is.it. project office set-up in complex environment. a post-merger case ( pragmatica mc)

#1PRAGMATICA Management Consulting

BigCORPPost-MergerIS/IT Project OfficeMission and Operating principles


This document proposes an approach focused on answering some of the main merger IS/IT challenges from a pragmatic point of view

Organizational implications

The merger and challenges for IS/IT management

Project Office operating principles

Value proposition of a Project Office

Project Office Mission and principal functions

Setting up the Project Office

… Some of the main BigCORP Integration IS/IT requirements

What can help in this situation?

Why will it be useful?

How is it going to work?

… and, What is next?Next steps

Document contents


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1 The merger and challenges for IS/IT management

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Table of Contents

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Setting up the Project Office6

Next steps7


BigCORP has to face and integrate an increased number of complex IS/IT projects to be delivered on time and budget, as part of the great merger challenge

A highly complex merger project… Merger to be completed in a 24 month horizon

focusing on the challenges of… Business continuity Synergies to capture Organizational change

High complexity of the merger project several parties International setting Considerable differences in company culture

To date, no central integration management

… and a difficult context for IS/IT service delivery IS/IT related projects are critical to the success of the

merger IS/IT projects contributing to the merger are

fragmented in terms of owners, deadlines, size, complexity and impact

Business sense of ongoing projects may be affected by the merger and need to be re-evaluated

Many important IS/IT merger projects are transversal (corporate, cross sector, cross BU)

IS/IT resources do not match the transversal scope of projects, mainly decentralized and reporting to business

IS/IT to deliver an increased number of complex projects on time and on budget

Complex mix of projects driven by the business transformation Risk of delay due to dependencies and IS/IT resource availability Budget risk due to redundancies, overlapping and external contracting

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IS/ITSteering Committee

The challenge is relevant at all IS/IT levels, but a corporate perspective is necessary to making a reality possible cross-sector synergies in knowledge, organization, information and costs

1

Information Systems Services and Resources

Information Systems Planning

DG Platform

Management Board

BU Head BU Head

Sector Head

CIO

Sector Head

Corporate vision

Sec

tor

vis

ion

Sector vision will be a success factor, pivotal as per market realities, but a transversal vision of the activity across different sectors / businesses is also necessary in order to

manage the achievement of synergies.

Synergies never materialize on their

own. Their achievement must be

managed

Plant Head

IS/IT project IS/IT project IS/IT projectIS/IT project


Specifically, project development presents information, monitoring and management needs on a “corporate perspective” level

1

Align projects with IS/IT strategy and identify critical projects

Rely on an “information hub” with standard information

Have elements for assessment in order to establish mapping of priorities

Facilitate & Monitor progress of transversal and critical projects

Identify redundancies

Corporate requirements

Coordination with projects in other sectors and standards for monitoring

Be aware of and follow critical projects with transversal impact

Access to achievements in other sectors, that can be used in my own sector

Identify redundancies

Possibility for arbitration

Rely on an “information hub” with standard information

Sector/Business requirements

Which projects and who’s responsible?

With what priority?

Which resources?

What’s the cross-sector impact?

Are there redundancies?

Can different BUs profit?

Which projects, what’s their priority and who’s responsible?

What resources do I provide / receive for corporate projects?

How can I take advantage of other sectors’ achievements?

Are arbitration facilities between projects / sectors available?

Can I access up-to-date information on “state of the art” for projects in other sectors and projects which may affect me?

facilitate project development and “service delivery”, prioritizing critical projects and maximizing synergy exploitation

New requirements

New projects

BigCORP Merger: IS/IT scenario

NewOrganization

On-goingprojects


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Next steps7


IS/IT Steering Committee

CriticalProject

Critical Project

Critical Project

Project Office

CIO CIO

Organization Flat Carbon Long Carbon Stainless …

Domain HR Purchasing Accounting …

Transversal Network …

Monitor Progress

Report on Corporate level

Report on Sector level

Merger issues, quick wins, synergies…

Transversal and cross-business/function projects… …monitored by the Project Office support

Creating a Project Office will substantially facilitate the identification and management of inter-sector questions of interest for BigCORP

