Obstacles hinder IT portfolio management

Many IT managers are keen on the notion of setting up a portfolio management approach to help gauge the value of technology investments. But those who try to do so often run into start-up problems, such as trouble getting buy-in from business units, according to attendees at a Meta Group Inc. conference held recently in San Diego.

Several attendees also said they fear that making information about the financial value of investments readily available could make them seem like IT police in the eyes of business managers who fund projects. In addition, they cited concerns that the data might not be fully accurate.

Like other IT executives interviewed at the Metamorphosis conference, Jim Larkin said he thinks his company’s business unit leaders “could benefit from seeing how technology is being used and the kinds of payback we’re getting.”

Larkin manages application development information systems at SRP, a Tempe, Ariz.-based utility that spends about US$100 million a year on IT. “We’d like to put an IT portfolio management practice in place, but we’re struggling with how to pitch this to senior management,” he said.

A growing number of companies are adopting the portfolio management concept, in which IT projects and assets are evaluated in much the same way that financial portfolios are.

At the conference, Meta released the results of an e-mail survey it conducted last month with 219 prospective attendees. A total of 56 per cent said they have either launched an IT portfolio management program or plan to do so.

Some organizations conducting equivalents of the monthly and quarterly financial updates that publicly held companies have to file, said Howard Rubin, executive vice-president at Stamford, Conn.-based Meta. The reports present financial breakdowns of IT investments that are in the pipeline as well as existing systems, he said.

But such disclosures can pose a problem for IT managers. “Some find the visibility of the portfolio very threatening,” said Mike Metcalf, vice-president of marketing at Pacific Edge Software Inc., a vendor of IT portfolio management tools in Bellevue, Wash. “They feel the data they have isn’t as accurate as it should be, and they’re being asked to share this information at a very high level.”

Dan Jones, senior director of customer-facing systems at ConAgra Foods Inc., said the Omaha-based food processing company is “doing some components of IT portfolio management, but we probably don’t call it that.” For example, ConAgra has implemented systems for use in tracking its IT assets, Jones said.

Sun Microsystems Inc. launched an IT portfolio management initiative about six months ago. “One of the challenges I’m facing is finding a [software] tool that meets our needs and runs on Solaris,” said Halina Tabacek, manager of IT planning and practices at Sun.

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