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Managing the Information Technology Resource through Strategic Partnerships

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Chapter 10 Managing the Information Technology Resource through Strategic Partnerships What is Outsourcing? The phenomenon that appeared in the information systems ... – PowerPoint PPT presentation

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Title: Managing the Information Technology Resource through Strategic Partnerships


1
Chapter 10
  • Managing the Information Technology Resource
    through Strategic Partnerships

2
What is Outsourcing?
  • The phenomenon that appeared in the information
    systems field in the late 1980s was outsourcing,
    which means turning over a firm's computer
    operations, network operations, or perhaps other
    information systems functions to a vendor for a
    specified time - generally, at least for three
    years.

TM -2
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
3
Outsourcing in Retrospect
  • Early computer service bureaus (mid 1960s)
  • Major drivers for outsourcing
  • access to specialized or occasionally needed
    computing power or skills
  • avoidance of building in-house skills
  • access to special functional capabilities

4
Outsourcing in the 1990s
  • Two factors have affected the growth of IT
    outsourcing
  • Acceptance of strategic alliances
  • partner to complement weakness
  • leverage part of value chain
  • For an alliance to be successful and endure for
    the long term, both firms must believe that they
    are winners.
  • ITs changing environment
  • The internal IT organization is already a
    selector of code rather than a developer.
  • low cost maintenance of old systems
  • transformation to new model

N
TM -4
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
5
Table 10-1 IT Markets
Local
Physical Aspects
Information
  • Informating Leveraging knowledge workers with
    computers.
  • User tasks leveraged through direct use of
    microcomputers enabled by graphical use
    interfaces (GU) and purchase software such as
    word processing, spreadsheet, graphics,and
    CAD/CAM.
  • Local area networks (LANs)--user-oriented
    software for e-mail, database sharing, file
    transfer,and groupware for work teams.
  • Microcomputer software consists of millions of
    lines of code--almost 100 purchased from other
    companies.

Internal
  • Automating Computerizing physical and clerical
    processes.
  • DP era (1960-1980)
  • Dominant use of mainframe and mini computers.
  • Operational level systems automated primarily
    with COBOL.
  • Process controls automate primarily with machine
    language.
  • Standard packages for payroll and general ledger.
  • Applications portfolio consists of millions of
    lines of code with 50 typically purchased from
    outside.

External
  • Networking The Information Highway.
  • Network era (1990-?).
  • Wide area networks (WANS) networking workers,
    suppliers, and customers.
  • Internet for commercial use.
  • Millions of lines of code, almost 100 purchased
    and maintained from outside software firms.
  • Embedding Integrating computers into products
    and services.
  • Micro era (1980-1995).
  • Specialized code embedded in products and
    services to enhance function.
  • Microcomputers in physical products such as
    automobiles and smart cards in service.
  • Thousands of lines of code developed by both
    specialized internal programmers and outside
    contract programmers.

TM -5
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
6
The Driving Forces Behind Outsourcing
  • Two drivers
  • focus
  • on core business
  • value
  • shareholder

TM -6
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
7
Pressures (Drivers) to Outsource
  • Concerns about costs and quality
  • Breakdown in IT performance
  • Intense supplier pressures
  • Simplified general management agenda
  • Financial factors
  • Corporate culture
  • Eliminating an internal irritant

N
TM -7
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
8
Figure Information Technology Strategic Grid
High
A, 1992
Factory
A, 1988
Strategic impact of existing operating systems
C
E
B
H
Strategic
F
Turnaround
G
D
Support
Low
Key AMajor bank 1988-1992 B Major insurance
company C Medium-size grocery chain D 100
million distributor E Major airline F Major
chemical company G Major process industry
manufacturers H Insurance broker
Low
High
Strategic impact of application development
portfolio
N
TM -8
TM -8
Dr. Chen, IT Operations and Management Processes
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
9
Figure Information Technology Strategic Grid
Outsourcing IT?
  • IT support
  • Cost-effective
  • No disruption

