Chapter 8: Strategic Management of IS/IT
Transcript of Chapter 8: Strategic Management of IS/IT
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Chapter 8
Strategic Management of IS/IT: Organization and Resources
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Agenda
• Requirements of strategic management
• Roles of the IT function
• IS/IT organization approaches
• Choice of IS/IT organization
• IS/IT organization strategies
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Requirements of Strategic Management
• IS/IT strategies, policies and plans reflects business objectives and strategies
• Identify and explore potential business advantages from IS/IT
• Ensure IS/IT strategies are viable in terms of business risks
• Establish resources and priorities• Match IS/IT management and corporate culture• Monitor business critical IS/IT activities• Balance between centralization and decentralization
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Roles of the IT Function – Iby Zmud
• User services– Delivery services
– Systems development
– Support center
– Information center
• Architecture management– Planning
– Technology diffusion
– Data management
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Roles of the IT Function – IIby Zmud
• Technology development– Research & development
• General– Administration– Quality assurance
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IS/IT Organization Approaches
• Total centralized (monopolistic)• Total decentralized to business functions• Geographically placed data centers and resources• Business unit control• Users• Activity• Type of resource – network, computers, software,
data, etc.
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Choice of IS/IT Organization
• Stage of application portfolio maturity• Geography of the enterprise• Synergy benefits of business services, products, &
information• Business diversity & rate of change• Competitive pressures• Economics of resource, obtaining and deploying
skills• Enterprise structure & management culture
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IS/IT organization strategies
• IT (centralized) or user departments (decentralized)
• Mix
• Chief information officer or steering committee
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IT or User Departments – Iby McFarlan and KcKenney
• IT department– Integration– Database– Feasibility and cost/benefit analysis– Litter innovation– IS organization based on technical specialist not user
need– High maintenance (80%)– No senior management– Use frustration with secret growth of user computing
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IT or User Departments – IIby McFarlan and KcKenney
• User department– Short term problem solving– Incompatible databases & systems– Lack of quality control– Hidden maintenance overhead– Duplication problems– Little cost/benefit analysis– Lack of skill technical staff
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Mix by La Belle and Nyce
• Business unit responsibility– Application architecture, development, and operation
• Central IT group– Telecommunication
– Hardware & software architecture
– Information architecture
– Risk management and security
– Shared services and utilities
– Human resources
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Chief Information Officer or Steering Committee - I
• Chief information officer (CIO)– Setting IS/IT policy & strategy– Goal oriented with business, IS/IT, &
communication competency
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Chief Information Officer or Steering Committee - II
• Steering committee– Executive steering group– IT planning group
• Service management group
• Technical management group
– Business IS planning group• Application management group
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Executive Steering Group Functions
• Aligning business & IS/IT strategies
• Establishing IS/IT priority & IS/IT resources
• Ensuring strategic applications achieve their objectives
• Establishing organizational responsibilities and relationships
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IT Planning Group Functions
• Interpreting IT trends and development for organizational business
• Allocating resources according priority
• Monitoring IS/IT performance
• Managing IT, specialists, & technical risks
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Service Management Group Functions
• Meeting business needs with the optimum means
• Monitoring performance against budget/service level
• Controlling quality
• Satisfying evolving demand
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Technology Management Group Functions
• Assessing technology against known and potential needs
• Planning and managing infrastructure
• Resolving technical issues/problems
• Support service group
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Business IS Planning Group Functions
• Identifying business needs
• Interpreting CSFs
• Assessing opportunities, threats, & IS implications
• Prioritizing, planning, & coordinating IS and expenditure
• Ensuring the delivery of benefits
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Application Management Group Functions
• Identifying special needs, changes, benefits, resources, and costs of applications for investment & priority evaluation
• Managing developments & usage of IS
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Points to Remember
• Requirements of strategic management
• Roles of the IT function
• IS/IT organization approaches
• Choice of IS/IT organization
• IS/IT organization strategies
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Questions
• What is a good IT strategic management for an e-business of the banking industry in terms of the organizational structure?
• What is a good IT strategic management for an e-business of the California State University system in terms of the organizational structure?