Strategic Planning for Information Systems Third Edition John

Strategic Planning for Information Systems Third Edition John Ward and Joe Peppard CHAPTER 8 Strategic Management of IS/IT: Organizing and Resourcing 1

Outlines • Strategi Pengorganisasian untuk IS / IT manajemen • Model dan kerangka kerja untuk membimbing tindakan manajemen 2

Objectives of the IS/IT Management Strategy • Untuk memastikan strategi IS / IT, kebijakan dan rencana mencerminkan tujuan bisnis dan strategi. • Untuk memastikan strategi, dll yang layak dalam hal risiko bisnis. • Untuk menetapkan tingkat sumber daya yang tepat dan mendamaikan pertentangan / set prioritas. • Untuk membuat 'budaya' untuk manajemen IS / IT yang mencerminkan budaya perusahaan. • Untuk memantau kemajuan bisnis penting IS / IT kegiatan. • Untuk mencapai keseimbangan yang terbaik b / w sentralisasi dan pengembangan IS / IT pengambilan keputusan. 3

Traditional IT Organization 4 Source: Luftman

sentralisasi 5 Source: Luftman

desentralisasi 6 Source: Luftman

Federal atau Hybrid 7

Manfaat Model federal 8

Faktor Memilih Struktur Organisasi • Organisasi ini tergantung pada TI Its tahap kedewasaan • dalam hal portofolio aplikasi • Geografi dari perusahaan, terutama bagi • organisasi dengan kehadiran global • Bisnis keragaman dan laju perubahan jenis usaha dan tekanan kompetitif di setiap bisnis • Potensi manfaat dari sinergi b / w bisnis di kedua barang perdagangan dan jasadan pertukaran informas • Ekonomi sumber daya, memperoleh dan menyebarkan keterampilan 9

La Belle dan Nyce • Sementara unit bisnis harus bertanggung jawab untuk aplikasiarsitekturpengembangan, dan operasi-daerah tertentu harus dipusatkan • Ini termasuk: sumber daya telekomunikasi, perangkat keras, arsitektur perangkat lunak, arsitektur informasi, manajemen risiko dan keamanan, layanan bersamadan utilitas, dan manusia. • Kegiatan unit harus dikoordinasikan dengan perkembangan arsitektur pusat melalui 'kelompok pengarah atau komite' 10

Divisi Tanggung Jawab: TI Arsitektur Manajemen • Fungsi: Mengembangkan dan menjaga arsitektur informasi • Pusat TI kelompok: Memantau proses; memberikan bantuan jika diminta • Bisnis unit operasi - Lengkap mendefinisikan arsitektur bisnis usaha dengan lokasi – Lengkap penerjemahan strategi kedalam persyaratan teknologi – Menentukan arsitektur informasi 11

Lanjutan • Fungsi: Mengembangkan dan menjaga arsitektur aplikas • Pusat TI kelompok – Menetapkan standar, memantau proses – Tinjauan arsitektur dan melaporkan kecukupan kepada Komite Teknologi – Pastikan kesamaan yang sesuai • Bisnis unit operasi – Menetapkan persyaratan dan mengembangkan arsitektur – Koordinat b / w unit untuk bisnis umum 12

Lanjutan • Fungsi: Mengembangkan dan menjaga arsitektur. Data • Pusat TI kelompok – Mengkoordinasikan pengembangan / pembentukan proses manajemen database umum – Buat/mempertahankan database perusahaan • Bisnis Unit Operasi – menetapkan persyaratan – Berkembang sesuai dengan standar 13

Lanjutan • Fungsi: mengembangkan dan memelihara perangkat keras / arsitektur sistemoperasi • Pusat TI grup – Memantau perkembangan / implementasi dalamsektor – Mengembangkan dan menjaga arsitektur untuk perusahaanpengguna-mendukung operasi • Bisnis unit operasi – Berkembang sesuai dengan standar perusahaan dan persyaratan bisnis – Permintaan varians yang sesuai; membuat rekomendasi perubahan 14

Lanjutan • Fungsi: Mengembangkan dan menjaga arsitektur telekomunikasi • Pusat TI grup – Berkembang sesuai dengan standar dan kebutuhan bisnis • Bisnis unit operasi – menetapkan persyaratan – Laporan kinerja / respon masalah 15

