A prioritization meeting at the SSG Level

The next set of slides present facts on the department and progress, observations, and reactions and future plans. (SSG meeting 1.1)

4. Decisions

This point refers to decisions that should be made during the meeting. The decision could regard the approval/rejection of an evaluation of an idea, of a project idea, or a budget change concerning an existing project.

5. Status reporting

The last point that is presented in the meeting is the status of the currently running projects in terms of their schedule, quality, and budget. This is not discussed unless a member has specific questions, however.

In the following paragraphs I focus on the discussions that evolve during the third point of the agenda, since this is where the SSG members discuss and decide the prioritization of the IT projects.

All projects are presented by the development manager in a spreadsheet (see Figure 19), which includes standard information such as the project’ name, the priority of the project, full time employees (FTE) on the project, cost calculations for the first year and for the lifecycle of the project, benefits for the next 5 years, the cost-benefit ratio, time schedule, the current status of the project and the focus area as well as the department’s strategic direction. The cost-benefit analysis consists of the columns of cost and benefit calculations together with the cost-benefit ratio. The decision-makers alter this list during the meeting, after which decisions on projects’ final ranking in the prioritization list are made.

Figure 19: Prioritized list of IT projects in a spreadsheet

At the beginning of my field study I was intensively reading documents related to the IT project prioritization process found on the Group IT web portal. These documents contained guidelines and descriptions of the overall governance structure, PowerPoint presentations from different departments and spreadsheets with data about current projects’ statuses. In these documents (see for example Figure 19) I observed that the organization has a specific categorization system to cope with the variety and large number of the projects to be prioritized. These categories have a label that designates the project nature or status and have emerged through years of practicing project prioritization to facilitate decision-makers in relating each project to a specific theme.

The current project labels, some of which are included in Figure 19, are:

Ongoing/Active – indicating the status of the project implementation phase; program-related or strategic – indicating the status of the project in terms of interdependences with a strategic initiative; business critical – indicating the status of the project in terms of its necessity for the organization; legal/compliance – indicating the status of the project in terms of institutional requirements.

The presentation by the development manager includes: a) the ongoing projects that will continue to run the next year, b) the compliance projects that ensure fulfilment of current legal requirements, and c) new business projects. For new business projects the cost-benefit ratio serves as the starting point of the discussion, while project specific arguments follow.

However, apart from the labels included in the official documents during the SSG meetings the decision-makers use other labels as well. In the SSG meetings and follow up interviews the managers used labels such as a step stone project,burning platform, a link in the chain,foundation project, and low hanging fruits to designate the nature of the projects and which at the same time would compensate for a poor cost-benefit analysis.

The list of proposed new projects includes more projects than a department can accommodate within its budget and employees, and thus a department’s resources are allocated to the new projects with the highest priority. Ongoing and compliance projects are considered mandatory for the organization, and thus in prioritization meetings discussions mainly concern the new business projects and ongoing projects that require additional resources.

The main criterion used to prioritize the projects is the cost-benefit analysis calculated for each project. The other criteria used involve the organizational strategic focus areas and the strategic directions of the department itself. For the new business projects the cost-benefit ratio is used as the starting point of the discussion, while project specific arguments follow.

The resources of a department are allocated to the projects according to their priority in the list. At some point, due to limited resources, there are no more resources to be allocated. Because the list of proposed projects exceeds the numbers of the projects that a department can carry out with its current number of employees, an invisible line is created that separates the projects that can run with the existing or planned full time employees and those that need new resources. The members of the SSG usually referred to this phenomenon as projects that are under the line to emphasize the constraint that resources place on projects.

The discussions usually evolved around the last projects in the list, around the line, since at the top of the list, there are the ongoing and compliance projects that, as already described above, are considered mandatory.

The discussions in the meeting evolve around four types of events as presented in Figure 20. For new business projects the sponsor of the project idea presents the facts of the proposal included in the presented spreadsheet, i.e. the cost-benefit analysis, the status of the project, the number of FTEs required and its priority. These are challenged by other members in order to understand the business rationale behind the project, e.g., cost savings compared to other project proposals in the list. The sponsor responds by putting forward arguments in order to justify the project. This challenging and development of arguments goes on until an agreement is reached.

Figure 20: Events in the SSG prioritization meetings

After the final SSG meeting in Q4, the prioritized list is sent to the PPMO and all the lists get consolidated into a spreadsheet comprising the whole IT project portfolio for Group IT.