Approach To Portfolio Management Intake Governance and Framework

Approach To Portfolio Management Intake Governance and Framework William C. Cox II PPM Services Architect CA Welcome

Presenter Bio William C. Cox II is a Services Architect at CA in the PPM services practice. In his career he has helped a plethora of global corporations across most industry verticals and Federal Government Agencies to implement and/or mature PPM processes, and competencies. William has more than two decades experience in leadership roles including VP EPMO & Service Delivery, VP Solutions, VP Principal Consultant, Business Services Practice Director, VP PPM Practice Director, Senior Global Director EPMO & SDO, Director IPMO, . Additionally, William has partnered with Boston Group, Bain Consulting, Deloitte, IBM, Booze Allen Hamilton and Mc. Kinsey & Co. on complex PMO and PPM solutions. William holds a B. A. and a MBA degree and the following certifications: QPM, PMP, CSM, PMOC, OPM 3, CPHIMS, 6 Sigma Black Belt, CA PPM 14. 3 Business Analyst. William is a resident of East Cobb in metro-Atlanta.

Topics Portfolio Governance Framework The beginning step. The Governance Council and Portfolio Intake and Governance Framework. Project Inventory and Data Collection What data needs to be collected and the SME validation process to support the project inventory. Defining, Weighting, and Prioritizing Business Drivers How to identify, define, weight and prioritize business drivers. How are they used and why they are critical to portfolio management. Project Intake Governance A defined process with built in checks and balances. Portfolio Optimization and Approval Process Framework Selecting a value driven portfolio.

Topics Portfolio Governance Framework Governance Council Portfolio Intake and Governance Approach Project Inventory / Data Collection Process Data Validation Process Business Driver Definition, Prioritization and Assessment Project Intake Governance Portfolio Optimization and Approval Process Framework PPM Tool Preparation Stakeholders and Communications

Portfolio Governance Framework • Began by defining a governance framework to guide the portfolio intake and governance. Governance Council

Topics Portfolio Governance Framework Governance Council Portfolio Intake and Governance Project Inventory / Data Collection Process Data Validation Process Business Driver Definition, Prioritization and Assessment Project Intake Governance Portfolio Optimization and Approval Process PPM Tool Preparation Stakeholders and Communications

PPM Governance Council Vision & Direction § Sets Policy and Portfolio Direction. Investment Committee Sets Direction, Priorities, Policy & Constraints § Sets Priorities (Business Drivers – defined and prioritized) Review’s Recommendations & Approves GC Executive Committee Recommended § Sets Constraints on enabled capital. Portfolio investment spend (CAPEX) § Sets Policies to ensure best outcomes (e. g. , bias towards “enterprise” focused Projects) § Review and approve GC Sub-Committee approved project portfolio § Communicate and Socialize portfolio decisions Prioritization & Alignment § Sets portfolio optimization workshop ground rules Investment Committee § Participates in a. Portfolio structured workshop to prioritize and optimize the most Sets Direction, Priorities, Policy Constraints advantageous project portfolio against & yearly plan § Review’s Recommendations & Approves the optimal project portfolio for review and approval by GC Executive Recommended Portfolio Committee GC Sub-Committee § Socialize decisions with business unit leaders Ongoing/Monthly: § Monitor Portfolio Delivery § Manage Contingency § Manage Exceptions § Monitor Benefits

Topics Portfolio Governance Framework Governance Council Portfolio Intake and Governance Approach Project Inventory / Data Collection Process Data Validation Process Business Driver Definition, Prioritization and Assessment Project Intake Governance Portfolio Optimization and Approval Process PPM Tool Preparation Stakeholders and Communications

Portfolio Intake and Governance Approach Intake and Governance

Topics Portfolio Governance Framework Governance Council Portfolio Intake and Governance Approach Project Inventory / Data Collection Process Data Validation Process Business Driver Definition, Prioritization and Assessment Project Intake Governance Portfolio Optimization and Approval Process PPM Tool Preparation Stakeholders and Communications

Portfolio Inventory / Data Collection • Defining the portfolio inventory is the first step in compiling the portfolio. • A Business Case template should be used to guide collection of the required data. • Business Cases are owned by the Business. • Project Managers facilitate the data collection process.

