Business Change

Portfolio Management
Ensuring that business change delivers business value

‘‘
To deliver
maximum
benefit to the
business, a
mechanism must be put in
place to ensure that
change is effective,
measurable, and constantly
aligned to high-level
business objectives.
Business Change Portfolio
’’
Management is
that mechanism.
Margaret Hassall,
Practice Head, Finance and
Media sector, Charteris plc
Page 2
Invest wisely to extract
maximum value from
business change.
As the business climate improves, can your business rise again to the
challenge of change?
While many organisations have embraced change, effective change management
remains one of the greatest business challenges – particularly following a recession.
Demand for change initiatives may be triggered by shifting customer needs, changes in the
competitive marketplace, legislation or technology, or takeover or merger. Alternatively,
your business may simply be responding to the seemingly ever-present need to achieve
more with less. But do you still have the skills and mechanisms in place to deliver the level
of change required across your business?
One of the consequences of recession is that knowledge and resources needed during
prosperous times tend to erode or disappear altogether. Some of the earliest casualties are
often the skills associated with discretionary business change.
As the outlook brightens, it’s vital that your business is able to build, resource, manage,
deliver and measure the optimum portfolio of change to generate maximum business
improvement and value. Our Business Change Portfolio Management services are
designed to meet that challenge.
Business Change Portfolio Management from Charteris is:
♦ A proven, practical and sophisticated framework delivered by a uniquely experienced
team offering highly specialised skills and expertise in change management.
It will enable you to:
♦ Prioritise, plan, resource, manage and execute a complex portfolio of business
change initiatives in the most timely, efficient and cost-effective way possible.
The business benefits are far reaching and can include:
♦ Improved effectiveness and business opportunities throughout the organisation, and
reduced costs
♦ Significantly less disruption to business operations, with faster, simpler adoption of
new processes and improved teamwork and staff morale
♦ Protection and improvement of customer service levels and customer loyalty.
Whatever the drivers of change in your organisation, Charteris has the experience you
need to transform the way you manage change – and to make a real difference to the
results that change delivers.
Copyright © 2004 Charteris plc. All rights reserved. Business Change Portfolio Management
Business change in the context of key service management processes

If change is vital to the future of the

organisation, Business Change
Portfolio Management must be at the
centre of its operations and strategy.

The challenges for business change At Charteris we have the

expertise and the practical
As the number of business change projects grows, so the challenges, and the need for a
cross-business strategic view, increase. Typical challenges include: experience to meet the
challenge of change. As
Alignment with business strategy you’ll see from our brief
Many organisations find that portfolios of change projects build up over a number of case studies on page 11,
years, often with little reference to business goals and objectives. our experience in managing
Cross-business prioritisation and aligning business
Portfolios of change develop across different parts of the business, yet typically call on change delivers tangible
the same shared resources. The lack of a cross-business mechanism for prioritisation can results for some of the
lead to internal conflict. largest names in the
Financial and Retail sectors.
Balancing demand and supply
Too often the demand for change cannot be met because resources are spread too thinly,
over too many change projects. And, in many instances, key skills and experience are
simply not available.
Support for ongoing change
Organisations will often conduct a one-off exercise to align the portfolio of change, but
then fail to put in place a process to maintain ongoing alignment.

Copyright © 2004 Charteris plc. All rights reserved. Business Change Portfolio Management Page 3
 How Charteris meets the
challenge of change.

Collect facts and Over the next few pages we outline key elements of the Charteris approach to Business
gain understanding Change Portfolio Management.

♦ Identify and understand 1. Establishing supply capability

all constraints
♦ Know the true
capability of resources What’s available? Insight and understanding
– internal and external Budget
How many?
♦ Now
♦ Spot the skills shortages
Resources ♦ Planned
♦ Plan around These might be limited by: ♦ Management capacity
bottlenecks. ♦ Expertise ♦ Constraints
♦ Ability to manage and support
♦ Take on rates
♦ Systems availability Profile
♦ Space ♦ Skills
♦ Rules and regulations ♦ Knowledge
♦ Availability
Time
♦ Location
♦ What’s the deadline and is the time
remaining sufficient to deploy the ♦ Internal/external/outsourced
change?
♦ Is the timing determined by internal or
external factors? Who does what?
Where are the bottlenecks?
Culture and capacity for change
Can we avoid them or plan around them?
Is the organisation constrained in any way
in its ability to take on change?

