Unlocking the Value of

Technology Investments

Speaker Name/Title
Date

1  2009 ISACA All rights reserved.

 The Importance of Reliable Investment

You would not buy a car that failed to

start 20 percent of the time.

You would not invest in a mutual fund that

consistently lost 20 percent of its value.

Yet more than 2 out of 10 enterprise IT

projects are outright failures.*
*The Standish Group, 2006

 2009 ISACA All rights reserved.

2
 IT Investments Bring Both Value and Risk

• IT investments are about enabling business change and can

bring enormous returns if managed properly
• Yet, without effective governance and good management,
there is an equally significant risk to destroy value

‘The concept of value relies on the relationship between meeting the

expectations of many differing stakeholders and the resources used in doing
so. The aim of value management is to reconcile these differences …’

— John Thorp, CMC, I.S.P.

Val IT researcher and developer
and author, The Information Paradox
[as adapted from the Institute of Value Management]

 2009 ISACA All rights reserved.

3
 A New Approach is Needed

• Managing IT-enabled change requires that IT investments be

managed
• One approach is to apply the principles of financial portfolio
management to evaluating, selecting and managing IT
investments over their full economic life cycle

A Massachusetts Institute of Technology (MIT) (USA) study of more than 300

enterprises in 23 countries found that faster-growing and more agile firms
such as 7-11 Japan, United Parcel Service (UPS) and ING Direct all had a
portfolio approach to IT management …

 2009 ISACA All rights reserved.

4
 Val IT™

• Proven practices and techniques for evaluating and managing

investment in business change and innovation
• Val IT helps executives:
– Increase the probability of picking winners
– Increase the likelihood of IT investment success
– Reduce surprises from IT cost and delivery date overruns
– Reduce costs due to inefficient investments

 2009 ISACA All rights reserved.

5
 Developed by the Leaders in IT Governance

Created by ISACA,
Fujitsu Consulting, ING and SeaQuation

Professional association with 86,000 constituents.

Worldwide leader in IT governance, control, security and assurance.
Offers the CISA, CISM and CGEIT certifications.

 2009 ISACA All rights reserved.

6
 Why Val IT™?

An organisation needs stronger governance over IT

investments if:
• IT investments are not supporting the business strategy or
providing expected value
• There are too many projects, resulting in inefficient use of
resources
• Projects often are delayed, run over budget, and/or do not
provide the needed benefits
• There is an inability to cancel projects when necessary
• It needs to ensure compliance to industry or governmental
regulations

 2009 ISACA All rights reserved.

7
 A Comprehensive Approach

• Many enterprises practice elements of Val IT™ already

• Val IT™ provides a consistent, repeatable and comprehensive approach
• IT and business become equal shareholders because Val IT™ helps
management to answer these key questions:*

The strategic question The value question

The architecture question The delivery question

* Based on the Four ‘Are’s as described by John Thorp in his book The Information
Paradox, written jointly with Fujitsu, first published in 1998 and revised in 2003

 2009 ISACA All rights reserved.

8
 The Seven Principles of Val IT™

IT-enabled investments will:

1. Be managed as a portfolio of investments
2. Include the full scope of activities required to achieve business value
3. Be managed through their full economic life cycle

Value delivery practices will:

4. Recognise different categories of investments to be
evaluated and managed differently
5. Define and monitor key metrics and respond quickly
to any changes or deviations
6. Engage all stakeholders and assign appropriate accountability
for delivery of capabilities and realisation of business benefits
7. Be continually monitored, evaluated and improved

 2009 ISACA All rights reserved.

9
 How Val IT™ Works
Establish informed and Define and Define portfolio
committed leadership. implement processes. characteristics.
Value Governance
(VG)
Align and integrate value
Establish effective Continuously improve value
management with enterprise
governance monitoring. management practices.
financial planning.

Establish strategic direction Determine the availability Manage the availability

Portfolio and target investment mix. and sources of funds. of human resources.
Management
(PM) Monitor and report
Evaluate and select Optimise investment
on investment
programmes to fund. portfolio performance.
portfolio performance.

Develop and evaluate the Understand the candidate

Develop the programme Develop full life cycle costs
initial programme concept programme and
plan. and benefits.
business case. implementation options.

Develop the detailed

Launch and manage Update operational
candidate
Investment programme business case.
the programme. IT portfolios.
Management
(IM)
Monitor and report on
Update the business case. Retire the programme.
the programme.

 2009 ISACA All rights reserved.

10
 Top Organisations Support Val IT™

Organisations struggling to execute IT strategies that

deliver business value and to communicate this value
to stakeholders should evaluate Val IT as a tool for
improved value delivery.

- Craig Symons, Vice President, Principal Analyst

Forrester Research
in the Report “From IT Governance to Value Delivery”
22 June 2007

For more information, please visit www.isaca.org/valit

 2009 ISACA All rights reserved.

11
 Getting Started
Visit www.isaca.org/valit to learn more or download a free copy of
the Val IT™ framework, Getting Started With Value Management
and The Business Case.

 2009 ISACA All rights reserved.

12