Topics Portfolio Governance Framework Governance Council Portfolio Intake and Governance Approach Project Inventory / Data Collection Process Data Validation Process Business Driver Definition, Prioritization and Assessment Project Intake Governance Portfolio Optimization and Approval Process PPM Tool Preparation Stakeholders and Communications

Data Collection Process Business Case Development Business Director Owns – PM Facilitates

Topics Portfolio Governance Framework Governance Council Portfolio Intake and Governance Approach Project Inventory / Data Collection Process Data Validation Process Business Driver Definition, Prioritization and Assessment Project Intake Governance Portfolio Optimization and Approval Process PPM Tool Preparation Stakeholders and Communications

Data Validation Functional Subject Matter Experts And Roles 15

Topics Portfolio Governance Framework Governance Council Portfolio Intake and Governance Approach Project Inventory / Data Collection Process Data Validation Process Business Driver Definition, Prioritization and Assessment Project Intake Governance Portfolio Optimization and Approval Process PPM Tool Preparation Stakeholders and Communications

Business Driver Definition and Prioritization • After Establishing The Portfolio Governance Framework, the GC Executive Committee and GC Subcommittee will identify and agree on a set of Strategic Business Drivers and their definitions. • Each member will work through a pairwise (1 -1) comparison of these Business Drivers and the group collectively will agree on final ranking and weighting.

Assessing Strategic Impact • Business Owners will complete initial assessment of impact on each Business Driver: o Include specific metric o Quantify the impact • During their review, Subject Matter Experts will assess and validate impact of each project on each business driver. 18 © 2015 CA. All rights reserved. CA confidential and proprietary information; for internal use only. No unauthorized use, copying or distribution.

Topics Portfolio Governance Framework Governance Council Portfolio Intake and Governance Approach Project Inventory / Data Collection Process Data Validation Process Business Driver Definition, Prioritization and Assessment Project Intake Governance Portfolio Optimization and Approval Process PPM Tool Preparation Stakeholders and Communications

Project Intake Governance (Example For Healthcare) Project Intake Governance Regulatory, Compliance, & Safety New Capability Discretionary projects, prioritized and selected based on alignment with Strategic Drivers (Quality, Patient Satisfaction, Operational Efficiency, Smart Growth, Revenue Enhancement), achievability (resource/budget), project risk, and project interdependencies e. g. , MUSE, RIS, Pharmacy Sustain (Replacement) Replacement, maintenance, and upgrade projects that sustain organizational capability and eliminates/minimizes risk Defined processes with built in checks and balances ensures an optimal portfolio Selected Portfolio Governance & Approvals Investment Strategy Road Maps Constraints & Strategy Projects that are not deferrable from a regulatory, compliance, or safety perspective

Topics Portfolio Governance Framework Governance Council Portfolio Intake and Governance Approach Project Inventory / Data Collection Process Data Validation Process Business Driver Definition, Prioritization and Assessment Project Intake Governance Portfolio Optimization and Approval Process PPM Tool Preparation Stakeholders and Communications

Portfolio Optimization and Approval Framework (Example For Healthcare) Portfolio Optimization and Approval Regulatory & Compliance: Specific Regulation? Not Deferrable? Regulatory, Compliance & Safety Yes Safety: Meets specific criteria? No Local Governance & Approvals Investment Strategy Road Maps Assess each project’s impact on Weighted Strategic Drivers Portfolio Optimization Strong Impact Extreme Impact New Capability Low Impact Driver 2 Selected Portfolio Review Driver 1 Score Constraints & Strategy “Force in” to portfolio Strategic Value Driver 3 Financial Value “Force in” to portfolio No Sustain (Replacement) Risk Score Indicates High Impact, High Probability? Yes Defined process with built in checks and balances ensures the best portfolio 22

Topics Portfolio Governance Framework Governance Council Portfolio Intake and Governance Approach Project Inventory / Data Collection Process Data Validation Process Business Driver Definition, Prioritization and Assessment Project Intake Governance Portfolio Optimization and Approval Process PPM Tool Preparation Stakeholders and Communications

PPM Tool Preparation Business Case and Capacity Management Information feeds into the PPM Tool of choice • Good quality data – Integral to process • Tool will support process and enable visibility and transparency in management of portfolio – Balance visibility of Capacity and Demand – Portfolio Management 24

Topics Portfolio Governance Framework Governance Council Portfolio Intake and Governance Approach Project Inventory / Data Collection Process Data Validation Process Business Driver Definition, Prioritization and Assessment Project Intake Governance Portfolio Optimization and Approval Process PPM Tool Preparation Stakeholders and Communications

Stakeholders and Communications • Stakeholder groups and key stakeholders are identified to drive the intake and governance process. • Each group will be engaged in the process at the appropriate time and level of effort. • Communications will be managed to ensure the awareness across all stakeholder groups as well as the entire Company; OCM.

Approach To Portfolio Management Intake Governance and Framework William C. Cox II PPM Services Architect CA Q&A

Approach To Portfolio Management Intake Governance and Framework William C. Cox II PPM Services Architect CA Appendix

Business Case Sample Section - Executive Summary A summary of the proposed projects from a business perspective § Current Situation/Background § Current Business Need § Proposed Solution § Funding Request Summary o Capital o Operational § Key Benefits and Opportunities 29 © 2015 CA. All rights reserved. CA confidential and proprietary information; for internal use only. No unauthorized use, copying or distribution.

