Investment Lifecycle Guidance Review

The Victorian Department of Treasury and Finance

Updated investment lifecycle and HVHR guidelines available

July 2012

Hi,

DTF is reviewing its investment policies to provide clear, integrated guidance and useful tools that promote better practice. They should help government agencies shape, plan and deliver well considered infrastructure investments. An important aspect of the update is the increased support for High Value/High Risk (HVHR) projects, including complex information and communication technology enabled projects.

The review examines the:

Guidelines, templates and examples
The new investment guidelines have been renamed the investment lifecycle and high value/high risk guidelines, to reflect the importance of the HVHR process. The lifecycle guidelines are set out in five key stages.

5 stage pic Each stage has its own set of documents, tools and templates that will step government departments and agencies through the relevant processes. Specifically, each stage has:

a guideline;
templates;
worked examples;
tools; and
technical guidelines for specialist areas (e.g. economic evaluation, governance etc.).

Relevant information from the Investment Management Standard (IMS), the HVHR process and the Gateway Review Process is incorporated in the documents.

The Overview and Stage 1: Conceptualise documents are now available online.

What has changed?

Overview guideline

To set the scene, the revised Overview document outlines:

the investment lifecycle framework;
background information about when and how to use the lifecycle guidelines;
the context surrounding the guidelines, with particular reference to the High Value/ High Risk (HVHR) process;
resources, skills and roles required at the different stages; and
summaries of each of the stages of the investment lifecycle framework.

Stage 1: Conceptualise guideline

The Conceptualise stage is the initial examination of problems or opportunities which agencies believe may become a priority for government attention. It allows decision-makers to consider the merits of the proposal early in its development and to determine whether it justifies further investigation.

If an agency concludes that an asset investment proposal is warranted, it may choose to present a submission to government either as a strategic assessment (non-HVHR), or a preliminary business case (HVHR). Where agencies do not have funds to develop a full business case and have an investment they consider worthy of government attention, they may prepare an investment development funding submission.

This guideline will assist departments and agencies in the preparation of submissions to the Government's early filtering of asset proposals. The guideline is accompanied by templates and worked examples to assist with the development of high quality submissions. The examples provide clarity on the difference in information requirements for a strategic assessment or preliminary business case.

The new templates, which have been updated since the 2011 budget process, are the:

Other useful content included in Stage 1: Conceptualise is a snapshot brochure with a summary of the stage and a road map to guide you through the process.

Investment Management Standard

The Investment Management Standard (IMS) has also undergone a recent review. Edition 5 has taken the IMS to a new level of maturity. Using its established approach and language it not only supports organisations to shape and manage individual investments and programs but can help to refocus and measure the outcomes of entire organisations. The main changes include:

new discipline in identifying the preferred strategic response;
a re-aligned investment logic map format that provides a direct logical connection from problem, to benefit, to strategic response through to solution;
an increased focus on the delivery of benefits; and
improved practices to drive better management of programs and organisational outcomes.

Next steps

Stage 2: Prove guideline

The purpose of Stage 2: Prove is to build on information developed in Stage 1: Conceptualise and provide a detailed evaluation of the short-listed project options to arrive at, and prove the deliverability of the recommended project solution. This stage guides you through the process of developing a full business case for funding consideration by Government.

The Stage 2: Prove guideline will be available late next month. In the interim, a draft full business case template is available for your use.

Other guidelines

The guidelines for Stage 3: Procure, Stage 4: Implement and Stage 5: Realise are currently available in a draft form as the review is still underway. As the final versions of these guidelines become available, they will be replaced on the investment lifecycle and HVHR guidelines website.