Managing IT assets the way an investment portfolio is managed is an excellent way to prioritise projects, cut costs and boost ROI. But it’s also crucial for surviving disruptive events, such as mergers and consolidations, or when phasing out legacy applications in favour of new ones.
“Companies with strong strategic portfolio management capabilities will be able to proactively and methodically address so-called disruptive technologies,” says Jeffrey Kaplan, a consultant at PRTM management consultants, and the author of Strategic IT Portfolio Management. “With a proper portfolio management process there’s time to retool employees, plan the migration and make good strategic decisions.”
There’s no shortage of software to help with the job. Portfolio management suites such as Artemis, CA’s Clarity, Pacific Edge Mariner, ProSight Portfolios, and UMT (which was recently purchased by Microsoft) offer a wide range of tools for collecting and analysing data about IT assets and using them to automate workflow. In addition, many organisations create their own custom IT management applications.
However, implementing a software suite isn’t enough, Kaplan says. Before investing in a solution, Kaplan recommends that CIOs and CTOs sit down with top management, make sure everyone understands what’s already in the company’s IT portfolio, and then hammer out common objectives for managing it.
In some cases — for example, an organisation with a series of low-value IT projects — a simple asset-tracking or homegrown application may suffice. But if a company is looking at implementing a new ERP or SOA system, or seeks a significant performance boost from its IT spend, it should consider a full-fledged suite that meets well-defined business, functional and technology requirements.
Organisations must also determine how processes will need to change, before automating them and then make sure people throughout the organisation are ready for the change.
Although implementing a portfolio management suite can be costly and time consuming, it’s worth the effort, Kaplan says. Companies that fail to strategically manage their IT portfolios often spend time and money retooling staff or outsourcing key operations.
“It’s easy to be caught up in the frenetic day-to-day issues and neglect the strategic part of management,” he says. “That’s why it’s important to have a strategic portfolio management process that forces managers to pick their heads up from time to time and look at the big picture. Over time, they’ll find they’re affected by these disruptive technologies less and less.”