Chapter 12 Revised

7/31/2019 Chapter 12 Revised

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McGraw-Hill/Irwin 2008,The McGraw-Hill Companies, All Rights Reserved

Chapter 12

Enterprise and Global

Management ofInformation Technology


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Chapter 12 Slide 2

Components of IT Management


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Chapter 12 Slide 3

Managing Information Technology

Managing the joint development andimplementation of business and IT strategies

Use IT to support the strategic business priorities

Align IT with strategic business goals

Managing the development and implementationof new business/IT applications and technologies Managing information systems development

Managing the IT organization and ITinfrastructure Hardware, software, database, networks and other

resources


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Chapter 12 Slide 4

Business/IT Planning Process


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Chapter 12 Slide 5

Components of Business/ITPlanning

Strategy Development Developing business strategies that support a

companys business vision

Resource Management

Developing strategic plans for managing or outsourcinga companys IT resources

Technology Architecture

Making strategic IT choices that reflect an informationtechnology architecture designed to support acompanys business/IT initiatives


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Chapter 12 Slide 6

Information TechnologyArchitecture

Technology Platform Networks, computer systems, system software and

integrated enterprise application software

Data Resources

Operational and specialized databases

Store and provide data and information for businessprocesses and decision support


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Chapter 12 Slide 7

Information TechnologyArchitecture

Applications Architecture Integrated architecture of enterprise systems that

support strategic business initiatives as well as cross-functional business processes

IT Organization Organizational structure of the IS function within a

company and the distribution of IS specialists


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Chapter 12 Slide 8

Organizing IT

Early years: centralization of computing withlarge mainframes

Next: downsizing trend with a move back to

decentralization Current: centralized control over the

management of IT while serving strategic needsof business units

Hybrid of both centralized and decentralizedcomponents


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Chapter 12 Slide 9

Organizational Components of ITat Avnet Marshall


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Chapter 12 Slide 10

Application DevelopmentManagement

Managing activities such as: Systems analysis and design, prototyping, applications

programming, project management, quality assurance,and system maintenance for all major business/IT

development projects


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Chapter 12 Slide 11

IS Operations Management

Use of hardware, software, network, andpersonnel resources in the corporate or businessunit data centers of an organization

Includes computer systems operations, networkmanagement, production control and productionsupport

Data centers are the computer centers of anorganization


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Chapter 12 Slide 12

System Performance Monitors

Software packages that Monitor the processing of computer jobs,

Help develop a planned schedule of computeroperations that can optimize computer system

performance, and

Produce detailed statistics that are invaluable foreffective planning and control of computing capacity


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Chapter 12 Slide 13

Features of Systems PerformanceMonitors

Chargeback SystemsAllocate costs to users based on the information

services rendered

Process Control Capabilities

Systems that not only monitor but automatically controlcomputer operations at large data centers


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Chapter 12 Slide 14

IT Staff Planning

Recruiting, training and retaining qualified ISpersonnel

Evaluate employee job performances and

reward outstanding performances with salaryincreases and promotions

Set salary and wage levels and design careerpaths so individuals can move to new jobs

through promotion and transfer as they gain inseniority and expertise


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Chapter 12 Slide 15

IT Executives

Chief Information Officer (CIO) Oversees all uses of information technology in many

companies, and brings them into alignment withstrategic business goals

Chief Technology Officer (CTO) In charge oftechnology management: all information

technology planning and deployment

Managing the IT platform

Second in command


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Chapter 12 Slide 16

Managing User Services

Business units that support and manage enduser and workgroup computing

Can be done with information centers staffed

with user liaison specialists Or with Web-enabled intranet help desks


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Chapter 12 Slide 17

Outsourcing

The purchase of goods or services from third-party partners that were previously providedinternally


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Chapter 12 Slide 18

Outsourcings Top Ten


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Chapter 12 Slide 19

Why outsource?

