IS Consulting Process ( IS 6005 )

IS Consulting Process(IS 6005) Masters in Business Information Systems 2006 / 2007 Programme in Professional Information System Practices Fergal Carton Business Information Systems

Revision class Reading list This week MBS (BIS) / 6005 / IS Consulting Process

Topics covered 1st term • The IS Consulting Business: • What does the IS Consultant do? • Segmenting consulting practice (eg. Vision) • Role of consultants on PPARS • Typical asssigments • PCB example • GAP analysis (eg. UCC) • ERP Projects: scope, resources, timescales, phasing • Consultant skills (analytic, technical, project) • Consultant tools • Identifying unique features of business • Managing Client Engagements: • Requirements analysis and understanding the client goals • Handouts • Task definition and project resources • SIB • Preparing and presenting the solution options • In-house vs custom MBS (BIS) / 6005 / IS Consulting Process

Segmenting the market Emphasis on services (from Helpdesk to ASP model) Any other research on market? Homework on Vision Typical consulting assignments Role of consultants Perspectives on IS function Do you know more than the client? Consulting practice in Ireland MBS (BIS) / 6005 / IS Consulting Process

What services are provided? IT strategy definition (laying out an investment plan for IT spend) Advise on IT cost reduction Feasibility study or business case for IT spend Develop requirements for new system Package selection and implementation Software development (Design, Build, Run, …) Outsourcing operations (ASP, Helpdesk, IT support, …) … What markets are operated in? Public Commercial SME Segmenting the IS consulting market MBS (BIS) / 6005 / IS Consulting Process

“Changing” your spots just to snag a project Fit of project with your capabilities Trade off between need to grow and comfort zone Challenge the sales team? Respond with a polite “no-bid” letter Propose, or not to propose? MBS (BIS) / 6005 / IS Consulting Process

Vision exercise • Background, size, structure, locations • Unique selling point (if one exists) • Industry sectors/practice areas • Offers/services within these areas MBS (BIS) / 6005 / IS Consulting Process

Consulting project examples ERP projects: big-bang or phased approach? Vital role of consultants: availability, courageousness and tenacity Telephone company uses Tel no. to identify customers! Catering trade: 14% stock loss, use of IT for control Gap analysis example: colour coded “fit” of ERP to actual processes PCB case studies presented Skills a key issue in implementation debate (Project Mgt, IT support, PU’s, …) Structured process overview diagram a good communication tool Top down approach, talk to managers first: protocol and common courtesy Including regional users in requirements specification What do consultants do? MBS (BIS) / 6005 / IS Consulting Process

Homework: how to reconcile Requirements Specification (wish list) with ERP generic processes? ERP Finance modules for UCC Scope System requirements Responding to an ITT / RFP Requirements definition report Functional requirements by dept, process, module, … Gap analysis MBS (BIS) / 6005 / IS Consulting Process

Gap analysis: expectation mgt • Describe existing processes • Document how things are currently done • Review inputs and outputs of current process (screens, forms, reports) • Outline problems with current way of doing things (speed, risk of error, …) • What improvements are expected from system (single point of data entry, faster reports, less manual work, …) • How to design and communicate the proposed solution • Review requirements documentation: answer with • Walk-through solution • Get sign-off from users MBS (BIS) / 6005 / IS Consulting Process

Off-site, phones off, informal, actual consulting team members present, start in “working together” mode Company history and current challenges (get people saying yes) Overview of ERP (education, building awareness, testing the water for resistance, …) Requirements for ERP (generic and company specific) Focus on benefits Understanding the cost of the Gaps (alternative functionality, workaround, modification) Addressing the functionality gap (get commitment for resources to work on B’s and C’s) Managing the GAP: workshop with client managers MBS (BIS) / 6005 / IS Consulting Process

