IT Financial Management: An Overview and Key Financial Disciplines Seminar (4 hours) Jeffrey Lockenvitz, I.S. Controller
United Parcel Service
An Integrated Approach to IT Financial Management. A comprehensive approach to IT financial management requires IT financial disciplines such as capital budgeting, project costing, product costing, activity-based costing, benchmarking, balanced scorecard, resource management, chargeback and project prioritization, This session will describe the framework used at United Parcel Service to integrate these disciplines. The organization, information structure, and processes used will be discussed too.
Case Study in Centralized IT Asset Management. United Parcel Service has centralized its IT Asset Management processes and data. This session reviews the challenges presented by a large and complex distributed infrastructure. Shared with you are the lessons learned when getting started as well as the formula for data, process and organization that got phase one off the ground. A roadmap to effective configuration management is reviewed.
A Measured Approach to IT Business Management. Since you can’t manage what you can’t measure, the focus on IT performance metrics has increased significantly in recent years. Unfortunately, the immaturity of today’s IT measurement system designs can lead to less efficiency instead of more. The problem is due to incomplete designs that do not take into account natural reactions to measurement such as focusing on the numbers instead of the business. An effective measurement system design should consider all key areas and the natural (equal and opposite) reaction to each measurement as a group so that the desired result is achieved while keeping the number of measures to a minimum. IT Finance has an opportunity to apply many of the disciplines we have discussed over the last several years in a way that can significantly improve the effectiveness of IT measurement. In this session, we discuss IT financial measurements, typical reactions to them, and ways to help ensure we achieve the desired results.
Benchmarking for Information Technology. As IT organizations continue to become a more strategic and customer-oriented part of business, benchmarking is used more than ever to evaluate IT effectiveness, prioritize improvement initiatives, and measure progress. This session reviews the various forms of benchmarking from both an internal and external perspective and the different types available in the marketplace. Methods for developing and maintaining self-assessment benchmarks are discussed as well as criteria for selecting an outside organization to provide external comparisons.
How to Measure Anything: The Applied Information Economics Approach Workshop (4 hours) Douglas Hubbard, President
Hubbard Decision Research
Doug Hubbard, the Author of How to Measure Anything: Finding the Value of "Intangibles" in Business and the inventor of Applied Information Economics (AIE) will describe how to use his methods to measure any "intangible", to think of risk like an actuary, and how to look at IT portfolios from a risk/return point-of-view. The material is designed for any analyst to C-level person who has responsibility for creating, reviewing or acting on business cases or performance metrics for IT or any other portfolio investments.
Introduction to Applied Information Economics and Measurement. This session introduces you to Applied Information Economics (AIE) and its measurement philosophy. There are only three reasons why anyone ever assumes that something is "intangible" and we will show that each of these three reasons is an illusion and can be overcome by training.
Understanding Measurement and Risk. We will show how to think about risk in quantitative terms just as any actuary or statistician would. "Soft" uses of the concept of risk (such as "high vs. medium vs. low") do little to reveal risk management problems. A more quantitative understanding of risk has a significant impact on IT decisions.
Calibrated Probability Estimates. Assessing one's own uncertainty quantitatively is a skill that can be taught. You will be introduced to the process of "calibrating" people for probability assessments and will learn why most subjective probabilities can't be trusted.
Monte Carlo Simulations. Monte Carlo simulations allow us to "do the math" when we have no exact numbers – only ranges and probabilities. In a Monte Carlo simulation a computer randomly generates thousands of scenarios and keeps track of the outcomes and their probabilities. Constructing a Monte Carlo simulation takes little more skill than it takes to put together a traditional business case in a spreadsheet and you will be shown how simple it can be.
Findings To Date: How AIE Changes Decisions. Risk/Return Analysis (RRA) with the AIE approach in over 60 IT investments has revealed some fascinating findings. This session will show how an AIE approach would significantly change IT investment priorities and what measurements receive the greatest focus.