Understanding supply and constraints

In establishing supply capability, we focus on the budget, resources and time available to effect
the change. Equally important, however, is the need to identify and understand constraints.
While budget is often easy to establish, resources are notoriously difficult to pin down,
particularly in large organisations where there is a mix of permanent staff, contractors and
external suppliers. External suppliers will often claim that they have ample resources but
their true capability must be clearly understood. Insight and thorough understanding are
key to establishing precise supply capability.
Constraints will often manifest themselves in the form of limited specialist skills or
perhaps in bottlenecks during project delivery.
If sufficient detail is obtained at this early stage, organisations can plan around
bottlenecks. Leave it too late, however, and some of the more serious bottlenecks may not
be resolved without months or years of development and training.

Page 4 Copyright © 2004 Charteris plc. All rights reserved. Business Change Portfolio Management
2. Mapping change demand Be rigorous

♦ Compile full
information on sources
of change demand
♦ Clear categorisation is
vital
♦ Remove or demote
overstated projects
♦ Maintain a clear view of
future demand.

Understanding what is to be achieved

The information required about individual demands for change varies by organisation
depending upon the basis used for prioritisation – what are the major drivers for change
within the organisation? However, as a minimum they will typically cover: the change
demand category (e.g. is this a legal requirement, or a discretionary spend item?); an
outline plan including the required by date; the projected cost and benefits profiles; and an
assessment of impact on projected bottlenecks.
It is also vital to understand the precise nature of the work: is it a routine project that can
be carried out as part of BAU (Business As Usual), is it a separately managed project
requiring additional resource, or is it a major project or programme requiring a ‘ring-
fenced’ team?

Copyright © 2004 Charteris plc. All rights reserved. Business Change Portfolio Management Page 5
 3. Setting the baseline portfolio

Cut off!
Projects below the baseline
are only started if more
capacity is made available.

Take a firm line From baseline to cross-business prioritisation

Using the knowledge gained of supply capability and demand items, we ‘baseline’ the
Points to note when
portfolio to ensure that there is sufficient capacity to undertake:
setting the baseline
portfolio: ♦ Mandatory change projects — the projects without which the business will be
closed down
♦ It takes several
♦ Business-critical change projects — the projects without which the business will fail
iterations to establish a
baseline and regular We then determine what headroom exists to undertake discretionary change projects, and
reviews to maintain it how many. We set criteria for prioritisation, harnessing sophisticated tools where necessary,
but always ensuring that business basics are in place first. At the basic level we set financial
♦ Be prepared to criteria (such as benefits and payback period) and business strategy alignment criteria.
slaughter sacred cows
We also work with you to ensure cross-business prioritisation by putting in place a clear
to establish true demand governance structure, senior-level sponsorship and representation from all business areas,
for mandatory and and formal approval and reappraisal processes.
business-critical work
♦ Take account of
existing commitments
(contracts, leases,
support agreements).
It takes time to change
a portfolio.
♦ Ensure that you can
measure objectively
against key criteria,
especially true costs
and benefits.

Page 6 Copyright © 2004 Charteris plc. All rights reserved. Business Change Portfolio Management
4. Driving into action Keys to success

♦ Senior business
ownership and
leadership
♦ Effective governance
♦ Corporate buy-in to
agreed processes and
mechanisms across
your business
♦ Accurate capture of
demand from diverse
sources
♦ Effective management
of supply capability,
including resource
allocation and planning,
cost control and
supplier management
♦ Perceptive ‘what if ’
scenario planning
♦ Proactive customer
relationship
management
♦ Rigorous change
management approach.

