance are natural byproducts.

Abstract models of IT Governance are hard to implement. For starters, it is difficult to

impose a new mode of operations on an existing operating model – it’s like repairing an
airplane engine in mid-air. In addition, few governance models build on what works while
identifying what needs improvement.

To be achieve-able in most IT organizations, improvements in the management of IT

projects and resources must be fast, incremental, and impactful while mitigating change on
the staff. The next three sections describe how the lean approach makes IT governance
achieve-able.

Sub-Argument 3
For IT to improve performance, IT managers must establish a light footprint lifecycle for managing projects
and resources. This demand-to-deliver process defines the lifecycle for capturing requests for new IT work,
selecting and planning the work, then executing and closing out the work.

Most organizations have well-ingrained, standard processes for important business

functions, such as the sales process or the procurement-to-payment process in Finance. The
lean approach to IT governance calls for implementing a similar standard methodology for
managing the lifecycle of projects.

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The key to making the lifecycle light-footprint lies in the relative simplicity in the process.
Many process designers mistake detail for value. In the lean approach, we define no more
process detail than what is needed to achieve the goal.

The demand-to-deliver process for managing projects has 5 phases:

o Request/Define: creates a single entry point for requests, such as requests for new
projects, changes and resources, and standardizes the data required for each request
type

o Analyze/Approve: establishes the workflows and criteria for analyzing and

approving requests

o Plan/Schedule: provides templates and standards for planning work, and for
identifying and assigning resources

o Execute/Monitor: manages budgets and schedules; resolves issues and risks; and
identifies key metrics and reporting requirements

o Close/Feedback: identifies support requirements and provides feedback for

improving the effectiveness of the Analyze/Approve phase

Sub-Argument 4
To be achieve-able, the initiative must incrementally build on what works, and fill in the demand-to-deliver
lifecycle where the impact will be greatest. This lean approach will produce results quickly, limit the impact
on existing operations, and mitigate the extent of change on the IT organization.

Some elements of the project lifecycle may exist in organizations, though usually they are
highly dispersed, inconsistent and incomplete. IT managers should implement the lifecycle
by following the guidelines below.

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Implement Incrementally: Implementing the entire project lifecycle at one time can result
in the same pitfalls as implementing a complex IT governance model. The project lifecycle
offers the advantage of providing performance improvements with only portions of the
lifecycle implemented.

Which portion of the lifecycle to implement first should be determined by need. For
example, in organizations where IT is overwhelmed by demand (i.e., where there are more
projects than capacity), the focus might begin with establishing a prioritization framework in
the Analyze/Approve phase, then applying that framework to all projects proposed and
underway. Subsequent phases can be ordered as warranted by need and impact.

Standardize: Wherever the focus, establishing standard policies and procedures creates
predictability and controls for managing the process. For example, creating standard forms
by request type insures that the data required for approval is consistent and complete across
all requests.

Create Linkages: From a process perspective, transitions in the process are smoother
when roles and responsibilities are identified for managing those transitions. From a data
perspective, providing information from earlier phases improves performance in later
phases. For example, identifying the original sponsor of a project, and linking the original
request to the project plan, focuses the project team on the goal of the initiative.

Improve Continuously: An incremental implementation enables organizations to achieve

“small wins” very quickly with relatively low cost, risk and change. The incremental
approach, and the lifecycle generally, also enable continuous improvement. Keeping the
entire project lifecycle in mind enables organizations to plan for and roll out the phases over
time. Comparing actual results with standard templates increases the accuracy of schedules
and budgets over time.

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Sub-Argument 5
Project portfolio data should be centralized for visibility, and automation should support business rules.
Without a centralized system for managing IT projects and resources, IT teams will operate in a vacuum, and
managers will manage with data that is incomplete, inaccurate and out of date.

The management of projects and resources is undergoing a fundamental transformation.

The current problem is that people, processes and data are spread throughout the
organization, creating a silo-effect for managing projects and resources. The results include
poor project prioritization, unpredictable performance, unreliable reporting, and decision-
making based on who screams the loudest.

By centralizing data and automating business rules, organizations will realize these benefits:

o Decision-making driven by business needs

o Ability to regulate demand and prioritize work
o Predictable approach to managing projects
o Accurate, timely reporting across programs and teams
o Ease of tuning the process for continuous improvement

This transformation is not new: a similar shift to centralized data has occurred with finance
information in ERP systems, inventory data in supply chain systems, and customer
information in CRM systems. Centralizing project information, similar to these other
transformations, will make that information a workable asset for the organization.

About Project Arena

Project Arena helps organizations take a portfolio approach to managing projects and
resources. We offer a management framework and web based software that:

o Standardizes the management of projects and resources

o Streamlines the administration of reporting and accounting
o Prioritizes the demand pipeline relative to organizational goals
o Provides real-time visibility into performance across the project portfolio

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