Chapter 8: Strategic Management of IS/IT
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  • 1. Chapter 8 Strategic Management of IS/IT: Organization and Resources
  • 2. Agenda
    • Requirements of strategic management
    • Roles of the IT function
    • IS/IT organization approaches
    • Choice of IS/IT organization
    • IS/IT organization strategies
  • 3. Requirements of Strategic Management
    • IS/IT strategies, policies and plans reflects business objectives and strategies
    • Identify and explore potential business advantages from IS/IT
    • Ensure IS/IT strategies are viable in terms of business risks
    • Establish resources and priorities
    • Match IS/IT management and corporate culture
    • Monitor business critical IS/IT activities
    • Balance between centralization and decentralization
  • 4. Roles of the IT Function – I by Zmud
    • User services
      • Delivery services
      • Systems development
      • Support center
      • Information center
    • Architecture management
      • Planning
      • Technology diffusion
      • Data management
  • 5. Roles of the IT Function – II by Zmud
    • Technology development
      • Research & development
    • General
      • Administration
      • Quality assurance
  • 6. IS/IT Organization Approaches
    • Total centralized (monopolistic)
    • Total decentralized to business functions
    • Geographically placed data centers and resources
    • Business unit control
    • Users
    • Activity
    • Type of resource – network, computers, software, data, etc.
  • 7. Choice of IS/IT Organization
    • Stage of application portfolio maturity
    • Geography of the enterprise
    • Synergy benefits of business services, products, & information
    • Business diversity & rate of change
    • Competitive pressures
    • Economics of resource, obtaining and deploying skills
    • Enterprise structure & management culture
  • 8. IS/IT organization strategies
    • IT (centralized) or user departments (decentralized)
    • Mix
    • Chief information officer or steering committee
  • 9. IT or User Departments – I by McFarlan and KcKenney
    • IT department
      • Integration
      • Database
      • Feasibility and cost/benefit analysis
      • Litter innovation
      • IS organization based on technical specialist not user need
      • High maintenance (80%)
      • No senior management
      • Use frustration with secret growth of user computing
  • 10. IT or User Departments – II by McFarlan and KcKenney
    • User department
      • Short term problem solving
      • Incompatible databases & systems
      • Lack of quality control
      • Hidden maintenance overhead
      • Duplication problems
      • Little cost/benefit analysis
      • Lack of skill technical staff
  • 11. Mix by La Belle and Nyce
    • Business unit responsibility
      • Application architecture, development, and operation
    • Central IT group
      • Telecommunication
      • Hardware & software architecture
      • Information architecture
      • Risk management and security
      • Shared services and utilities
      • Human resources
  • 12. Chief Information Officer or Steering Committee - I
    • Chief information officer (CIO)
      • Setting IS/IT policy & strategy
      • Goal oriented with business, IS/IT, & communication competency
  • 13. Chief Information Officer or Steering Committee - II
    • Steering committee
      • Executive steering group
      • IT planning group
        • Service management group
        • Technical management group
      • Business IS planning group
        • Application management group
  • 14. Executive Steering Group Functions
    • Aligning business & IS/IT strategies
    • Establishing IS/IT priority & IS/IT resources
    • Ensuring strategic applications achieve their objectives
    • Establishing organizational responsibilities and relationships
  • 15. IT Planning Group Functions
    • Interpreting IT trends and development for organizational business
    • Allocating resources according priority
    • Monitoring IS/IT performance
    • Managing IT, specialists, & technical risks
  • 16. Service Management Group Functions
    • Meeting business needs with the optimum means
    • Monitoring performance against budget/service level
    • Controlling quality
    • Satisfying evolving demand
  • 17. Technology Management Group Functions
    • Assessing technology against known and potential needs
    • Planning and managing infrastructure
    • Resolving technical issues/problems
    • Support service group
  • 18. Business IS Planning Group Functions
    • Identifying business needs
    • Interpreting CSFs
    • Assessing opportunities, threats, & IS implications
    • Prioritizing, planning, & coordinating IS and expenditure
    • Ensuring the delivery of benefits
  • 19. Application Management Group Functions
    • Identifying special needs, changes, benefits, resources, and costs of applications for investment & priority evaluation
    • Managing developments & usage of IS
  • 20. Points to Remember
    • Requirements of strategic management
    • Roles of the IT function
    • IS/IT organization approaches
    • Choice of IS/IT organization
    • IS/IT organization strategies
  • 21. Questions
    • What is a good IT strategic management for an e-business of the banking industry in terms of the organizational structure?
    • What is a good IT strategic management for an e-business of the California State University system in terms of the organizational structure?