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3. An effective organizer with skills in:
(b) Allocating resources

3b1 ITS Strategic Planning process for prioritizing projects, budgeting and allocating resources

Development Plan Portfolio Documentation
Develop a Strategic Plan for ITS that gives budgetary direction for allocating resources and prioritizing projects in accordance with Andrews' objectives.  Include goal setting for personal and departmental growth. Document the budgeting process followed in ITS, including wage and salary budgeting, prioritizing funding for technology in accordance with the institution’s mission and goals, and measures developed to foster accountability in team leaders.
  1. Prioritizing Projects
  2. Budgeting
  3. Allocating Resources
  4. Strategic Plan
  5. Accountability

1. Prioritizing Projects

Strategic Information Technologies

As it became increasingly evident that there were pressures for IT projects beyond the capacity of the resources available in ITS, we compiled a list with brief descriptions of the major requests that were coming to us.  Our purpose was to present the projects in various venues, and ask each group to prioritize the projects.  Fifteen IT projects were identified, and are listed alphabetically in the following list.
1.  Customer Relationship Management
2.  Data Warehousing
3.  Disaster Recovery Planning
4.  E-commerce
5.  Emergency 911
6.  GroupWare & “white collar productivity”
7.  Helpdesk
8.  Imaging & Workflow in Banner
9.  Instructional Technology
10.  Integrating Voice & Data
11.  Intranet
12.  Mass Storage
13.  One Card Integration
14.  Streaming Audio/Video
15.  Time & Attendance

In 1999, ITS personnel wrote Strategic IT Summaries briefly describing each project.

Voting Results For The Strategic IT Projects

From this list of 15 IT projects, ITS managers, the three university computing committees (Academic, Administrative and Web), the Strategic Planning committee, and the President's Cabinet were asked to vote for the 5 projects considered to have the highest strategic importance to Andrews University. The objective was to reduce the list from 15 to a smaller number of projects for further study, cost-benefit analysis, and prioritization.

Putting together all the votes, but counting only one vote per person, five projects were identified for further study:

2.  Data Warehousing
8.  Imaging & Workflow in Banner
1.  Customer Relationship Management
4.  E-commerce
9.  Instructional Technology

In addition, the Cabinet chose three other projects for inclusion:

3.  Disaster Recovery Planning
5.  Emergency 911
15.  Time & Attendance

The number of votes received by each project is reported in Voting on the Strategic IT Projects.  The table also includes projected completion dates.  After completing this first pass prioritization, we had a more concrete basis on which to budget staffing, capital investment, and maintenance contract operating costs for new hardware or software purchases.

I have written up some of the more formal approaches to choosing between alternatives and prioritizing projects in Competency 4(c) A collaborative consultant with skills in: Problem-solving and decision-making, including Weighted Score Rankings and Analytical Hierarchical Process.

2. Budgeting

As Chief Information Officer for the University, I was heavily involved in the budgeting process.  For this competency, I have included my handout describing my ITS Budget Proposal for FY2001, and also my speaking notes for presenting ITS 2001 Budget.

FY2001 did not end well, and tight control had to be imposed on any kind of spending in the final period of the year.  I imported the closing balances for each of the 12 periods of the year for each of my ITS cost centers into a spreadsheet.  I then plotted them to analyze visual deviations from budget throughout the year, attaching notes to explain some of the peaks and troughs.  (See Monthly activity for ITS for FY2001 - scroll to the right to see the graphs.)

In preparing the ITS budget proposal for FY2002, I prepared a business case for increasing staffing in the Servers and Networks department in ITS.  There had been quantum leaps in the number of actual servers being administered, as well as the number and complexity of services provided, but there had been no corresponding increase in staffing (see Growth in Network Services).  I felt we had a compelling case to create a new position in this department but in my budget presentation for FY2002, I tried to minimize the budgetary implications by reallocating other budgets as much as possible.

The financial situation at Andrews continued to be tough for everyone.  I have included the Budget Scenarios spreadsheet I prepared for 2003 (see in particular the last tab: Charts and the first tab: Scenarios).  I have also included the spreadsheet I used for Budget Development for 2003, as well as the PowerPoint presentation I prepared for the 2003 budget meetings.