IT Service Asset and Configuration Management Workshop (4 hours) Rajesh Radhakrishnan, Senior Managing Consultant and Senior IT Architect
IBM, Global Services
IT Service Management Frameworks such as ITIL v3 treat IT Service Financial Management as a significant process domain as part of the Service Delivery (V2) and Service Design (V3) of the Service Life Cycle Phases. IT Service Asset and Configuration Management is a process domain in the IT Service Transition phase of the Service Life Cycle. This workshop discusses some of the salient aspects of IT Asset and Configuration Management processes as part of an IT Process Framework such as ITIL and also discusses some of the key relationships with other IT and Business Processes. The workshop covers:
• Introduction to IT Service Management
Introduction to ITIL V3
Introduction to ITIL-based IT Service Financial Management
Introduction to IT Service Asset and Configuration Management
• IT Service Asset Management – Deep Dive 1
• IT Service Asset Management – Deep Dive 2
• IT Service Asset and Configuration Management – Inter- relationships
The subjects discussed include IT Services, IT Service Management, IT Service Financial Management, Service Costing, Service Modeling, Service Cost Modeling, Service Budgeting, Cost Accounting, Micro Economics, Micro Finance and IT Asset and Configuration Management.
Building Cost Allocation Models for Virtualized Environments Workshop (4 hours) Robert Mischianti, Vice President
This workshop will explore the process of constructing cost allocation models and chargeback methodologies that can carry your organization through the various stages of deploying virtualized technologies. This workshop covers:
• Virtualized Technology Primer
Review of virtualization technologies
Is cloud computing our final destination?
Strategies for deployment of virtualized technologies
IT Contract, Procurement and Supplier Relationship Management Seminar (3 hours) Chioma Iheanacho, Software Licensing Manager
Chicago Bridge & Iron
Because companies rely heavily upon technology to achieve primary business objectives, it is crucial that Information Technology investments are fully managed. The only method to accomplish this is to build and maintain an accurate picture of the IT infrastructure and the associated costs so that intelligent decisions can be made about the technological needs of the company. Decentralized, underdeveloped or nonexistent methods for handling approvals, acquisitions, and ITAM processes greatly impede the ability to accurately plan, budget and report on IT investments. Delve deeper into three interrelated core components to assist you in thoroughly managing your IT Assets by attending the following sessions:
• The Ins and Outs of IT Contract Management
• IT Procurement Management, the Gatekeeper
• Building Your IT Supplier Relationship Management Program
Begin controlling the processes or functions that surround the entrance of an IT asset within your environment and initiate ways to create, standardize, or refining controls within policies and processes to ensure consistency, compliance, and the ability to increase value and reduce costs. After all, you cannot effectively manage your suppliers if you do not know how the product was negotiated, what is specified within the contract, or how the product was acquired and is performing in your environment.
How to Implement Service Level Agreements for Internal IT Workshop (3 hours) David Smith, President
Effective service level agreements (SLAs) need to provide visibility into service level performance that helps prioritize management focus. You need to be able to define your services in terms of "business outcomes” to improve business/IT integration and enable value creation. The goal of this workshop is to provide the participant with a service level agreement framework and process to create effective service level agreements for IT services so they can be measured and improved to meet customer requirements and expectations. This interactive workshop will enable you to understand the necessary techniques and steps required to define accountabilities, traceability and service level performance requirements. The workshop will encourage open discussion and dialog to facilitate internalization of the methodologies, tools, and techniques to enable you to be immediately productive upon their return to the office. The workshop will present a methodology, tools & techniques used to implement, measure and report service level achievements and performance using the ITILÔ framework. Practical examples will be used to illustrate the methods used to develop, maintain and report service level achievements through key performance metrics and indicators. ITIL™ (Information Technology Infrastructure Library) is a public domain approach for managing IT services. ITIL provides a comprehensive, consistent and coherent set of best practices for IT Service Management. The benefits of the workshop are:
• Learn a practical working approach to documenting your services in agreements that provide accountability, traceability and performance feedback
• Gain experience with working models for measuring and assessing the health of your services and trouble-shooting hot-spots requiring attention
• Walk away with lots of usable intellectual capital
The workshop will cover:
• Basic service management concepts such as service definitions, utility vs. warranty, performance attributes, service portfolios, catalogues, agreement models, decomposition methods
• Service agreement lifecycle including strategy, design, transition, operations and continual improvement
• Service measurement and reporting including metrics and measurement life-cycle of monitoring, analysis, tuning and service improvement.