Save money achieve greater ROI Focus on core competencies organization can

focus on the business that they are in

Achieve flexible staffing levels Gain access to global resources

Decrease time to market


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Chapter 12 Slide 20

Offshoring

Relocation of an organizations businessprocesses

To a lower-cost location, usually overseas


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Chapter 12 Slide 21

IT Management Failures

IT not used effectively Computerize traditional business processes

Instead of developing innovative e-business processes

IT not used efficiently Poor response times and frequent downtimes Poorly managed application development projects

M t I l t d


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Chapter 12 Slide 22

Management Involvement andGovernance

Managerial and end user involvement Key ingredient to high-quality information systems

performance

Involve managers in the management of IT

Governance structures such as steering committees


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Chapter 12 Slide 23

Senior managements involvement in

business/IT decisions

Case 2: IBM Corporation: Competing


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Chapter 12 Slide 24

Case2: IBM Corporation: CompetingGlobally by Offshoring IT Workersand Giving Away Technology

IBM is expanding their development centers in India tocompete with companies like Wipro, Infosys, and TCS.

IBM is also giving away technology and its intellectualproperty to expand its business.

According to Fortune magazine, IBM gives away at least$150 million worth of technology every year. The idea that giving things away makes the pie bigger for

everybody is being embraced by IBM. When IBM gives away free tools, it often sells additional

software and consulting services. As long as IT remains hard to use, expensive, and labor

intensive, with customers continuing to need help solvingbusiness problems, IBM will have the opportunity to thrive.


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Chapter 12 Slide 25

Case Study Questions

1. Do you agree with IBMs employment response tocompetition from software development contractors inIndia, like Wipro, that are expanding into IT consultingservices? Why or why not?

2. Will IBMs plan to give away some of its IT assets andintellectual property and increase its support ofopensource software products like Linux be asuccessful growth strategy in the brutally competitive

marketplace in which it operates? Why or why not?


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Chapter 12 Slide 26

Case Study Questions

3. Do you agree with IBM researchersassumption that IT will remain hard to use,

expensive, and labor-intensive, with customerscontinuing to need help solving business

problems for a long time to come? ShouldIBM bet its business on that assumption?Defend your answers to both questions.


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Chapter 12 Slide 27

Real World Internet Activity

1. Use the Internet to research news on the latestdevelopments in the competition to provide ITconsulting services to businesses andgovernments. Check out IBMs performance,

as well as major players like HP andAccenture, new entrants like Dell, andinternational competitors like Wipro. Whoappears to be winning or losing in this arena?What reasons can you uncover for the resultsyou find?


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Chapter 12 Slide 28

Real World Group Activity

2. IBM eliminated 14,500 jobs, mostly in Europe,and then reportedly hired thousands ofadditional IT workers in India. Such cutting ofhigh-cost jobs and offshoring jobs to a

subsidiary in a lower-cost country is acontroversial business strategy being used byother global companies.

Discuss the implications of this issue for your currentor future career choices and the kinds of companiesor organizations you would want to work for.


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Chapter 12 Slide 29

Global IT Management

Develop appropriate business and IT strategiesfor the global marketplace

Develop the portfolio of business applicationsneeded to support business/IT strategies

Determine the technology platform needed

Determine the systems development projectsthat will produce the required global information

systems



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Chapter 12 Slide 30

Global IT ManagementDimensions



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Chapter 12 Slide 31

Global IT ManagementChallenges

Political Geoeconomic effects of geography on the

economic realities of international businessactivities

Cultural


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Chapter 12 Slide 32

Political Challenges

Rules regulating or prohibiting transfer of dataacross national boundaries

Severely restricted, taxed, or prohibited importsof hardware and software

Local content laws that specify the portion of thevalue of a product that must be added in thatcountry if it is to be sold there

Reciprocal trade agreements that require abusiness to spend part of the revenue they earnin a country in that nations economy


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Chapter 12 Slide 33

Geoeconomic Challenges

Sheer physical distances Difficult to get good-quality telephone and

telecommunications services

Differences in the cost of living and labor costs


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Chapter 12 Slide 34

Cultural Differences

Languages Cultural Interests

Religions

Customs Social Attitudes

Political Philosophies


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Chapter 12 Slide 35

Transnational Strategies

Business depends heavily on its informationsystems and Internet technologies to helpintegrate global business activities