2

Issue Quick Win Synergy

Qualification

Task Force

Ad Hoc Mission

Resolution/Capture


2

DG Platform

Sector CIO’s

IS/ITSteering

Committee

… informational and project monitoring support to facilitate the task of coordinating sector and corporate visions

Early recognition of issues and risks leading to resolution Information efficiency

Decision oriented reporting Filtering of project-related information

Transparency on progress

Project managers

IS/ITProject

Manager

… providing an “information hub”… supporting and providing standard principles of monitoring & reporting

Information efficiency Action oriented synthesis Filtering of project-related information

Transparency on interdependencies, resource usage Identification of eventual redundancies


Sector & BUCIO’s


BusinessOwner / Leader

… providing transparency on critical projects in decentralized service delivery… helping to ensure delivery of critical projects

Transparency on interdependent projects and option for coordination

Assistance for the identification of issues in a changing environment

A direct and efficient way to communicate issues and ask for decision

Promoting arbitrage when necessary

Having a Project Office adds value for all stakeholders of the projects


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Next steps7


Business Owners / Leaders

Project Managers


The Project Office’s mission is to provide service to the direct “stakeholders” of the projects in order to facilitate decision making

3

For whom?Direct stakeholders

Facilitate and monitor progress Ensure coordination and follow-up of IS/IT critical projects Ensure transversal coordination of projects Identify and facilitate arbitrage on conflicts/trade-offs

between isolated projects Provide transparency on risks and initiate early mitigation

Represent the “information hub” for the program Ensure “information efficiency” by consolidating the

project reporting Harmonize and share project-related information

On demand, support project managers in integrating with other projects, on methodology aspects or planning of project

How so?Principal functions

Inform

Coach

Monitor


Project Office’s mission concentrates on project delivery, but its activities provide transparency to assist throughout the project lifecycle

Project Office services

Project lifecycle

Project Office provides standard templates and tool for monitoring and reporting

Project Office directly monitors and reports on critical projects

Project Office provides support on demand in project management

Project Office serves as a channel for communication

Escalates issues Provides

information for decision-making

Deliver

Projects must be managed in coherence with the BigCORP principle of subsidiarity, with Project Office interacting at relevant levels to add value through transparency and monitoring

Project Office provides standard templates

Project Office provides information that allows stakeholders to quick-scan arcelor environment to identify project alternatives before qualification

Project interdependencies

Project overlap or redundancies

Possible synergies, integration with other projects

QualifyConceive

Project Office provides support on demand in project planning

MethodologyResources with

required skills (having participated in similar projects)

Evaluate and Learn

Project Office promotes data base

Project Office supports objectives tracking for success/failure qualification

Project Office provides information for continuous improvement measures

Project Office monitors and reports on task forces that implement improvement measures

Project Office focus

Project Office supportProject Office support

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The Project Office operating principles can be described by answering a number of key questions

4

Which projects will be on the Project Office radar ?

How to register new projects ?

What are the roles of the Project Office organization ?

How does the Project Office communicate with the different stakeholders ?

Which information is managed by the Project Office ?

What do « monitoring » and « reporting » mean ?

Which tools can be used by the Project Office?


Which projects will be on the Project Office radar?

The Project Office will primarily monitor those projects approved by the Steering Committee

4

Projects approved by the Steering CommitteeProjects with cross-sector or cross-functional scopeProject size > ____ EurosProjects whose non-completion pose an operational risk

Projects relying on resources loaned by other sectors

Those projects, new or ongoing, defined as such “on demand”Projects “visible” at board levelBy a member of IS/IT Steering Committee

IS/IT Steering Committee must approve and publish criteria determining which projects must be submitted to the Steering Committee

•Must have a clear guideline for acting•Decentralized Service Delivery staff must understand which projects must be reported

Criteria for qualifying a critical project

Illustrative

Monitored by IS/IT SC

Approved by IS/IT SC


IS/ITSteering

Committee


Process for qualifying a critical project4

Proposes Qualifies (Approves)

On-going projects

Newprojects

•Management Board•Sector CIO•ISSR / ISP•Project Office

•Management Board•Sector CIO•ISSR / ISP



Critical Project

•Sector CIO /ISSR/ ISR (Owner/Leader)•Project Manager•Project Office

Interact “directly” around the project

ProjectManager

Sector CIO (*)