High
A, 1992
Factory
A, 1988
YES
Strategic impact of existing operating systems
NO
C
E
B
H
Strategic
NO
F
YES
Turnaround
G
D
Support
Low
  • IT support
  • Un-interruptive cost-effective
  • is NOT necessary
  • IT support
  • Little strategic impact

Key AMajor bank 1988-1992 B Major insurance
company C Medium-size grocery chain D 100
million distributor E Major airline F Major
chemical company G Major process industry
manufacturers H Insurance broker
Low
High
Strategic impact of application development
portfolio
N
TM -9
TM -9
Dr. Chen, IT Operations and Management Processes
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
10
Outsourcing As an Economic Strategy
  • Core competencies
  • Which sources are less expensive
  • How much control is needed

TM -10
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
11
When to Outsourcing?
  • Which IS activities are strategic to our
    company's business?
  • Will outsourcing save us at least 15 percent?
  • Does our firm have access to the needed
    technology and expertise?
  • If not, outsourcing may be the answer to
    acquiring these resources.
  • Does outsourcing increase our firm's flexibility?

TM -11
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
12
When to Outsource IT
  • Position on strategic grid
  • The more the firm is operationally dependent on
    IT, the more sense outsourcing makes.
  • factory yes strategic no
  • support yes turnaround no
  • strategic differentiated outsourcing
  • Development portfolio
  • maintenance/high structured projects yes
  • low structured projects no

TM -12
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
N
13
When to Outsource IT (Cont.)
  • Organizational learning
  • Firms era
  • The farther a company is from the network era in
    its internal use of IT, the more useful
    outsourcing can be to close the gap.
  • Current IT organization
  • The more IT development and operations are
    already segregated, in the organization and in
    accounting, the easier it is to negotiate an
    enduring outsourcing contract.

TM -13
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
N
14
What Activities that Management should not
Outsource?
  • strategy
  • policy role
  • the decisions about when to introduce information
    systems into the organization
  • the management of the vendor
  • when the system (IS) department is well managed,
    and where IT is a core competency

TM -14
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
15
Structuring the Alliance
  • Contract flexibility
  • Standards and control
  • Areas to outsource
  • Cost savings
  • Supplier stability and quality
  • Management fit
  • Conversion problems

TM -15
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
N
16
Managing the Alliance
  • The CIO function
  • The heart of the CIOs job is planning
  • partnership/contract management
  • architecture planning
  • emerging technologies
  • continuous learning
  • Performance measurements
  • Mix and coordination of tasks
  • Customer-outsourcer interface

TM -16
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
N
17
Fig. 15.10 (Turban)
TM -17
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
18
Fig. 15.9 (Turban)
TM -18
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
19
Fig. U15.02 (Turban)
TM -19
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
20
OUTSOURCING BENEFITS
  • Economy
  • Service quality
  • Predictability
  • Flexibility
  • Making fixed cost variable
  • Freeing up human resources for other projects
  • Freeing up financial capital

TM -20
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
21
CONS OF OUTSOURCING
  • Loss of control
  • Vulnerability of strategic information
  • Dependency

TM -21
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
22
Outsourcing Recommendations
  • Write shorter contracts - less than 5 years
  • Subcontract control
  • Selective outsourcing

TM -22
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
23
Desirable Outcomes and Implementation Issues
  • On-time
  • On-budget
  • Full functionality
  • user acceptance
  • Favorable cost-to-benefits ratio
  • Low maintenance
  • Scalability
  • Integration with other systems
  • Reusability

TM -23
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
24
Chapter 11
  • A Portfolio Approach to Information Technology
    Development

TM -24
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
25
Questions
  • What is IT Development?
  • What is a Portfolio Approach?
  • A profile that aggregates a companys project
    information for its portfolio of systems and
    programming projects.

TM -25
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
26
Common in Big Disasters (both general
management and IT management)
  • Failure to consider the implementation risk of a
    specific project
  • Failure to consider the aggregate implementation
    risk of the portfolio of projects
  • Failure to recognize that different projects
    require different managerial approaches

N
TM -26
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
27
Portfolio Risk
  • What is Portfolio Risk?
  • A profile that aggregates a companys project
    implementation risk for its portfolio of systems
    and programming projects.
  • How much portfolio risk is appropriate?