Budgeting seems to fall into three major categories - Operating, Capital, and Salaries and Wages - and for all of these, spreadsheets have become indispensable for modeling different scenarios and assumptions.  At Andrews University, we based salaries on the 50th percentile values obtained in a survey called HEITS (Higher Education Information Technology Salary survey).  We took this as the upper end of the range for each category, and spread the ranges downwards by 25 percent to allow for lower levels of experience and qualifications (see Salary2003.xls).  My predecessor at Sanitarium had developed a more complex model for salaries for the IT staff there.  This was done out of a need to make salary setting as objective as possible because of all the wrangling that used to take place every year (see SHFSalary2004.xls).  The median and lower decile values are taken from a survey prepared for the Australian Computer Society (ACS).  These values are provided for each of four levels that are defined by the ACS survey according to job description and responsibility.  The ranges are then spread across two dimensions - experience and qualifications.  One of my key performance objectives for 2003/2004 is to review the whole process so that the spread across the ranges follows the surveys more closely.  For instance, the current model has a close to linear relationship between experience and remuneration, whereas the increase in salary is greater during the earlier years than it is later on.

3. Allocating Resources

Dr. Mailen Kootsey was the University's first CIO and my predecessor in the position.  In 1997, he wrote a Proposal to Increase Support for Computing at Andrews.  I guess this was the first part of a campaign that became ongoing to raise awareness in the university's administrative group about the close ties between achieving strategic objectives and providing adequate IT support.  In 1997, the focus was still largely on the Banner implementation (Banner is an ERP - Enterprise Requirements Planning - system for higher education), but this report also contains references to the increasing importance of instructional technology and the world wide web.

When I became CIO in mid-1998, one of my main duties was to ensure that as new initiatives were discussed in places like the President's Cabinet, Deans' Council, and other executive groups, adequate provision was made for the IT infrastructure that would be needed to support the new initiatives.  Even more than that, my role was to be a proactive consultant.  As I listened to business needs being expressed, I was able to relate those needs to technology that was available for implementing those needs.

In November, 2000, I gave a presentation to the Deans' Council in which I summarized briefly some of the IT initiatives currently being worked on, as well as giving an overview of the COSTS Project - Cost of Supporting Technology Services.  I believe presentations like this one were helpful and necessary for gaining support in the budgeting process for IT initiatives.

I have numerous other examples of reports I prepared, and presentations I gave, to guide priorities in the allocation of university resources.  One I mentioned above was the growth in network services and the request for additional staffing.  Another was an analysis of Internet bandwidth usage done in early 2000, when the university had two T1 connections to the Internet (a T1 is roughly the equivalent of 24 telephone lines).  The analysis showed that we needed to raise that to at least 4 T1s in 2000, with increase in demand rising during the next several years.

The financial situation had become very tight by the end of 2001, not only at Andrews University, but generally throughout the USA.  In the November 26, 2001 Tom Peters Observer!, Peters gave his "Seven Rules for Leading in a Recession+".  In Rule # 5, he said, "This is exactly the wrong time to hunker down and cut the IS/IT investment account ... Be sensible in the face of a downturn, but INVEST LIKE A MADMAN IN THE 'NEW STUFF.'"  When Andrews was faced with budget cuts in 2001/2002, I used this statement from Tom Peters when making a case for continuing to allocate sufficient resources to IT.

The two areas where I spend the most time in my job allocating resources are capital spending and staffing.  I have described the former elsewhere in this competency under 3(b)2 Tracking and monitoring capital projects

Concerning staffing, there were many occasions during my six and a half years at Andrews University where I directed resources to the creation of new positions, or else I restructured the IT organization so that the available resources better met the emerging needs of the university.  The structural changes are summarized in 3(a)1 Evolving organizational structure in ITS.  In the changes that were made in July 1997, I created three new positions in PC support, and in the budget approval process, these positions were to be funded largely from charges recovered from servicing help desk calls.  The need for improvements in PC support were so great that this goal has been largely achieved.

There were further staffing reassignments in July 1998 when I was appointed Chief Information Officer (CIO) for the university,  Institutional Research was transferred into ITS, as was the Banner Support Coordinator position.  There were also other structural changes that occurred along the way.  We set up separate departments for Client Services and Services and Networks, and created a a dedicated Instructional Technology department.  Other significant staffing changes were the creation of a Web Developer position and most recently, in 2002, the creation of a new position in Networks and Servers to handle emerging Microsoft Server requirements.