ProjectOffice

CriticalProject

(*) Or ISSR or ISP

Owner /Leader

Manager / Delivery Monitoring & Reportingsupport

The project begins to be monitored by the Project Office

dossier

ProjectQualification

(*)

(*) See next slide


(*)

ISP: Information Systems Planning. ISSR: Information Systems Services & Resources



Project Office support in Project Planning and Qualification4

Defines standard templates for “Project Qualification”, ensuring uniform information, which the Steering Committee uses to make decisions

Templates represent a checklist to ensure application of best practices in project definition and launch

Business alignment

Appropriate specification of needs

Resource planning, budget

Risk estimation

Standard templates provide transparency, with Project Office promoting their visibility through an “on-line” tool

Supports Project Managers / CIO’s with project preparation methodology, if requested

Provides information for quick-scan to ensure coherency with ongoing projects, identify interdependencies

Checks alignment with Corporate orientations


What are the roles of the Project Office organization ? The Project Office is neither a substitute nor the corporate police; it supports the players in fulfilling their roles on a project

4

Accepts / rejects projects in accordance with priorities as per strategyOversees progress for Corporate resultsIntervenes as decisions necessary

Generates demand, defines project objectivesSigns-off on project proposal and submits to Steering Committee

signifying that believes in project as defined and is willing to payGuarantees provision of inputs that IS/IT service providers need from clientValidates status reported by “Project Manager”

signifying client acceptance

Matches demand to project planning signifying understanding of client objectives

Guarantees achievement: milestones & objectives to do so, mobilizes and controls resources in alignment with project planning raises the red flag when issues endanger achievement

Channel for communication aggregates information prepares reports to IS/IT Steering Committee escalates critical issues / decisions

Support, Coaching on demand“Repository” of informationIdentifies redundancies and transversal synergies

ProjectOffice

IS/ITSteering

Committee

IS/ITProject

Manager

BusinessOwner / Leader


How does the Project Office communicate with the different stakeholders ? The Project Office collects information on project level, aggregates information and reports to the IS/IT Steering Committee and CIOs on a regular basis


Critical Project

Critical Project

Critical Project

Project Office

CIO CIO CIO

Project ManagementEach Project Manager reports status for the main project and progress on achievement of objectives to the Project Office

Co-ordination and ReportingThe Project Office co-ordinates the deliverables and reports only aggregated project status, open issues and objectives information to the Steering Committee

Control and ManagementThe Steering Committee uses the information to pilot the integration process

CIO

4


How does the Project Office communicate with the different stakeholders ? Project Office communicates with its “customers” through reports and direct interaction in meetings

4


Critical Project

Critical Project

Critical Project

Project Office

CIO CIO CIOCIO

Synthesis to CIO and Business Leaders on the progress of projects by the Project Office

Regular reporting to Steering Committee from the Project Managers via the Project Office

Presence of Project Office members in meetings if required

Regular contacts between Project Office members and the Project Managers to update project cards


Description Rationale Objectives Scope Organization

Owner Steering

Committee Business

Leader Project

Manager Resources Prerequisites Interdependencies with other projects Budget Planning Approval

#1

BudgetPrerequisite and Dependency

Sample of ProjectQualification

End 03/2002

Dashboards, other next steps..

End 03/2002

Implementation of the DB for 200 users

End 02/2002

Implementation of ETL for 20 users

Project Name

Common commercial data warehouse & dashboard (project 2)

Required Inputs

common customer list, plants, SOP / demand products, market segments

analysis axes

sales organization description

needs collection on extractions in sales units

arcelornetwork connection (project 1)Other Prerequisites(availability, coaching, etc.)

definition and lists of Master Data (Planning & Marketing)

for next steps, clarify the role of the DW (for example as regards with i2 DP reporting)

Human Resources

IS/IT Team

H.Vanseer A.Sinap

G.Verbeeck C.Struyve

JY Lemaire F.KleinProject Members (Business Requirements)

E.Goeminne R.Segaert

E.de Guibert C.Boucher

D.Pierret A.Hervas

J Tamargo Cuervo A.Rivera

B IglesiasProcess Owner

TBDRequired Skills (soft, hard, change)