N
TM -27
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
28
Project Implementation Risk
  • Project implementation risk is what remains
    after application of proper tools.
  • Consequences of Risks
  • 1. Anticipated benefits
  • 2. Higher-than-expected implementation costs
  • 3. Longer-than-expected implementation time
  • 4. Technical performance too low
  • 5. System incompatibility

N
TM -28
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
29
SYSTEM INTERDEPENDENCE
TM -29
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
30
SYSTEM FAILURE
  • AN INFORMATION SYSTEM THAT
  • DOESNT PERFORM AS EXPECTED
  • ISNT OPERATIONAL AT A SPECIFIED TIME
  • CANNOT BE USED AS INTENDED

14.3
TM -30
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
31
PROBLEM AREAS
USER INTERFACE How User Interacts with System
Hardware, On-Screen Commands and Responses
TM -31
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
32
MEASURES OF INFO SYSTEM SUCCESS
  • 1. HIGH LEVELS OF USE
  • 2. USER SATISFACTION
  • 3. FAVORABLE ATTITUDES
  • 4. ACHIEVED OBJECTIVES
  • 5. FINANCIAL PAYOFF

14.6
TM -32
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
33
CAUSES OF INFORMATION SYSTEM SUCCESS FAILURE
  • IMPLEMENTATION
  • LEVEL OF COMPLEXITY RISK (Project Dimension
    that influence risk)
  • CHALLENGE OF BUSINESS REENGINEERING

TM -33
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
34
CHANGE AGENT
  • DURING IMPLEMENTATION, INDIVIDUAL ACTS AS
    CATALYST DURING CHANGE PROCESS TO ENSURE SUCCESS

14.10
TM -34
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
35
ACTIONS INDICATORS FOR SUCCESSFUL SYSTEM
IMPLEMENTATION
  • SUPPORT BY LOCAL FUNDS
  • NEW ORGANIZATIONAL ARRANGEMENTS
  • STABLE SUPPLY MAINTENANCE
  • NEW PERSONNEL CLASSIFICATIONS
  • CHANGES IN ORGANIZATIONAL AUTHORITY

14.11
Source Yin (1981)
TM -35
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
36
ACTIONS INDICATORS FOR SUCCESSFUL SYSTEM
IMPLEMENTATION
  • INTERNALIZATION OF TRAINING PROGRAM
  • CONTINUAL UPDATING OF THE SYSTEM
  • PROMOTION OF KEY PERSONNEL
  • SURVIVAL OF SYSTEM AFTER TURNOVER
  • ATTAINMENT OF WIDESPREAD USE

Source Yin (1981)
TM -36
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
37
FACTORS IN IMPLEMENTATION OUTCOME DESIGN, COST,
OPERATIONS, DATA
  • USER INVOLVEMENT INFLUENCE
  • MANAGEMENT SUPPORT
  • MANAGEMENT OF IMPLEMENTATION PROCESS
  • LEVEL OF COMPLEXITY / RISK (Project
    Dimension that influence risk)

Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
TM -37
38
MANAGEMENT OF THE IMPLEMENTATION PROCESS
  • DEFINE REQUIREMENTS
  • ASSESS COSTS, BENEFITS, SCHEDULES
  • IDENTIFY INTEREST GROUPS, ACTORS, DETAILS
  • TRAIN END USERS
  • CONTAIN CONFLICTS, UNCERTAINTIES

14.19
TM -38
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
39
OBSTACLES TO BUSINESS REENGINEERING SUCCESS
Adapted from Caldwell, 1994
14.26
TM -39
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
40
Project Dimensions that influence risk
  • Size
  • Experience with Technology
  • Project Structure
    (LEVEL OF COMPLEXITY / RISK)

N
TM -40
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
41
Assessing Project Risk
N
TM -41
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
42
MANAGING IMPLEMENTATION CONTROLLING RISK FACTORS
  • EXTERNAL INTEGRATION TOOLS Link work of
    Implementation Team to Users at all
    Organizational Levels
  • INTERNAL INTEGRATION TOOLS Ensure Implementation
    Team Operates as a Cohesive Unit