Menyeimbangkan IS Permintaan dan Pasokan TI • Unit bisnis menerima layanan responsif dari desentralisasi fungsi IS • Sementara pada saat yang sama perusahaan IS fungsi menyediakan l ayanan TI yang luas kelompok dan mengerahkan beberapa derajat kepemimpinan pusat dan pengendalian kegiatan TI 16

Ringkasan Pengaturan Struktural untuk IS Fungsi di Beberapa Bus 17

Lanjutan 18

Penting bagi Manajemen IS / IT: Rockart et al. • Mencapai dua arah penyelarasan b / w bisnis dan strategi IS / IT • Mengembangkan hubungan yang efektif dengan manajemen lini • Menyampaikan dan menerapkan sistem baru • Membangun dan mengelola infrastruktur TI • Reskill IS fungsi dengan kompetensi dan pengetahuan baru • Mengelola kemitraan penjual • Mendesain ulang dan mengelola organisasi federal IS 19

Penting bagi Manajemen IS / IT: Venkatraman • Dia berpendapat perlunya pendekatan yang berbeda untuk mengelola sumber daya TI yang menganggap sumber-sumber nilai yang akan diperoleh dari sumber daya TI. • Ia mengusulkan bahwa sumber daya harus dikelola sebagai pusat nilai. • Pusat nilai adalah sebuah konsep pengorganisasian yang mengakui empat sumber yang saling tergantung nilai dari sumber daya TI: pusat biaya, pusat layanan, investasi dan profit center. 20

Lanjutan • Pusat biaya memiliki fokus operasional yang meminimalkan risiko dengan penekanan pada efisiensi operasional. Biaya-pusat kegiatan adalah kandidat yang baik untuk outsourcing. • Pusat layanan, meskipun masih meminimalkan risiko, bertujuan untuk menciptakan kemampuan bisnis TIenabled untuk mendukung strategi saat ini. 21

Lanjutan • Pusat investasi memiliki fokus jangka panjang dan bertujuan untuk membuat baru berbasis IT kemampuan bisnis. Ini berusaha untuk memaksimalkan peluang bisnis dari sumber daya TI. • Pusat laba ini dirancang untuk memberikan layanan TI ke pasar eksternal untuk pendapatan tambahan dan untuk memperoleh pengalaman berharga untuk menjadi kelas dunia IS fungsi. 22

Penting bagi Manajemen IS / IT: Gartner Group 23

Lanjutan • TI kepemimpinan, yang meliputi TI membayangkan, sekering strategi TI dengan strategi bisnis, dan mengelola sumber daya IS. • Arsitektur pembangunan, yang berkaitan dengan mengembangkan cetak biru-untuk desain keseluruhan TI teknis. • Bisnis perangkat tambahan, yang mencakup analisis proses bisnis dan desain, manajemen proyek dan mengelola hubungan dengan pengguna. • Kemajuan teknologi, yang merupakan aplikasi desain dan pengembangan. • Penjual manajemen, yang meliputi mengelola dan mengembangkan hubungan dengan vendor dan pemasok, negosiasi dan pemantauan kontrak dan 24 pembelian.

Sebuah Kerangka Guiding Aksi • Apa yang perlu dikelola? • Dimana IS / sumber daya TI harus outsourcing? • Siapa yang harus mengelola IS / IT? • Mekanisme koordinasi untuk pengelolaan strategis IS / IT • Tentukan kompetensi IS • mengelola hubungan 25

Apa yang Perlu Dikelola? • Kegiatan yang secara tradisional dipandang perlu untuk 'TI', dan akibatnya dianggap sebagai terjadi dalam fungsi IS, dapat digambarkan sebagai memberikan berbagai layanan untuk bisnis. – – Strategi dan perencanaan layanan Pengembangan aplikasi layanan Aplikasi dan layanan teknis Teknologi pengiriman dan layanan pemeliharaan 26

Menentukan organisasi IS / IT Sumber Daya • 2 isu penting yang harus dipertimbangkan • Lokasi IS/IT hak keputusan • Apa keputusan harus terpusat dan apa aspek IS / IT manajemen harus diserahkanke dalam bisnis dan keluar dari fungsi IS? • Organisasi perlu untuk mendefinisikan kewenangan, tanggung jawab, kebijakan, prosedur mekanisme koordinasi d an kontrol. – Sumber IS/sumber daya IT • Internal atau sumber daya interorganisasional • Susunan interorganisasional menekankan tempat 27 baru, menuntut koordinasi tambahan dan