TBDSteering Committee

TBD

(K Euros)

First -Level Planning

Risk Identification

huge investment in BO by Usinor : how to report on industrial data if DWH is to become the unique system of reference?

acceptance of the DWH architecture by the Corporate

risk of delay considering the march deadline : tests and resolution cycles on the different sources can take time

implication of all subsidiaries

management of authorizations still to define

needs definition from the sales management concerning step 2

99,999Total

99,999External Resources

99,999Capital Expense (i.e. licensing)

99,999Workload (i.e. application development)

99,999Operational Budget (i.e. traveling)

Objectives and Scope

Owner

Business Leader

Project Manager

TBD

Marc Billant(to be replaced)

Marc Baudet

Day One objectivesProvide Sales Management with consolidated sales data in order to handle sales operations from Day-1Next Steps Objectives

Implement the sales dashboards for monitoring

Extend the scope of the DW in order to steer the different sales activities

Scope

Complete FC sector commercial activity

La Magonaout of the scopeProject phase 1 (Day 1) is to aggregate data on order entry and invoicing history

customer / group of customer

products (aggregated level)

business units, plants

market segments, country

commercial organization (sales units)Next steps priorities to be defined with sales management (i.e. sales dashboard)

Rationale

Turnover

Capital Employed

Cost

Safety and Environment

Business Continuity

Compliance

Which information is managed by the Project Office ? The Project Office keeps structure of a restricted, constantly changing, quantity of information at all times

Project Qualification

Expected output Status and % completion Revised budget Revised planning Progress on milestones Risks anticipation Outstanding issues Decisions to make

Periodical Project Cards

4

Preliminary

Support and meeting minutes of Steering Committees Deliverable per milestone and dossier for IS/IT maintenance 6-month evaluation Financial effect tracking (i.e. synergies) …

Collection of Project Evidences

______

______

______

Last Update 15/02/2002

Version #1

Author Marc Billant

Page

Validation Status

Owner

Business

Delivery

TBD

Domain Mgt Committee

Organization Project Group


What do « monitoring » and « reporting » mean ? Monitoring critical projects will take form in a practical manner with the support of the Project Office

4

IS/ITProject

Manager

IS/IT Steering

Committee

Business Owner / Leader

Project Card

Project Launch & monitoring

Responsible for service delivery and due preparation of Cards

No intervention

CoachingReviews and Posts CardsSelection of elements for

“escalation”

As Client, responsible for “buying” final result, validates:

Definition of milestonesStatus reported by

Manager; does client accept deliverables?!

Project Approval

Project Qualification

Assigns human resources

Identifies prerequisites; calculates budget

Signs off on final proposal Approves, rejects and/or conditions approval

“Repository”Assists on demand in

preparationalignmentdependenciesrisks

Defines objectivesSigns off on final proposal

implies participation in / acceptance of prerequisites, budget...

Match strategic/project objectives

Qualifies project success /failure

Prepares reports on objectives and achievement per project

No intervention in tracking (though intervenes in use and maintenance issues)

Assesses achievement of long-term objectives

CriticalProject

Associated“tools”

ProjectOffice

Progress Report

Makes necessary decisions

Responsible for due preparation of Reports

No intervention

(Recipient)

Milestone reporting

Post-project l/t tracking


Revised

ProgressReport

What do « monitoring » and « reporting » mean ? Monitoring critical projects will take form in a practical manner with the support of the Project Office (cont)

4

Periodical procedures for Monitoring & Reporting

OperationalAspects

Achievement of Objectives

Risks & otherRevised

Project Cards

Project Managers Project Office

Progress review Validation of project card

for submittal Identify / communicate

issues Identify decisions to be

“escalated”

Support

Business OwnersSector CIOISSR / ISP…

IS / ITSteering

CommitteeMonitoring overview for

Corporate reportingMake decision as

necessary for project achievement

Qualify success

i i

i

Each Month

Project Launch & monitoringProject Approval

CriticalProject

Milestone reporting


4What do « monitoring » and « reporting » mean ?

