MANAGING INFORMATION TECHNOLOGY

Transcription

1 MANAGING INFORMATION TECHNOLOGY Lecture 13 LEADING THE INFORMATION SYSTEMS FUNCTION By : Prof. Lili Saghafi 1-1

2 MANAGING THE IT ASSETS Technology Computer and communications infrastructure that enables information sharing over standard IT platforms Human Resources IT people talent with appropriate skills mix Business/IT Relationship Partnering relationships between business and IT managers, including joint decision-making 13-2

3 EVOLVING IS LEADERSHIP ROLE Executive IS leadership role has evolved over time due to: Rapid technological change Opportunities for strategic IT applications and business intelligence Increase in IT-savvy business managers Ubiquitous IT usage 13-3

4 TOP IS EXECUTIVE ISSUES IN Business productivity and cost reduction 2. Business agility and speed-to-market 3. IT and business alignment 4. IT reliability and efficiency 5. Business process re-engineering Source: Survey of Society of Information Management members in mid-2010 Luftman and Ben-Zvi, MISQ Executive, Dec

5 IS ORGANIZATION RESPONSIBILITIES AND GOVERNANCE IS GOVERNANCE - Locus of decision-making and accountability for: 1) computer and network operations 2) application software (development of new applications and maintenance of existing applications) 13-5

6 TWO PRIMARY IS RESPONSIBILITIES Computer & Network Operations Application Software Development & Maintenance Planning, purchasing, installing, operating, and maintaining/upgrading: - Computer hardware - Systems software on which applications software runs - Local area networks and wide area networks that support distributed computing and telecommunications for the enterprise - Acquiring (custom-developing, purchasing or renting ) - Implementing - Maintaining/upgrading Application software for: - the entire enterprise - business units/departments - smaller work groups - individuals 13-6

7 Centralized IS GOVERNANCE ALTERNATIVES Decision making and IS workers are concentrated within a central IS unit to take advantage of economies of scale and opportunities for integration of IS resources Decentralized Decision making and IS workers are dispersed to be closer to business managers within highly autonomous business units and be responsive to their needs Federal Combines both the centralized and decentralized designs to have the best of both worlds. The most typical Federal design is: Centralized responsibilities for computer operations & networks Decentralized responsibilities for applications software 13-7

8 IS GOVERNANCE ALTERNATIVES Fig

9 . IS GOVERNANCE ALTERNATIVES Another type of Federal IS governance design: - Centralized for Shared resources (services & applications) - Decentralized for Local IS resources Local Applications Software applications specific to a business unit or function Shared Applications (Enterprise systems such as ERP, CRM) Shared IT Services Fig 13.1: Shared versus Local IS Resources 13-9

10 SHARED SERVICES IN A MULTINATIONAL FIRM Shared Services Organization for Asia Pacific region at British America Tobacco Source: Brown and Vessey, 2003

11 MANAGING IT SERVICE DELIVERY Technology Tradeoff Decisions - Equipment Location - Client/Server Allocations - Operating System Standards - Network Redundancy - Bandwidth Capacity - Network Response Time - Security, Privacy and Network Access 13-11

12 GREEN COMPUTING TRADEOFF DECISIONS Hydroelectric Power Virtualization Tools Thin Clients Enhanced sleep modes for microcomputers E-waste recycling 13-12

13 EXAMPLE: BECOMING GREEN WITH BUSINESS INTELLIGIENCE United Parcel Service Business intelligence helped identify ways for UPS to reduce idling times of its delivery trucks, saving fuel and reducing pollution - Creates fuel-efficient routes for its package delivery vehicles - Cuts fuel consumption by monitoring and reducing idling time of trucks at their delivery destinations Move from a scheduled maintenance program to a condition-based maintenance program for its trucks - Fewer truck breakdowns and fewer replacement parts required for the vehicles, which eliminates waste 13-13

14 CHARGEBACK SYSTEMS Chargeback systems place control of IS spending with business managers and enables them to better understand their true IT costs Examples of IT resources that can be part of chargeback costs: - IS personnel (time spent and rate for specific skills) - Computer usage (or computer cycles used) - Disk file space (data storage costs based on type of storage unit) - Number of transactions processed - Amount of computer main memory used (per unit of time) - Number of users of an application 13-14

15 Potential Benefits CHARGEBACK SYSTEMS Fig

16 CHARGEBACK SYSTEMS What makes a good Chargeback System? - Understandable - Prompt and regular feedback - Controllable - Accountable - Costs related to benefits - Consistent with goals Fig