Keeping change on track

It is never enough to simply initiate each project and await completion; rigorous follow
through is essential.
In particular, ensure that work in train continues to be aligned to a high-level, strategic
view of the business. Keep a close eye also on changes in supply capacity and demand
across the portfolio, and adjust priorities and resource allocation accordingly. For example,
early release of resource from a closed or temporarily delayed project may open the door
to rapid completion of another high revenue generating project.
It is this ongoing balancing of the portfolio components to achieve maximum return that
is the essence of Business Change Portfolio Management.

Copyright © 2004 Charteris plc. All rights reserved. Business Change Portfolio Management Page 7
 5. Managing the entire process

The right level of senior sponsorship is critical to the success of portfolio management,
as decisions will need to be made across organisational boundaries. Typical set up activities
would cover:
♦ Identification of a senior-level sponsor
♦ Set up of a cross-business forum, either a dedicated steering group or subsumed into
existing management forums
♦ Gaining buy in from the cross-business forum.

Establish an accurate definition of the organisation’s ability to supply change. This

will cover:
♦ Governance
♦ Programme structure
♦ Resources, both internal and external, such as people, budget and technology
♦ Programme and project management processes
♦ Quality management.
This process can result in the identification of quick wins, particularly around any
bottlenecks identified.

Assess how demand is captured and tracked and, where possible, validate the sources. On
the basis of this assessment:
♦ Draw up the current portfolio complete with the key information such as likely
impact on bottlenecks identified and status indicators for each project – and then
maintain it
♦ Agree the categorisation to be used in prioritisation activities and assign projects to
the appropriate categories
♦ Push back on the assessment until there is confidence in the robustness, e.g. is it really
a legal requirement?

Map the demand against the supply capability and identify the prioritisation challenge.
♦ Using the agreed criteria, put the projects in order of priority allowing a line to be
drawn once capacity has been reached
♦ Agree the prioritised list in the cross-business forum and baseline it
♦ Drive it into action – and set up a transition plan to move to the future portfolio.

Page 8 Copyright © 2004 Charteris plc. All rights reserved. Business Change Portfolio Management
6. Linking the business for maximum strategic value

Bringing your business together to achieve sustainable change and

maximum benefit
As the pace and complexity of change increases, the benefits of strategic Business Change
Portfolio Management become ever more compelling.
Portfolio Management, however, is simply one element of the total framework needed to
introduce effective business change that is aligned to your business goals.
Charteris has the experience and skills to link in all business disciplines to achieve the
optimum mix of strategic focus, informed programme and project management and cost-
effective delivery.
Our expertise and accountability in our three key disciplines – Business, Projects and
Technology – will help to ensure that business-aligned change is not only delivered, but
delivers measurable business benefit.

Copyright © 2004 Charteris plc. All rights reserved. Business Change Portfolio Management Page 9

Business
Projects
Technology
Our services across three
key disciplines – Business,
Projects and Technology –
are designed to help you
and your clients meet the
most demanding business
goals promptly and reliably.
Page 10
Why Charteris?
Experience – the difference
Much of this document is concerned with process. But process – no matter how methodical
and intelligent – is nothing without insight and pure “been there, done that” experience.
At Charteris it is our people that make the difference. They offer a rare blend of business
experience, expertise and technological flair, enabling Charteris to provide the essential
bridge between business and technology.
That our people have helped create and manage some of the most demanding portfolios
of change in the business world, we believe, is further evidence that Charteris can help
you change your business for the better.
Our strengths
♦ Proven in-depth portfolio management expertise
♦ Highly experienced practitioners
♦ Bridging between business and technology
♦ End-to-end business consultancy, project management and technical
delivery capability
♦ Independent, practical, results-driven approach
♦ Performance improvement and measured business benefits
Our Business Change Portfolio Management expertise
♦ Design and set up of all or parts of Business Change Portfolio Management
♦ Review of existing processes and mechanisms
♦ Definition of demand portfolio – including categorisation
♦ Definition of supply capability
♦ Programme and project mobilisation
♦ Programme and project management
♦ Coaching and mentoring
Copyright © 2004 Charteris plc. All rights reserved. Business Change Portfolio Management
From our own portfolio

Managing global change for Reuters

Situation: Reuters needed to carefully manage a complex programme portfolio generated
by massive organisational change throughout its worldwide operations.

