SUMMARY Executive Masters CIO

COURSE OBJECTIVES n Provide You Various Frameworks/Perspectives (Situation Analysis) – Learn What to Look For -- A Lot to Consider n Provide You With Approaches/Solutions – Learn Limits on What Applies Where n How to Make Judgements/Develop New Approaches (Think) -- There are Few Formulas – Learn to Recognize When There May Be No Approach Defined n As Fast as Solutions/Methods/Tools are Developed to Solve a Specific Problem, New Problems are Encountered (Change) -- Need for Continuous Improvement/Learning/Knowledge

TYPES OF CASES n Can’t Make a Decision -- End Up Doing Nothing (Which May Be Good) n Make a Decision to Proceed -- Bad Idea (At Least at This Time) n Make a Decision to Proceed -- Good Idea But Poor Implementation n Make a Decision to Proceed and Succeed (May Be Painful) n Same as Above, But Extend to Another Area and Fail

THERE WILL BE FAILURES (OR LIMITED SUCCESSES) n Failure to Get Business Benefits n Higher Cost to Develop Impacting “ROI” n Longer Development Time Missing Window of Opportunity n Technical Performance (Response Time/ Capacity) Impacting Operating Costs or Worse, Feasibility n Technical Incompatibilities at a Future Date

STRATEGIC QUESTIONS n Can IT build barriers to entry? n Can IT build in switching costs? n Can IT strengthen customer relationships? n Can IT change the balance of power in supplier relationships? n Can IT change intra-industry competitive balance? n Can IT change the basis of competition? n Can IT generate new products? Source: Cash, J. I., McFarlan, F. W., McKenney, J. L., and Applegate, L. M., Corporate Information Systems Management: Text and Cases, Homewood, IL, 1992.

Information Technology Management in the 1990’s Questions from Senior Management n Is my firm competitively positioned in the use of IT? n Is my IT application portfolio effective? n Is my IT spending efficient? n Am I insulated against the risks of an operational disaster? n Do I have the right IT leadership in place? n Do I have the right IT organization in place? Source: Cash, J. I., McFarlan, F. W., McKenney, J. L., and Applegate, L. M., Corporate Information Systems Management: Text and Cases, Homewood, IL, 1992.

THE MANAGEMENT FRAMEWORK Company Senior Management CIO MIS Director D.P. Manager Staff Environment Users (Managers and Staff)

A Framework for Analyzing IT Impact on Organizations CONTEXT External Environment Industry Structure Rate of Change Competitive Intensity Organization History Current State Industry Position Competitive Benchmarks Resources People/ Leadership Technology Capital Culture Stimulus for Change Type Urgency Clarity Shared Understanding Strategy EXECUTION Organization Structure People Culture Management Control Processes ORGANIZATION EFFECTIVENESS MEASURES Competitive Benchmarks Source: Applegate, L.M., IT-Enabled Business Transformation, Boston: HBS Publishing, 1992 Work Technology Process Time Quality Cost Innovation Stakeholder Customer/ Supplier Employee Satisfaction Shareholder Satisfaction Results Market Share Financial ROE P/E

IT-Enabled Business Transformation Module Scope of Change Anticipatory Crisis StimulusforChange Source: Applegate, L.M., IT-Enabled Business Transformation, Boston: HBS Publishing, 1992 Function Organization Inter- Organization

Guiding Principles for Managing Information Technology 1 There are and will be opportunities, but they won’t come easy and risk of failure may be higher than value of success. However, failure to act may mean failure. 2 Innovation in both the business and within IS are important. 3 The “users” will continue to be able to do more for themselves but they will need help as the complexity of their problems increase.

4 Doing things faster (reduced cycle time), at lower cost, with better service, being first to market, … has “always” been a business objective -- the intensity is dependent on the threats, either perceived or real, and the incentive for continued success. 5 Someone is “always” trying to sell you something regarding IT -- be a smart buyer. 6 Remember who your audience is -- “sell” them in terms they’ll understand.

7 Learn to determine “fads” from “trends”. 8 IT trends which depend on other IT trends usually happen more slowly than projected. 9 Watch out for replacement/competitive technologies/trends.

10 Be lucky if all else fails.