I had the great pleasure of speaking with Jim Maholic, a VP in Hitachi Consulting’s Management Consulting and Industries Practice. We discussed how to identify, calculate and communicate the value of large scale IT projects, based on Jim’s book “Business Cases that Mean Business”.
He said he wrote the book as a way of benefitting others by sharing his insights and experience on how to communicate the business value of proposed projects in a way that senior business leadership is more likely to approve its funding.
His first piece of advice for IT executives, IT managers, and Project Managers seeking approval and funding for a large project is that senior executives only fund projects for four reasons. To obtain approval, IT proposals must align to core business drivers and show that they: • Enhance revenue • Reduce cost • Optimize assets • Minimize risk
Furthermore, as senior executives are deciding what project to fund, it can’t just be the best IT project; it must be the best business project. When looking for project funding, IT people must understand they are not just competing against other IT related projects. They are competing against all project types that consume the company’s money, time, and other resources. For example, if the company has $1 million to spend on a project, it will compare your new “Accounting System Replacement” project against building a new warehouse in a new up-and-coming sales district. Therefore, you must present your project in terms of its overall business and financial benefits, such as Return On Investment, not on IT related technologies alone.
Mr. Maholic went on to say that before pitching your project to senior management, you should do your homework and assure it includes the following items: • Understand how your company compares to other companies in your industry as it relates to your project. For example, if your project proposes to improve the inventory throughput, present data showing how your company performs against its peers in inventory turnover. • Dot your “I”s and cross your “T”s. That is to say, don’t try to be clever, senior executives will see through it. Anticipate being asked the questions that you don’t want them to ask. • Gather and analyze as much data about the potential business benefits of your proposed project as possible. It will not only better prepare you for your presentation, it will give you a better understanding of what needs to be done. These types of needed analysis and desired benefits are thoroughly discussed within his book.
I then asked Jim what advice he had for Project Managers who are asked to lead approved IT projects and he suggested the following: 1. Project plans are necessary, but will change based on many variables. Be prepared to respond to changes to your plan. 2. Be comfortable holding people accountable for their assignments. Escalate if they consistently miss their promise dates. 3. Understand the value of IT governance. That is to say, if you are asked to expand the project’s scope by adding new features or functionality of some type, defer the decision to your project’s oversight committee or key stakeholder. Passing the decision to your governance group saves you from continually saying “no” and helps assure that all additions have appropriate business value. In effect, it helps minimize scope creep. 4. No one likes change when it’s imposed on them. As a result, be a supportive leader (and part-time coach) to those within your group who seem slow to embrace the necessary changes. 5. Notify your supervisor as soon as problems occur. He/she has a right to know because it’s his/her project too. Also, your manager can help you make corrections when they are small, rather than when they become major issues that jeopardize the success of the project.
In closing, Jim said that his initial intent was not to write a book. Over the years he simply kept notes of the trials and tribulations of the projects he worked on. Over time, these notes were collected into binders and these binders were converted into the book. I for one am glad this book was written.
Jim Maholic and Hitachi Consulting can be found at www.hitachiconsulting.com and his book, “Business Cases that Mean Business” can be found on www.Amazon.com.
If you have any questions about your career in IT, please email me at eric@ManagerMechanics.com or find me on Twitter at @EricPBloom and @MgrMechanics or at www.ManagerMechanics.com.
Until next time, work hard, work smart, and continue to build your professional brand.
Read more of Eric Bloom's Your IT Career blog and follow the latest IT news at ITworld. Follow Eric on Twitter at @EricPBloom. For the latest IT news, analysis and how-tos, follow ITworld on Twitter and Facebook.