14.28
TM -42
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
43
MANAGING IMPLEMENTATION FORMAL PLANNING
CONTROL TOOLS
  • FORMAL PLANNING TOOLS Help Structure, Sequence
    Tasks Budget Time, Money, Resources
  • FORMAL CONTROL TOOLS Help Monitor Progress
    Toward Completing Tasks, Reaching Goals

14.31
TM -43
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
44
Project Management A Contingency
Approach (Management Tools)
  • External integration
  • Internal integration including technical
    leadership
  • Formal planning
  • Formal results-control mechanisms

N
TM -44
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
45
EXTERNAL INTEGRATION TOOLS
  • User as Team Leader or Assistant
  • User Steering Committee
  • Users as Active Team Members
  • Require User Approval of Specs
  • Distribute Important Minutes Widely
  • Users can Report to Management Lead Training
    Effort and Installation
  • User Responsible for Change Control

14.29
TM -45
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
46
INTERNAL INTEGRATION TOOLS
  • Team Members Highly Experienced
  • Leader has Strong Technical, Project Management
    Background
  • Frequent Meetings Distribute Minutes Concerning
    Key Decisions
  • Regular Technical Status Reviews
  • Members have Good Working Relationships with
    Others
  • Members help set Goals, Establish Targets

14.30
TM -46
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
47
FORMAL PLANNING TOOLS
  • SELECT MILESTONE PHASES
  • DEVELOP SPECIFICATIONS FROM FEASIBILITY STUDY
  • ESTABLISH SPECIFICATION STANDARDS
  • DEVELOP PROCESS FOR PROJECT APPROVAL

14.32
TM -47
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
48
FORMAL CONTROL TOOLS
  • MAINTAIN DISCIPLINES TO CONTROL, FREEZE DESIGN
  • SPOT DEVIATIONS FROM PLAN
  • PERIODIC FORMAL STATUS REPORTS TO SHOW PROGRESS

14.33
TM -48
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
49
Results-Control Tools
  • Best when
  • Clear knowledge of desired results exists
  • Where the desired result can be controlled
  • Where the controllable result area can be
    measured effectively

N
TM -49
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
50
Selection of Project Management Tools
HIGH STRUCTURE
LOW STRUCTURE
Need to choose only one option and stick to
it External integration Results-control
leadership by user Formal planning
Low Technology
Results-control Formal planing
Need to choose only one option and stick to
it External integration Technical
leadership Internal integration
High Technology
Technical leadership Internal integration
TM -50
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
51
TABLE 11-3 Relative Contribution of Tools to
Ensuring Project Success by Project Type
Contribution
Project Type
External Integration
Internal Integration
Formal Planning
Formal Results Control
Project Description
I
II
III
IV
V
VI
VII
VIII
TM -51
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
52
MANAGING IMPLEMENTATION OVERCOMING USER
RESISTANCE
  • COUNTERIMPLEMENTATION Deliberate attempt to
    Thwart Implementation. Countered by
  • PEOPLE-ORIENTED THEORY
  • SYSTEM-ORIENTED THEORY
  • INTERACTION THEORY

N
14.34
TM -52
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
53
MANAGING IMPLEMENTATION DESIGNING FOR THE
ORGANIZATION
  • ORGANIZATIONAL IMPACT ANALYSIS
  • ERGONOMICS
  • SOCIOTECHNICAL DESIGN

14.38
TM -53
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
54
ORGANIZATIONAL IMPACT ANALYSIS
  • HOW WILL PROPOSED SYSTEM AFFECT ORIENTATIONAL
  • STRUCTURE
  • ATTITUDES
  • DECISION MAKING
  • OPERATIONS
  • ?