Business Case Sample Section - Company Impact Identify impact of the proposed project to Company § What is the focus of the project. Is a system-wide solution in place? § Market Segment impact 30 © 2015 CA. All rights reserved. CA confidential and proprietary information; for internal use only. No unauthorized use, copying or distribution.

Business Case Sample Section - Project Type § Project type is defined by portfolio intake and governance “Swim Lane” a project follows into the portfolio. “Forced In” classifications identify a project as non-discretionary – Company must complete these projects. New Capability project are discretionary and are evaluated on their strategic and financial value to Company. § Business Owners provide their perspective on classification during initial Business Case development. § SMEs review and validate each classification. 31 © 2015 CA. All rights reserved. CA confidential and proprietary information; for internal use only. No unauthorized use, copying or distribution.

Business Case Sample Section - Risk Analysis • What is the risk of not proceeding with the project o Probability of occurrence o Impact if it occurs • Consider business risk as well as looking at the risk from a clinical and technical/infrastructure perspective § Initial executive risk provides insight into achievability of a proposed project. § This preliminary risk identification will be built on during initiating and planning and managed through execution. 32 © 2015 CA. All rights reserved. CA confidential and proprietary information; for internal use only. No unauthorized use, copying or distribution.

Business Case Sample Section - Cost Estimates Capture the breakdown of project costs: § Capital § Operational Costs (2016 and 5 -year) Each project will be estimated to support the total cost: § Direct Costs § Total Lifecycle Costs 33 © 2015 CA. All rights reserved. CA confidential and proprietary information; for internal use only. No unauthorized use, copying or distribution.

Business Case Sample Section - Resource Estimates Establishing visibility into portfolio demand organizational capacity is a critical outcome of this process. To provide the demand, we’ll need the following information for each project: o Generic Role (list will be provided) o FTE level by month Capacity will be calculated by generic role to supportfolio planning and balancing § capacity with portfolio demand. This information will be validated by Managers as well as the Project Managers and estimating SMEs. 34 © 2015 CA. All rights reserved. CA confidential and proprietary information; for internal use only. No unauthorized use, copying or distribution.

Portfolio Governance Approach SUSTAIN SWIM LANE AND FORCE-IN 35 © 2015 CA. All rights reserved. CA confidential and proprietary information; for internal use only. No unauthorized use, copying or distribution.

Portfolio Governance Approach- Swim Lanes Regulatory & Compliance: Specific Regulation? Not Deferrable? Regulatory, Compliance & Safety: Meets specific criteria? e. g. , ICD 10, Baxter Smart IV Pump No “Force in” to portfolio Governance & Approvals Investment Strategy Road Maps Assess each project’s impact on Weighted Strategic Drivers Portfolio Optimization Strong Impact Extreme Impact New Capability e. g. , Lumedx Implementation, TMS Professional, Yardi Upgrade Low Impact e. g. , Firewall Replacement, Image Now, Infra Server Refresh Sustain (Replacement) Driver 2 Selected Portfolio Review Driver 1 Score Constraints & Strategy Yes Strategic Value Driver 3 Financial Value “Force in” to portfolio No Risk Score Indicates High Impact, High Probability? Yes Defined processes with built in checks and balances ensures an optimal portfolio 36 © 2015 CA. All rights reserved. CA confidential and proprietary information; for internal use only. No unauthorized use, copying or distribution.

How to determine if a “Sustain Project should be “Forced In” Initial Classification of Sustain (Replacement) Project Yes No • Project is NOT Forced in as a Sustain Project • Project may still be included to be prioritized with other projects in the New Capabilities Swim Lane Is there significant risk to Company if the project is not executed q Review documentation and due diligence items. q Quantify the associated Risk to Company of not doing the project (Probability and Impact). Complete risk assessment from a Business, Clinical, and IT/Infrastructure standpoint Not a significant risk (Low, Medium) Yes Significant Risk (High, Very High) When Risk of not proceeding is evaluated as High or Very High, the project is Forced in as a Sustain Project Use the risk assessment framework to identify the probability that the risk will occur and the impact to Company if the risk occurs. Asses risks from a Business, Clinical and IT/Infrastructure perspective 37 © 2015 CA. All rights reserved. CA confidential and proprietary information; for internal use only. No unauthorized use, copying or distribution.