Something I heard Robert Cooper say in a Lessons In Leadership seminar I attended in 1999 impressed me at the time and has stuck with me ever since.  He said that in the performance appraisal / development planning process we go through with employees, we should develop strengths and identify and find ways around weaknesses, when so often our focus is just the opposite.  This approach is getting even more attention lately.  Curt Coffman, co-author of First, Break All the Rules (2002), says in the Summer 2003 issue of Microsoft Executive Circle,

"The world's best managers know that an employee's greatest potential for growth and contribution lies in the individual's areas of strength, not their areas of weakness.  While this seems like it should be common sense, it's actually fairly uncommon.  Great managers find out what employees are good at and build their work on that.  They don't make employees fix their weaknesses; they minimize them or help employees find ways to work around them.

"What's more, empowerment starts when managers clearly identify the desired performance outcomes for a role, then assess how well the employees are doing at meeting those outcomes.  Rate performance -- not the person.  And communicate regularly, not just during annual performance reviews." [1]

Rather than targeting weaknesses to better fit people to jobs, the focus is shifting.  This is the subject of The McKinsey Quarterly, 2003 Number 2 in an article by Agrawal, Maniyika, and Richards (2003) entitled Matching People and Jobs. [2]

4. Strategic Plan

Andrews University

I have documented the process we followed at Andrews University to produce a strategic plan that was aligned with the goals and objectives of the institution under Competency 2(a) A dynamic change-agent with skills in: (a) Planning and implementing change.

Sanitarium Health Food Company

When I joined Sanitarium at the end of 2002, we began a process that included reorganizing and restructuring the IT department.  This is reflected in my second KPI (Key Performance Indicator):

        2. Re-invent IT at Sanitarium

    1. Review IT organizational structure.
    2. Review department names.
    3. Review job titles and descriptions
    4. Review performance appraisal and development planning process.
    5. Review salary setting model

We also reviewed the existing strategic plan, and began revising it, but then shifted direction to some extent.  We realized that setting strategic IT priorities and allocating resources was being left to IT when it needed to involve the whole of the enterprise, especially the executives.  So we shifted our focus to the creation of an IT Portfolio that looked beyond the current budget year, .  This is reflected in my third KPI:

         3. Review strategic alignment of IT and corporate goals

    1. Develop a comprehensive IT Portfolio, documenting both current and possible future IT investments, with a 3 to 5 year horizon.
    2. Complete the revision of the IT Strategic Plan.

As part of a company-wide strategy planning exercise, we did another SWOT Analysis within the IT department.  We will incorporate these results in our next revision of the IT Strategic Plan.

We also began to address some issues related to IT governance.  A very significant investment had been made by the company in the purchase of an ERP (Enterprise Planning System), but the full benefits of this purchase would only be realized if individual departments used that system to satisfy their information system needs, rather than looking for alternate third party solutions.  On the 10th of June, the IT Steering Committee (ITSC) approved an Enterprise Architecture statement that required ITSC approval for IT projects to be researched.  The process for gaining approval of IT projects was also formalized at the same meeting.  The four General Managers announced these decisions to their direct reports on June 23, 2003.  The announcement included the Enterprise Architecture statement, and a simple flowchart with brief text explaining the IT project approval process.  This simple flowchart was condensed from the chart in the IT Procedures manual.

5. Accountability

The standard approach to setting measures for accountability in managers is through budgets.  The IT managers are heavily involved in the budgeting process, and when budgets are approved, they feel committed to achieving them.  Accountability results from their own personal integrity, as well as from the sense of ownership they have through their involvement in the process.  In addition, there is a sense of loyalty to the team.  Because of the good working relationships that have developed between members of the management team, no one wants to let the rest of the team down.

[1] Coffman, Curt W. (2003). The Chemistry of Empowerment. Microsoft Executive Circle, Summer 2003, p50. (EN-0878)

[2] Agrawal, Vivek, Manyika, James M. and Richards, John E. (2003). Matching people and jobs. McKinsey Quarterly, 2003. (EN-0915)
Retrieved 18-Jun-2004
URL: http://premium.mckinseyquarterly.com
(on local server)

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Created: Sunday, February 20, 2000 05:32 PM 
Last Modified: Thursday, March 15, 2012 9:08 PM