Perdagangan-off di Organisasi dan Sumber Daya dari IS / IT 28

Lanjutan • Organisasi terlibat dalam outsourcing pada tahap tertentu mengidentifikasi kebutuhan untuk menyetel kembali, mengubah dan / atau mengembangkan bagian-bagian yang berbeda dari mereka IS / IT, kompetensi struktur dan keterampilan yang memungkinkan mereka untuk mempertahankan link b / w IS / IT dan prasyarat bisnis. • Meningkatkan kompleksitas dalam mengelola IS / IT 29

Aspek Diperlukan untuk Mendistribusikan IS / IT Peng ambilan Keputusan • Konten - daerah keputusan yang sedang dikelola (Tabel 8. 4) • Otoritas - individu atau kelompok yang memiliki kekuatan sebenarnya untuk membuat keputusan di berbagai daerah • Tanggung Jawab - individu atau badan yang bertanggung jawab untuk hari-hari eksekusi dalam wilayah keputusan. Definisi tanggung jawab harus integral peran pekerjaan masing orang dan fungsi • Koordinasi - mekanisme dan proses untuk memastikan koherensi di semua wilayah keputusan (misalnya Pengarah komite, 30 kelompok manajemen)

Lanjutan • Kebijakan - pernyataan atau tindakan mendefinisikan prinsip-prinsip perilaku yang dapat diterima. Mereka menyediakan dasar untuk pengambilan keputusan dan alokasi sumber daya yang konsisten. • Kontrol - menguraikan mendekati keputusan kepolisian, memastikan kesesuaian seluruh organisasi 31

Kebijakan IS/IT • Kebijakan menahan dilihat sebagai menggambarkan aturan federasi. Mereka mendefinisikan parameter di mana keputusan dibuat. • Mengaktifkan kebijakan berhubungan dengan penyebaran praktek terbaik. 32

Mengaktifkan dan Menahan Kebijakan • Menahan Kebijakan – Teknis kompatibilitas standar – Standar untuk membeli peralatan & jasa – Umum sistem mandat – Pemulihan bencana, keamanan dan kualitas kebijakan – Kelompok standar sistem – Spesifikasi pekerjaan kelompok – Setiap kesesuaian dengan standar industri. . . • Mengaktifkan kebijakan – Membuat kelompok-sumber daya pelayanan tersedia untuk divisi – Negosiasi diskon volume – Mengelola hubungan pemasok – Mempengaruhi perilaku melalui biaya-keluar aturan – Menetapkan kriteria untuk memilih sistem-sistem umum – Pendanaan aset berbagi. . . 33

Provisioning sumber daya IS/IT • Insourcing - IS / sumber daya TI yang disediakan oleh pusat fungsi IS • Outsourcing - delegasi, melalui perjanjian kontrak, dari semua atau bagian dari sumber daya teknis, sumber daya manusia dan tanggung jawab manajemen yang berkaitan dengan pemberian layanan TI, untuk sebuah vendor eksternal. 34

Alasan Outsourcing • Keuangan dan ekonomi alasan • alasan teknis • bisnis alasan 35

Klasifikasi Pilihan Sourcing • Gaya pembelian – Gaya Transaksi mengacu pada satu-waktu atau kontrak jangka pendek dengan detail yang cukup untuk menjadi dokumen referensi asli – Hubungan gaya mengacu pada kurang rinci, sering insentif berbasis kontrak, berpusat di sekitar harapan bahwa pelanggan dan vendor akan melakukan bisnisselama bertahun-tahun. • Fokus Pembelian – Sumber daya pilihan, organisasi membeli sumber daya penjual seperti HW, SW atau keahlian, tetapi mengelola penggunaan sumber daya di-rumah. – Hasil pilihan, vendor mengelola pengiriman TI kegiatan, menggunakan sumber daya apa pun yang diperlukan, untuk menyediakan pelanggan dengan hasil yang ditentukan. 36

Klasifikasi Pilihan Sourcing 37

4 Strategi Outsource • Kontrak strategi keluar - vendor bertanggung jawab untuk menyampaikan hasil kegiatan TI. • Buy-dalam strategi - organisasi membeli dalam sumber daya dari pasar eksternal, sering untuk memenuhi kebutuhan sementara. Kontrak sering menentukan keterampilan yang dibutuhkan dan biaya, dengan sumber daya yang kemudian berhasil di-rumah. • Strategi yang dipilih kontrak - kontrak jangka panjang organisasi dengan vendor untuk mengurangi risiko, dengan vendor bertanggung jawab atas pengelolaan dan pengiriman suatu kegiatan atau layanan TI. • Pemasok pilihan strategi - strategi ini mengambil membeli-dalam pendekatan lebih lanjut, dengan organisasi berusaha untuk mengembangkan hubungan jangka panjang dekat dengan vendor dalam rangka untuk mengakses sumber daya untuk kegiatan TI yang sedang berlangsung. Organisasi bertanggung jawab 38 untuk mengelola sumber daya tersebut.