17 SERVICE LEVEL AGREEMENTS (SLAs) Service Level Agreements (SLAs) Defines the client expectation for a specific type of IT service as well as procedures to follow when these expectations are not met. Should include: - A simple definition of the service to be provided (e.g., help desk support) - The name(s) and contact information of IS personnel to contact for this service - A table listing the services to be provided and their costs (e.g., how quickly different types of problems will be responded to, and the costs associated with providing this type of service level) - Escalation procedures (e.g., who to contact if the agreed upon service response is not being provided) - A sign-off page for the appropriate business client and the IS liaison preparing the SLA document 13-17

18 IT SERVICE MANAGEMENT with ITIL Information Technology Infrastructure Library (ITIL) - Processes that focus on the business aspect of IT service delivery - created by the British Office of Government Commerce - Describes how various IT processes should be performed to ensure outcomes such as: - Adequate computer capacity exists for new IT applications or other IT infrastructure changes - Tracking of a computer incident from the time it first appears until a system change is made to permanently fix the problem - Formal change management process are followed for changes to any component of an IT system ITIL Official Site

19 IT SERVICE DELIVERY: SUPPORTING COMPUTER USERS IT support for employees using computer tools, including those developing software applications with these tools Key principle: - Unique aspects of the organization, as well as the different support needs of work units and computer users, need to be taken into account when designing strategies and tactics for user support Fig 13.6 Framework for Designing User Support

20 STRATEGIES FOR SUPPORTING USER COMPUTING 1.Laissez-Faire ( hands-off ) 2. Acceleration 3. Containment 4. Controlled Growth Fig 13.7 Strategies for User Computing 13-20

21 STRATEGIES FOR SUPPORTING USER Laissez-faire COMPTING Hands off approach: low levels of control but also few resources for support Common in 1980s when PCs were first introduced into corporations: IT leaders did not attempt to support or control their introduction. Today: approach may be used with new personal technologies Acceleration Low levels of formal controls and significant investments in resources to support users, to promote growth in tool usage The goal is to encourage users to acquire and learn about computer tools, including developing their own applications, before introducing heavy control policies 13-21

22 STRATEGIES FOR SUPPORTING USER COMPTING Containment Risk adverse approach with high levels of formal controls and procedures, including strict policies for tool security Appropriate for highly regulated environments to be sure policies and procedures are formulated and enforced Controlled Growth Combines high levels of formal controls and procedures with significant investments in resources Considered to be the ideal, mature approach: organizations initially begin with a different strategy and then migrate to controlled growth 13-22

23 SERVICE LEVEL AGREEMENTS FOR DESKTOP SUPPORT Speed in responding to user requests is a key performance metric Different support levels based on the problem type are established in consultation with business unit managers Different types of problems will have different maximum time periods in which they should be solved Fig

24 COMMON SUPPORT SERVICES Fig

25 COMMON POLICIES AND PROCEDURES Establishing technology standards is typically an IS department responsibility, but some organizations have committees with business unit representatives to establish policies Organizations communicate the policies and procedures to new employees via orientation programs Control Policies have to be modified in response to new technologies, ways of working, new laws and new external threats Fig Common Policies and Procedures 13-25

26 SUPPORTING TELECOMMUTERS Telecommuters spend at least a part of their regular business hours using IT to perform their jobs outside of a company s physical facilities, using a mobile office, an office in their personal home, or a temporary office at a shared work center away from the company s main office. Potential benefits from implementing Telecommuting include: - Increased workday flexibility and improved work-life balance for the telecommuter - Easier accommodation of communications across time zones for the organization 13-26

27 MANAGING IT APPLICATIONS Legacy Systems - Maintenance of aging legacy systems can make up a large portion of IT budget - Integration of new technologies with legacy systems can be difficult and time-consuming - The trend is to replace custom-developed applications with purchased software packages for common business applications: the maintenance burden is moved to the vendor, which is expected to regularly develop revised versions of the software 13-27

28 IT APPLICATIONS PORTFOLIO APPROACH IT Applications Portfolio Software portfolio needs to be managed as an asset For installed software, a company must know: - What software it owns - Where it is located - What it does - How effective it is - What risks are associated with the continued use Systems project decisions take into account existing software as well as projects for new systems already underway 13-28

29 METRICS FOR IT APPLICATIONS Performance metrics for projects to develop new applications: - High Quality - On-time Delivery - Within budget IS processes to manage and deliver IT applications Example: CMM (or CMMI) The Capability Maturity Model (CMM) - Five levels of process maturity that can be measured - For outsourcing vendors, the certified CMM level of a vendor is often used in client firm evaluations of potential vendors 13-29

30 FIVE LEVELS OF CAPABILITY MATURITY FOR SOFTWARE DEVELOPMENT (CMM) Fig

31 PROJECT MANAGEMENT OFFICE (PMO) Management structure to oversee projects and improve project processes Provides benefits in the form of: - Repeatable processes - Established change management procedures - Post-project reviews - Skilled project leaders 13-31

