IT Strategy Challenges

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An update of my presentation on IT Strategy Challenges. This is the deck I will use at a Boston University Executive Program on October 19, 2009.

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IT Strategy Challenges

  1. 1. Winning with Information Technology in the Network Era<br />Professor N. VenkatVenkatramanDavid J. McGrath Jr. Professor of Management<br />October 19, 2009<br />
  2. 2. Discussion Overview<br />2<br />©2009: N. Venkatraman<br />1<br />3<br />2<br />4<br />
  3. 3. IT is everywhere<br />© 2009: N. Venkatraman<br />3<br />
  4. 4. And could influence even more in the future….<br />© 2009: N. Venkatraman<br />4<br />
  5. 5. And change the geography of work<br />© 2009: N. Venkatraman<br />5<br />
  6. 6. (c) Venkatraman, 2009<br />Transact<br />6<br />Learn<br />Live<br />Innovate<br />Play<br />Consume<br />Connect<br />Work<br />
  7. 7. Why am I so bullish on IT?<br />© 2009: N. Venkatraman<br />7<br />
  8. 8. Take the three I.T. ‘laws’ together..<br />© 2009: N. Venkatraman<br />8<br />
  9. 9. The Scope of IT extends beyond processes<br />© 2009: N. Venkatraman<br />9<br />
  10. 10. A working framework to understand the scope of IT<br />© 2009: N. Venkatraman<br />10<br />BandwidthLaw<br />Metcalfe’sLaw<br />Technology<br />Domain<br />Moore’sLaw<br />Process<br />Product<br />Service<br />Business<br />Domain<br />
  11. 11. Discussion Overview<br />11<br />© 2009: N. Venkatraman<br />1<br />3<br />2<br />4<br />
  12. 12. Focus of IT Strategy<br />© 2009: N. Venkatraman<br />12<br />
  13. 13. Accelerated Pace of Innovation<br />© 2009: N. Venkatraman<br />13<br />
  14. 14. Sketching out the possibilities…<br />© 2009: N. Venkatraman<br />14<br />IBM, 2005<br />
  15. 15. Sketching out the possibilities…<br />© 2009: N. Venkatraman<br />15<br />IBM, 2005<br />
  16. 16. Sketching out the possibilities…<br />© 2009: N. Venkatraman<br />16<br />IBM, 2005<br />
  17. 17. Sketching out the possibilities…<br />© 2009: N. Venkatraman<br />17<br />IBM, 2005<br />
  18. 18. Sketching out the possibilities…<br />© 2009: N. Venkatraman<br />18<br />IBM, 2005<br />
  19. 19. Sketching out the possibilities…<br />© 2009: N. Venkatraman<br />19<br />IBM, 2005<br />
  20. 20. Sketching out the possibilities…<br />© 2009: N. Venkatraman<br />20<br />IBM, 2005<br />
  21. 21. Sketching out the possibilities…<br />© 2009: N. Venkatraman<br />21<br />IBM, 2005<br />
  22. 22. Sketching out the possibilities…<br />© 2009: N. Venkatraman<br />22<br />IBM, 2005<br />
  23. 23. Sketching out the possibilities…<br />© 2009: N. Venkatraman<br />23<br />IBM, 2005<br />
  24. 24. GM OnStar<br />© 2009: N. Venkatraman<br />24<br />
  25. 25. Business Implications:Auto Sector as a Case in Point<br />© 2009: N. Venkatraman<br />25<br />
  26. 26. IT Strategy in the Auto Sector<br />© 2009: N. Venkatraman<br />26<br />
  27. 27. Automobile– “computers on wheels”<br />© 2009: N. Venkatraman<br />27<br />“Cost of electronics<br />in cars” (~20--50%)<br />
  28. 28. Automobile– “computers on wheels”<br />© 2009: N. Venkatraman<br />28<br />‘Black Box’<br />Lines of Software Code<br />
  29. 29. OnStar’s impact is broader than the core service domain<br />© 2009: N. Venkatraman<br />29<br />
  30. 30. Microsoft’s Role in Automotive<br />30<br />© 2009: N. Venkatraman<br />
  31. 31. Ford (and Microsoft): Sync<br />© 2009: N. Venkatraman<br />31<br />
  32. 32. Business transformation underway…<br />© 2009: N. Venkatraman<br />32<br />Source: GM<br />
  33. 33. Management ideas for network era<br />20th Century<br />21st Century<br />33<br />© 2009: N. Venkatraman<br />
  34. 34. Computer industry [circa 1980]<br />Source: Bill Gates Testimony <br />Source: Bill Gates Testimony<br />34<br />© 2009: N. Venkatraman<br />
