Using MIS 2e Chapter 11: Information Systems Management David Kroenke

1. Using MIS 2e Chapter 11: Information Systems Management David Kroenke This presentation has been modified from the original and should be downloaded from the Course Documents area in Blackboard

2. Study Questions • Q1 – What are the functions of the IS department? • Q1a – How do I select the best technology? • Q2 – How do organizations plan the use of IS? • Q3 – What tasks are necessary for managing computing infrastructure? • Q4 – What tasks are necessary for managing enterprise applications? • Q5 – What are the advantages and disadvantages of outsourcing? • Q6 – What are your user rights and responsibilities? Chapter 11: Information Systems Management

3. Q1 – What are the functions of the IS department? • The major functions of a typical IS department include: • Planning the use of information technology to accomplish the organization’s goals and strategy. • Developing, operating, and maintaining the organization’s computing infrastructure. • Developing, operating, and maintaining enterprise applications. • Protecting information assets. • Managing outsourcing relationships. • Each organization’s IS structure varies according to its size, culture, competitive environment, industry, and other factors • The title of the principal manager of the IS department varies from organization to organization. • A common title is Chief Information Officer, or CIO • Other common titles are vicepresident or Directorof Informationservices. Chapter 11: Information Systems Management

4. Q1 – What are the functions of the IS department (reporting relationships)? Fig 11-1 Typical Senior-level Reporting Relationships The CIO, like other senior executives, typically reports directly to the CEO Chapter 11: Information Systems Management

5. Q1 – What are the functions of the IS department? • The Technology office, headed by the Chief Technology Officer (CTO) investigates new information systems technologies and determines how the organization might benefit from them. • Gartner Research (www.gartner.com) is the world’s leading information technology research and advisory company providing technology-related insight necessary for clients to make the right decisions, every day. Founded in 1979, Gartner is headquartered in Stamford, Connecticut, U.S.A., and has 4,000 associates, including 1,200 research analysts and consultants in 80 countries. • Gartner is free to UM students and alumni • Forrester Research, Inc. (www.forrester.com) is an independent research company that provides pragmatic and forward-thinking advice to global leaders in business and technology. Forrester works with professionals in 19 key roles at major companies providing proprietary research, consumer insight, consulting, events, and peer-to-peer executive programs. For more than 25 years, Forrester has been making IT, marketing, and technology industry leaders successful every day. Chapter 11: Information Systems Management

6. Q1a – How do I Select the Best Technology (Gartner’s Magic Quadrant) The Magic Quadrant is based on two axes: Ability to Execute: Summarizes factors such as the vendor's financial viability, market responsiveness, product development, sales channels and customer base. Completeness of Vision: Reflects the vendor's innovation, whether the vendor drives or follows the market, and if the vendor's view of how the market will develop matches Gartner's perspective. UM spends $75,000 a year for access to Gartner Research. It is available to students and alumni at no charge Chapter 11: Information Systems Management

7. Q1a – How do I Select the Best Technology (Gartner Hype Cycle) The Hype Cycle is a commentary on the pattern of human response to technology and provides a graphical way to track multiple technologies within an IT domain or technology portfolio. Hype Cycles enable technology planners to compare their understanding of a technology's evolution against Gartner's analysis of the technology's maturity, to decide when to invest in that technology. Each point on a hype cycle includes an estimate of the expected time to mainstream adoption. You want to be on the “leading edge”, not the “bleeding edge” UM spends $75,000 a year for access to Gartner Research. It is available to students and alumni at no charge Chapter 11: Information Systems Management

8. Q1 – What are the functions of the IS department (continued)? • The Operations function manages the computing infrastructure, monitors system users, and responds to their problems. It includes system and network administrators. • The Development department manages the process of creating new information systems while maintaining existing information systems. It includes analysts who work with users, operations, and vendors to acquire and install licensed software. It may include programmers, test engineers, and technical writers. • If an organization uses outsourcing vendors, it may have a department devoted to managing its outsourcing relationships. It negotiates outsourcing agreements with other companies to provide equipment, applications, and other services. • Some companies have a separate data administration function that is responsible for protecting data and information assets by establishing data standards and data management practices and policies. Chapter 11: Information Systems Management

9. Q2 – How do organizations plan the use of IS? • An organization must take the following steps to plan how it will use IS and IT and to make sure both of them support the organization’s strategy. • Align information systems with organizational strategy • Communicate IS/IT issues to executive group • Develop/enforce IS priorities within the IS department • Sponsor steering committee • The CIO is responsible for most of these items. It’s a never-ending process as organizations change, grow, or merge with other companies. • The steering committee, a group of senior managers from major business functions, works with the CIO to set IS priorities, make decisions about major IS projects, and serve as a communication channel between users and the IS function. Chapter 11: Information Systems Management

10. Q3 – What tasks are necessary for managing computing infrastructure? • The IS infrastructure must mirror the organization’s structure. That is, if the organization itself is highly controlled and centralized, then the IS infrastructure should be also. If the organization is decentralized with autonomous operating units, then the IS infrastructure should support that. • The figures below show the discord between one type of organizational structure and another type of IS infrastructure. Fig 11-3 Distributed Check-Printing Company Fig 11-4 Problematic Centralized IS Fig 11-5 Decentralized Order-Management System Chapter 11: Information Systems Management

