Operating Cost Impacts in Project Business Case

Cost transparency involves educating the governance team about the impact of today's investments on tommorrow's operating costs. ...

... "Factoring in costs of collateral impact should also happen at the project management phase as applications are being developed. While an organisation's impact metric might state that a new application for 1000 users will require five help desk people ... " ...

Via Computerworld, NZ: IT cost calculations

Project Financials

Expect to collaborate more with your counterparts in finance to review in-flight projects for cancellation and to develop more creative ways to finance new investments. ...

... "There is a different style of IT project evolving. People are looking for the cash implications to be less onerous on the business, but that doesn’t mean that they are shelving projects. " ...

Via Accountancy Age: Funding IT

Project Cost to Complete

Watch those math errors when calculating the cost to complete your project. ...

... "According to the report, in calculating the costs of the project, the Energy Department mistakenly compared two numbers that should not have been used together. " ...

Via NYTimes: Error on Coal Project

Strategic Position of Projects

IT project portfolios are currently under-review for reducing investment. Portfolio reviews are a healthy process. Visibility into the business case financials and support for the current business strategy are key inputs to enable the discussion. Exercising this (even if painful) will increase your process maturity, eventually leading to an increased return on the portfolio. ...

... "if the project really is strategic -- if it involves the executive team and will enable transformation across the business -- then it is by definition more than an IT project ... " ...

Via Computerworld: Project Portfolio Management

Holistic Project Budget

Occupy the high ground and define a holistic set of project financials --- the benefits (tangible and intangible), the one-time costs, recurring costs, and potential investments in future to further scale the business capability, if appropriate. ...

... "There are few things more distressing to a CFO than being told up front about only part of the costs involved in a proposed project. " ...

Via CIO Australia: Get Your Budget Approved by the CFO

SaaS Projects Alternative

If capital investment is being curtailed at your enterprise, SaaS-enabled IT projects may be a model to keep some investments moving forward. SaaS tools can be funded through operating expenses, in a buy-by-the-drink model. This changes the profile of the project financials. ...

... "Software as a service is generally treated as a operating expense. CFOs don't need to go hat-in-hand to their banker and beg for money. " ...

Via Computerworld: Financing IT

Innovation Projects

While we are confronting the strongest headwinds since the Great Depression, leave room in your shrinking project portfolio for innovation and growth investments. It is understandable that operational efficiency and financial stability will move to the forefront and the portfolio balance will shift. There are innovation and project investment lessons to be learned from similar times. ...

... "Neoprene, which DuPont publicly announced in November 1931 and introduced commercially in 1937, became one of the 20th century’s major innovations. By 1939, every automobile and airplane manufactured in the United States had neoprene components. " ...

Via McKinsey Quarterly: Innovating during the Great Depression

Project Impact from Credit Market Turmoil

IT projects in jeopardy of cancellation or on-hold status change? Creative financing could be an option depending on the scale of your implementation partner. ...

... "IBM has a large financial services group and it has the capital to help finance IT enterprise projects. " ...

Via ZDNet: IBM financing

The Dell Supply Chain Competitive Advantage

Dell's competitive advantage ... cooking the books ...

... "The investigation raised questions relating to numerous accounting issues, most of which involved adjustments to various reserve and accrued liability accounts. The investigation identified evidence that certain adjustments appear to have been motivated by the objective of attaining financial targets. According to the investigation, these activities typically occurred at the close of a quarter. The investigation found evidence that, in that timeframe, account balances were reviewed, sometimes at the request or with the knowledge of senior executives, with the goal of seeking adjustments so that quarterly performance objectives could be met. The investigation concluded that a number of these adjustments were improper, including the creation and release of accruals and reserves that appear to have been made for the purpose of enhancing internal performance measures or reported results, as well as the transfer of excess accruals from one liability account to another and the use of the excess balances to offset unrelated expenses in later periods. The investigation found that sometimes business unit personnel did not provide complete information to corporate headquarters and, in a number of instances, purposefully incorrect or incomplete information about these activities was provided to internal or external auditors. " ...

Via Dell: Dell Independent Investigation Completed; Will Restate Financials