P2C2 Group - Specialists in Enterprise Portfolio Management, CPIC, ITIM, and OMB 300


September 2007

The Future of CPIC in Enterprise Management

The P2C2 Group

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© 2007 P2C2 Group, Inc.



Capital Planning and Investment Control (CPIC) has come of age in little more than ten years, and it has brought a more disciplined approach to the Federal government’s spending for information technology. Its future is changing, however, because it must fit into a broader vision of enterprise management.


Our future vision for CPIC is based on trends that are already evolving. Some Federal agencies are already moving in the directions discussed here, and the P2C2 Group has certainly emphasized these strategies both in its consulting practice and past newsletter articles.


CPIC as a Child of the 1990s 


CPIC is a child of the legislation of the 1990s intended to ensure that Federal spending, including investments in IT, is well planned and managed, cost efficient, and achieve intended results. It implements provisions of the Government Performance and Results Act (GPRA) of 1993, Federal Acquisition Streamlining Act (FASA) of 1994, and Information Technology Management Reform Act of 1996 (Clinger-Cohen Act). As CPIC evolved, additional requirements were appended to comply with more recent legislation, such as the Federal Information Security Management Act (FISMA) of 2002.


Challenges for CPIC


CPIC has been a significant step forward for managing individual investments in IT systems and infrastructure, especially major outlays requiring the Exhibit 300. There is an increasing consistency in budget justification, performance data and accountability throughout the Executive Branch. The expectations for CPIC are defined in Sections 53 and 300 of Office  of Management and Budget (OMB) Circular A-11.


Yet the problem with CPIC is that it is a legislative compliance framework. Compliance is mandatory but not sufficient to achieve enterprise, mission, or information technology success. In addition, CPIC is not fully connected to current best practices for management of large enterprises. Its overall focus is on individual line items in the Federal budget—typically major systems and infrastructure--or clusters thereof. Within these individual investments, the focus has been largely on the “Control Phase,” involving projects that build new solutions or make major enhancements to existing systems. Such a focus is understandable, because development initiatives and enhancements are at significant risk of failure, cost overruns, and delays.


However, the lion's share (70 – 80 percent) of IT budgets is not for “Control Phase” development, modernization and enhancement (DME) projects but rather for steady-state “Operations & Maintenance.”  IT  governance must deal with the whole IT budget, involving all costs.


Most projects are at the bureau or sub-agency level, where the millions (and billions) of dollars of piecemeal investments do not necessarily add up to a Departmental, enterprise-wide vision or budget strategy. The OMB has attempted to address this problem by introducing the Federal Enterprise Architecture and insisting that each Department implement a consistent architecture. While some progress is being made, the alignment of the Executive Branch’s Fiscal Year 2008 $66 billion IT budget is truly daunting.


The challenge for Departments is that they must integrate the CPIC process into a more comprehensive approach to technology management. In May 2000, the General Accountability Office (GAO) suggested Information Technology Investment Management (ITIM) as a framework for a broader, enterprise-wide approach. Structured as a “maturity model,” it placed great emphasis on IT portfolio rather than individual investments. It addressed higher-level issues such as:


  • Defining and evaluating the portfolio
  • Managing the succession of information systems
  • Improving overall portfolio performance
  • Using IT to drive strategic business change.

Significantly, ITIM sought to address the organizational (enterprise) level of IT management, and GAO states that ITIM has become its primary tool for evaluating investment management capabilities. (See p. 3, GAO-04-394G, GAO IT Investment Management Framework, March 2004).


Some forward thinking Departments are already moving forward with ITIM and enterprise business management.

CPIC in Enterprise Portfolio Management - the Future 

CPIC as Component of a Broader Management Paradigm


The CPIC discipline must become integrated into the broader framework that includes robust approaches to strategic planning, Balanced Scorecards, and portfolio management.


Strategic Planning. At the highest level, IT must be an integral part of an agency’s core strategic visioning and planning process. An “IT Strategic Plan” must be spawned by the overall strategic plan. It cannot be separated from mission, human resources, financial, or other requirements.  Gap analysis and alternatives analysis should begin at the enterprise level, because there are few “technology solutions” that are not intertwined with overall business issues.


All too often, departmental strategic plans relegate IT to a sub-goal or objective, such as business modernization, when in fact technology should be an integral component of the mission, the services, and delivery system. Can you imagine moving money at Treasury without IT? Or protecting U.S. borders without technology? Or evaluating climate or soil conditions for farmers without information systems?  IT is not an add-on; it’s like the air we breathe … inherent, environmental, and integrated with the delivery of government programmatic services and products.