14.39
TM -54
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
55
ERGONOMICS
  • INTERACTION OF PEOPLE MACHINES, INCLUDING
  • DESIGN OF JOBS
  • HEALTH ISSUES
  • END-USER INTERFACES

14.40
TM -55
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
56
SOCIOTECHNICAL DESIGN
  • DESIGN TO PRODUCE INFORMATION SYSTEMS THAT
    BLEND
  • TECHNICAL EFFICIENCY
  • SENSITIVITY TO ORGANIZATIONAL NEEDS
  • SENSITIVITY TO HUMAN NEEDS

14.41
TM -56
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
57
POOR PROJECT MANAGEMENT
  • COST OVERRUNS
  • TIME SLIPPAGE
  • TECHNICAL SHORTFALLS IMPAIR PERFORMANCE
  • FAILURE TO OBTAIN ANTICIPATED BENEFITS

14.20
TM -57
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
58
WHAT CAN GO WRONG?
  • ANALYSIS Incorrect allocation of Time, Money
    Resources Too Little Preliminary Planning
    Improper Staffing Excessive Promises Incomplete
    Requirements Users Spend Insufficient Time
    Helping Team Gather Information Poor User
    Interviews

14.21
TM -58
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
59
WHAT CAN GO WRONG?
  • DESIGN Little or no User Input to Design No
    built-in Flexibility Lack of Organizational
    Impact Analysis Functional Specifications
    Inadequately Documented

14.22
TM -59
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
60
WHAT CAN GO WRONG?
  • PROGRAMMING Underestimated Time, Cost
    Incomplete Specifications Not Enough Time for
    Program Logic Time Wasted on Writing Code
    Insufficient use of Structured Design,
    Object-Oriented Techniques Programs Inadequately
    Documented Requisite Resources not Scheduled

14.23
TM -60
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
61
WHAT CAN GO WRONG?
  • TESTING Underestimated Time Cost Disorganized
    Test Plan All Direct Users not Involved until
    Conversion Inappropriate Acceptance Tests
    Management Doesnt Sign Off on Test Results

14.24
TM -61
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
62
WHAT CAN GO WRONG?
  • CONVERSION Insufficient Time Money All Direct
    Users not Involved until Conversion Delayed
    Training To Reduce Cost Overruns Delays System
    Goes On-line too soon Inadequate System Use
    Documentation No Performance Evaluation or
    Standards Insufficient System Maintenance Plans
    or Training

14.25
TM -62
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
63
Success or Failure Factors of IS
Succeed
Continuous
Service, speed, quality, innovation
or
Business
Improve
Change Management
Survive
Radical
Organization
Management
Technology
culture
(Behavior)
(Human)
(Strategic Advantage)
  • Structure
  • attribute
  • decision-making
  • operation
  • Ethically Acceptable
  • Socially Responsible
  • Politically control

uncertainty
Risks
Benefit
overcome
enhance
strategy
I S
A Digital Society
Ability flexibility to compress time and space
and to expand organizational knowledge and then
increase
1) choosing strategy 2) organizing the
business 3) organizing the systems management area
The Driver Servant
HUMAN ADAPTABILITY
organizational change
------Radical Change
TM -63
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
64
Success or Failure Factors of IS (Contd)
organizational change
------Radical Change
Evolution of change
A FIRM/ORGANIZATION
Restructuring Competitive Advantage
Re-engineering Cooperative Advantage
Electronic Market flatten the organizational
hierarchical structure
Revolutionary significance lies in generality
e.g., steam engineers--triggered the first
Industrial Revolution Computers--Seem to be
triggering a second one.
TM -64
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
65
IT Yesterday, Today and Tomorrow
  • Yesterday
  • Computer age
  • Computer proc.
  • Computing
  • Accuracy
  • Automation
  • Efficiency
  • doing things
  • right

Today Information age People proc.
Communication Perspective
Information Effectiveness
doing
the right things
Tomorrow Knowledge age Knowledge
proc. Connectivity Reality Innovation Performance/
Innovation creativity
TM -65
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
66
EXHIBIT 11A-1 Technology Support for Group
  • Teleconferencing
  • Videoconferencing
  • Conference calls
  • Electronic/voice mail
  • Computer conferencing
  • Shared information databases
  • and management support
  • systems
  • Workflow/coordination
  • technologies
  • Intelligent agents

Different
Any Time Any Place
Place
  • Information centers
  • Team rooms
  • Electronic meeting rooms
  • Decision conferences

