Are You Measuring Value to Ensure Survival?

In my banking career, I recall working on the next evolution of a retail-banking network -an important project to deliver differentiated services through our company’s environment. We spent 12 months getting requirements and another 12 months coding, then rolled out the environment only to realize that the business requirements defined some two years ago were no longer relevant.  We had done our work correctly in terms of completeness of functionality, but we completely missed the change in market dynamics that was occurring before our eyes.

Projects are not just about quality and delivery, but they’re intertwined. If the delivery takes too long, the customer will be as disappointed if the completed project suffered from poor quality or performance.

Think about the last time you had a great idea for an initiative in your organization. How long did it take from the time you conceived the idea, generated internal support and momentum, found a business sponsor, completed the business case and found money to fund the initiative?

Often, once the initiative reaches the approval process, it is evaluated against all the others in the queue. And, of course, there are always more projects in the queue than can be undertaken at one time; meaning that even if a project is deemed ‘critical’ it must wait for an existing project to be completed.

The approval process can take weeks, even months. And it can take another 6 to 12 months for the project to be executed. The entire time from ‘concept to delivery’ may actually be years!  And by this time, no one can recall why the demand was originally requested.

Because most organizations are increasing their rate and pace of change, application development teams are being asked to do more with less, and agile development is becoming more common. And with the increasing popularity of the DevOps movement, organizations are using agile concepts for more mission-critical delivery processes (read my blog on the “Adoption of DevOps continues to accelerate“).

The industry is experiencing a radical transition in spending and cost justification. Forward-looking organizations are starting to measure value with the shorter life of applications and the use of cloud services.

In the past, traditional development processes would see the business accruing value and amortizing costs over the long periods of relative stability that followed the business initiative or project use in production environments. Today, as soon as one change program is finished or nearing completion, another has already begun. In today’s fast moving, regulated environment, the market must drive the timing of change more than a project schedule.

Continuous change has dramatically reduced the effective life of a process or technology solution. This means that traditional business cases are no longer relevant and your Project Management Office must adapt or evolve to execute projects and recover costs in shorter timeframes. The only way to do this readily is to measure the outcomes and value directly to the business value delivered. The business must also be much more diligent especially in the discontinuation of applications and activities that don’t meet business expectations or deliver value.

Is your business measuring value — not IT value, but value of the overall initiative of which IT is only part of the cost model? If not, then it needs to rethink its processes to ensure survival.

Post a comment below or tweet me @RobertEStroud.

 

 

Article source: CA PPM Blog

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