Regulatory, Compliance, & Safety Swim Lane How to determine if a project should be “Forced-in” Initial Classification of Safety, Regulatory or Compliance Governance Aspects Yes Has the appropriate external board/authority issued guidance with regards to the solution? Supporting documentation to the clause and/or paragraph number stipulating the solution would need to be provided. No Re-classify project and assess against other criteria Yes • • • Appropriate Issuing Authority Safety Regulation Compliance JCAHO • Federal • GLBA CMS • State • CMS HHS • Local • FDA OSHA CDC Review due diligence with governing board to determine if the project is “Safety, Regulatory, or Compliance” Due diligence items: § How did you arrive at the “preferred” solution? What are the alternatives and tradeoffs? Is this the low cost alternative? § Does the regulation stipulate a technology? Technology enabled solution? What is the risk of not doing a technology enabled solution? § Is there a date the solution needs to be implemented by? § How long does it take to implement the solution? Given the requirement date, is the project deferrable? § What is the occurrence rate / severity of the incidents this regulation addresses? § What is the scope of the solution (e. g. facility based, Acute, MSMG, system wide) § Are existing systems affected? No Re-classify project and assess against other criteria Governance Representation Clinical MSMG Compliance • MSMG • Complian • CNO Rep. ce Officer • CMO • Clinical Risk Mgr. Yes 38 Categorize project appropriately © 2015 CA. All rights reserved. CA confidential and proprietary information; for internal use only. No unauthorized use, copying or distribution. and “Force-in” Project

Risk of Not Proceeding- Risk SME Role § Risk SMEs review each project to determine if the Risk of not proceeding is significant enough to require the project to be “Forced In” to the portfolio via the Sustain Swim Lane. § If the risk is deemed acceptable or deferrable, the project would be evaluated via the New Capabilities selection and optimization process. Sustain Swim Lane “Sustain” selected as Project Type SME Review & Validation of Risk to Company Overall Risk Rating “Very High” or “High” “Force In” to portfolio as a Sustain project Overall Risk Rating “Low” or “Medium” Project Type changed to “New Capabilities” Overall Risk Rating “Very High” or “High” New Capabilities Swim Lane “New Capabilities” selected as Project Type 39 SME Review & Validation of Risk to Company Overall Risk Rating “Low” or “Medium” Continue in the New Capabilities Swim Lane © 2015 CA. All rights reserved. CA confidential and proprietary information; for internal use only. No unauthorized use, copying or distribution.

Risk Analysis - Risk of Not Proceeding § Identify Business, Clinical, and/or IT/Infrastructure risks that could occur if we do not proceed with the project. § Identify the Risk category § Use the risk assessment framework to identify the Probability that the risk will occur and the Impact to Company if the risk occurs. 40 © 2015 CA. All rights reserved. CA confidential and proprietary information; for internal use only. No unauthorized use, copying or distribution.

Strategic Impact Assessment Initial Classification identifies impact to Business Drivers in Business Case SMEs assess the impact on each Business Driver Impact None Low Moderate Strong Individual evaluation scales for each Business Driver 41 © 2015 CA. All rights reserved. CA confidential and proprietary information; for internal use only. No unauthorized use, copying or distribution. Extreme

Governance Council Portfolio Intake and Governance OPTIMIZATION WORKSHOP 42 © 2015 CA. All rights reserved. CA confidential and proprietary information; for internal use only. No unauthorized use, copying or distribution.

Preparing for successful collaboration § The GC Sub-committee will need to prepare for the Portfolio optimization Workshop and their role during the workshop. • Role prior to, during, and after the workshop • Expectations during the workshop • Targeted outcomes and follow-up § The PPM Implementation Manager will lead the preparation of the portfolio for review by the GC Sub-committee • Validate readiness of core data in PPM tool of choice (e. g. , generic roles, resource managers, resource pools, estimating, understanding business drivers, aligning project need to Company strategy) • Drive data collection effort across the organization • Ensure the right data was available to support decision making 43 © 2015 CA. All rights reserved. CA confidential and proprietary information; for internal use only. No unauthorized use, copying or distribution.

Portfolio Review Criteria Aligning around approach and decision criteria § The GC Sub-committee conducts a review of each submitted Business Case, applying the following criteria during their analysis to determine viability of each Business Case: • • 44 Strategic Alignment Consistency with current Strategic platforms Certainty of alignment with current application strategy Presence of coherent application strategy Demonstrated incremental value Consideration of timeline and Interdependencies Business Owner justification of need (some proposed projects may be eliminated by the business owner during the validation effort) © 2015 CA. All rights reserved. CA confidential and proprietary information; for internal use only. No unauthorized use, copying or distribution.

Portfolio Review Criteria Throughout the first time through this approach, reinforce the shifts required for success: § Collaboration § Transparency § Visibility § Consistency § Decision-making 45 © 2015 CA. All rights reserved. CA confidential and proprietary information; for internal use only. No unauthorized use, copying or distribution.

Post GC Sub-committee Workshop It’s just the beginning, Best Practice suggest: • Initial Portfolio should be allowed to bake for 6 months • Begin with quarterly optimization cycles • Accelerate optimization cycles predicated on Company’s ability to adapt and adopt to change 46 © 2015 CA. All rights reserved. CA confidential and proprietary information; for internal use only. No unauthorized use, copying or distribution.