Establishing an IT Programme Office in the Logistics Sector

The incoming CIO at a major European Logistics Company quickly realised that his department were not in control of their projects. The department providedIT expertise for innovative supply chain solutions as well as supporting and delivering a service to its internal customers. Realising that there was no single person in his department who had their finger on the portfolio and project pulse he commissioned Caroline Edwards to create a programme office with the specific intention of building structure and control around the delivery of internal and external projects and programmes.
The CIO also acknowledged that cost control and vendor management was not effectively managed and asked for these to also be controlled by the Programme Office.
In an environment of low margins and high customer demand it is important to have the appropriate levels of controls in place: too rigorous and there is no flexibility, too flexible and there is no control.
Initially the IT portfolio was not formalised. Individual departments within IT kept a list of their jobs and each Business Unit had a list of work that they believed was being undertaken by IT. Not surprisingly, on examining the lists there were very few correlations! Once a single list had been compiled and aligned to the key strategic values of the business it became much easier to understand and prioritise requirements.
Resource management forecasts were already in place but the Applications Manager frequently came under pressure from business leaders to put their projects at the top of the pile. Acknowledging that go/no-go decisions lie at the heart of successful prioritisation Caroline formed a Project Liaison Board with senior representatives from each Business Unit – all with budgetary responsibility. This Board met monthly to discuss current and forthcoming projects, to agree prioritisation and to understand the resource constraints within the IT department.

Project structure and control needs to be lightweight and responsive – always varying from Company to Company. An assurance process based heavily on Prince2 was introduced with IT-specific documentation included to ensure a robust methodology for IT delivery. Formal stage gates were set up and Project Boards were encouraged to meet regularly – always formally authorising the move to the next stage.
The CIO knew that his internal customers frequently felt they were not treated as customers and his IT department spent all their time servicing external customers and forgetting their peers. Increasingly his internal customers were becoming frustrated and impatient: they needed to feel that the IT department understood their specific needs, could provide accurate financial estimates for work undertaken and could manage their third party software vendors to deliver on time and in budget. Focussing on customer services and control Caroline created a new department to manage those areas traditionally overlooked by IT
departments – Vendor Management, document control, finance and finally (but by no means least important) business liaison.
At the start of the exercise costs were invisible, internal customers felt neglected and project delivery was inconsistent, unaudited and poorly executed. The IT department could now see at a glance the current and upcoming projects and programmes, the resource available and the funding solutions. All projects were managed in a consistent manner and assured through
the programme office. The CFO now felt confident that costs within IT were under control and external and internal customers were managed in a consistent and successful manner.