IntroductionThe IT PMO of a large Healthcare organization determined it needed project prioritization. A small, diverse team of people from its hospitals and IT was brought together to develop the prioritization model. The team consisted of the VP of Strategy for these hospitals, hospital staff members (clinicians, nurses, Doctors, radiologists etc.) as well as IT leadership for the hospital. At the same time, the Portfolio Management process was being developed.

Issues faced by the OrganizationWhat drove the decision to make such a significant change? The issues facing the organization were:

Organization of mergers and acquisitions: Stove-piped, independent businesses with no incentive to work toward common goals.

Division between Business and IT Resistance to change PMO leaderships belief that a tool was the solution Diverse mix of businesses No application/ systems standards (multiple solutions for the same capability) No view of resource capacity/ demand No single view of all projects Mandate to IT Site Leaders: must push through the PMO all projects suggested by their specific

hospital.

Poor Project Intake led to Project Management InefficienciesImportant projects were not getting done. With no prioritization and no view of true resource demand/ capacity, low value projects could take up resources needed by high value projects. This cause the more valuable projects to be stalled or stopped mid implementation. This also resulted in corners being cut when project managers tried to push the projects through the lifecycle quickly to ensure they did not lose resources. Project planning was one key phase that was shortened or skipped altogether, leading to a higher rate of project failure.

What was the current Project Lifecycle?Projects under a certain budget limit could be submitted and were automatically put in queue. Anyone could submit a project request and provide very minimal information. Once the requestor filled in a resource grid and a risk survey, the project would go through the resource management process to assign resources. Once resourced, the project could be rejected by an oversight committee but this was seldom the case.

The organization had tried different methods for prioritizing (such as labeling as 1, 2, and 3 with 1 being highest priority). However, these methods yielded only top priority ranking for almost all projects.

For higher cost projects, IT Governance did exist. In the fall of each year, the IT site directors were given instructions and deadlines for preparing the next years IT project plans for the site. The plan would provide budget information, justification, categorization according to standard functional areas and tie

to the IT corporate strategy. The regional leader would review and accept the projects he or she deemed priority for the site. This was then reviewed by the PMO oversight committee, which eliminated additional requested projects from the plans. The results of these meetings determined the site’s budget. In the following year, the sites were free to substitute other projects for those that had been approved.

The business Need/ driving factors for Project Portfolio Management:

Goals of the Portfolio ManagementThe goals for the Portfolio Management implementation were as follows

Help ensure realization of the business strategyo Projects must be tied to the corporate strategy

Portfolio of projects optimized for maximum benefit to the organizationo Needed to determine Risk, Cost, Benefit and Return before going forward with each

project Methodical and strategic method for selecting projects, with clear justification of the project

selection Prioritize at site, region, enterprise View projects across all sites to determine opportunities to combine efforts Improved future planning of projects Develop solutions standards

o Catalogue of accepted applications for specific capabilities

The Pilot of the prioritization modelA small group of hospitals had been discussing the concept of prioritization criteria for some time as they recognized the need to successfully complete the projects that would help them compete in a highly competitive market. Project prioritization would lead to smarter decisions regarding what should be funded. The model was based on research of best practices in the industry, input from all areas of the hospitals to determine the greatest needs, and tie to their strategic goals.

Once the model was in place, it was used to prioritize the projects submitted for the yearly budget to show the decision makers why they should fund the proposed projects. This trial run also showed what needed to be changed in the model in cases where the priorities were not as expected.

Developing the Prioritization model for the entire organizationNext, the entire organization needed to develop an enterprise wide model. This was difficult as there were hospitals of different sizes, budgets and age, from different states and differing specializations – all competing for the same resources. The organization grew by acquiring new hospitals. Each hospital still ran like an independent business, no incentives were in place to encourage the hospitals to work together.

The appendix contains the information that was provided for those attending the prioritization model development sessions. The material provides information from IT Health industry research, input from

the Pilot team and information to provide background and questions to think about. This material was expected to inform on background and ensure the attendees were prepared for the required brainstorming.

The final model is shown below. The number of business drivers at one point was probably 3 times this number but was narrowed down to these business drivers. The business drivers were prioritized to determine their weight in scoring.

