It recently made the news when the Australian government decided to formally audit all outside IT contracts worth more than $10 million, or about 100 individual projects.
“This is more than a review, it’s ongoing oversight, and it will provide unprecedented visibility and centralised management of IT projects,” announced Hon Angus Taylor MP, the Assistant Minister for Cities and Digital Transformation.
Sounds like good government, right? Who wouldn’t want to ensure investment in the right technology projects and proof they actually “deliver on the public policy benefits they promise”. After all, the stakes are high: Australia’s annual IT spend that now reaches north of $6 billion.
But the Australian Institute of Project Management had a thoughtful reaction to the announcement, pointing out the inherent benefit of a separation of power between those funding projects and those reviewing performance.
AIPM’s CEO Yvonne Butler promoted what she called “a fully integrated portfolio approach across federal government agencies, which would see better oversight, improved interoperability, optimised buying power and enhanced risk management. With a genuine portfolio approach and improved governance in government projects, we would see less need for reviews and more return on project investment.”
The AIPM said they plan to work closely with Digital Transformation Agency CEO Nerida O’Loughlin, adding a pitch for the Australian government to adopt advances from other countries such as “recent legislative changes in the United Kingdom (Royal Charter) and United States (passing of the Program Management Improvement and Accountability Act), which have recognised the importance of certified project managers.”
In the United States, that act, introduced by an Iowa senator in 2015, details a comprehensive approach to bringing project management best practices into government. It says the government will, in part:
- Adopt and oversee implementation of government-wide standards, policies, and guidelines for program and project management for executive agencies;
- Establish standards and policies for executive agencies consistent with widely accepted standards for program and project management planning and delivery;
- Engage with the private sector to identify best practices in program and project management that would improve federal program and project management;
- Conduct portfolio reviews to address programs identified as high risk by the Government Accountability Office (GAO);
- Conduct portfolio reviews of agency programs at least annually to assess the quality and effectiveness of program management; and
- Establish a five-year strategic plan for program and project management.
All of these initiatives draw on a body of knowledge that shows integrated portfolio management is the path forward.
Writing for a Projectmanagement.com special report, Andy Jones says that organisations taking a broader portfolio approach to management from the beginning have results that “are much more likely to align with the organisational needs right from the outset.”
For example, Jones writes, “if the organisation has strategic priorities that are well understood throughout the organisation then the ideas that are developed into business cases and become project candidates can be developed with those goals and objectives in mind – proposals are aligned with organisational needs from the outset. If the organisation also has processes and tools that support the sharing of ideas, collaboration among different groups, and consistent approaches to business case preparation then the foundation becomes even stronger. The organisation can enter the annual planning exercise with project candidates that better align with the goals and objectives and that can be compared objectively because they are developed using similar approaches.”
Data backs this up. Project Management Institute research shows organisations employing robust project portfolio management practices deliver better results than those without on a range of key performance indicators: more projects on time (36% better) on or under budget (19% better), meet the original goal or business intent (18% better), and meet or exceed expected ROI (29% better).
The DTA review of Australian IT projects is expected to be completed by mid-2017.
What’s your take on project portfolio oversight? Do you think the government would benefit from legislation passed in the UK and US?
If your challenge is to do more with less, speak to PM-Partners to see how we can help you focus your investments on the initiatives that will deliver the most value. For more information on our Portfolio Management Services please click here or contact us on 1300 70 13 14.