Making Business Cases With Portfolio Management Tools Seminar (3 hours) Scott Johnson, CEO
In this seminar, you will learn how portfolio management tools can help IT secure management support by clearly demonstrating each project's business case. The seminar will discuss how portfolio management can help IT departments prioritize, plan, and execute on projects that will provide their organizations with the maximum business value. Individual sessions of the workshop will focus on the following topics:
Prioritization. Learn how to establish the business value of your projects and initiatives. Identify the business objectives your projects are designed to achieve and the deliverables that can be used to measure success. Examine risks vs. benefits, and determine your projects’ alignment with organizational strategic and financial goals.
Planning. Compare portfolio projects relative to business importance. Estimate resources necessary to complete the project. Evaluate your organization’s project capacity and identify which projects can be completed and which ones need to be revisited at a later date.
Execution. Monitor project status and completion dates. Manage risks and possible changes to the business case throughout the project. Upon completion, measure deliverables and portfolio scorecards to evaluate performance.
Standards and Tools for IT Asset Management Seminar (3 hours) Robert Stroud, Service Mgmt. & Governance Evangelist
Delivering Sound Business Management and Governance Using COBIT and ISO\IEC38500. Multiple surveys this year have identified that IT Governance and business alignment is on the top of almost every CIO’s mind. As the momentum has grown, the standards body ISO in 2008 launched their first ICT governance standard, ISO\IEC 38500 that parallels closely with COBIT. This session will introduce the attendee to ISO\IEC 38500, the ISO standard for ICT Governance, a principle based standard, how it maps to COBIT and how to use COBIT with the standard to verify your implementation adheres to the standard. No matter where you are in your IT Governance journey, this session will give you practical advice that you can use immediately when you return to the office.
Enterprise Value: Governance of IT Investments Using the Val IT Framework 2.0.Val IT is a governance framework including generally accepted guiding principles and supporting processes related to the evaluation and selection of IT-enabled business investments, and benefit realization and delivery of value from those investments. The Val IT framework is based on the COBIT framework. To obtain a return on investment, the Val IT principles are applied to management processes including value governance, portfolio management, and investment management. The Val IT framework will be supported by publications and operational tools and provides guidance to:
• Define the relationship between IT and the business and those functions in the organization with governance responsibilities
• Manage an organization's portfolio of IT-enabled business investments
• Maximize the quality of business cases for IT-enabled business investments with particular emphasis on the definition of key financial indicators, the quantification of "soft" benefits and the comprehensive appraisal of the downside risk
Val IT addresses assumptions, costs, risks and outcomes related to a balanced portfolio of IT-enabled business investments. It also provides benchmarking capability and allows enterprises to exchange experiences on best practices for value management. This session will introduce you to Val IT and how to use it in your organization to drive value of your IT investments ensuring enterprise value.
Service Level Management for Managing Customer Expectations. When you go to the store to buy a hamburger, would you settle for a cheeseburger when you are allergic to cheese, or would you demand the ordered item to be delivered? Well, logic says that most of us would ask for the correct burger but some of us don’t complain, we live with the result and maybe never go back to the store, in reality change suppliers. This session will introduce you to leveraging the service catalog with sound financial and service level management to ensure customer value and more importantly manage those customer expectations! If you are business aligned, you will not want to miss this session!
