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transparent decision-making process.
Local managers do have local control
over the implementation of the process
and there are no procedures for
examining process results.
4 Managed Demand/supply planning is a standard Increased coordination between IT Closer connection between IT and




303
and practice and management notes strategy and business strategy at the business processes at the enterprise
Measurable exceptions. enterprise level. level (cross-silo).
Demand/supply planning is a defined Better projects that are more closely More successful projects due to greater
management function with senior level connected to business objectives and business involvement through the entire
ownership and responsibilities. direction. project lifecycle.
Increased leverage of new and existing
The process and its results are
infrastructural elements.
measured and monitored (e.g., percent
of plan converted to initiatives, percent
of IT budget connected to process
outcomes).
5 Optimized Methods of integrating IT and business IT and business planning are fully The company maximizes strategic and
planning are continuously improved connected and integrated. bottom-line impact from its IT
with best practices, industry investments and capabilities.
comparisons, and tools and
automation.
Innovation
EXHIBIT F.3
Maturity Level Description Practice Outcomes Business Outcomes
0 Nonexistent There are no management processes Planning is top-down, and IT planning IT is seen as a support function only.
to consider new opportunities created is reactive to business tactical planning. Limited innovation.
by IT capabilities.
1 Initial/Ad IT-based innovation opportunities Individuals and departments drive Innovations occur as isolated incidents.
Hoc occur based on unstructured individual innovations. Innovations have only loose and
insight within the business. IT is continually reacting to vendor- incidental connections to business
Business does not view innovation as driven “flight magazine” innovations strategy.
something to be managed. based on new technology. Follow-through on these ad hoc
Business asks, “Why aren™t our IT guys innovation initiatives is limited due to lack
looking at this technology?” of management commitment.


2 Repeatable Individual business managers monitor Innovation is viewed as being Specific managers and business units
but Intuitive new IT capabilities within the company “environmentally” managed (i.e., if the gain a reputation for being consistently




304
as well as within specific competitors right elements are present and the innovative and IT-savvy.
and the industry. IT is invited to culture is supportive, innovation will
present new capabilities. happen).
Outside research views are included
as part of the innovation process.
3 Defined A documented process exists for IT capabilities are used as input to the New IT-driven opportunities are
Process business™s innovation thinking. proposed and considered to support
communicating IT capabilities and
exploring their impact on existing existing strategic intentions.
IT begins to be recognized for its
business processes. This involves a active role in business innovation New IT-driven capabilities influence the
structured visioning and scenario (inward and outward view). development of new strategies and
development processes. business innovations.
Better (higher value) projects, including
The implementation of the innovation cross-silo innovations, are formed. IT evaluates architectural decisions in
process is left to the discretion terms of future business capabilities.
individual managers and innovation
results are not specifically monitored.
Innovation (Continued)
EXHIBIT F.3
Maturity Level Description Practice Outcomes Business Outcomes
4 Managed Levels of innovation become part of Percentage of revenue from new
There is a regularly executed process
and products and services increases.
for communicating IT capabilities and management™s performance criteria.
Measurable exploring their impact on existing Innovation initiatives are managed as Number of cross-functional innovations
business processes. an identifiable portfolio (or portfolio and process improvements increases.
There is a stated innovation strategy subset). Organizational change management
with specific goals. Continuous Innovations are selected and becomes a critical management issue.
innovation is expected of all business prioritized based on a multidimensional
units. It is measured and is part of set of criteria including connection to
individual managers™ performance business strategy and the ability of the
evaluations. organization to implement (change).
Managers are expected to follow the




305
process in their business planning
activities and there is a defined
process for monitoring compliance.
Ownership of the innovation practice
lies with a manager who is responsible
for documentation, training, process
support, compliance, and
measurement of results.
5 Optimized Methods of driving continuous IT- IT-enabled innovations impact The company continually improves
driven innovation are continuously business planning and offer new products, processes, and bottom-line
improved with best practices, industry strategies. performance through IT-based
comparisons, and tools and innovations.
automation.
Prioritization
EXHIBIT F.4
Maturity Level Description Practice Outcomes Business Outcomes
0 Nonexistent There is no defined process for None None
prioritizing projects.
1 Initial/Ad New IT investments are approved Projects are isolated from other Because there is no way to assign value
Hoc individually based on local operational projects and are treated individually. to strategic projects, tactical and
justification. operational projects rise to the top.
Priorities within a business unit are
Prioritization is loosely performed by informally negotiated between Management views IT exclusively in
the IT organization in response business sponsors and IT. terms of labor and cost savings.
organizational pressures. Development managers establish
priorities across silos based on
business unit clout and noise.
2 Repeatable IT investments are viewed and Large numbers of projects are in crisis.
Each IT initiative has a required
but Intuitive managed as a project list. This is due to changing tactical
financial business case that is based