11. Q3 – What tasks are necessary for managing computing infrastructure? • The IS department is responsible for creating, operating, and maintaining the organization’s computing infrastructure for end-users, networks, data centers, data warehouses, and data marts. • The IS department must establish technology and product standards and ensure end-users do not deviate from them. On the other hand, IS configurations must support the type of work users do. • The IS department must track user problems and monitor their resolution. They assign a tracking number to the problem, enter it into the queue according to its priority, and monitor the problem until it’s resolved. CIOs and managers should also monitor problem resolution. Chapter 11: Information Systems Management

12. Q3 – What tasks are necessary for managing computing infrastructure? • The figure below shows a typical IS operations group. Note all of the people necessary to support an information system. Fig 11-6 Organization of a Typical IS Operations Group Chapter 11: Information Systems Management

13. Q4 – What tasks are necessary for managing enterprise applications? • If an organization uses enterprise applications, it may need support staff for managing them. Either the IS department manages everything, or individuals and workgroups manage their own applications. • Enterprise applications include some functional applications and all cross-functional applications including CRM, ERP, EAI, and SCM. • The following is a list of tasks involved in managing enterprise applications: • Manage development of new applications • Maintain legacy systems • Adapt systems to changing requirements • Track user problems and monitor fixes • Integrate applications • Manage development staff Chapter 11: Information Systems Management

14. Q4 – What tasks are necessary for managing enterprise applications? • This figure shows how a typical IS development group might be organized. Each business may adapt this chart to its own needs. Fig 11-8 Organization of a Typical IS Development Group Chapter 11: Information Systems Management

15. Q4 – What tasks are necessary for managing enterprise applications? • Administering data resources is a very important function with two aspects: • Data administration, which pertains to all of an organization’s data assets. • Database administration, which pertains to a particular database. • The two terms are often used interchangeably, but database administration is the more common • A data administrator/database administrator supervises the entire data functional group. Data administration is an enterprise-wide function that includes the following tasks: • Define data standards • Maintain data dictionary • Define data policies • Establish disaster-recovery plan Chapter 11: Information Systems Management

16. Q5 – What are the advantages and disadvantages of outsourcing? • Outsourcingis the process of hiring another organization to perform a service. It’s rise is due to several factors: • Massive capital was raised during the “Internet Bubble” era • Capital was used to create infrastructure as the cost of communication plunged • Computers became even cheaper and software continued to evolve • The result is that intellectual work can be delivered from anywhere at any time • India is the most popular foreign outsourcer because of its large, well-educated, English-speaking population who earn 20 to 30 percent less in labor costs than their U.S. counterparts. • Outsourcing also occurs within the US; e.g., Jet Blue • The global playing field has been leveled; the world is flat! Chapter 11: Information Systems Management

17. Q5 – What are the advantages and disadvantages of outsourcing? EDS is a successful vendor of hardware Licensing software is a form of outsourcing A Web storefront; e.g., Amazon provides a storefront for vendors who choose not to develop their own Web presence PeopleSoft provides an entire function (e.g. payroll) Chapter 11: Information Systems Management

18. Q5 – What are the advantages and disadvantages of outsourcing? Outsourcing offers several advantages . . . But it is not without its disadvantages. . . Some would say that you are outsourcing middle management of the same IT personnel you had originally Chapter 11: Information Systems Management

19. Q6 – What are your user rights and responsibilities? Chapter 11: Information Systems Management

20. Summary • The major functions of the IS department are to • Plan the use of IT so as to accomplish the organization’s goals • Manage the organization’s computing infrastructure. • Develop, operate, and maintain enterprise applications. • Protect the organization’s information assets. • Manage outsourcing relationships. • The principal manager of the IS department is the Chief Information Officer (CIO) who typically reports to the CEO. • The Chief Technology Officer (CTO) identifies new IT products that will be relevant to the organization. • The IS department manages the computing infrastructure by aligning it with organization’s structure and dynamics. Chapter 11: Information Systems Management

21. Summary (Continued) • Data administration and database administration are functions in the IS department that protect the organization’s information assets. • Outsourcing is the process of hiring another organization to perform a function or service. • Companies outsource hardware, programs, applications, and even entire business functions. • As a future user of information systems, facilities, and services, you have rights and responsibilities. Chapter 11: Information Systems Management

22. Review: Select the appropriate term for each item CIO – CTO –Outsourcing – Information System – Information Technology – Legacy system – Development group – Operations group • It is comprised of hardware, software, data, people, and procedures Information System • This position typically reports to the CEOCIO • This individual is responsible for determining which new technologies are relevant to the organization CTO • Hiring another organization to perform a service Outsourcing • Outdated system still in use Legacy system • Manages the computing infrastructure, data centers, and data warehouses Operations Group • Staffed by systems analysts, programmers, test engineers, and technical writers Development Group • Products, methods, inventions, and standards used for the purpose of producing information InformationTechnology Chapter 11: Information Systems Management