Role of consultants (cf. Wang & Chen paper) Personal commitment: invest the time in getting to know the client Winning trust Significant “knowledge asymmetry” Not doing, but advising : how to disentangle yourself from an operational role Conflict resolution Freeman 5 concepts of IT advisory role: Relationship Role Visualise success You advise, they decide Disentangle yourself from operational role Give the criteria by which you would make the decision, rather than the decision Be results oriented Managing the GAP: workshop with client managers Off-site, phones off, informal, actual consulting team members present, start in “working together” mode Company history and current challenges (get people saying yes) Overview of ERP (education, building awareness, testing the water for resistance, …) Requirements for ERP (generic and company specific) Focus on benefits Understanding the cost of the Gaps (alternative functionality, workaround, modification) Addressing the functionality gap (get commitment for resources to work on B’s and C’s) Phasing discussion: big bang vs phased Business constraints or seasonality in business cycles (eg. Hershey) Scale (# users, # countries, …) Scope (# modules, # interfaces, level of customisation, …) Timescale and cost (NB. PPARS still costing €21m. a year) Different requirements between sites, resistance to ERP (get quick wins first) Format of tenders Functional requirements might be by dept, process, module, … Analysis of data volumes (process flow for revenue and expenditure cycles) # non-PO invoices (40%) # debtor accounts Research account maintenance Last week MBS (BIS) / 6005 / IS Consulting Process

All Homes Provide A roof over your head A floor under your feet A lock on the door Electricity, water, sewer Picture A starter home Uses standard blue prints Can be built with generic skills Requires much compromise Doesn’t have unique features Is very similar to the next house Is generic in style and function Your dream home Architect develops a custom plan Requires skilled craftsman Requires little compromise Is unique where you value it Is like no other house The style and function are specific MBS (BIS) / 6005 / IS Consulting Process

ERP • Why ERP ? • Automate and streamline sales/quote/order/invoice • Shorten order processing time • Better inventory control • Consolidates all sales information • Improve sales information on customers • Why reinvent the wheel, use best practice • Scalability • Robustness – one system, minimises repetition • Faster to implement • Clear upgrade path (linked to vendor): better expansion capability • Develop ERP skills in-house, useful for further projects • Ability to implement, large team required! • Quantifiable outcome & timescale MBS (BIS) / 6005 / IS Consulting Process

In-house • More control over process design • More adherence to specific requirements • More programmers required • Own processes may be better than ERP template • Have we got the resources / experience • Design • Build • Support • Cost of back fill • Long term Support issues • Time scale & cost MBS (BIS) / 6005 / IS Consulting Process

Business constraints or seasonality in business cycles (eg. Hershey) Scale (# users, # countries, …) Scope (# modules, # interfaces, level of customisation, …) Timescale and cost (NB. PPARS still costing €21m. a year) Different requirements between sites, resistance to ERP (get quick wins first) Phasing discussion: big bang vs phased MBS (BIS) / 6005 / IS Consulting Process

What is unique to the business? Business model (cost, products, design, customer satisfaction, …) Unique feature (products, production methods, IS, supply chain, …) Leading questions Revenue, headcount, … Current successes, recent announcements, … Project timescale: a trade off between cost and tying up resources Scope creep because of changes to the business model Eg. EMC integration of DG rejected because of timeline impact but later regretted Package vs. custom debate MBS (BIS) / 6005 / IS Consulting Process

IS consulting profession Consultant, project manager, analyst Consultant skills Analytic abilities Analysis tools (IT audit example) Checklists, presentation matrices, … Adding value in reporting findings in a way that prioritises actions to be taken Technical abilities Project management abilities Example from Accenture Consulting skills MBS (BIS) / 6005 / IS Consulting Process

Key roles in ERP project: Accenture example Client, consultant and technology vendor resources Doubling up of client and consultant resources (experience where it counts) ERP project team example (PCB case study) Steering committee (SC) meets once a month, only want a report on progress Project issues should be sorted out before SC meeting SC members represent first and foremost their functional areas Project Manager should not be on Steering Committee? Clarity of project team presentation, keep like resources together Time commitment to project (increases downwards through org chart) Reporting lines not trivial: think where decision bottlenecks can occur (and place a consultant at that point) Roles on ERP projects MBS (BIS) / 6005 / IS Consulting Process

Things to think about • In considering change, think about how people are goaled / measured • It will always benefit you if you make your boss look good • Policy driven approach • Statement of work • Decisions • Reporting • Milestones • Planning • Policies MBS (BIS) / 6005 / IS Consulting Process

Things to think about • Resistors easier to deal with than the George Hall’s • Pfizer: 3 IT development centres competing against each other • Communication • set your stall out, be determined • Deliver tough message first, but how you communicate it is key • Different deal shapes (eg. SAP licence issue) • Is manufacturing cultural? • How do you judge level of interdependence between plants • Interdependence betweeen ERP and legacy (ownership issues?) MBS (BIS) / 6005 / IS Consulting Process

