Understanding Integrated IT Portfolio Analysis (IIPA)

Integrated IT Portfolio Analysis recognizes the close relationship that must exist between IT portfolios, business objectives, and the strategic decisions that drive those objectives.

To succeed, CIOs need to be able to connect multiple disparate portfolios, projects, epics, applications and infrastructure to deliver an integrated and cohesive set of investments that align the IT technology roadmap with business strategy.  That’s what IIPA delivers.

Align IT Investments with Business Strategy

Gartner considers IIPA to be one of the core elements of Strategic Portfolio Management. In today’s world business objectives cannot be delivered without effective investments in strategy.  But organizations don’t have just one objective and one investment.  There are multiple objectives, multiple investments for each objective, and multiple opportunities for problems to occur.  Integrated IT Portfolio Analysis helps manage the dependencies across multiple IT portfolios, programs and products, projects and other forms of work.  It also ensures changes to those portfolios are implemented effectively and efficiently, maximizing performance while minimizing disruption.

3 Elements of Integrated IT Portfolio Analysis

There are a number of elements of IIPA and the ability to successfully analyze and manage alignment between business strategy and IT investments requires organizations to consider each of them.  They are:

1. Evolving to a product / capability aligned investment model
2. Consistently achieving continuous delivery and optimized resource utilization
3. Support for effective application portfolio management

1. Evolving to a product / capability aligned investment model

Traditionally, IT most commonly delivered functionality through projects.  These were frequently treated as self-contained, independent entities that were only peripherally aligned with business strategy.  A project-based approach cannot deliver the alignment businesses need.  Instead, organizations must evolve to a product and capability aligned model where:

• IT investments in services and applications are aligned with key products, business services and capabilities.
• Investments are approved and funding allocations confirmed based on the ability to deliver relevant value to those products and capabilities.
• All IT investments directly tie back to the business strategies, goals and objectives they support.

2. Consistently achieving continuous delivery and optimized resource utilization

More than simply delivering the right work, something that the product / capability aligned model helps ensure, IT must also deliver work in the right way – as effectively and efficiently as possible.  That means ensuring that:

• Regardless of how work is being delivered within the tri-modal reality, the focus is on continuous delivery that ensures value is achieved as early as possible for every investment
• Resource management software ensure that all IT resources are optimized to their fullest in all IT functions at all times, ensuring the best possible return on the investment in those resources.
• IT leaders have complete and accurate insight into these delivery and resource utilization metrics so they can make needed adjustments quickly and decisively.

3. Support for effective application portfolio management

Application Portfolio Management can be thought of as the execution element of strategic portfolio management.  It’s the work to implement the various work items identified and approved in support of strategic objectives.  Integrated IT Portfolio Analysis must align with Application Portfolio Management. Benefits realization management tools ensure the right work is always being pursued and that the expected outcomes are on target to be achieved.  That involves:

• The ability for IT leaders to ensure the portfolios is rationalized from the outset to deliver only the work that directly contributes to strategic success.
• Clarity to identify where execution is resulting in variances in alignment with business strategy and the ability to quickly correct.

Why Integrated IT Portfolio Analysis is Important

Today’s business objectives rely heavily on digital investments.  Digital transformation remains a strategic imperative for organizations looking to streamline their internal operations while improving their ability to deliver value to their markets in less time and greater quality.  Unless IT investments and business objectives are tightly integrated that can never occur.

IT is a significant cost area for the business. It’s imperative that IT leaders leverage capital planning software to help manage the total cost of ownership of their investments. This ensures the best possible return for the business is being achieved at all times.  Today’s IT leaders are faced with a portfolio of investments that is becoming ever more diversified.  From physical assets to services, projects to programs and products, the way IT delivers value continues to evolve.  Unless IT leaders have a holistic, transparent and accurate view of all IT portfolios they will never be able to optimize their support for business strategy and objectives.

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