Improving Communication Skills for Managing Change in Finance Workshop (4 hours) Timothy Partlow, President
Everyone is in the process of managing change. Either you are asking others to change (implementing new processes, new software, etc.) or change is being thrust upon you (budget reductions, government regulation, etc.). The reality we all face is that change must occur in order for us to improve our organizations and reach our goals. This half-day workshop will help you to understand the psychology around change as well as help you think through practical ways to improve your skills as an agent of change. The workshop will address the following:
• A study of the four basic personality profiles including how they interact based on the DiSC system. Only participants enrolled in this workshop will receive a free copy of the DiSC Classic Profile, so be sure to sign up specifically for this workshop when you register for the conference. The DiSC Classic Profile is a 20-page booklet with self-assessment and learning tools. The foundation of personal and professional success lies in understating yourself, understanding others and realizing the impact of personal behavior on others. For nearly 30 years, the DiSC Classic Profile has unlocked the door to productive communication and relationships through its DiSC Dimensions of Behavior learning approach. Over 40 million people worldwide have taken the DiSC Classic Profile to reduce conflict and improve interpersonal communication.
• A review to help you understand what happens when a change takes place, how to reduce the impact of change and what are the best ways to implement change using Models from Main Event Management's Model-Netics (a Management Development Course).
• A discussion on how to take on the role of the Change Agent – an activity outside some of our comfort zones.
Building and Managing the IT Budget: Technical and Cultural Approaches Workshop (4 hours) John Chambers, President
JCC Executive Partners
This hands-on workshop provides senior managers, directors, and executives a step-by-step approach to a collaborative budgeting process. IT groups face increasing fiscal challenges, due to market and industry forces, as well as directives to reduce the overall spend. As a result, innovation and collaboration among IT financial managers as well as business-unit leaders are necessary to guide the planning process. The same principles are employed when adapting to sudden changes occurring in the fiscal year. Both management tools and management/cultural techniques are reviewed in this workshop.
Part 1: Budget initiation
• Company mission and alignment
• Strategic planning
New projects and programs
• Challenges and obstacles
Part 2: Decision-making
• Dividing up "the pie"
• Innovation in the face of budget challenges – "finding a way"
• Opportunities for savings
Duplication of effort
Part 3: Maintaining Order
• Rigor in the process
• Updating the tracking tools
• Constant vigilance
Financial (trends over time)
Customer satisfaction (reconciling needs to deliverables)
IT Financial Management Key Trends for 2009 and Beyond Seminar (4 hours) Bob Simko, Executive Director and
Brian Jeffery, Managing Director
International Technology Group
Next Steps in IT Governance Beyond ITIL. Now that Information Technology Infrastructure Library (ITIL) is becoming a de facto industry standard, many organizations are starting to evaluate broader IT management and governance frameworks, project management methodologies and other models that potentially complement it. This session will discuss such approaches as the Committee of Sponsoring Organizations of the Treadway Commission (COSO) framework, Control Objectives for Information & Related Technology (COBIT), Application Services Library (ASL), Capability Maturity Model Integration (CMMI), Prince2, Project Management Body of Knowledge (PMBOK), and ISO 20000 and 17799/27001. The session will review user experiences with these approaches, and will discuss broader trends in corporate and public sector IT governance.
Microsoft Outlook: New Opportunities, Old Problems. As Microsoft Windows Server 2008 and SQL Server 2008 reach the marketplace, new opportunities are opening up to consolidate and virtualize servers, and to replace higher-priced servers and databases. But users are still reluctant to upgrade to Vista, and Microsoft software quality and support terms and pricing continue to generate controversy. This session will outline the challenges and opportunities that face Microsoft users in 2009 and beyond, and will discuss how organizations are dealing with them. The session will conclude with recommendations as to how users should deal with their Microsoft environments – and with Microsoft – over the next two to three years.
Enterprise Management: Experiences and Potential. Organizations that have deployed high-end enterprise management systems to manage IT from vendors such as BMC, Computer Associates, Hewlett-Packard, IBM Tivoli, and NetIQ have reported mixed experiences. This session will examine the "state of the art” in use of enterprise management tools, and will discuss user experiences with these and whether cost outweighs the benefits. Organizational as well as technical success factors will be reviewed, and potential of enterprise management strategies to deliver cost savings and service quality benefits will be examined.