32 MANAGING IT HUMAN RESOURCES Highest percentage of a typical IS budget is for IS personnel Five categories of IS personnel skills: - Technical - Project Management - Business Domain - Sourcing - IT Administration 13-32

33 CATEGORIES OF IT HUMAN RESOURCE SKILLS Technical Skills Systems analysis Systems design Programming Systems testing Database design/administration IT architecture/standards Operations (service delivery/itil) Mainframe Distributed systems Operating systems Voice/data telecommunications Help desk/desktop support Continuity/disaster recovery Project Management Skills Project team leadership Project planning, budgeting, & scheduling Project risk management User relationship management CMM utilization Working globally/virtual teaming Fig

34 CATEGORIES OF IT HUMAN RESOURCE SKILLS Business Domain Skills Sourcing Skills IT Administration Skills Account management & communications Industry application knowledge Company-specific knowledge Function-specific knowledge Business process design & reengineering Change management/readiness Sourcing strategy Third-party provider selection Contracting & legal Vendor relationship management IT governance Financial management Internal HR management Fig continued 13-34

35 MANAGING IT HUMAN RESOURCES Attracting, recruiting, and retaining qualified staff is a key responsibility for IS managers in collaboration with an organization s HR staff Some common practices that managers use to retain valued IS personnel include: - Changing the work environment to be more employee-friendly - Increasing career development opportunities - Providing community-building initiatives - Establishing monetary or other employee incentives 13-35

36 COMMON PRACTICES FOR RETAINING IT WORKERS Fig 13.13

37 INTERNAL AND EXTERNAL IT STAFFING Insourcing and Outsourcing of IT skills Large firms in developed countries (e.g., U.S., Western Europe) today outsource some IS activities to countries with lower labor costs - What skills are most likely to be outsourced? - What skills are most likely to be retained in-house? Fig 13.14

38 MANAGING THE BUSINESS/IT RELATIONSHIP Business/IT Relationship Partnering relationships between business and IT managers, including joint decision-making - Business managers must work with IS managers to realize investments in IT resources - A formal statement of the IS organization s role may be helpful in strengthening a strained or failed IT-Business relationship - A strong relationship is characterized as a partnership 13-38

39 MANAGING THE BUSINESS/IT RELATIONSHIP Horizontal (lateral) mechanisms can be used to help build and foster the business/it partnership Fig

40 EXAMPLES OF HORIZONTAL MECHANISMS Formal Groups Common example: IS Steering Committee with responsibilities to: - Approve requests for new technology investments - Set priorities for application development and implementation - Monitor progress of IT projects against timelines and budgets - Share responsibility and ownership for achieving business value from IT investments Formal Roles Some organizations have managers in integrator roles to help achieve a strong Business/IT relationship An Account Manager is an integrator role that manages the relationship between the IS organization and a particular business unit 13-40

41 MEASURING OVERALL IS PERFORMANCE Balanced Scorecard A tool that provides an overview of organizational performance that is not strictly based on financial performance. In this tool, customer satisfaction, internal processes, innovation and learning, and financial performance are the balanced metrics

42 IS MANAGEMENT IN GLOBAL ORGANIZATIONS Many large corporations operate globally Key management issue is extent to which IT is standardized Key region and country factors that impact global IT management: - Country Telecommunications Infrastructure - Legal and Security Considerations - Language and Culture - Time Zone Differences 13-42

43 MANAGING IT OUTSOURCING Potential Outsourcing Benefits - Reduced costs - Obtaining expertise from large service provider - Ability to expand geographically - Flexibility to expand or reduce IT resources - Access to new technology 13-43

44 MANAGING IT OUTSOURCING Common Characteristics of IT Service Outsourcing - Cost savings from leveraging different labor markets - Long-term contracts, which are common for outsourcing computer & communications, can be very complex and require months of preparation prior to vendor selection and contract negotiation - Outsourced IT services typically difficult to bring back in-house 13-44

45 MANAGING OFFSHORE IT OUTSOURCING Offshore Outsourcing: Outsourcing to a location outside of the country where the client is located Near-shore: Offshore outsourcing to a geographic location that is close to the shores of the client (which can take advantage of overlapping time zones) Best-shore: This term refers to the fact that there are multiple options for firms with multiple geographic sites, as they may have options to choose among their own global locations and select the best shore for a particular IT activity based on labor markets (costs and expertise), time zones (overlapping versus those that take advantage of different time zones), etc

46 MANAGING OFFSHORE IT OUTSOURCING Some key issues to consider for sourcing alternatives: - Support of business units that will be affected - Impact due to differences in business practices and norms of personnel with different national backgrounds - Need for training programs due to national, cultural, language, and location differences - Need for face-to-face communications and/or appropriateness of available collaboration tools for a specific IT activity 13-46

47 Thank you Any Question? 7/20/ Professor Lili Saghafi

48 7/20/2014 Professor Lili Saghafi