1 Greg Edit Problem Definition

Tips and traps

Problem Definition workshop

The Secretary

Department of Treasury and Finance

1 Treasury Place

Melbourne Victoria 3002

Australia

Telephone: [phone]

Facsimile: [phone]

www.dtf.vic.gov.au

Authorised by the Victorian Government

1 Treasury Place, Melbourne, 3002

© Copyright State of Victoria 2012

This book is copyright. No part may be reproduced by any process except in accordance with the provisions of the Copyright Act 1968.

ISBN 978-1-922045-91-1

Published January 2013.

If you would like to receive this publication in an accessible format please telephone [phone] or email mailto:[e-mail]

This document is also available in PDF format at www.dtf.vic.gov.au

Contents

Purpose of this document 1

Purpose of this document 1

Context for the Investment Management Standard workshops 2

Context for the Investment Management Standard workshops 2

How many workshops? 3

Problem Definition workshop 6

Problem Definition workshop 6

Purpose of a Problem Definition workshop 6

Responsibility of the facilitator 6

Who should be there? 7

Before the workshop 7

At the workshop 7

Step 1: Setting the scene 8

Step 2: Issues identification 10

Step 3: Problem statements 10

Step 4: Benefits 12

Step 5: Strategic response 13

Step 6: Changes and assets 14

Step 7: Finalise the workshop 15

After the workshop 15

Templates and examples 16

Appendix 1. Shaping new investments using the IMS 17

Appendix 2. 16 questions checklist for investment decision-makers 18

Appendix 3. Benefit framework 19

Appendix 4. Design guidelines – Investment Logic Maps 21

Appendix 5. Facilitator feedback form – Problem Definition workshop 22

Appendix 6. Quality assessment form – Investment Logic Map 23

Appendix 7. Sample agenda – Problem Definition workshop 24

Appendix 8. Sample email – before the Problem Definition workshop 25

Appendix 9. Sample email – after the Problem Definition workshop 26

Purpose of this document

This is the first of four guidance documents within the ‘shape a new investment’ series of tips and traps, written primarily for facilitators. It provides practical tips and guidance on how to successfully facilitate an initiative-level Problem Definition workshop and prepare an Investment Logic Map (ILM) consistent with the Investment Management Standard (IMS) version 5.0.

Guidance on how to facilitate the shaping of programs of new investment and improving the effectiveness of organisations is available in separate documents.

This document assumes you have read and understood the IMS – its principles, practices and the theory upon which it is built. It is available on the investment management website at www.dtf.vic.gov.au/investmentmanagement.

This document is also used in the facilitator training course. Further detail on the facilitator training course can be found on the investment management website.

Context for the Investment Management Standard workshops

The ability to select the investments providing the most benefit to society is a key component of good government. This is often a complex exercise requiring the contribution of many people who each bring their specialist skills and perspectives.

The IMS is a collection of simple, commonsense ideas and practices helping organisations direct resources to deliver the best outcomes. It has been designed to answer many of the key questions required to make an investment decision. These questions are also reflected in the ‘Investment Lifecycle and High Value/High Risk’ business case guidelines and templates. The Victorian Government has aligned these elements of its investment shaping and decision-making processes.

The 16 questions decision-makers checklist (see Appendix 2.) has been developed as a simple-to-use tool to describe the key information needed to decide on what direction an investment should take. Some of these questions are more applicable at the implementation phase of an investment, while the majority apply to the early planning and strategy phase of an investment’s lifecycle.

Together these provide a mechanism allowing decision-makers to assess whether:

• 
  there is a real problem needing to be addressed at this time;
  
• 
  the benefits provided by successfully addressing the problem are of high value to the organisation;
  
• 
  the way the problem will be addressed is both strategic and innovative; and
  
• 
  the solution is likely to be delivered within the time and cost expectations.
  

The workshops forming part of the IMS are used to support the primary investment decision-making functions of an organisation in a number of ways.

Investment management can be used to:

• 
  shape a new investment;
  
• 
  prioritise investment proposals;
  
• 
  develop new policies;
  
• 
  monitor and measure the delivery of benefits;
  
• 
  evaluate a program of investment;
  
• 
  refocus an organisation to improve its effectiveness; and
  
• 
  monitor an organisation’s outcomes.
  

Within organisations, investment decisions are usually made at three levels:

• 
  new individual investments;
  
• 
  programs of investment; and
  
• 
  the organisation direction and outcomes.
  

While these levels should naturally connect hierarchically, they are often managed using entirely different processes, in different forums and using different language. By providing an integrated view of IMS practices (Figure 1), closer alignment between levels can be achieved and the logic for investment at each level tested within a broader organisational context. The thinking, principles and workshops incorporated in the IMS can be applied to each of the three levels ensuring consistency of understanding and language.

The integrated view of the IMS shows the three levels at which the practices are applied and the workshops extracting the investment logic. These are also aligned to a set of foundation questions that depict change.

Figure 1: Integrated view of Investment Management Standard