Kompetensi penting untuk Mempertahankan In-House • Kemampuan untuk melacak, menilai dan menafsirkan perubahan IS / IT kemampuan dan menghubungkannya dengan kebutuhan organisasi. • Kemampuan untuk bekerja dengan manajemen bisnis untuk mendefinisikan persyaratan TI dari waktu ke waktu. • Kemampuan untuk mengidentifikasi cara yang tepat untuk menggunakan pasar, menentukan dan mengelola IS / IT sumber. • Kemampuan untuk memonitor dan mengelola 39

Ketika. Outsource • • • Posisi strategis pada grid pengembangan portofolio organisasi belajar Sebuah perusahaan posisi di pasar TI saat ini organiztion 40

Posisi Grid Strategis 41

pengembangan Portofolio • Pemeliharaan atau tinggi-terstruktur proyek = calon> untuk outsourcing • Teknologi tinggi, pekerjaan yang sangat terstruktur = calon> kuat untuk outsourcing • Besar, rendah-terstruktur proyek => masalah koordinasi menjadi sulit untuk outsourcing 42

Pembelajaran Organisasi • Kemampuan pembelajaran organisasi Sebuah perusahaan mempengaruhi apakah dapat mengelola pengaturan outsourcing secara efektif. • Banyak perusahaan pengembangan portofolio 'mencakup sejumlah besar proyek yang bertujuan rekayasa ulang proses dan transformasi organisasi. • Keberhasilan dari kedua jenis proyek tergantung pada memiliki staf internal secara radikal mengubah cara kerjanya. 43

Sebuah Perusahaan Posisi di Pasar • Perusahaan yang jauh di belakang rekan-rekan mereka sering tidak memiliki kepemimpinan TI, keterampilan staf, atau arsitektur untuk mengupgrade cepat ke negara-of-the-art teknologi. • Harus maju dengan praktek kontemporer dan teknologi. • Sebuah perusahaan yang kemampuan TI telah menjadi usang, tidak tinggal senilai bagaimana perusahaan mendapatkan mana itu tapi penting untuk menentukan bagaimana hal itu dapat melepaskan sendiri 44

Organisasi TI saat ini • Semakin TI sudah dipisahkan kegiatan dalam hal organisasi dan akuntansi, mudah untuk menegosiasikan kontrak outsourcing abadi. • Sebuah berdiri sendiri Unit TI telah mengembangkan mengintegrasikan mendasar dan mekanisme kontrol diperlukan untuk kontrak outsourcing 45

Siapa yang harus Mengelola IS / IT dan mana sebaiknya TI Laporan Kelebihan Direktur • keahlian teknis TI • akurat Sistem • teknologi suara • sistem integrasi Direktur • Ketat pengendalian Keuanga biaya n • Departemen koordinasi • Biaya pelatihan terpadu • ketat otorisasi Kekurangan • TI tidak selaras • pendidikan dihilangkan • informasi overload • teknis solusi • Tidak selalu nilai terbaik untuk uang • Cukup waktu untuk mencurahkan untuk TI • kehilangan kesempatan • Pendekatan jangka 46 pendek

Lanjutan Kelebihan Bisnis- kepala unit Dewan Direksi Kekurangan • Investasi TI terkait dengan arah bisnis • Lokal terfokus sistem • pembangunan berkelanjutan • Shorter struktur pelaporan • strategis arah • Apresiasi dampak yang lebih luas dari keputusan • Masalah utama ditangani • dana yang dialokasikan • Sistem tidak terkoordinasi • Ketidakcocokan di BUS • Duplikasi data • Tidak perlu biaya yang timbul • Rincian logistik dihilangkan • IS / IT underexploited • infrastruktur yang lemah • Lambat untuk 47 memanfaatkan teknologi

Changing Role of the CIO Application portfolio • Mainframe era – Transaction processing-automation for efficiency • Distributed era – Knowledge-worker support, interorganizational systems, ERP systems • Web-based and Internet era – Electronic commerce, knowledge management, virtual organizations, supply chain re-engineering 48