Patient safety, care and satisfaction Physician strategy/ alignment Financial benefit Compliance Sunsetting/ Risk mitigation Clinical transformation Competitive advantage Operational readiness Operations improvement

Preparation for developing the enterprise-wide prioritization modelTo help the participants prepare for the sessions to determine the model, healthcare research and information gathered in the pilot was provided prior to the meetings. This information follows. In addition to the material, the participants were asked to review the organization’s business and corresponding strategic goals.

Materials for Prioritization Model Preparation:The purpose of the prioritization model session is to determine the Project Prioritization Model that best fits the business to ensure the portfolio of approved projects contains the projects that provide the most value to the organization.

How will the Project Prioritization model be used?Below the high level process is outlined to explain how the model will be used.

• The submitter evaluates their requested project against the business driver by answering each question related to the business driver.

• Each question provides 5 specific answers to show the relationship of the proposed project to the driver.

• Each Business driver is weighted so that the total project score reflects the weighting as well as the score resulting from the answer.

• All projects will be analyzed together based on scores (benefit/ value, risk) and cost.• Along with prioritization, the resource analysis will determine the final approved portfolio of

investments (projects).

The remainder of this document contains ideas to think about in determining the prioritization model that will define the value of the projects to the business.

Defining Value/ Determining Prioritization model1. What defines value for your hospital? For CHW? For your region?2. As the decision maker, granting project funding, how would you decide what are the most

important projects to do? 3. Think about: 1. Operations. 2. Market/ Competitiveness. 3. Customers. 4. Financial return/

benefit. 4. How is the hospital measured? 5. What are current specific issues for the business?

Typical Criteria for Value Evaluation:• Business:

– Strategic Alignment– Productivity– Process Improvement– Competitive Advantage– Business Impact

– Employee satisfaction– Customer Satisfaction– Impact of not doing the project

• Financial Benefits:– Revenue growth– Cost Savings – Cost Avoidance– NPV– ROI– Payback Period

• Risk-related criteria– Business risks– Technology risks– Project Mgt risks– Implementation risk– Public relation risks

• Legal/ Regulatory compliance criteria• HR Related criteria

– Specific competency– Employee satisfaction

• Market Advantage• Technical

– Architectural alignment– Information delivery– Success probability– Conformity to Standards

Healthcare Business Drivers to consider:• Patient Safety• Patient Care• Patient Satisfaction• Sun-setting/ Fixing• Regulatory/ Legal/ Mandatory• Operations Improvement• Cost Reduction• Business Impact• Avoid Negative Consequences• Competitive Advantage• Physician satisfaction/ strategic/ alignment

Example of a model from the Pilot:Risk Evaluation:

• Management Support – measures level of interest by senior management• Risk of not doing the project – Risk to organization if project is not approved.• Schedule Risk – risk of not completing per schedule.• Cost Sensitivity – evaluates quality or sensitivity of cost estimates.

• Organizational risk – risk project will fail due to organizational disruption.• Technical risk – risk to complete based on technical point of view.

Organizational Impact:

• Business Process redesign – allows organization to do things in a better way. • Business Model – degree of alignment with the organization’s business model.• Quality of work life

Mission Effectiveness – measure of system on internal and external customers

• Improve internal program services• Improved service to patients

Model Example from Internet Research:Value to System as a whole:

• Strategic• Financial• Clinical• Image• Customer Service

Practical Considerations

• Time Required • Capital Required• Legal/ Regulatory• Internal Resistance• Executive Support• Competitive Response

Strategic Areas:• Ambulatory Care• Regulatory• Patient Safety • Operational Improvement• End of Life• Clinical• PACS• BI• Rev Cy• HIM,

• Finance• Supply Chain• Employee Services• Web and Portal• Integration• Infrastructure

Top 10 Healthcare IT Systems Priorities (in order of importance)• Move toward electronic health record• Improve patient care capabilities• Improve decision support for all clinicians• Improve revenue cycle capabilities• Improve productivity and reduce costs• Improve ambulatory and outpatient capabilities• Make optimal use of networks and infrastructures• Implement wireless access and personal digital-assistant usage• Improve financial management and supply chain