New Trends in Outsourcing. This session will outline the latest trends in IT, business process, and call center outsourcing, and will discuss their implications for users. Among the subjects covered will be rising Indian labor costs, and the growing shift in activity towards such countries as China, the Philippines and Vietnam. The session will also review price and quality trends for outsourced services, and will discuss the positive – and negative – experiences of outsourcing customers. The session will conclude with practical recommendations as to how users should evaluate outsourcing opportunities and manage outsourcing relationships.
Effective Techniques for Analyzing, Measuring and Improving IT Processes Workshop (4 hours) Andrew Muras, Senior Manager
BAE Systems Analytical Solutions
I once heard a CIO state, "You give me good people and a great process, and we’ll beat any organization with the best technology but poor processes.” A recent best practice study from CIO Magazine on reducing IT complexity seconded this idea, concluding "Make process central to your IT organization’s approach to technology.” But where do you start and what tools do you use? How does ITIL fit in? What kind of results can you expect? How do you link with financial and reporting requirements such as chargebacks and performance metrics? Will it help improve service delivery and costs? Effective IT organizations realize, first, that IT really is a process, and second, that all processes can be managed and improved. However, you need techniques with proven track records that provide actionable results and don’t consume significant staff time. Using case studies and lessons learned, this workshop will provide you the techniques and software tools you need to quickly and effectively analyze and improve your processes, all the while linking with your costing and performance management systems. The goal of this workshop is simple – providing each participant an understanding of what they need to do, how to do it and where to begin. Specific topic areas will include:
• The basics for effective IT process analysis
• Key tools in performance management: activity analysis and scorecards
• Coupling with ITIL and Lean Six Sigma
• Keeping it simple for getting results in 3-5 days
• Linking processes, service costing and improvement opportunities for transforming the organization
• Meaningful service level agreements, chargebacks and unit costs
• Using results for benchmarking internally and with external service providers
In addition, each participant will also be sent a free software package to help analyze your processes and products and develop effective measures.
The Software Audit Process Leading to Proactive License Management Seminar (3 hours) Howard Hastings, Director, Product Management
This seminar will explain the software audit process, including the difference between audits conducted by software associations like the BSA and SIIA versus those conducted by software publishers themselves. Most importantly, this seminar will provide you with a step-by-step action plan to respond to those audits along with recommendations for proactive software license management.
Strategic Fundamentals of Effective IT and Telecom Cost Management Seminar (3 hours) Gary Eckert, President
This seminar will address a variety of topics that illustrate the concept of a sound strategic approach to IT and Telecom cost management in order to maximize results. This seminar will present a roadmap of the tasks to be performed to develop an overall strategic plan, the importance of an integrated budget approach to meet plan goals, and how ongoing benchmarking can provide the metrics to measure success and fine tune the process.