Same
Same
Time
Different
TM -66
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
67
EXHIBIT 11A-2 IT Alignment Team Perspective
Effectiveness
Alignment
Process Effectiveness
Outcome Effectiveness
Team
  • Level of effort brought to bear on the task
  • Level of knowledge/skill
  • Appropriateness of task performance strategies
  • Performance
  • Satisfaction
  • Group viability/ learning
  • Context
  • Environment
  • Organization

Task
Technology
TM -67
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
68
Framework for Analyzing Organizational Design
Defining Direction
Executing and Adapting
Environmental Context and Resources
Units, groupings
Incentives
Coordinating mechanisms
Authority
Formal and informal power

Purpose Core Values, Core Competencies
Boundary systems
People
Strategy
Values and Behavior
operation, processes
Control
Work
Management processes
Technology
Information Policy
Exhibit TN-3
TM -68
Dr. Chen, Managing IT Reos. Thru Strategic
Partnerships A Portoflio Approach to IT
Development
69
  • End of Chapters 10, 11

70
Pressures to Outsource (Ch. 10)
  • Financial factors
  • 1) To liquefy the firms intangible IT asset,
    and
  • Hardware/Software Asset
  • 2) Outsourcing can turn a largely fixed-cost
    business into one with variable costs
  • 3) A third-party relationship brings an entirely
    different set of dynamics to a firms view of IT
    expenditures
  • Corporate culture
  • 1) A companys values can make it very hard for
    managers to take appropriate action.
  • 2) However, outsourcing driven by very senior
    management, provided the fulcrum for overcoming
    this impasses, since it was not directly
    associated with any division or corporate staff.
  • 3) An internal IT organization may fall behind
    the state of the art without being immediately
    attacked while an outsourcers is forced to keep
    up with the latest technology to be successful.
  • Eliminating an internal irritant
  • 1) No matter how competent and adaptive existing
    IT management and staff are (and usually they are
    very good), there is usually tension between the
    end users of the resources and the IT staff.
  • 2) Often the tension is exacerbated by the
    different language IT professional use, and
  • 3) lack of career paths for users and IT staff
    across the organization,
  • 4) perceived high IT costs, perceived
    unresponsiveness to urgent requests, and
  • 5) perceived technical obsolescence.
  • In this context, the notion of a remote,
    efficient, experienced outsourcer is particularly
    compelling, even though the internal perceptions
    are not necessarily realistic.

N
71
Selection of Project Management Tools
  • High Structure Low Technology
  • results-control
  • formal planning
  • High Structure High Technology
  • technical leadership
  • internal integration

72
Selection of Project Management Tools
  • Low Structure Low Technology
  • need to choose only one option and stick to it
  • external integration
  • formal planning
  • results-control leadership by user
  • Low Structure High Technology
  • need to choose only one option and stick to it
  • external integration
  • technical leadership
  • internal integration

73
USER-DESIGNER COMMUNICATIONS GAP
  • DIFFERENCES IN BACKGROUNDS, INTERESTS,
    PRIORITIES
  • IMPEDE COMMUNICATION AND PROBLEM SOLVING
  • AMONG END USERS AND INFORMATION SYSTEMS
    SPECIALISTS

74
USER CONCERNS
  • WILL SYSTEM DELIVER INFORMATION I NEED?
  • HOW QUICKLY CAN I ACCESS DATA?
  • HOW EASILY CAN I RECEIVE DATA?
  • HOW MUCH CLERICAL SUPPORT WILL I NEED FOR DATA
    ENTRY?
  • HOW WILL SYSTEM OPERATION FIT INTO MY DAILY
    BUSINESS SCHEDULE?

14.15
75
DESIGNER CONCERNS
  • HOW MUCH DISK SPACE WILL MASTER FILE CONSUME?
  • HOW MANY LINES OF PROGRAM CODE WILL THIS
    FUNCTION TAKE?
  • HOW CAN WE REDUCE CPU TIME?
  • WHAT IS THE MOST EFFICIENT WAY OF STORING THIS
    DATA?
  • WHAT DATABASE MANAGEMENT SYSTEM SHOULD WE USE?
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