Information Technology Management

1. Information Technology Management Strategy & IT

2. Business Strategy Organizational Strategy IT Strategy IT Strategy Triangle • All 3 Strategies Need to be in Harmony • Multiple Ways to Create Harmony

3. Business Strategy Frameworks • High level strategic business concepts • Efficiency ( low cost) vs. Innovation • Value disciplines (Tracy & Wiersema) • Operational Excellence • Product Leadership • Customer intimacy • More specific strategic business concepts • Porter’s Generic Strategies Framework (and its variants) • Co-opetition (Brandenburg and Nalebuff) • Hypercompetition and the New 7-S’s framework (D’Aveni)

4. Value Capturing Strategies ProductLeadership Leadership requires a primary strategy Operational Excellence CustomerIntimacy

5. Customers Intermediaries Porter’s Value Chain Value Chain Suppliers Enterprise Joined-up Business • Vertical Process Integration • 3 Ways to Differentiate • Low Cost • Differentiation as Viewed by Customer • Narrow Segment Focus

6. Hypercompetition and the New 7-S’s framework (D’Aveni) • Sustained competitive advantage is not possible • Only temporary advantages exist, created by a company’s speed and aggressiveness. • Assumes: • Every advantage becomes eroded • Sustaining an advantage uses too much time and resources. • Instead, companies must seek to stay ahead of its competitors by creating temporary advantages • These are done in small steps over short competitive cycles. Focus on creating the next temp. advantage.

7. Competitors/ Substitutors Enterprise Suppliers Customers Intermediaries/ Complementors Co-opetition – The Value Net New Joined-up Business Value Net • Virtual integration • Differentiation • Focus on Customer Needs • Co-source Processes • Coordinate Partners to Assemble Strategic Advantage

8. ProductLeadership Leadership requires a primary strategy Operational Excellence CustomerIntimacy Attributes of the different Value Capturing Strategies Focus on Core Processes of invention, product development, and market exploitation Loosely knit, ad hoc business structure Metrics are on product success and don’t punish experimentation Operations culture is individualistic, out of the box, futuristic, Team based Focus on core processes of solution development, results management, relationship management Operations culture delegates decision making to employees closest to customer Metrics are based on results from carefully selected and nurtured clients. Intent is to create deep and lasting relationships with clients Specific (custom) solutions preferred over general solutions Processes optimized for end to end supply Operations culture is standardized, simplified, tightly controlled, centrally planned Metrics are cost based Integrated, Reliable, High speed transaction systems Standardization“When it absolutely, positively has to be there overnight

9. Traditional IT Investment Portfolio MIS Decision Support Knowledge Mgn’t Processing Business Activities Orders Sales Shipment Communications Data Base Office Automation Groupware

10. Customers Intermediaries Product/Service Flow The Value Chain Information Flows Value Chain Suppliers Enterprise Joined-up Business • Product to Customer • Vertical integration • Processes are internally focused Information Flows

11. Competitors/ Substitutors New Joined-up Business Value Net Enterprise Suppliers Customers Intermediaries/ Complementors Future State : The Value Net • Drive from customer need – not products • Assemble the solution from the value net to match the need • Virtual integration • Processes are externally focused & executed by the members of the value net that can best execute them

12. The Business Organization (Hammer and Champy) Business Processes Values and Beliefs Jobs and Structures Management and Measurement systems

13. Hierarchical, flat and matrix organizational structures Hierarchical Organizational Structure Matrix Organizational Structure Flat Organizational Structure

14. The networked organization • The networked organization is a new form, made possible by IS. • Instead of rigid hierarchies, all parts of the company are connected by formal and informal communications.

15. IT Impact on Organization ( Structure, Processes, Culture)? • Computer • Transaction systems • Databases • PC • Telecommunications • E-mail • Internet

16. Business Strategy Organizational Strategy IT Strategy Change Enabler How do You Get the 3 in Sync? One-way? Two-way? Improvisation?

17. What Happens When my Business Strategy is Value-Net Based?