About Me. James Chan, Director - Technical Sales James.Chan@ca.com Mobile: CA. All rights reserved.

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2 About Me James Chan, Director - Technical Sales James.Chan@ca.com Mobile: CA. All rights reserved.

3 Agenda What Portfolio Management is NOT What is Portfolio Management The 3 Key Components to Portfolio Management Best Practices in Portfolio Management Identification Categorization Evaluation Prioritization Portfolio Balancing Performance Measurement Benefits Realization Drawing CA. All rights reserved.

4 HDMI Pocket Projector CA. All rights reserved.

5 CA. All rights reserved.

6 Portfolio Management is NOT Status Reporting CA. All rights reserved.

7 Portfolio Management is NOT Scheduling or Sequencing CA. All rights reserved.

8 Portfolio Management is NOT Budgeting CA. All rights reserved.

9 What is Portfolio Management? Principles originate from finance A tool to solve a multi-objective optimization problem CA. All rights reserved.

10 A portfolio is designed according to the investor s Investment Objectives Time Frame Risk Tolerance CA. All rights reserved.

11 The 3 Key Components of Portfolio Management Asset Allocation Time Horizon Diversification CA. All rights reserved.

12 Best Practices in Portfolio Management Identification Categorization Evaluation (& Selection) Prioritization Portfolio Balancing Performance Measurement Benefits Realization CA. All rights reserved.

13 Identification Candidate Registration CA. All rights reserved.

14 Future Impact Categorization TAGS! Organizational Strategy Business Unit Goal Business Metric Affected IT Portfolio Matrix Entrepreneur Developer Caretaker Controller Current Impact CA. All rights reserved.

15 Evaluation (& Selection) SCORES! Financial Return Savings Revenues Risk Rating Organizational Risk Technology Risk Sustainability Organizational Technological CA. All rights reserved.

16 Prioritization Grow Revenue Optimize Operations Promote Innovation Introduce New Product in Different Regions Upgrade Back Office Technology to Reduce Operating Costs Encourage Submission of New Ideas from Employees Improve Sales Execution Streamline Compliance with Regulatory Requirements Leverage Consumer Technology to Empower Customers in Purchasing Decisions THERE IS NOT ONE RIGHT ANSWER! CA. All rights reserved.

17 Portfolio Balancing Asset Allocation Strategic Goals Business Units Time Horizon This Year Next Year 3 Years 5 Years Risk Tolerance CA. All rights reserved. High Risk Flyers

18 Portfolio Review & Reporting Performance Measurement Metrics Affected Costs vs. Budget Benefits Realization Benefit Contracts Benefit Accounts CA. All rights reserved.

19 Strategic Change Business Executives CA Playbook Vision Objectives Initiatives Year 5 Jan Feb Investments Above-the-line Year 4 Strategic Playbook Initiatives/Portfolio Mar Q2 Q3 Boardrooms Dashboards CA Clarity PPM Idea management Year 3 Investment Resources Q4 Below-the-line Requirements Year 2 Agile execution Project management Portfolio management IT team Line of business Product Developers Resource management Financial management CA. All rights reserved.

20 Final Tips from the Oracle of Omaha "Investors should remember that excitement and expenses are their enemies. Most investment decision are overly influenced by emotions Excitement OR fear Changes in investment direction are more expensive that you think Should make a change when it s warranted BUT not just for change s sake "Never ask the barber if you need a haircut. Most investments are advocated by people with a vested interest Will the investment thesis stand up to an independent observer? CA. All rights reserved.

21 Portfolio Management Use Cases Applying Best Practices in portfolio Management to CA Clarity

22 Some Prerequisites Identification Categorization CA. All rights reserved.

23 Portfolio Management Prerequisite Investment Inventory List of inflight and or potential Investments Categorization of Investment to enable aggregation for analysis Investment Type (Project, Application, Service, etc.) Investment Timing Investment Attributes CA. All rights reserved.

24 Identification Cross all Use Cases Any Investment Type Any Status/Condition Placeholder options can be used Idea Project/Programs Required elements need to reflect: Categorizations Evaluation Criteria CA. All rights reserved.

25 Prioritization Cross All Use Cases Investment Priority Dual Prioritization is recommended Each investment has a score Stakeholders drive priority Portfolio Rank Schemes for this vary by customer Required items need to be factored into the scheme Portfolio investments are ranked Automated ranking functionality Portfolio Owner drive rank CA. All rights reserved.

26 Portfolio Management Prerequisite Resource Demand Team Staff Multiple Maturity Options Usage 1. Full Project Resource Need (Team Staff) 2. Time Phased Resource Need (Team Detail) 3. Task Level Resource Need (Allocate from Estimates) Complexity Roles and or Individuals Team Detail Metric (Hours, FTE, Days, Percentage) Team Assignment Processes CA. All rights reserved.

