Information Systems Portfolio Management

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Information Systems Portfolio Management

• March 7, 2002

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Agenda

• Kraft background
• Business
• Information Systems
• Some context to help think about Information
  Systems role
• Aligning Business - Information Systems visions /
  strategies
• Architecture
• Kraft Portfolio Management Process
• Key principles for successful IS Portfolio
  Management
• Questions and answers

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Information Systems PortfolioManagement Challenge

• Breadth of the business
• Many people
• Many projects
• Picking the highest value initiatives
• Balancing short term return, longer term /
  strategic initiatives / and overall risk
• Ensuring the right sequence of initiatives
• Getting things to fit together towards a cohesive
  future vision

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Aligning Business and IS Strategy
Catalyst Role
Value
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Three-Legged Stool of Effective Change Management
Change
People
Technology
Process
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KFIS Vision

• Vision
• Information Services will support Kraft Foods
  vision of Undisputed Leadership and establish
  information as a source of competitive advantage
  by transforming the way people work, and
  harnessing
• the collective knowledge and innovation of people
  throughout the company to out-think and
  out-perform the competition.

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Our Information Systems Strategiesare Well
Aligned to the Kraft Business Strategies

• Strategies
• Drive growth by enabling superior consumer
  insight, streamlining revenue producing
  activities, providing value added customer
  services and increasing collective innovation
• Accelerate productivity by eliminating people,
  paper and time from business processes and
  providing people with unique insights into their
  activities and decision processes
• Enable organizational excellence by providing
  people with instantaneous, relevant, integrated
  information and knowledge any time and any place
  in the world
• Provide an information technology infrastructure
  which is reliable, secure and responsive at top
  10 cost efficiency levels
• Develop an integrated, information systems plan
  to support global food business and deploy
  solutions which enable global business processes

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Architecture

• A set of guidelines and standards detailed enough
  that
• people can work independently yet create an
  envisioned end
• product
• Blueprint for a house
• Sub-division plan
• City highway plan

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An Information TechnologyArchitecture
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Portfolio Process

• Projects gt 250,000
• Evaluation criteria aligned to Kraft business /
  IS strategies
• Value to the company
• Risk or ability to deliver
• Cost to develop and run
• Project write-ups submitted. Value and risk
  challenged by sub-committee
• Project ranking by combination of value and risk
  developed
• Senior management steering team with broad
  representation selected
• Projects reviewed for understanding with steering
  team
• Forced rank voting by steering team to apply
  strategic management judgement

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Portfolio Model
Portfolio Model Process Flow Register project
idea IT investment proposal form (project
definition) Infrastructure review Scoring of
value and risk criteria Cross-functional
review Senior Management Council review /
selection
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The Following Criteria WereUsed to Evaluate the
IS Projects
An independent review committee evaluated all
projects and ensured consistency of scoring
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Portfolio Model
Portfolio Application Model
100
50
Value to the Business
100
0
50
0
Ability to Succeed
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Portfolio Model

• The Following are Key Factors Required for
  Success
• of This Process
• Buy-in within IS and our business partners that
  this is an equitable approach to funding IS
  development
• Sufficient resources dedicated to perform good
  project write-ups (scope, benefit, costs, etc.)
• Tailor project rating criteria to link with Kraft
  business and IS goals
• Review committees that have the confidence of IS
  and our clients

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So What

• 80 of the IS investments went to the top 50
  Kraft wide projects vs. functionally best
  projects
• Stronger alignment to business, Information
  Systems objectives and wider support from senior
  business management
• IRR from 20 to 100
• Balance short term value, strategic investments
  and risk
• Perceived to be fair, objective and equitable. .
  . rigor to the process and people got their day
  in court

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Our Strategies and DeliverablesSupport KFNA
Strategies
Strategies LRP Deliverables

• eCRM
• Internet Marketing
• CRIC
• Idea to Market Rollout
• Marketing and Global Brand Management Reengineer
• Supply Chain Optimization / CPFR
• Exception Based / Real Time Demand / eHub
• Millenium / Trade Systems
• eProcurement
• Employee Portal
• Best Practice Collaboration
• Nabisco Integration
• eLearning
• Planning and Reporting / eFinance / Virtual
  Close
• Fast Track Deployment of Systems
• Component Based interfaces

Accelerate Productivity
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10 Principles for SuccessfulPortfolio Management

• Communicated direction (vision - strategies -
  goals)
• Partnership (business process owner and
  Information Systems)
• Architecture
• Common, integrating processes
• Systems development process
• Master Files design
• Project reviews
• Think programs vs. projects
• e.g. inventory reduction vs. new forecasting
  system
• Alignment to business strategy and direction
• Rigor and balance on priorities
• Project tracking (cascading the top 10)
• Think asset lifecycles (add, maintain, shed)
• Trusted people

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Questions and Answers