Balanced Scorecards provide a powerful means for harnessing information technology to broader enterprise results. Harvard Business Review proclaimed Balanced Scorecards as one of the most important business concepts to come out of the 1990s. They help executives and senior managers translate strategy into initiatives, align the organization with strategic goals, and manage performance.


Projects and portfolios of projects should line up with enterprise metrics for Balanced ScorecardsLinking projects and programs to Balanced Scorecards and strategy mapping was the topic of a recent webcast sponsored by the Financial Services Specific Interest Group (SIG) of the Project Management Institute. The webcast is archived as Ensuring Strategic Value, Creating Enduring Project Performance, and it continues to be available to SIG members. The presenter is Ron Person, a Certified Management Consultant and Project Management Professional.


Enterprise Management Office. An Enterprise Management Office (EMO) is a rapidly-emerging function that translates strategy into action, implements enterprise-level governance, and serves as an agent for change management. It typically doesn’t get “down in the weeds” of project management, but it should play a strong role in accountability, constructive guidance, and silo-busting. It should provide IT project, programs, and Project Management Offices (PMOs) with a road map of how to get to an enterprise-friendly future from the status quo.


When well implemented, an EMO can offer a positive value proposition to sub-agencies, PMOs, programs, and projects. It can clarify priorities for projects, ensure that IT budgets are justified by organizational strategy, and create a community of IT professionals who work together to advance the core programs and mission of the enterprise.


The EMO can also make strategic use of the ongoing work to support CPIC: a library of Post-Implementation Reviews (PIRS) can be highly valuable for future projects. Enterprise-wide EVMS will give clues to how better policies and acquisition strategies can resolve performance and cost bottlenecks. OMB 300 goals and metrics that roll up to a Balanced Scorecard can demonstrate the value of well-executed IT budgets.


Portfolio Management.  Portfolio management is a structured process for overseeing a collection of investments, and often it is accomplished within the aegis of a PMO—a program management office or project management office. This may include entire lifecycle IT assets (Operations & Maintenance as well as development, modernization and enhancement initiatives). In the Federal government it is often organized at the sub-agency level or line-of-business level, such as health or financial PMO.


Other Issues. Like CPIC, the discipline of Enterprise Architecture needs to become better integrated into the strategic management process. Also like CPIC, it currently tends to be like an island within enterprises. Some of our thoughts are in a previous article, Putting the Federal in EA.


You will also find that there are many other disciplines that should be integrated into enterprise-level technology management. Examples are Business Analysis and Six Sigma.


Getting IT Right 


In a worldwide survey of program and project management maturity, PriceWaterhouseCoopers found:

  • Performance is related to institutionalization of change--integration with other enterprise processes such as procurement, strategic planning, portfolio management techniques, and a continuous improvement mentality
  • Senior management frequently blames project managers for poor results and bad management, but the survey found that many of the reasons for failure are organizationally related and outside the influence of project managers.

You might want to think of enterprise technology management as a football team. You have a variety of players: quarterbacks, running backs, linemen, etc. You don't win unless you have an entire team of good performers who work together.


With occasional exceptions, CPIC and other players are on separate ballfields, and that's no way to achieve success for the enterprise team.


Back to the Future


The CPIC process must ultimately be a component of a more comprehensive process. Many Federal Departments and sub-agencies are already well on their way to an enterprise-wide approach to technology management. In our opinion, this is a good thing.


CPIC methods should be--and indeed are becoming--consolidated into the processes of PMOs and Enterprise Management Offices. The processes will remain identifiable to ensure compliance with legislation, but they will be leveraged through a comprehensive approach to truly effective technology management.


The P2C2 Group helps agencies and prime contractors achieve more by aligning strategy, budgets, capital investments, acquisitions, projects, and performance.

Drop us an e-mail sometime. Just to chat. Or to discuss how our services can support your vision to achieve more.

P2C2 Group, Technology Management Consultants for Federal Agencies and Contractors 



OK, I’ll confess. I’ve gotten caught up in “social networking” for business. I’ve started using LinkedIn. For me, the best part is that I don’t have to shuffle through a stack of business cards to find my best connections. Drop me a note if you want to be LinkedIn.
Best regards,

Jim Kendrick, PMP
Technology Management Consultant
P2C2 Group, Inc.
4101 Denfeld Avenue
Kensington, MD 20895



The P2C2 Group, Inc.
4101 Denfeld Avenue | Kensington, MD 20895
Point of Contact: Jim Kendrick, President
e-mail: kendrick@p2c2group.com
phone: 301-942-7985 | fax: 301-942-7986