27 Portfolio Management Prerequisite Financials Financial Summary Multiple Maturity Options Usage 1. Financial Summary (properties subpage) 2. Cost Plan with Benefit Summary 3. Cost and Budget Plan with Benefit Summary 4. Cost, Budget, and Benefit Plan Financial Plans Complexity Level of Cost plan Detail Usage of Versions Automated Processes CA. All rights reserved.

28 Portfolio Management Prerequisite Alignment and Risk Multiple Maturity Options Usage Numeric Capture Question Series Complexity Scale Weighting Frequency CA. All rights reserved.

29 Use Cases Business Driven Goal Portfolio for Management of Business Drivers Operational Driven Resource/Release Portfolio for Execution Planning Application Portfolio for Application Rationalization Financial Driven Department Portfolio for Annual Planning CA. All rights reserved.

30 Business Driven Use Case Goal Portfolio for Management of Business Drivers Identification All Projects and Ideas (potential and inflight) Categorization Evaluation Prioritization Portfolio Balancing Performance Mgmt. Goal (OOTB Attribute) Benefit Top Down Cost/Budget Target vs. Bottom up Estimates/Budgets Resource Constraints LOB Priority Portfolio Rank Count and Resource investment Mix Cost investment Mix Top Down Benefit Target vs. Bottom up Benefits Achieved Progress (i.e. Completed, In Progress, Planned) CA. All rights reserved.

31 Operational Driven Use Case Application Portfolio for Application Rationalization Identification Applications Categorization Evaluation Prioritization Portfolio Balancing Performance Mgmt. Architectural Fit, Stage Business Process Supported Risk, Resource Demand Top Down Budget Target vs. Bottom up Cost Forecasts LOB Priority Portfolio Rank Technology/Platform Mix Business process count and cost mix Application counts and cost aggregations Trend on spend and resource demand/actuals CA. All rights reserved.

32 Operational Driven Use Case Project Resource/Release Rationalization Portfolio for Business for Execution Operations Planning Identification Approved Projects Categorization Evaluation Prioritization Portfolio Balancing Performance Mgmt. One Product, Release, or Operating group Delivery timeline Resource Constraints Business Alignment, Risk LOB Priority Portfolio Rank LOB or Goal mix Lifecycle Overlap to maximize resource utilization Top Down Resource Target vs. Bottom up Resource Forecasts Progress (i.e. Completed, In Progress, Planned) CA. All rights reserved.

33 Financial Driven Use Case Department Portfolio for Annual Planning Identification All Investment Types Categorization Evaluation Prioritization Portfolio Balancing Performance Mgmt. Department Inflight and potential for FY in question Top Down Cost/Budget Target vs. Bottom up Estimates/Budgets Capital/Expense, Benefit, etc.(target vs. Plan/Budget) Stakeholder priority Portfolio Rank Work Type Mix (i.e. Run, Grow, Transform) LOB and or Goal Mix Top Down Budget Target vs. Bottom up Cost Forecasts Progress (i.e. Completed, In Progress, Planned) CA. All rights reserved.

34 Waterlines Waterline is drawn against the primary constraint, with the ability to see other criteria as well CA. All rights reserved.

35 Waterlines Ranking Rules CA. All rights reserved. Define Ranking Rules to have the system automatically prioritize based on the most critical attributes

36 Waterlines Manually readjust results by dragging and dropping projects to reprioritize CA. All rights reserved.

37 Portfolio Dashboard: Cost Analysis Understand how Costs are being spent by Goal, ensuring work is aligned to the strategic direction of the company CA. All rights reserved.

38 Analysis View how Projects above the Waterline align to Planned Cost and Role Demand factors CA. All rights reserved.

39 Portfolio Dashboard: Roles CA. All rights reserved. Compare Distributed Roles and Role Demand to Portfolio Target to identify variance and prevent overallocation.

40 Portfolio Dashboard: Cost and Benefits CA. All rights reserved. Compare Distributed Cost and Planned Cost to Portfolio Target Cost to identify variance and prevent cost overruns.

41 Recommendations 1. Capture candidate investments in the PPM system 2. Properly categorize investments (and have someone own this) Strategic Goal(s) Benefit Timeframe 3. Agree to standard metrics for an investment category Score each investment in a category on these metrics 4. Understand that prioritization is difficult & messy BUT it is important and represents great value for the firm Buy-in to the process is the most important factor 5. Compare current situation to the original asset allocation plan 6. Green light worthy higher risk projects when possible Even if cancelled later, the lessons learned/information gained is often worth it 7. Track project performance against business metrics, not project metrics 8. Establish perpetual planning guidelines centered around these principles CA. All rights reserved.

42 James Chan Director Technical Sales, CA Clarity