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1 Best Practices in Business Technology Management Stephen J. Andriole CRC Press Taylor & Francis Group Boca Raton London New York CRC Press is an imprint of the Taylor & Francis Croup, an informa business AN AUERBACH BOOK

2 Contents Preface Acknowledgments About the Author xiii xix xxi 1 Perspectives 1 The 5x7 Business Technology Strategy 1 Operational and Strategic Technology Recommendations 2 Technology Image Building and Messaging Recommendations 4 People and Skill Sets Recommendations 4 Data, Applications, and Communications Recommendations 5 Security and Disaster Recovery Recommendations 6 Acquisition and Funding Recommendations 6 Measurement Recommendations 7 The 5x7 Business Technology Strategy Assessments 8 Revisiting the "IT Doesn't Matter" Argument 8 Ten Things IT Should Tell Management 11 Ten "New Rules" for IT 13 Ten Questions for Everyone :. 14 Still Too Many Dollars 16 Way Too Pricey 16 Hype, Misalignment, and Bad Biz/IT Management 17 One-Third Off? 18 Preparing for the Tsunami 18 IT's All about Processes 25 Does Any of This Sound Familiar? 26 Markets, Pills, and Timing 31 Why Should You Care? 32 Do You Know What Time It Is? 33 That Was Then, This Is Now 33 The Perfect Storm 33 The Glass Is Half Full 34 Trends That (Really) Matter 35

3 vi Contents What They're Doing 37 Strategy 37 Applications 37 Communications 38 Data 38 Infrastructure 38 Security 39 Organizationw 39 Management 39 Marching Orders 40 Business Technology Trends to Worry about 40 Collaborate/Integrate: What to Do about Business Technology 43 Collaborate Or Else 44 Integrate/Interoperate 45 Strategy, Anyone? 45 2 Organization 49 Five Flavors of Alignment 49 Strategic Alignment 50 Infrastructure Alignment 50 Operational Alignment 51 Innovation Alignment 52 People Alignment 52 Alignment Nirvana 53 Cost versus Profit Centers 53 The Proof Is in the Attitude 53 Should Boards of Directors Govern Technology? 55 Level 1: Business Strategy 58 Level 2: Strategic Business Applications 59 Level 3: Enterprise Business Technology Architecture 59 Level 4: Technology Infrastructure 59 Level 5: Technology Support 59 Context 1': Strategic Planning 59 Context 2: Enterprise Risk Management 60 Just Enough Organization 61 Tuning Up the Business Technology Organization 65 Industry Trends: Do You Know What's Happening And How to Respond? 65 Do You Know What Business, Technology, Organizational, and Trends Matter? 66 Have You Optimized Business Technology? 67 What about Business Technology Management? 68 Would You Survive an Alignment Audit? 70

4 Contents vii You Report to Who? 72 Business Strategy Linkages 73 Assessment of Core Competencies 74 Acquisition and Support Requirements 75 Optimal Organizational Structures 76 Organization Effectiveness Metrics 84 Who's Minding the Technology Store? 85 Time to Promote the Gurus 85 Tracking the Right Technology Trends 85 Components of a Technology Watch Strategy 86 Business Strategy Linkages 86 Macro Technology Trends 86 Key Technology Areas 87 "Hit List" Development and Pilot Projects 87 Technology Investment Effectiveness Metrics 88 Continuous Improvement 88 Five Hours to Influence 88 Grading Industry Cultures 90 Whatever Happened to Mentoring, Meritocracies, and Sabbaticals? 91 Whatever Happened to Mentoring? 91 Whatever Happened to Meritocracies? 92 Whatever Happened to Sabbaticals? 93 Has Anyone Been to Nordstrom's? 93 Do You Have a CTMO? 95 Another Audit 96 The Whole Context and Nothing but the (Whole) Context 98 What Kind of Technology Center Are You, Really? 100 Who's in Control? 101 Discipline 103 Making Money with IT: Three Ideas for Revenue Generation 104 A Little Exercise Goes a Long Way: Internal Focus Group Problem Solving. 105 The Idea 105 Templates 106 Examples Ill Conclusions 113 Of PMOs, VMOs, and XMOs: Why So Many Management Offices? Project Management Offices (PMOs) 114 Process Management Offices (PMOs) 115 Vendor Management Offices (VMOs) 115 Why So Many Management Offices? 115 Best Practices 116

5 viii Contents People 119 Time for New Skills: People Readiness for the Second Digital Revolution 119 Business Strategy Skills 119 Business Applications Skills 120 Enterprise Business Technology Architecture Skills 121 Infrastructure Skills 121 Support Skills 122 Feel My Pain 123 IT Begins in the Classroom 124 What Should We See? 124 So What Should We Teach? 125 Decision-Making Discipline: An Executive Course on Multicriteria Selection Methods 126 Course Content 127 What Next? 129 Theory versus Practice: Who Owns IT Education and Training? 131 The Practice of IT 131 The Joint Task Force for Computing Curricula 131 Theory versus Practice 132 Conclusion 135 Tweaking Business Technology Leadership: What Academia Can Learn from Executive Education 136 The Business Technology Leadership Executive Education Program 136 The Program's Impact 138 Impact at Villanova University 138 Lessons Learned 140 How's the Team Doing? An Unbalanced Scorecard 141 Three Brands for the Millennium 143 Can We Handle the Truth? 145 The Real Truth 146 Do You Speak Business? 148 Pain > Pleasure 149 Credibility > Influence 149 Operations > Strategy 149 Three Easy First Steps 149 Leadership, Likability, and Life 150 Politics, Culture, and You 152 Consultants in the Hen House 154 The Consulting Process 155 Consulting Knowledge and Skills 155