More tips on proposals • Consistency in style throughout proposal • Knowledge of a sector: state it or show it • Who is the biggest benefactor of MIS? • IT resources are important • Customers like frameworks • An architecture of functions might re-assure • Phasing, on what basis? • Package vs. custom discussion • Security deserves attention • Maybe customer doesn’t understand new business model • Honesty looks professional and increases credibility MBS (BIS) / 6005 / IS Consulting Process

A methodology … • Requirements are “representational”: you can’t interview everybody • Breaks a large task into manageable chunks • Shows knowledge and experience • Allows negotiation over the scope of work • Inspires confidence • Can take account of latest research / thinking • Helps calculate FTE and budget MBS (BIS) / 6005 / IS Consulting Process

Read current business press for ideas (SBP, FT, Economist, CEO, Fortune, …) Outsource to Puerto Rico: like Ireland 20 years ago Outsourcing: the knowledge economy in Ireland IFSC now has reputatation for “futures” currency trading “Centre of excellence” notion: holding on to higher value activities … Popular issues / projects MBS (BIS) / 6005 / IS Consulting Process

Consulting sales is like any other sales: creating client need is critical Discuss sales tactics with someone you know who is a good sales person Quantify the levels in the funnel (as you would for a sales campaign) Marketing funnel MBS (BIS) / 6005 / IS Consulting Process

Strategy is a report which matches business goals to IT directions Lays out a plan for future investment Contains pointers to implementation initiatives Can refer to your experience of implementing solutions Hopefully leads to you being retained for the implementation work What’s an IT strategy MBS (BIS) / 6005 / IS Consulting Process

Customers Sports organisations (IRFU, FAI, IOC, …) Club / county / national team supporters Corporate Ireland Business conference users Concert goers Tourists TV viewers Internet users … Stakeholders GAA Govt. Sponsors … Suppliers Tourist Board Dublin City council … Products Sports events (seats and viewing rights) Entertainment events Business conferences Not for profit events Hotel accommodation Museum Retail Telecoms …. Croker Strategy MBS (BIS) / 6005 / IS Consulting Process

PPARS project • Governance • Complexity • Job title • Responsibilities • No payscale • Bonuses • Overtime • Link roster to payroll? • Resources • Business process change, not system issue MBS (BIS) / 6005 / IS Consulting Process

PPARS project information • http://irishhealth.com/index.html • PPARS is only a tool, a computer system, to aid the recording personnel data and payroll. • Problems lay deeper than the PPARS system, • e.g Business Process is poor, • no standardisation, • poor management of resources, • no reports to monitor pay expenditure and pull back on over spends. • The system is only highlighting the problems that exsist. • The system is being used as an excuse. If managers managed and were held accountable and responsible for their actions, the roll out of a new system should not be such a chore!! MBS (BIS) / 6005 / IS Consulting Process

PPARS scope (www.PPARS.ie) • Personnel Administration • Organisational Management • Time Management • Payroll (full Gross to Net) • Personnel Development (Qualifications only) • Training & Events • Travel Management (Expenses only) • Compensation Management (Mass Pay Increases only) • Managers Self Service • Employee Self Service (Limited Pilot) • Electronic time capture (Pilot) MBS (BIS) / 6005 / IS Consulting Process

PPARS.ie Core Benefits • An integrated HR system for the Irish Health System. • Comprehensive employee data and profiles. • Improved reporting / standardised reporting across and within agencies. • Enhanced potential to improve the facilities for resource planning / costing. • Potential to improve the alignment of resources to service plans. • Enhanced information on organisational structure, reporting relationships, positions and staffing complements. MBS (BIS) / 6005 / IS Consulting Process

PPARS.ie Core Benefits (cont.) • Standard & streamlined processes, procedures and forms. • Reduced administrative costs. • Compliance with the reporting requirements of the Department of Health & Children, the Health Services Employers' Agency and the Office of the Comptroller and Auditor General. • Potential for electronic information flow between Health Agencies and the Department of Health & Children. • Enhanced empowerment of Line Managers – In line with best practice in HR. • Improved employee satisfaction through, for example, improvements to career and organisation planning. MBS (BIS) / 6005 / IS Consulting Process

Environments for IS / IT planning Internal Organiastional Pressures – demanding further distribution of IS/IT control organisation High “Complex” “Opportunistic” Diffusion – degree of decentralisation of IS/IT control in the organisation CRM External Competitive Pressures – increasing the criticality of IS/IT to the business “Traditional” “Backbone” ERP Low High Source : Sullivan (1985) in Ward & Griffiths (1996) Infusion – degree of dependence of the business on IS/IT MBS (BIS) / 6005 / IS Consulting Process