  35. 35. Computer industry [circa 2002]<br />Source: Bill Gates Testimony <br />35<br />© 2009: N. Venkatraman<br />
  36. 36. We can apply the same logic in many sectors…..<br />© 2009: N. Venkatraman<br />36<br />
  37. 37. Discussion Overview<br />© 2009: N. Venkatraman<br />1<br />3<br />2<br />4<br />37<br />
  38. 38. Value from IT Resources<br />Innovation<br />StrategicFocus<br />CostCenter<br />Implementation<br />Business<br />IT/IS<br />Leadership Responsibility<br />38<br />© 2009: N. Venkatraman<br />
  39. 39. Cost Center<br />© 2009: N. Venkatraman<br />39<br />
  40. 40. Value from IT Resources<br />Innovation<br />StrategicFocus<br />CostCenter<br />ProfitCenter<br />Implementation<br />Business<br />IT/IS<br />Leadership Responsibility<br />40<br />© 2009: N. Venkatraman<br />
  41. 41. Profit Center<br />41<br />© 2009: N. Venkatraman<br />
  42. 42. Value from IT Resources<br />Innovation<br />GrowthCenter<br />StrategicFocus<br />CostCenter<br />ProfitCenter<br />Implementation<br />Business<br />IT/IS<br />Leadership Responsibility<br />42<br />© 2009: N. Venkatraman<br />
  43. 43. Growth Center<br />43<br />© 2009: N. Venkatraman<br />
  44. 44. Value from IT Resources<br />Innovation<br />GrowthCenter<br />InvestmentCenter<br />StrategicFocus<br />CostCenter<br />ProfitCenter<br />Implementation<br />Business<br />IT/IS<br />Leadership Responsibility<br />44<br />© 2009: N. Venkatraman<br />
  45. 45. Investment Center<br />45<br />© 2009: N. Venkatraman<br />
  46. 46. Managing their relative emphasis;and dynamic shifts<br />Innovation<br />GrowthCenter<br />InvestmentCenter<br />StrategicFocus<br />CostCenter<br />ProfitCenter<br />Implementation<br />Business<br />IT/IS<br />Leadership Responsibility<br />46<br />© 2009: N. Venkatraman<br />
  47. 47. There are significant gaps in reality..<br />1<br />Today<br />Desired<br />IT Capital for Innovation<br />IT Capital for Implementation<br />47<br />© 2009: N. Venkatraman<br />
  48. 48. There are significant gaps in reality..<br />2<br />Today<br />Desired<br />IT competence for Innovation<br />IT competence for Implementation<br />48<br />© 2009: N. Venkatraman<br />
  49. 49. There are significant gaps in reality..<br />3<br />Today<br />Desired<br />IT Sourcing for Innovation<br />IT Sourcing for Implementation<br />49<br />© 2009: N. Venkatraman<br />
  50. 50. There are significant gaps in reality..<br />4<br />Today<br />Desired<br />IT Performance for Innovation<br />IT Performance for Implementation<br />50<br />© 2009: N. Venkatraman<br />
  51. 51. There are significant gaps in reality..<br />5<br />Today<br />Desired<br />IT Mandate for Innovation<br />IT Mandate for Implementation<br />51<br />© 2009: N. Venkatraman<br />
  52. 52. Discussion Overview<br />52<br />©2009: N. Venkatraman<br />1<br />3<br />2<br />4<br />
  53. 53. Leadership challenges<br />We say innovation… but we manage for implementation<br />We say future… but we manage for today (and yesterday)<br />We say business value.. But we get bogged down with IT costs<br />We say shared business-IT responsibility but we blame IT for the problems<br />© 2009: N. Venkatraman<br />53<br />
  54. 54. Winning with IT<br />Value creation for today & tomorrow<br />No business innovations without IT<br />“You”<br />54<br />© 2009: N. Venkatraman<br />
  55. 55. So….in conclusion<br />IT’s impact beyond traditional process domain<br />We are in the early stages of transformation with IT<br />Business models built on and with IT functionality<br />Business organizations architected with IT<br />Continuous balancing of innovation and implementation<br />More diffused but coordinated responsibility for IT<br />55<br />© 2009: N. Venkatraman<br />
  56. 56. © 2009: N. Venkatraman<br />56<br />Winning with IT:Can you make it happen?<br />Thanks very much….<br />

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