Tuesday, May 26, 2020

IT Architecture-Driven Portfolio Management

IT management has a strong sense of how to develop customer-centric programs for building an integral and unique set of business capabilities by combining technology and business tactics.

With rapid change and IT consumerization trend, to keep relevant, the CIO and IT function must be contributing to the future business strategy by leveraging technology as a means to an end, not the end itself. IT architecture is the visualization of IT strategy that describes how to encompass organizations from an “as-is” state to future state, and IT portfolio management is the bridge between strategy and execution.

While some organizations may be excellent in the execution of project management, they may not have a mature portfolio management process in place, which causes business-IT misalignment and overall IT management ineffectiveness. IT architecture-driven portfolio management plays a significant role in project delivery, portfolio rationalization, prioritization, and optimization.

IT portfolio rationalization: IT is not just the sum of services or processes, or monolithic hardware only, but a mosaic business solution provider. IT portfolio rationalization is an activity more critical than ever because business economic cycles are getting shorter, and decision cycles are getting shorter as well. IT Architecture provides a framework in which sound strategic planning can happen grounded in present state realities and translates business initiatives to IT projects so a full accounting of the perceived risks and rewards can avail itself to the decision-making process. Portfolio management is essential to successful corporate governance and as such, a comprehensive fusing of a firm's IT-enabled strategic capabilities.

Good business sense suggests that knowing an application's utilization and resource consumption (both admin and infrastructure) are necessary to make good architecture decisions. IT needs to build unique competencies via weaving all necessary hard and soft elements, with continuous deliveries. By applying IT architecture as a practical tool, IT management can identify and blend the ways that information and technology can assist and shape the future of business by taking logical steps and linking all-important business aspects such as goals, objectives, actions, etc, together to enforce IT-enabled digital competency, in reaching high-level maturity.

IT portfolio prioritization: A company has finite resources to apply to get the best yield possible to meet stakeholders’ expectations. IT Architecture deals with business initiatives, derived from strategy, and improves the visibility of IT management. Organizations have limited resources, to survive the long term, IT needs to do more planning and prioritization, bring transparency, and align IT portfolio management with strategic business goals and objectives. IT prioritization helps to focus on the strategic goals of the organization, which has huge benefits in terms of execution.

In practice, there’re always some constraints for businesses to balance a healthy portfolio of “running, growing, and transforming,” exploring the emerging opportunities or deploying new ideas. IT Architecture is a practical tool that helps the organization do pre-planning, planning, prioritizing, and adjusting all the time; partnering with the business to understand entry, exist, risk permanence, and value generation strategy, use of new technology, business process, partner, business model, joint product development, supplier integration, and use of real-time, accurate, predictive information, etc.

IT portfolio optimization:
To keep relevant, the challenge for IT organizations is to manage and optimize its portfolio of relevant cross-border strategic synergies and organizational interdependence. IT becomes seamlessly integrated and aware of the organization as a whole. Companies without an effective project portfolio management may be missing important contextual information. IT optimization is not just about fixing things, but applying IT architecture to leverage trade-off for improving IT efficiency, flexibility, agility, and risk intelligence.

The challenge for IT optimization is to have visibility and traceability between costs and the assets consuming those costs. IT architecture is a practical tool to help the management gain a holistic understanding of IT transition and to advocate for "departmental immersion" and other strategies. Not having the big picture creates a vulnerability to be second-guessed and stonewalled by anyone that might be forced through a transition. It is through this comprehensive understanding, IT management would be able to identify true cost savings, workflow optimizations, and additional revenue opportunities.

IT is an enabler of current and future capability for both the organization and its ecosystem. By leveraging IT architecture as a strategic tool. IT management has a strong sense of how to develop customer-centric programs for building an integral and unique set of business capabilities by combining technology and business tactics. So, IT transformation is on the horizon to improve IT maturity.