Monitoring means to assess progress on a regular basis, regarding operational aspects and the achievement of objectives

Project Card

Hard & Software

Other opex

Man-days

Euros

Total

Man-days

External resources

Man-days

Euros

Euros

Internal resources

RevisedRemainingConsumedInitialBudget concept

ReferenceProject Reference Current Status

Last Status

Completion 999 %

Start Date

Initial Due Date

Revised Due Date

mm/yy

mm/yy

mm/yy

Initial Budget

Revised Budget

99,999 (K Euros)

99,999 (K Euros)

OutputText

City Planning

ObjectiveText

Organization

Domain

Transversal

Text if applicable

Text if applicable

Text if applicable

Owner

Business Leader

Project Manager

Name

Name

Name

Project name #1 Project name #2

Dependency

Project NameText

LegendOn Track Attention Requested Action Requested

Last Update dd/mm/yyyyVersion Number

Author NamePage

Related project documentation / deliverables available Text if applicable Text if applicable Text if applicable


4What do « monitoring » and « reporting » mean ? Monitoring means to assess progress on a regular basis, regarding operational aspects and the achievement of objectives (cont’d)

Project Card

To Start99.99999.999dd/mm/yydd/mm/yyText

BudgetDue Date


Finish99.99999.999dd/mm/yydd/mm/yyText

Progress99.99999.999dd/mm/yydd/mm/yyText


Finish99.99999.999dd/mm/yydd/mm/yyText

Progress 99.99999.999dd/mm/yydd/mm/yyText

StatusSpentPlanRevisedInitial

Milestone



Author NamePage

Project Name Text ReferenceProject Reference


4What do « monitoring » and « reporting » mean ? Monitoring means to assess progress on a regular basis, regarding operational aspects and the achievement of objectives (cont’d)

Project Card

Issue #1 Issue #2

Risk rationale and mitigation #1 Risk rationale and mitigation #2

Decision #1 Decision #2

Next step #1 Next step #2

Next StepsDecisions

RisksProject ReferenceProject reference

Resource

Budget

Time Slipping

Hypothesis/Decision

Dependency

Technology Current Status

Last Status

Completion 999 %

Issues Risks Rationale and Mitigation

Project NameText



Author NamePage


What do « monitoring » and « reporting » mean ? Reporting aggregates information on project status according to the information needs of the different stakeholders

P R T A S D

Infrastructure Network interconnections

P.Y Joyeux (technical) V

90% Second and third connection delivered

Progress Low reactivity in case of problems

Launch study on global network for arcelor J V V V V V

Infrastructure Common arcelor directory

V

90% Progress Legal issue for Aceralia (no sharing of personnal information allowed) V V V V V V

Infrastructure e-mail interconnections J 70% Interconnection servers SMTP Progress User naming to be defined V V V J V VInfrastructure arcelor intranet J.C Meyer V 100% (n.a.) Finish V V V V J VInfrastructure Travelling users V 90% Testing Progress V V V V V VInfrastructure Financial consolidation

interconnection of applications

J.C Meyer

V

100% (n.a.) Finish

V V V V V VInfrastructure ALZ / Ugine

interconnection of commercial application

T. VanLeeuw

V

100% (n.a.) Finish

V V V V V VInfrastructure Flat Carbon commercial

interconnectionV

20% Preliminary analysis Finish

V V V V V VInfrastructure Access to applications

for agencies V20% Progress

V V V V V VInfrastructure Deployment of demand

planner V20% Progress

V V V V V VInfrastructure Commercial

datawarehouse V20% Progress

V V V V V V

City Planning RisksStatus & Completion

Progress Report on 25 February 2002

LeaderProject Name DecisionsIssuesStatusMilestone

Project Name PriorityIssue Subject

Outstanding Issues on 25 February 2002

Close Date ProgressResolutionDescription Open Date ImpactsAssign ToOriginator

Project Name Decision Subject

Decisions on 25 February 2002

DescriptionDecision

DateFor Decision / Validation

Decision Maker

4

ILUSTRATIV

E


4Which tools can be used by the¨Project Office? For running the Project Office, a collaborative tool for information sharing, such as Notes, will be put in place in a phased manner

TemplatesPower PointExcel

Mail...

Document archivingDownload templatesVisualize project infoKey contacts

Forms Work flows

(“click&send”)Levels of aggregationProject card historical

tracking (hyperlink)

Review targets and annual impacts(objectives and implementation costs)

Synergy plotting

Project hostingBest practice publishing...

