1. Implementing P3M3: A Progress Report David Maybanks Assistant Secretary Investment Management Branch Department of Finance and Deregulation 1

2. Agenda Introduction Agency Capability Initiative Update on Implementation Emerging themes from Capability Improvement Plans ICT Investment Management Policy 2

3. "The great end of life is not knowledge but action" - T.H. Huxley 3

4. Australian Government ICT Total ICT Expenditure some $5.1B (2009/10) Total ICT FTE about 15,700 (internal and external) 360,000 desktop devices (PCs, laptops, thin clients) 15,300 servers 4

5. ICT Investment Management Policy Improve Agency Capability initiative ICT Two-Pass Review process Annual ICT Benchmarking Custodian of Benefits Realisation 5

6. Objectives Agency Capability Initiative I Improve agencies’ capability to commission, manage and realise benefits from ICT investments provide a framework with which organisations can assess their current performance and put in place improvement plans. 6

7. Agency Capability Initiative II Part of Government’s response to the Review of the Australian Government’s Use of ICT FMA Act agencies (ICT spends over $2 million) 7

8. Agency Capability Initiative III Organisation-wide assessment of process key to the lifecycle management of ICT investment Undertake a self-assessment twice yearly from September 2012 Report to SIGB on progress against plans 8

9. Agency Capability in Two Pass Agency Capability Initiative IV Independent validation of capability before major ICT projects Agency capability assessments included in ICT Two Pass 9

10. Why P3M3? Agency Capability Initiative V A globally recognised capability maturity model Many models were reviewed P3M3 piloted and then adopted in 2009 10

11. History of P3M3 Agency Capability Initiative VI 1973: Richard Nolan 1988: CMM - 5 levels 1998-2003: PMI – OPM3 2002: OGC PMMM - project management 2005: P3M3 v1 2008: P3M3 v2 11

12. P3M3 Details Agency Capability Initiative VII Portfolio - the totality of an organisation’s investment (or a segment thereof) in the changes required to achieve its strategic objectives Program - a temporary, flexible organisation created to coordinate, direct and oversee the implementation of a set of related projects and activities in order to deliver outcomes and benefits related to the organisation’s strategic objectives Project - a unique set of coordinated activities, with definite starting and finishing points, undertaken by an individual or team to meet specific objectives within defined time, cost and performance parameters as specified in the business case. 12

13. P3M3 Details Agency Capability Initiative VIII Management Control Benefits Management Financial Management Stakeholder Engagement Risk Management Organisational Governance Resource Management 13

14. P3M3 Details Agency Capability Initiative IX Level 1 – awareness of process Level 2 – repeatable process Level 3 – defined process Level 4 – managed process Level 5 – optimised process 14

15. Value Proposition Agency Capability Initiative X P3M3 allows agencies to: Assess capabilities Work toward realistic future improvement Design and plan necessary improvements with measurable results In a clear and structured way 15

16. P3M3 Consultancy Services Panel Agency Capability Initiative XI APMG Accredited Consulting Organisations (ACOs) Procuring from the panel Finance website: www.finance.gov.au/budget/ict-investment- framework/p3m3-consultancy-services-panel.htmlwww.finance.gov.au/budget/ict-investment- framework/p3m3-consultancy-services-panel.html 16

17. P3M3 Elsewhere Agency Capability Initiative XII 17 National, regional and local governments Private sector Europe, North America, Asia

18. 18 "Setting goals for your game is an art. The trick is in setting them at the right level - neither too low nor too high" - Greg Norman

19. Large Agencies Update on Implementation I Annual ICT spends greater than $20 million Required to complete P3M3 assessment and CIP by December 2010 25 of 27 are complete 19

20. Medium Agencies Update on Implementation II Annual ICT spends greater than $2 million Required to complete P3M3 assessment and CIP by June 2011 Most are on track to complete by the deadline 20

21. Update on Implementation III The median current maturity level is 2 for the Portfolio model 1 for the Programme model 2 for the Project model The median target maturity level is: 2 for the Portfolio model 2 for the Programme model 3 for the Project model 21

22. Update on Implementation VII More mature areas Project Management particularly Organisational Governance and Management Control Financial Management 22

23. Update on Implementation VIII Less mature areas Benefits Management Resource Management in the Portfolio and Project models Management Control in the Program Management model 23

24. Key Messages I Agencies have options with P3M3 assessments: Internal self-assessment Validated self-assessment Independent assessment APMG verified assessment 24

25. Key Messages II Agencies set their own targets Higher levels may be not be appropriate Relative value of reaching next level 25

26. Key Messages III Comparing Maturity Scores Small differences can lead to large variations Self-assessment vs independent Levels 2 and 3 indicate substantial capability Cost of achieving further improvement increases exponentially 26

27. Key Messages IV Ongoing SIGB sponsorship Responding to FOI requests is an agency responsibility 27

28. Key Messages V Senior level and business area participation Impact on PMO resources Areas of opportunity to improve maturity 28

29. "If you don't know where you’re going, you might wind up someplace else" - Yogi Berra 29

30. Better Government Policy Developments I Achieve change to improve the delivery of services, policy and programs Improved implementation and assurance mechanisms Ensure implementations are consistently efficient and effective 30

31. Other Capability Related Initiatives Policy Developments IV APSC Capability Model Gateway Reviews P3M3 complements other capability initiatives 31

32. Investment Management Branch is here to help CapabilityAssessment@finance.gov.au 6215 1958 32

33. ‘ No institution can possibly survive if it needs geniuses or supermen to manage it. It must be organised in such a way as to be able to get along under a leadership composed of average human beings’. - Peter F Drucker 33