‘‘
Charteris’ role: Reporting directly to the Reuters board, Charteris helped develop a Charteris told
strategy for restructuring the entire business, involving some 17,000 people in over 100 me that
countries. The objective was to “wrap the business around the customer”. change is
Solution: Charteris managed the shift from product service and offerings principally driven something an
by technology and technologists, to a customer-facing offer driven by business-focused organisation has to own.
units. A simple but effective governance process was put in place to assess aggregate This is sound advice:
demand from business units, align this with corporate needs and strategy, and then prioritise because you have to win
the funding of product development. The system has now been in use for two years and
the hearts and minds of
is the key mechanism by which business change portfolios are managed at Reuters.
the team, they have to
believe in the changes you
Providing strategic IT leadership for a leading retail banking group are making. However, it
Situation: Between 2000 and 2002, in one of the largest systems integration programmes was extremely valuable to
ever undertaken, this customer’s IT development unit was focused almost entirely on have an independent,
merging its IT assets with those from another of its High Street banking brands. Virtually experienced organisation
all new development was put on hold. at our sides to make sure
Charteris’ role: With integration complete, the flood gates of demand for new products that we didn’t fall into
and IT support were opened. Charteris was engaged to provide strategic leadership to the traps, to keep us honest to
IT unit's programme management office to help cope. our cause and to keep up
Solution: Processes were put in place to take aggregate demand from business units, the momentum. Charteris

’’
categorise it into mandatory and non-mandatory classes, establish consistent business fulfilled just
cases, and then prioritise. Charteris helped the IT unit adopt a flexible resourcing and that role.
procurement strategy to optimise the programme portfolio by delivering maximum
business benefit for money spent. We also assisted in the transformation of the unit from
David
a pure development shop to a highly effective channel for IT procurement.
Grigson,
Finance Director, Reuters plc.
Improving disparate IT group services for a major utilities company
Situation: The customer’s IT department consisted of disparate units, each originally
located within diverse operating divisions serving a range of markets. Although the units
had been merged, there were concerns at board level that the combined IT group was not
delivering the levels of technology-enabled business advantage needed in each market.
Charteris’ role: Charteris was commissioned to undertake a comprehensive and wide-
ranging review of the IT group, which was facing an increasing backlog of demand for
business change and new systems development.
Solution: Charteris helped put in place a demand management process that ensured the
right prioritisation of activity across all business units, reduced demand backlog and
identified new procurement methods which would allow key activities to be completed
without the IT group acting as a bottleneck.

Copyright © 2004 Charteris plc. All rights reserved. Business Change Portfolio Management Page 11
 The essential bridge between
business and technology

About Charteris
Charteris was founded in 1996 by a group of senior executives from the IT and
Consultancy industries and is listed on the Alternative Investment Market (AIM).
Charteris employs around 90 experienced business and technical consultants with
many years of experience, further supported by a network of around 200 associates.

Charteris has three market-focused practices:

♦ Finance & Media

♦ Government, Legal, Utilities & Energy
♦ Retail, Manufacturing, Distribution & Technology

Charteris services are organised into three disciplines — Business, Projects and
Technology — to provide clients with the essential bridge between business
and technology.

Business
Practical experience of improving business performance and potential through
increased operational effectiveness and the strategic application of technology

Projects
Industry-leading experience applied directly to the most challenging projects and
programmes for business success

Technology
Hands-on experience of the latest proven technology to deliver maximum benefit
with minimum risk

For more information on Charteris, visit www.charteris.com, email info@charteris.com

or telephone +44 20 7600 9199.

Charteris plc
Head office:
Charteris House,
39/40 Bartholomew Close,
London EC1A 7JN
Tel: +44 (0)20 7600 9199
Fax: +44 (0)20 7600 9212
email: info@charteris.com
www.charteris.com

Page 12 Copyright © 2004 Charteris plc. All rights reserved. Business Change Portfolio Management