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requirements during the development
on local operational justification. Tactical projects and projects to “fix
phase.
what™s broken” dominate the list.
An IT governance board individually
Management attention shifts to
approves projects primarily based on Projects qualify for consideration
improving the development process and
projected ROI but with the based on ROI projections, but priorities
managing scope creep.
consideration of other unspecified are negotiated based on informal “soft”
management factors. An IT benefits and management factors. Project benefits are organizationally
governance board manages isolated.
Once a project is approved, it runs to
prioritization, but it is accomplished completion.
through a political process of argument
and debate.
Once approved and started, projects
generally run to completion. Resource
priorities for running projects are
determined by IT.
Prioritization (Continued)
EXHIBIT F.4
Maturity Level Description Practice Outcomes Business Outcomes
3 Defined Each IT initiative has a required project Project justification and prioritization Management attention moves to the
Process description that includes ROI occur on a regular schedule. project definition phase and the resource
projections, nonfinancial benefits allocation process.
New IT investments are described in
categories, and risk assessments. business terms. IT investment decisions are made by
An IT governance board approves and business management rather than IT
In-process projects regularly have their
prioritizes new projects primarily based users.
value cases reexamined.
on projected ROI but with the IT assigns resources and begins to
consideration of other unspecified manage projects as a portfolio.
management factors.
4 Managed The goal is a balanced project The connection of IT investment
Company strategy is explicitly defined
and in understandable terms. portfolio. This means that IT resources resources to business objectives can be
Measurable and investments are allocated across a clearly communicated.
There are defined processes to justify
range of different projects”tactical
and prioritize IT-related investments, Increase in overall project success and
and strategic, with different risk/reward value delivery due to increased business
tied to the company™s strategic
profiles. management buy-in and participation.
intentions and business processes.




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The process provides early justification There is a greater business involvement
Each proposed investment has a
for canceling problem projects. in the full project life-cycle.
standard business case and project
description.
An IT governance board approves and
prioritizes projects based on a
standard multi-dimensional set of value
criteria.
An IT governance board manages
resources at a portfolio level across
the company.
Projects already in development are
regularly reexamined and resources
reallocated as necessary.
Responsibility for executing and
managing the prioritization process
has been clearly assigned,
Prioritization (Continued)
EXHIBIT F.4
Maturity Level Description Practice Outcomes Business Outcomes
5 Optimized The prioritization process is an integral IT investments are prioritized against The company maximizes bottom-line
part of IT management and, through business strategy. impact and return on its IT investments
the IT governance board, provides the and capabilities.




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critical forum for communicating with
the business.
Prioritization is an ongoing process
that is continually reexamined and
upgraded.
Alignment
EXHIBIT F.5
Maturity Level Description Practice Outcomes Business Outcomes
0 Nonexistent There are no company management None None
processes to assess the connection
between IT systems and services and
the business.
1 Initial/Ad IT systems and services are IT service levels and quality become IT and business resources are allocated
Hoc occasionally assessed at an aggregate issues. to improving functionality and service
level on the basis of customer (user) levels of tactical applications and IT
Service level agreements begin to
satisfaction. services.
appear.
Lights-on applications are inventoried Snap-shot representation of lights-on
and examined for special purposes application status and importance.
such as establishing disaster recovery
requirements.
2 Repeatable IT systems and services are High-level issues regarding service IT alignment becomes a business




309
but Intuitive occasionally assessed at an aggregate level and quality are identified. management issue.
level on the basis of business High-level issues regarding IT™s
management satisfaction. connection to the business are
identified.
3 Defined There is a documented process for Application-by-application information The business begins to understand
Process assessing the connection and becomes available regarding annual where IT resources are spent and the
contribution of existing IT systems to cost, business impact, quality, and budget impact of lights-on systems.
strategic intentions and key business other key attributes. Specific business units begin to evaluate
processes. IT uses this information to their lights-on applications and make
There is a documented process for communicate with the business about informed retire/replace decisions.
assessing the service level, quality, managing IT demand.
intensity of use, and other key
attributes of existing IT systems.
The assessment process supports a
portfolio view for managing IT
resources.
Alignment (Continued)
EXHIBIT F.5
Maturity Level Description Practice Outcomes Business Outcomes
4 Managed Company strategy is explicitly defined Poorly performing and nonaligned Budgets and resources for lights-on
and in understandable terms. systems are removed or replaced. systems and services are planned and
Measurable assigned based on connection to
The organizational responsibility for Resources are assigned to
strategic intentions and gaps in service
the execution and monitoring of the maintenance and enhancement
and quality levels.
alignment process is clearly defined. projects based on connection to
strategic intentions and gaps in The percentage of the IT budget
The results of the alignment
service and quality levels of high- allocated to legacy systems is
assessments are used as important
connection systems and services. maintained or reduced.
input to the planning process.



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