6 Contents ix 4 Acquisition and Measurement 157 Many Happy Returns 157 So What Are the Methods? 158 What to Do? 159 Sourcing, Sourcing Everywhere 159 Concepts to Clusters: The Real Technology Chasm 161 Vendors, Vendors Everywhere... Who's the Fairest of Them All? 163 Vendors as Necessary Evils 163 Vendors as Adversaries 163 Vendors as Partners 164 Three Reasons More Outsourcing Is Inevitable 165 Squeezing Willing and Not-So-Willing Vendors 166 Guerilla Budgeting 168 Dissenting Opinions about Outsourcing 169 Selling Tough Projects 173 Key Business Value Questions 173 Key Technology Questions 174 Key Cost/Benefit Questions 174 Key Risk Questions 175 The Recommendation 175 What's Your Core IT Competency? Really? 175 Business Strategy Linkages 175 Assessment of Core Competencies 176 The Range of Acquisition Alternatives 177 Products and Services Acquisition Options 177 Acquisition Effectiveness Metrics Future Modeling : 180 Who Pays for All This Stuff? '. 181 Benchmarking 181 Organizational Governance and Cost Allocation 183 Infrastructure Funding 185 Applications Funding 187 Future Modeling 188 Who's Measuring All This Stuff? 188 Components of Measurement Alignment 190 Industry Benchmarking 196 Security Solutions Outsourcing: It's Time 196 Project Management Yes, Again 198 Project Management Is Different 198 Five Not So Easy Pieces 199 What to Do? Triangulating on Requirements 200 A Requirements Management Methodology 200

7 Contents A Requirements Management Case Study 202 Sourcing the Sources: Who Does What Today? Who Wins Tomorrow?. 204 Business Technology Strategy 204 Strategic Business Applications 205 Enterprise Business Technology Architecture 205 Infrastructure, 205 Support Strategy, Applications, and Architecture Sourcing: Where There Are Still Competitive Advantages 207 Emerging Acquisition Strategies 207 The Business Technology Landscape 207 Education and Training Gaps 210 Outsourcing Trends 211 What to Do 211 Advanced Vendor Management: A Graduate Course in the Optimization of Vendor Relationships 213 Big Spenders 214 Advanced Vendor Management Best Practices 214 Tomorrow's Assignment 216 Project Management Rigor (or Rigor Mortis) 216 Discipline 217 Rigor 218 Rigor Mortis 218 Appropriate Discipline 219 Operational Effectiveness 221 Thin Is Beautiful 221 Vinfrastructure 223 Vertical Industry Requirements 223 Customized Infrastructures 224 Simplicity 224 Marching Orders 224 Another Look at Open Source Software 225 Commodities: Where Premiums Meet Payments 227 Who Needs PCs? Where Does Software Come From? 231 Everyone to the Woodshed 232 What You Need to Know about Pervasive Analytical Computing 234 A Pervasive Computing Checklist 234 Ten Things You Can Do Tomorrow to Improve Biz/IT Convergence 239 Some Final Thoughts (from the Bunker) 241 Killer Apps 241 Elements of Applications Alignment 242

8 Contents xi Ownership and Communication 245 Communications 245 Business Modeling 246 Communications Strategy 246 Access and Bandwidth 247 Collaborative Computing 247 Electronic Commerce 248 Process Management 248 Architecture 249 Infrastructure 249 Future Modeling 249 Ownership and Communication 249 Data's Still King 249 Data Alignment 250 Data Storage Information Storage 250 Knowledge Storage 251 Data Analysis 251 Information Analysis 252 Knowledge Analysis 252 And the Holy Grail 252 Don't Forget the Plumbing 252 Elements of Infrastructure Alignment 254 Standards Now or (Lots of) Cash Later 257 Elements of Standards Alignment 258 Should You Buy or Rent? 261 Don't Crack the Box 262 Data Information and Decision Making: Platforms, Analysis, and Real-Time Management 264 Getting the Platforms Ready 264 Getting Ready for Analysis 265 Getting Ready for Real-Time Management 266 Open Source Software Redux 266 Strategic Effectiveness 271 Appropriate CRM 271 Web 2.0 and the Enterprise 273 Thinking about Web 2.0: The Right Questions for the Right Impact 275 The R&D Project 275 The R&D Project Tasks 278 Conclusion 280 The Reality of New 280 It's the Data, Stupid 281

9 xii Contents They Know What We Like And Where We Are! 284 Back to the Future: Herding 3,000 Cats through a Worm Hole 285 The Situation 286 The Solution 288 Back to the Future 289 The Consumer's Internet: Thin Clients and Fat Hosts for Everyone 290 It's All There...! 290 Thin Access 290 The Device 291 The Business Model 292 Commercializing Information Technology: A Four-Step Methodology Step 1: Technology Trends Analyses 294 Step 2: Enumeration and Development 295 Step 3: Planning 297 Step 4: Execution and Commercialization 299 Conclusion 300 Business Intelligence in the Early Twenty-First Century: Models and Mining for Dynamic Real-Time Business Optimization 300 Introduction 300 So Where Are We Now? 301 Where Are We Going? 302 The New BI 302 Things to Do Now 302 Master Data Management for Business Intelligence and Customer Analytics 304 Master Data Management (and Data Warehousing) 304 MDM Approaches 306 MDM Governance 306 MDM and Business Intelligence 307 MDM for Business Intelligence to Customer Analytics 309 MDM + BI = Customer Analytics 310 Conclusion 313 Strategies and Tactics around "New": Time for a Reality Check 313 The Invention/Innovation/Commercialization Value Chain 313 Best Practice Reality Check 314 Conclusion 316 Profiling Your Strategic Technology Alliances 317 Definitions 318 Analysis 320 Results 322 Epilogue 325 Index 329

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