Transcript IT Architectural Alternatives

IT Architectural Alternatives
Applications
Information systems Environment
Structure and Controls
Architecture and
standards
Business information and Policies and Planning and Development
communication models procedures control system Methodologies
User Interfaces
Graphical desktop metaphor
I/O devices
Tools
Reporting
Tools
Information
analysis
Groupware
Information management
Computers,printers, …
Operating system
DBMS
Document management
Personal
productivity
Expert system
development tool
CAD
CASE
Communication management
Network, routers, …
Network management system
Gateways
E-mail and file transfer servers
Components of an ICT-architecture
Value – Creating Business Opportunities
Commerce
Content
Community
Value Enabling ICT Infrastructure
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Solutions and services
Software productivity and development tools
• Packages (WP, Spreadsheets,e-mail, …
• Programming languages( C++, visual basic, JAVA, Cobol, …)
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• Internet service providers
• System Integration services
• Outsourcing and hosting
• ERP (e.g. SAP, PeopleSoft)
• Supply chain management
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Computing
Hardware (computers, printers, …)
Operating systems
BDMS’s
Document management systems
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Communications
Hardware (networks, routers, …)
Network operating systems
Gateways
E-mail and File transfer services
Value creation in a networked environment
Benefits from Investments
Category I: Platform improvements (NC)
Organizational benefits
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Improve ability to share
information, communicate,
coordinate, and control
activities inside the
organization
Market/Industry benefits
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Improve ability to share
information, communicate,
coordinate, and control
activities with customers,
suppliers, and business
partners
Category II: Options Value (Internet-based)
Organizational benefits
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Increase functionality,
flexibility, and “useful life”
of the internal ICTinfrastructure
Market/Industry benefits
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Increase functionality,
flexibility, and “useful life”
of the industry ICTinfrastructure
Sample metrics
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Lower operating and maintenance cost
 Consolidate data centers
 Streamline and simplify networks (single protocol)
 Decrease headcount for IT-professionals
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Improve application development process
 Redude cost of IT-development projects
 Decrease time needed to deploy IT-enabled business solutions
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Increase useful life of platform
 Decrease upgrade cost for new technologies (thin client)
 Enable flexibility (Lego approach)
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Increase range of options for new business solutions
 Increase number of value-creating business solutions (more vendors)
 Enable new business building opportunities
Value creation in a networked environment
Benefits from investments
Category III: Commerce
Organizational benefits
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Improve core operating
activities inside the firm
(procurement, sales, …)
Market/Industry benefits
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Improve existing supply/ distribution channels that link firm
to customers, suppliers and
partners or create new ones
Category VI: Content
Organizational benefits
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Improve decision making and
enhance organizational learning
Market/Industry benefits
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Exploit economic value of
information by adding value
to products and services
Category VI: Content
Organizational benefits
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Enhance collaboration of
individuals and teams
Market/Industry benefits
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Establish position at center of
electronic market
Sample metrics
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Savings
 Reduce paper and communication cost
 Reduce headcount
 Reduce transaction and communication cost
 Reduce inventory cost
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Speed
 Reduce cycle time
 Decrease waste
 Rdeuce process errors
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Increase satisfaction and retention
 Customers, suppliers, partners, employees
The learning environment
Assimilating Emerging
Technologies
Phases in assimilating
emerging technologies
1. Technology identification and investment
2. Technological learning and adaptation
3. Rationalization and management control
4. Maturity / widespread technology transfer
Four Phase ICT Assimilation
Phase 1
decision to invest
+ project initiation
Lack of
Attention
And
commitment
stagnation
block A
Success
Phase 2
technology
learning
and adaptation
narrowly
focused and
not marketed
stagnation
block B
Success
Phase 3
rationalization and
management
control
too efficiency
dominated
stagnation
block C
Success
Phase 4
widespread
technology
transfer
Phase 1: Technology Identification
Initiated by decision to invest in ICT
• one or more complementary project developments
• lack of precision in cost estimation and ultimate stream of benefits
• each step characterized by much uncertainty
reasons for failure
• vendor failure
• discovery that technology is inappropriate to the firm
• poor user involvement
• lack of management attention
• bad choice
fault only discovered after 1 or 2 years
result: not clear technical disaster , but unwillingness to invest more
perceived as adding more work to the organization
significant cost overruns
Phase 2: Technology Learning and Adaptation
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involves learning to adapt new technology to particular
