1 IS 8950 Managing and Leading a Networked IT Organization

2 Organizing and Leading the IT Function

3 Organizational issues in the control of IT Activities 1.From centralized, IT-driven innovation to decentralized, user-driven innovation 2.User-driven innovation over IT department protests 3.From decentralized, user-driven innovation to centralized IT management 4.From decentralized, user-driven innovation to unexpected centralized innovation

4 Drivers toward user dominance Pent up demand The need for staff flexibility Growth in the IT services industry Users’ desire to control their own destiny Fit with the organization

5 Drivers toward a centralized IT structure Staff professionalism Standard setting and ensuring system maintainability Envisioning possibilities and determining feasibility Corporate data management Cost estimation and analysis

6

7 Coordination and location of IT policy IT responsibilities 1.Develop and manage the long-term architectural plan 2.Develop a process to establish, maintain, and evolve company standards 3.Establish procedure for outsourcing options 4.Maintain an inventory of installed and planned systems and services 5.Identify career paths for IT staff 6.Establish internal marketing efforts that help business users understand IT challenges 7.Incorporate plans for compatibility with existing architecture and standards 8.Identify and maintain relationships with preferred systems suppliers 9.Establish education programs for business users that introduce the benefits and pitfalls of new technology 10.Set up a process for ongoing review of legacy systems

8 Coordination and location of IT policy (continued) User responsibilities 1.Seek to understand the scope of all IT activities supporting business users 2.Develop realistic estimates for new projects 3.Ensure comprehensive user input for IT projects 4.Ensure the nature of staffing interfaces is consistent with a new technology’s strategic relevance to a business unit 5.Periodically audit system reliability standards, communications services performance, and security procedures 6.Participate in developing and maintaining IT plans that set new technology priorities

9 Coordination and location of IT policy (continued) General management responsibilities 1.Ensure an appropriate balance between IT and business users 2.Ensure the company has a comprehensive corporate IT strategy 3.Manage the inventory of hardware and software systems 4.Establish standards for acquisition, development, and IT systems operation 5.Facilitate the transfer of technology from one unit to another 6.Actively encourage technical experimentation 7.Develop an appropriate planning and control system to link IT to a company’s goals

10 Managing IT Outsourcing

11 Outsourcing Why outsourcing alliances are so difficult –Expand over long periods of time –Fast-moving technical and business change Outsourcing drivers in the 1990s –Cost-effective access to specialized or occasionally needed computing power or systems development skills –Avoidance for building in-house IT skills, primarily an issue for small and very low-technology organizations –Access to special functional capabilities. Outsourcing in the 21 st Century –Acceptance of strategic alliances –IT’s changing environment

12 What drives outsourcing? General managers’ concerns about costs and quality Breakdown in IT performance Intense vendor pressures Simplified general management agenda Financial factors Corporate culture Eliminating an internal irritant

13 When to outsource Position on the strategic grid Development portfolio Organizational learning A firm’s position in the market Current IT organization

14

15 Structuring the Alliance Contract flexibility Standards and control Areas to outsource Cost savings Supplier stability and quality Management fit Conversion problems

16 Managing the Alliance The CIO function Performance measures Mix and coordination of tasks Customer-vendor interface

17 A Portfolio Approach to IT Projects

18 IT project management dficiencies 1.Failure to assess the implementation risk of a project at the time it is funded 2.Failure to consider the aggregate implementation risk of a portfolio of projects 3.Failure to recognize that different projects require different managerial approaches

19 Source of Implementation Risk Consequences of ignoring project risk: –Failure to obtain anticipated benefits due to implementation difficulties –Higher than expected implementation costs –Longer than expected implementation time –Resulting systems whose technical performance is below plans and requirements –System incompatibility with selected hardware and software Project dimensions influencing implementation risk: –Project size –Experience with the technology –Project structure