Cont… Senior business executive attitudes to IS/IT • Mainframe era – IT for cost displacement and automation • Distributed era – Increased involvement in IT issues and governance – Polarization of attitudes: IT as strategic asset or cost to be minimized • Web-based and Internet era – IT, particularly the Internet, viewed as transformational – IT investments now more attractive in terms of costs and timescales – IS/IT now part of ongoing business conversation 49

Cont… Input to business • Mainframe era – Advisor on ‘How to do’, not ‘What to do’ • Distributed era – Access to senior executives – Invited ‘seat at table’ • Web-based and Internet era – Member of executive team having a ‘seat at the table’ – Helps define ‘what to do’ 50

Cont… Major tasks • Mainframe era – On-time delivery – Reliable IT operations • Distributed era – Manage IS function – Provide infrastructure – Manage vendors • Web-based and Internet era – Jointly develop business/IT model – Introduce management processes that leverage technologies, particularly the Internet 51

Role • Mainframe era Cont… – Functional head – Operational manager – Deliver on promises • Distributed era – – Strategic partner Relationship builder Technology advisor Align IS/IT with business • Web-based and Internet era – – Visionary Relationship builder Technology opportunist Drive and shape strategy 52

5 Roles for the Success CIO • • • Leadership Visionary Relationship builder Politician Deliverer 53

Leadership: Characteristics • Broad business and organizational knowledge • Broad set of relationships in the firm and the industry • Excellent reputation and a strong track record in a broad set of activities • Keen mind and strong interpersonal skills • High integrity and personal values • High level of motivation 54

Leaders VS Managers 55

Profile of the CIO • Behavior – Is loyal to the organization – Is open in management style – Is perceived to have integrity • Motivation – Is goal oriented – Comfortable as a change agent – Creative and encourages ideas • Competencies – Is a consultant/facilitator – Good communicator – Has IT knowledge – Able to achieve results through others • Experience – Sound experience in an IS development role (especially in system analysis) 56

Coordinating Mechanisms for the Strategic Management of IS/IT • Steering group or committee • Reasons – Ensuring top management involvement in IS planning – Ensuring the fit b/w IS and business strategy – Improving communication with top and middle management – Changing user attitudes to IT 57

Causes of the Problems with Steering Committee • The wrong people involved • The activities of the steering committee and the decisions taken have to be integrated with the overall strategy processed in the business. • The committee has no infrastructure to support it and carry out its actions which become the strategy. 58

Steering Organization for IS/IT Strategic Management 59

Responsibilities: Executive Steering Group • Interpreting business strategy and agreeing overall IS/IT policies • Establishing priorities, agreeing resource and expense levels, authorizing major investments • Ensuring that strategic applications achieve their objectives • Establishing the appropriate organizational responsibilities and relationships 60

Responsibilities: Business IS Strategy Groups • Identifying business needs, interpreting CSFs, assessing opportunities and threats and IS implications in that business area • Prioritizing, planning and coordinating IS activities and expenditure in the area and ensuring planned benefits are delivered • Ensuring appropriate user resources are allocated to projects and appoint application managers 61

Responsibilities: IT Strategy Group • Interpreting IT trends and developments in the context of the organization’s business • Ensuring resources are deployed to meet business priorities • Developing IT resources and services in line with business IS plans and monitoring the performance of those resources • Managing the supply of technology and specialist bought-in services • Ensuring technical risks are minimized 62

Responsibilities: Application Management Groups • Identifying and specifying the needs, benefits, business resources and costs of applications to enable management to evaluate investments and set priorities • Managing developments and ongoing use of systems to ensure benefits are maximized • Ensuring business changes necessary to get the benefits carried out • Ensuring that user resources are made available as needed and used effectively on projects 63

Responsibilities: Service Management Groups • Translating business needs into technical requirements and resource implications • Selecting the optimum means of meeting the business needs • Monitoring performance against budgets/service levels agreed with the business • Ensuring technical solutions are tested and quality assured to avoid application failure • Planning the development of services and resources to meet evolving demands 64

Responsibilities: Technology Management Groups • Understanding technology development, formulating options and communicating the implications • Assessing the capabilities of the technologies against known and potential needs • Planning and managing infrastructure developments and migrations to minimize the risk to business applications • Resolving technical issues/problems with suppliers and ensuring service groups are effectively supported 65