Develop an integrated and cooperativeworldwide IT platform

Transnational Business/IT


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Chapter 12 Slide 36

Transnational Business/ITstrategies

Gl b l B i D i


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Chapter 12 Slide 37

Global Business Drivers

Business requirements caused by the nature ofthe industry and its competitive or environmentalforces

Examples of drivers:

Global Customers

Global Products

Global Operations

Global Resources Global Collaboration

Gl b l IT Pl tf


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Chapter 12 Slide 38

Global IT Platform

Managing the hardware, software, dataresources, telecommunications networks, andcomputing facilities that support global businessoperations

Technically complex with major political andcultural implications

International Data Communications


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Chapter 12 Slide 39

International Data CommunicationsTop 10 Issues

I t t Gl b l IT Pl tf


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Chapter 12 Slide 40

Internet as a Global IT Platform

Technology platform free of many traditionalinternational boundaries and limits

Expand markets, reduce communications anddistribution costs, and improve profit marginswithout massive cost outlays fortelecommunications

Key Questions for Global


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Chapter 12 Slide 41

y QWebsites

Will you have to develop a new navigational logicto accommodate cultural preferences?

What content will you translate, and what contentwill you create from scratch to address regionalcompetitors or products that differ from those inthe U.S.?

Should your multilingual effort be an adjunct to

your main site, or will you make it a separatesite, perhaps with a country-specific domain?

Key Questions for Global


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Chapter 12 Slide 42

yWebsites

What kinds of traditional and new mediaadvertising will you have to do in each country todraw traffic to your site?

Will your site get so many hits that youll need to

set up a server in a local country?

What are the legal ramifications of having yourwebsite targeted at a particular country, such as

laws on competitive behavior, treatment ofchildren, or privacy?

Internet Users by World Region


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Chapter 12 Slide 43

Internet Users by World Region

Global Data Access Issues


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Chapter 12 Slide 44

Global Data Access Issues

Transborder Data Flows Business data flow across international borders over

the telecommunications networks of global informationsystems

May be viewed as violating a nations sovereigntybecause avoids custom duties

Or violating their laws to protect local IT industry fromcompetition or their labor regulations for protecting local

jobs

U S E U Data Privacy Requirements


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Chapter 12 Slide 45

U.S.-E.U Data Privacy Requirements

Notice of purpose and use of data collectedAbility to opt out of third-party distribution of data

Access for consumers to their information

Adequate security, data integrity andenforcement provisions

Internet Access Issues in Most


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Chapter 12 Slide 46

Restrictive Countries

High Government Access Fees Government Monitored Access

Government Filtered Access

No Public Access Allowed

Global Systems Development


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Chapter 12 Slide 47

Global Systems Development

Conflicts over local versus global systemrequirements

Difficulties in agreeing on common systemfeatures

Disturbances caused by systems implementationand maintenance activities

Global standardization of data definitions

Systems Development Strategies


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Chapter 12 Slide 48


Transform an application used by the homeoffice into a global application

System used by a subsidiary that has the bestversion of an application will be chosen for global

use

Set up a multinational development team withkey people from several subsidiaries to ensure

that the system design meets the needs of localsites as well as corporate headquarters



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Chapter 12 Slide 49


Parallel Development parts of the system areassigned to different subsidiaries and the homeoffice to develop at the same times based on theexpertise and experience at each site

Centers of Excellence an entire system may beassigned for development to a particularsubsidiary based on their expertise in thebusiness or technical dimensions needed forsuccessful development

Offshore Development outsource thedevelopment work to a global development

Internet-enabled Collaboration in IT


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Chapter 12 Slide 50

Development

Source: Adapted from Jon Udell, Leveraging a Global Advantage, Infoworld,April 21, 2003, p. 35.

Documents

Chapter 12 Revised