tasks beyond those identified in the initial proposal
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often quite different benefits than those anticipated
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projects still highly uncertain in their cost and benefits
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typical example are knowledge systems or CAD/CAM
 insufficient understanding of possibilities leads to stagnation
and competitive disadvantages
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management in adaptive manner permits management to
capture , develop, and refine new understanding of IT
Phase 3: Rationalization/Management Control
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Change in organization’s approach to the technology
 continued evolution to ones originally not considered
 development of precise controls for guiding the design and
implementation of IT systems
 various aspects of project life cycle are analyzed
 role of IT staff and users becoming clearer
 results becoming more predictable
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failure if excessive controls are developed
 controls can be so onerous that profitable expansion of the
use of IT is inhibited and prevents logical growth (p379)
Phase 4:Maturity/Widespread Technology
Transfer
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Program of technical diffusion
 expand experience gained in one operating division
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A firm is confronted over time with a series of waves of
technologies
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assimilation of several technologies in different phases
To enable and encourage unprogrammed or innovative activity , it is recommended that organizations make special and separate provisions for it.
Special units for innovative purposes
Emerging Technology Group
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Often initially in IT at level of operations and applications
Difference between leading and lagging companies is the
early creation of the ET group
Sometimes put outside IT , to help ensure that it is not
swamped by the IT control philosophy
Characteristics of effective management of ET groups by phase
Management
issue
Organization
Innovative-phase
effectiveness
Organic (ET)
Control-phase
efficiency
Mechanistic (trad IT)
Management control Loose , informal
Tight
Leadership
Directive (telling,delegating)
Participating
Innovative Phase
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atmosphere in ET group : exploratory, experimental
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organizational structure and management controls must
be loose and informal
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cost accounting and reporting : flexible
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no requirements for cost-benefit analysis
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leadership : participating
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temporary relaxation of performance standards
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ET independent unit due to growth in information centers
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ET responsible for intra-organizational technology
transfer
Merging the Islands of IT
Three Islands
• Office support
• data processing
• telecommunications
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Integration required for several reasons
1. all three areas require
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large capital investment
large protracted projects with complex implementation
extensive user training
more and more supplied by one single vendor
2. key sectors of all three islands physically linked in a network
3. dominant suppliers market products as base for co-ordinated
automation of three islands
Reasons for merging
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decisions in each island involve large budgets and
complex technical and cost evaluations , whereby
similar staff backgrounds are needed to do the analysis
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great similarities exist in type of management skills and
staff needed to do the implementation
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most applications require integrated technological
networks to handle computing , telecommunications
and office support
IT Resource Management
Pressure
Centralized
Decentralized
Distributed
Management
control
Hierarchical
Standardization
Reliability, security
Entrepreneurial
user responsiveness
local reliability
Information age
learning
efficiency, effectivity
Technology
use of resources
specialized
equipment, skills
efficient use of low
scale
low cost equipment
global reliability
mix of specialized
and off-the-shelf
common data
security control
data standards
local data
fit with field needs
data locally relevant
information sharing
high capacity
networks
specialized staff
turnover disruption
career paths
generalized expertise
interfunctional career
mix of professional
resources
low technical skills
no IT motivation
technical
sophisticated
IT motivated
high level of
commitment and
literacy
Data
IT-professionals
End users
Conclusions on Architectural Alternatives
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Merge technologies and distribute hardware and data must be
managed carefully in combination
periodic re-examination is needed
establish a permanent corporate policy group
uniformity in management practice should not be pushed too far
respect differences in international activities
address the issues in a broad strategic fashion
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corporate organization structure
current operating administrative processes
corporate strategy and direction
availability of human resources
ensure adequate innovation-phase investment in experiments
• ensure proven expertise is distributed
ensure balance between long-term and short-term needs