Cost Management Strategies and Benefits in a Slow Economy. The first session will discuss how business success is not just measured by performance during good economic times, but also how the business reacts and performs in tough economic times. Companies that recognize the importance of sound IT/Telecom cost management and optimization, and establish a plan to enhance operational efficiency, while not compromising levels of service and internal resources, can differentiate themselves from their competitors and enhance their company’s financial performance. This session addresses the steps companies should be taking to ensuring the optimal efficiency of their communications infrastructures and reducing associated cost factors to augment superior financial performance during challenging economic times. This session will address the following topics:
- Effective cost management strategies that do not involve staff reduction
- The importance of developing an IT/Telecom cost management plan
- The role of contracts in the optimization process - How to get the right analytics to make effective strategic decisions
- How to get the most benefit from existing TEM implementations
- The "big picture” perspective on the overlooked financial benefits of effective IT/Telecom cost management in influencing company fiscal performance
Strategic Budgeting and Project Prioritization. The second session will deal with how the success of any IT or Telecom cost management process is dependent upon a sound strategic budgeting and project prioritization process. Unfortunately, for most companies, this process is compromised by a variety of factors that negatively impact the obtaining of the right analytics to make good budget decisions and the development and implementation of an effective communications cost management plan. As a result, hundreds of thousands and/or millions of budget dollars are wasted annually by overspending for provided services and failing to fund projects that can have a significant positive contribution in meeting business objectives involving revenue enhancement and cost savings. This session is intended to help provide a better perspective into the challenges and solutions for improving the budget and project prioritization process as it relates to the IT/Telecom area. The topics to be covered include:
- The current environment and why the process is broken
- The role of strategic budgeting in cost management
- Goals and objectives for an effective strategic budgeting and project prioritization process
- Key steps to process improvement in project prioritization
- Process pitfalls to avoid
- Importance of a formal documented plan for success
- A best practice approach to ensure maximum results
Effective Benchmarking for Performance Measurement. The final session will discuss benchmarking for success. Benchmarking is a term that is used in many contexts. At its base level, benchmarking is the art and science of measuring one’s performance against one’s peers. This presentation will address the many nuances of benchmarking and how to establish an effective benchmarking project. It will discuss the benchmarking process, the benefits of conducting benchmarking, and pitfalls to avoid that can undermine its success. By attending this presentation, you will gain a better understanding of the overall process and how to get better results from your benchmarking efforts that you can use to achieve even better performance results. Specific topics to be addressed include:
Software Usage Metering and Business Value Case Studies Workshop (3 hours) Signe Stenseth, Vice President and
Joanna Marie Talaga, Customer Care Consultant
Open iT, Inc.
Independent research shows that companies implementing software usage capabilities will achieve savings of 5-25% in the first year. In addition, studies confirm that software usage tools have a quick payback with minimal effort after implementation. ("Cost Cutting by Effectively Using Existing Software” by Patricia Adams, Gartner, Inc., Feb. 7, 2008.) This workshop will illustrate and examine software usage metering and analysis initiatives in various industries, how they increase asset and user efficiency, and how they support business processes in asset management, chargeback and ITIL. Also discussed are benefits such as flexibility to enter into pay-per-use agreements and the advantages of user-friendly and easily accessible usage reports for various stakeholders in the organization. From inspiring customer case studies to the demonstration of powerful features within software usage tools, IT leaders and decision-makers will learn first-hand the value of IT usage metering. The workshop will be interactive, with the aim of sharing knowledge and discussing best practices.
Business Case Financial Fundamentals for IT Investments Workshop (3 hours) Kyle Hilmer, Bureau Chief
State of Montana
Business cases are usually mandatory for all major IT investments and the financial analysis is often the heart of the business case. This workshop will be a mixture of lecture and case studies, based on real examples, designed to prepare you to build or review a financial analysis that supports an IT business case. Subject matter will include:
Before you Start. Evaluate the environment before you begin. What are your legal and policy requirements? Who will be judging the proposal? What is the skill level of the people constructing the analysis and what tools and time are available?
Financial Statistics. How to calculate the standard financial statistics (payback, IRR, NPV, ROI, etc.), their limitations, and when to use them.
Types of Financial Analysis. Select the type of financial analysis appropriate to the situation. Do you have an incremental analysis, an investment decision to make, or a financing decision? A cost comparison may be significantly less work that a cost/benefit analysis.
Costs and Benefits. Know: (1) what costs and benefits are relevant to an IT financial analysis, (2) how to handle sunk costs and prepaid assets, (3) Total Cost of Ownership (TCO), and (4) translating or not translating benefits to dollars and cents.
Financial Modeling Tools. The choice of a financial tool is a balancing act between the amount of work to construct a financial analysis, the ability of reviewers and executives to critique the analysis, and the skill levels of the individuals preparing the financial analysis.
Assumptions. Implicit assumptions on the project environment, such as growth rates, can heavily influence the financial analysis. Know what to disclose and how to sell your preferred alternative using sensitivity analysis.
Structure. The length of the analysis period, the number of alternatives that are compared, and the level of detail within the analysis reveals the depth and scope of the knowledge, planning and accuracy of the analysis.