Starter kit

Knowledge sharing

Process management

e.g., Optimus

e.g., Changepoint

Possible evolution Aligned with BigCORP

Project Office “on-line” collaborative tool

Not led by the Project Office, but if tools are available, the Project Office has supplied elements (info) which make use possible for its clients

Objectives tracking

Possible evolution...


Project Card


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The Project Office interacts at different organizational levels, although at first activity will be launched with a simple scheme, located under ISSR functional responsibility

5

Initial organization

IS/ITSteering

Committee



DG Platform

Management Board

BU Head BU Head

Sector Head

CIO

Plant Head

critical project

critical project

critical project

Sector HeadSector Head Sector Head

IS/IT project IS/IT project IS/IT projectIS/IT projectIS/IT project

Project Office


Once a “critical project” has been identified and qualified, it will be monitored by the Steering Committee, with the Project Office providing support to all figures involved

5

IS/ITSteering

Committee

ProjectManager

Sector CIO (*)

ProjectOffice

CriticalProject

(*) Or ISSR or ISP

Owner /Leader

Manager / Delivery Monitoring & Reportingsupport

Critical project

organization

Resources


The first few “working” months will allow us to contrast the real needs posed by Project Office activity and evaluate the convenience of extending this organization within the Sectors

5

Possible future organization

IS/ITSteering

Committee

ISSR

ISP

DG Platform

Management Board

BU Head BU Head

Sector Head

CIO

Plant Head

Sector HeadSector Head Sector Head

CIO

Project Office

Project Office

Project Office

Critical projects

IS/IT project

IS/IT project

IS/IT project

IS/IT project

Organizational principles• subsidiarity• efficiency• continuous improvement


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A Project Office is usually operational in 6 to 8 intensive weeks

Objectives Promote and collaborate on identifying the major IS/IT critical projects, with particular emphasis on objectives, milestones, issues, risks and decisions

Obtain a high level vision of interdependencies

Visualize outcome based on a reduced panel of critical projects

Start to implement the tools

Identify the key contact persons along the defined processes

Create a communication pack for Project Managers

Initiate monitoring of progress in all critical projects and communication

Activate register process

PhasesMap the Critical Projects

Deliverable Presentation identifying and detailing the critical projects and their interdependencies

Set of tools for operating the project office

List of contact persons Communication pack

Project Office running

Set Up the Project Office

Launch the Project Office

6

Define the Operating Principles

Definition of « critical project », and reporting frequency

Definition of Project Office key processes Register new projects Monitor Communicate and

report Specification of Project

Office starter kit, such as forms, and tools

Presentation for validation of principles

We arehere


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Project Office Next Steps7

Introduce consulting senior team as soon as possible Establish a first-step infrastructure

Meet selective stakeholders Introduce the project office (Mission & Operating principles) Collect feedback Align on expectations

Submit to the Steering Committee for approval

Main critical streams Actions

Communicate, reach

consensus and approve project

Set up an initial project kit

Introduce the Project Office to the approved projects (Initial project kit) Initiate and monitor the pipe of candidate projects (ISSR, ISP, other)

Initiate a “starter” Map of possible critical projects with the CIOs Identify, with the approval of the Steering Committee, projects to add to the “starter kit”

*Reference convention for projects and sub-projects*Clustering definition of projects along organization, domain and transversal axis*“Critical project” and “priority” definition

Set up definitive starter templates and standards Project qualification and project card templates

Establish a communication kit for Business and IS/IT Leaders Promote development of the on-line tool

Progress on starter

templates, and tools

ongoing

ongoing

ongoing

asap

asap

immediate


What do we need from the members of the IS/IT Steering Committee?7

Define and publish criteria for qualifying critical projects

Validate the Project Office operating principles

Validate “starter kit” templates

Supply an initial list of key contacts within the sector

Initiate mapping of projects

Quick win for launching Project Office activity:Identify 1-3 projects per sector for qualification at IS/IT Steering Committee in (date)

is.it. project office set-up in complex environment. a post-merger case ( pragmatica mc)

Business

merger isit projects

isit management project

important isit merger

critical projects

complex merger project

corporate projects

project development

business isit