Obstacle course

Obstacle course

IT heads describe why some projects make it and others don't, and what to do to get yours passed.

Getting technology projects past their C-suite colleagues is an uphill task for chief information officers (CIOs). It is often hardly about the technology and mostly about the bottom line. The main hurdle in selling information technology (IT) projects to chief executive officers (CEOs) and chief financial officers (CFOs) is demonstrating the return on investment (ROI).

"Most IT projects are about heavy and long-term investment. The major obstacles are normally the uncertainty of the future, and whether the project is market-driven or technology-driven," says Rosemary Chan, a consultant at US-based investment bank Morgan Stanley Asia.

She is a seasoned IT executive with more than 25 years experience in managing turnkey data centre solutions. In any discussion with C-level executives about project management, you should take into account the comprehensiveness of due diligence, cost with options and timing, she explains.

Economical solution

When illustrating an IT project's ROI, the stakeholders' returns should be considered from both financial and non-financial aspects. So says Iswaraan Suppiah, head of group information and operations division, CIMB Group, a Malaysia-based investment banker.

Suppiah says he usually demonstrates to the C-suite that it is an economical solution comprising the following 'DNA':

  • Enabling-that the project is in line with the group's vision and helps achieve the group's agenda in the mid-and-long term;
  • Efficient-the project must exemplify how the enabling solution optimises cost to service and cost of utilising the resources, a demonstration of the best use of time, people and money; and
  • Effective-it's essential to show how the IT team can execute the project effectively to achieve the intended objective.

Making tactical decisions is the hardest type of work in IT project management, adds Chan, as this involves not only long-term commitment, but also heavy capital investment.

When CEOs and CFOs oppose IT projects, they usually put forward reasons such as market uncertainty and the lack of assurance that the decision made is the best one, she says. "The strategy to overcome this is to ensure all options, including the 'impossible' options, have been reviewed and studied, together with detailed risk analysis."

Language of CEOs

James Loo, CIO of Singapore-based logistics services provider YCH Group, says CIOs have to do better in finding ways to present their cases in the language of CEOs and CFOs: "We might have created our own obstacles unknowingly.

"While my project managers can present their plans to me as IT projects, my presentation to my CEO and CFO will always be a business project. Only when there is a specific request to answer some technology questions, would I put such details into the appendices for their reference and even then, in summary or in a very condensed form."

In any discussion with CEOs and CFOs about project management, Loo focuses on presenting the project results, rather than details at execution level, because their key interests will be on the business and money at both the top and bottom lines.

Improved process

"For example, they are not interested in moving a project into UAT [user acceptance testing] except to know that you have made progress," says Loo. "But if we present this milestone as another one month from cutover, which means in another month we will start seeing an improved cash collection process for the business because manual billing is eradicated, they will want to know. They may even ask if the UAT can be shortened for an earlier cutover and what additional resources from finance is needed."

When CEOs and CFOs oppose IT projects, the key concerns are usually cost-related, the certainty of payback and the strategic impact on business-"especially crucial issues affecting the industry that the company needs to stay ahead of, or at least not be left behind and pushed out of business because of compliance issues", says Loo.

"I have shared how we can change our reporting to dollar terms on our project milestones. It will be difficult initially. We may have to approach this in two steps.

"I propose starting with reporting both in terms of project phases by activities and then associate each project phase with the corresponding budget and actual cost figures. Basically, they need to know that you have control over the project and can manage it well, both in terms of work and finances."

Loo's mantra: "The business is the only reason for IT and our projects, so make it [IT] work."

To ensure robust project management, it is essential to have procedures, frameworks and reporting mechanisms firmly in place to ensure an effective and successful delivery, says Suppiah. At CIMB, the project management office comes under the umbrella of the transformation office, which is under the purview of the CIMB's CEO, under the operations and technology division.

The hardest type of IT projects to argue, says Suppiah, are investments that have no identified short-term financial payback but instead deliver the enterprise architecture with long-term growth for the business.

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Tags CIO rolecostcio and cfo

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