IS 371 Week 3 Agenda: • Administrative things • Homework #1 due now Watch for grades on COL • • IT Department Administration (more) • IT Globalization and Culture • IT Outsourcing

IT Traditional Roles/Responsibilities • Enable corporate strategies  - Competitive strategies - Low Cost/High Quality/Special Niche  • Process redesign  - Value enhancement  • Enhance workgroup productivity  • Infrastructure/Architecture  • Service Management  • Resource Management The Real, Critical Role of IS Management is to translate these IT activities for User Managers 

Information Management Superiority - Strassmann IT and business plans must be congruent Exercises authority and achieves corporate consensus Business Plan Alignment Governance Process Improvement Operating Excellence Searching for improvements is ongoing (Kaizen) Quality in the business process is critical Resource Optimization Always question whether resources are used most effectively

MAJOR TRENDS IN IT MANAGEMENT • GLOBALIZATION OF BUSINESS - Specialized talent - Reduction in cost - Time to market – follow the sun development • VELOCITY OF CHANGE IN BUSINESS - Time from recognition of business need to system operation - Pace of technology changes • OUTSOURCING - Cost savings - Functionally discrete, non-core business - Political compromise - Lack of internal skills

According to the CIO desk reference–Meta Group, 2001, most IT According to the CIO desk reference–Meta Group, 2001, most IT organizations “have a cost center, ‘just-keep-the-lights-on’, service- utility mentality that maintains IT should be mostly transparent to the rest of the business. If things are going well, no one knows the IT organization is there. If things are going badly, it gets noticed.” Organizations in which IT is viewed as extremely critical to the business, are those in which the CIO has realized that marketing the IT organization furthers the awareness of the value that IT adds to the business and helps ensure the CIO is a business partner. The best way to achieve this partnership is by organizing IT to respond to the needs of individual business groups. This can only be done by: • establishing working relationships at individual and group levels with all business partners in which business teams, including IT as a “business,” can work together. • Enterprise infrastructure is the only IT project. • Whether responsible for 10 percent or 90 percent of the tasks, IT is a member of a business team led by a business project champion. • All projects require business unit champions and business project champions.

ORGANIZATIONAL STRUCTURE / GOVERNANCE • Functional • Centralized • Project/Process • Decentralized • Matrix

In the beginning, IT was managed by the Accounting Department In a product group structure as seen in Figure 14.3B in the textbook, people are grouped together by products or product lines in self-contained groups. Computer use typically grew in each of the various product divisions to automate the accounting for that division. IT

As IT applications expanded beyond Accounting, IT moved up in the organization

Centralized IT Structure President

Decentralized Structure President

A categorization of business activities, such as: - marketing - sales Functional Alignment: organized around similar resources performing similar activities – task centered A categorization of business activities, such as: - marketing - sales - production - human resources - finance - materials management - accounting - information technology Within the IT Department: Organizing IT personnel by functional knowledge and platforms:  organized around resources. - What are some “IT Functions?” 

FUNCTIONAL RELATIONSHIPS EMPHASIZE FORMAILTY Communication Flow

Functional Alignment • Advantages: - reduced training costs (peers together to facilitate training) - expertise fostered - reduced task-switching time - easier workforce scalability • Disadvantages: - internal, parochial focus - limited connections between functions - silo effect - rigidity

• PROJECT / PROCESS ORIENTATION -- - organized around outputs A specific ordering of work activities across time and place with a beginning, an end, and clearly identified inputs and output." - the focus is "HOW" to get to outputs - organizational orientation:  horizontal workflow value chain - people are geared to becoming flexible generalists

Project/Process Alignment: Organizing IT personnel by tasks and services

Project/Process Organization • Advantages Effective and efficient for large projects Resources available as needed Broad range of specialists short lines of communication easy to measure progress • Drawbacks Expensive for small projects Specialists may have limited technological depth May require high levels of duplication for certain specialties

PROCESS (PROJECT) RELATIONSHIPS EMPHASIZE LATERAL COORDINATION / COMMUNICATION 360 DEGREE VIEW

The Present and Future are shifting toward project/processes . . .

Defined the functions of management: Who is Henri Fayol? A French engineer who: Defined the functions of management: • Planning • Organizing • Leading • Controlling And identified 14 principles of management: • Specialization/division of labor • Authority with responsibility • Discipline • Unity of command • Unity of direction • Subordination of special interests • Remuneration • Centralization • Chain / Line of Authority • Order • Equity • Lifetime jobs (for good workers) • Esprit de corps