Managing the IS Function • 3 enduring challenges in the exploitation of IT – The challenge of business and IS/IT vision is to address the need for two-way alignment b/w business and technology – The challenge of delivery of IS services at low cost and high quality is being transformed by the evolving, vibrant service market – The challenge of IT design architecture – the choice of technical platform on which to mount IS services 66

Core IS Competencies IS/IT leadership Integrating IS/IT effort with business purpose and activity Business system thinking Envisioning the business process that technology makes possible Relationship building Getting the business constructively engaged in IS/IT issues Architecture planning Creating a coherent blueprint for a technical platform that responds to current and future business Making Rapidly achieving technical progress by technology work one means or another 67

Cont. . Informed buying Managing the IS/IT sourcing strategy that meets the interests of the business Contract facilitation Ensuring the success of existing contracts for IS/IT services Contract monitoring Protecting the business’s contractual position, current and future Vendor development Identifying the potential added value of IS/IT service suppliers 68

Other Framework for IS Competencies 69

Cont… • Strategy: the ability to identify and evaluate the implications of IT- based opportunities as an integral part of business strategy formulation and define the role of IS/IT in the organization. • Define the IS contribution: the ability to translate the business strategy into processes, information and system investments and change plans that match the business priority- IS strategy • Define the IT capability: the ability to translate the business strategy into long-term information architecture, technology infrastructure and resourcing plans that enable the implementation of the strategy- IT strategy 70

Cont… • Exploitation: the ability to maximize the benefits realized from the implementation of IS/IT investments through effective use of information, applications and IT services. • Deliver solutions: the ability to deploy resources to develop, implement and operate IS/IT business solutions that exploit the capabilities of the technology. • Supply: the ability to create and maintain an appropriate and adaptable information, technology and application supply chain and resource capacity. 71

Cont… Strategy • Business strategy • Technology innovation • Investment criteria • Information governance Define the IS contribution • Prioritization • IS strategy alignment • Business process design • Business performance improvement • Systems and process innovation Define the IT capability • Infrastructure development • Technology analysis • Sourcing strategy Exploitation • Benefit planning • Benefit delivery • Managing change Deliver solutions • Applications development • Service management • Information asset management • Implementation management • Apply technology • Business continuity and security Supply • Supplier relationships • Technology standards • Technology acquisition • Asset and cost management 72 • IS/IT staff development

Mapping Location of Resources against IS Components 73

IS Competencies 74

Hygiene Factors for Keeping Key Staff • Training new recruits from school or university, which is expensive • Recruiting experienced staff from other organizations, which can be risky • Training existing non-IS people, especially in application skill in user areas, which may require the development of new job roles • Using external resources, either on a short-term basis to overcome peak loads, or long-term to provide the organization with particular skills 75

Use of Resources 76

Keen’s 4 Major Role Categories • Business services – requiring strong business, organizational and planning skills • Business support – business and organizational as well as some technical skills • Development support – strong technical and good business skills • Technical services - strong technical skills 77

Managing Relationships: 3 Key Relationships (Venkatraman & Loh) • With outside IT suppliers, who will inevitably do increasingly more of the work through outsourcing arrangement. • With the business managers and system users, to enable the business to identify and realize the benefits from the applications investments and to obtain maximum value from the services provided. • With IT specialists in other companies, especially trading partners 78

Internal Organizational Relationships • Organizations contain subcultures often associated with functional specialism or geographical location. • These subculture can be dyfunctional. • IT as a functional specialism has introduced new subculture and one that is often difficult to reconcile with the dominant culture in the organization. => culture gap • This implies that the viability of the IS strategy will depend on the extent to which it is derived from the ‘shared values’ of those who have to 79 implement the strategy.

6 Staged Model Regarding Shared Value Stage 1 Adhocracy Very few shared values since the focus of IT is internal and they are unable or unwilling to seek a coherent relationship with the business. They relate more closely to IT supplier Stage 2 The ‘priesthood’ of IT begins to develop and IT ‘Starting the staff perhaps cultivate a unique culture based foundations’ on technology worship – often seriously at odds with the business Stage 3 When IT management often reacts to business ‘Centralized managers’ concern over ‘excessive spending’ dictatorship’ on IT and views of poor delivery performance by becoming defensive and exerting control over what it does to redress the balance 80