IT strategic grid (McFarlan & McKenney) Strategic Factory HIGH Strategic impact of existing systems LOW Turnaround Support LOW HIGH Strategic impact of application development portfolio MBS (BIS) / 6005 / IS Consulting Process

IT strategic grid (McFarlan & McKenney) “IT is a tightly managed shop which must not get beyond its station” “IT is integral to the business” Strategic Factory HIGH Strategic impact of existing systems eg. steelworks eg. credit card “Don’t call us, we’ll call you” “Let’s get on with it” LOW Turnaround Support eg. cement eg. retailer LOW HIGH Strategic impact of application development portfolio MBS (BIS) / 6005 / IS Consulting Process

3 forces driving firms around grid • Fit between IT potential and operations & strategy • Strategic choices made about IT • Changes in the competitive environment MBS (BIS) / 6005 / IS Consulting Process

Limitations of Strategic Grid • Every company has systems in 4 quadrants • Systems may migrate around quadrants • Therefore : • Use grid to plot range of business applications • Investment appraisal approach for each quadrant MBS (BIS) / 6005 / IS Consulting Process

Application Portfolio(adapted from Ward & Griffiths, Strategic Planning for Information Systems, 1996) Key operational Strategic Applications on which the organisation currently depends for success Applications critical to sustaining future business strategy Applications which may be important in achieving future success Applications which are valuable but not critical to success Support High Potential MBS (BIS) / 6005 / IS Consulting Process

Application PortfolioExample for a manufacturing company Key operational Strategic • Bill of Materials • Inventory management • Customer database • Receivables / Payables • Employee database • … • Sales order management • Links to suppliers • Sales Forecast & market analysis • Product Profitability analysis • … • Time recording • Budgetary control • General accounting • Cost accounting • Payroll • … • EDI with wholesalers • Manpower planning • Decision Support (capacity plan) • Expert fault diagnosis • Document processing • … Support High Potential MBS (BIS) / 6005 / IS Consulting Process

Handouts in class 1 Oct 06 ERP Implementation Case Study (PCB), Fergal Carton Rick Freedman (2000). The IT Consultant, Chapter One, Part One 18th Oct 06 UCC ERP project documentation? Format of Tenders and Evaluation Appendix II, current data volumes Key roles and team structure 20th Nov 06 SIB Industries Inc. (case study on ERP implementation project) 8 Jan 07 (soft copies also sent) “How to deal with difficult customer”, Peter Urs Bender “Stand Up, Sit Down...Don’t Fight, Fight, Fight”, Jacobsen (2004) Sales and Marketing, Ch. 6, Rick Freedman (2003). Building the IT Consulting Practice What is the IT Consulting Business, Ch. 1, Rick Freedman (2003). Building the IT Consulting Practice 26th Feb PPARS handouts : articles from Greg Baxter, Ciaran Buckley, Ian Campbell, John Kennedy and Auditor General report extracts Emails Sent 18 Oct 06: “Effects of internal support and consultant quality on the consulting process and ERP system quality”, Wang & Chen (2006), Decision Support Systems 46, pp 1029-1041 Sent 6th Nov 06: “Blaming ERP”, Osterland (2000), CFO, pp 89-92 Sent 14th Nov 06 “Business Process Management, The Future of IT “, Keen (2002), Working paper for Action Technolgies Inc. Sent 20th Feb 07: “Strategy and The New Economics of Information”, Evans & Wurster (1997), BCG “Systems Planning in the Information Age”, Sullivan (1985), Sloane Management Review Sent 26th Mar 07: “2x2 Modeling and Problem Solving”, Lowy & Hood (2004), Consulting to Management, Vol. 15, No.4, pp 40-47 Recommended reading Rick Freedman (2000). The IT Consultant: A Commonsense Framework for Managing the Client Relationship, Jossey-Bass / Pfeiffer, San Francisco Rick Freedman (2003). Building the IT Consulting Practice, Jossey-Bass / Pfeiffer, San Francisco Reading list MBS (BIS) / 6005 / IS Consulting Process

Building the IT Consulting Practice 1 3 skim 4 yes 5 yes 6 have 7, 8, 9, 10 no The IT Consultant: A Commonsense Framework for Managing the Client Relationship Parts 1 and 2 Freedman is light reading! MBS (BIS) / 6005 / IS Consulting Process

IS Consulting Process ( IS 6005 )