Cont… Stage 4 ‘Democratic dialectic and cooperation’ IT specialists recognize the need to work in cooperation with business managers toward achieving business goals, but still expect the business to cooperate with IT’s set of values Stage 5 Recognition in the business that IT can ‘Entrepreneurial deliver new, potentially strategic, benefits opportunity’ through innovative use often leaves the IT department looking after the legacy and struggling to provide any value to the newly ‘liberated’ users Stage 6 Rarely achieved, due to the difficulties in ‘Integrated reconciling differing values, overcoming harmonious historical precedents and prejudice, and relationship’ requiring a new openness in all aspects of 81 IT activity

Bridging the Gap 82

Models for Improving the Relationship b/w IS Function & the Business • Earl and Sampler – – Recognize disequilibrium Emphasize supply management Emphasizing demand management Maintain equilibrium • Peppard – – – Get the basics right Enlist key influencers Build credibility Seek involvement early in project Place responsibility for IS with business Cultivate and maintain partnership 83

Earl and Sampler: Recognize Disequilibrium • The organization articulates, explores and analyses the crisis or loss of confidence in IT in general and IS function in particular. • Symptoms and prescription – Business needs not satisfied – Technological problems – Management assessment – Start of new regime 84

Earl and Sampler: Emphasize Supply Management • The organization seeks radical performance improvement of the supply side by setting delivery goals and beginning to rebuild the technology platform. • Prescriptions – – Setting ambitious performance targets Beginning to rebuild technical platform Seeking early, visible results Setting application priorities 85

Earl and Sampler: Emphasizing Demand Management • Emphasizes demand management, shifting the focus from supply to demand. • The concern is with building IT capabilities and creating future value. • Prescriptions – Work out the vision – Define demand management processes – Define value propositions – Plan the infrastructure 86

Earl and Sampler: Maintain Equilibrium • The organization completes the transformation process by implementing final radical changes in both demand supply sides. • If business or technological discontinuities occur and the company does not deal with them, it can initiate a new transformation process by returning to Stage 1. • Prescriptions – – Recognizing that it is a continuous journey Rethinking governance Reskilling IT personnel Creating a partnership with business and vendor 87

Peppard’s Model • Get the basics right – IT leadership – Get business focused – Focus on internal quality of IT organization – Examine internal structures and processes – Define value-added aspect of IS/IT – Get buy-in and commitment from all IS staff • Enlist key influencers – Get key influencers on board – Agree role of the IT organization – Listen to the business – Define key priority areas – Establish relationship roles within IT organization – Establish service level agreements – Open communication channels 88

Cont… • Build credibility – Build a dialogue with business – Address values and beliefs of business management – Demonstrate business value – Initiate education program to address ‘mindset’ blockages – Initiate internal marketing programme • Seek involvement early in project – Focus on benefits delivery – Ensure IT involvement early in business projects and visa-versa 89

Cont… • Place responsibility for IS with business – Move responsibility for IS demand out into the business – Reframe IS/IT governance structure – Create IT/business processes – Define informational roles • Cultivate and maintain partnership – Emphasis continual communication – Revisit previous stages 90

Managing Relationships with Vendors • 4 critical areas that require close attention – The CIO function – Performance measurement – Mix and coordination of tasks – Customer-vendor interface 91

The CIO Function • Partnership/contract management • Emerging technologies – A company must develop a clear grasp of emerging technologies and their potential applications – Assessing technology alternatives cannot be delegated to a third party – An informed CIO who monitors performance against the contract and plans for and deals with issues that arise helps an outsourcing alliance adapt to change. • Continuous learn • Architecture planning – A firm should create an internal IT learning – A CIO’s staff must visualize environment to bring users and coordinate a long-term up to speed so that they are approach to networks, HW comfortable in a climate of and SW standards and continuous change database architectures 92

Performance Measurement • Companies must develop performance standards, measure results. • Most important measures of success are intangible and play out a long period of time 93

Mix and Coordination of Tasks • If not carefully managed, both the contracts and the different geographic locations of the outsourcing vendor’s development staff may inhibit discussion and lead to additional cost 94

Customer- Vendor Interface • The interfaces b/w customer and the vendor are very complex and usually must occur at multiple levels. • The senior levels, there must be links to deal with major issues of policy and relationship restructuring • The lower levels, there must be mechanisms for identifying and handling more operational and tactical issues. • CEO level- policy discussion • Both side need regular full-time relationship managers and coordinating groups lower in the organization to deal with operational issues and 95 potential difficulties