Organization Management, business presentations

Key Words ... Organization Model – Scientific Management – Motivation Framework – Maslow’s Hierarchy – ERG Theory – Intrinsic/Extrinsic Rewards – Compensation Management – Job Enrichment – Group Performance – Linking Pin Organization – Likert’s Overlapping – Mintzberg’s Coordinating Mechanisms – Matrix Organization – Network Organization – Change Management – Hierarchical Structures – Formal Organization – Role Diagram – Job Description – Divisional Structures – Project Organization – Value Chain Management – Span of Control – Task Force – Organization Development – Growth Management – Learning Organization – Virtual Organization

A Basic Organization Model Human Behavior in Organizational Settings The Organization The Individual – Organization Interface Environment Environment

Phases of Scientific Management I Manager Worker Worker Worker Worker Task Phase 1: A Task, a Manager, and a Pool of Workers Phase 2: Task Analysis, Breakdown, and Job Specialization by Manager T1 T2 T3 T4 Manager Worker Worker Worker Worker

Phases of Scientific Management II Phase 3: Task Assignment and Training T1 T2 T3 T4 Manager Worker Worker Worker Worker Phase 4: Continued Supervision, Coordination, and Planning by Manager T1 T2 Worker Worker T3 T4 Worker Worker Manager

The Basic Motivation Framework 1 Need Deficiencies 2 Search for Ways to Satisfy Needs 3 Goal-Directed Behaviors 4 Performance 6 Need Deficiencies Reassessed by the Employee 5 Rewards or Punishments The Employee

Maslow‘s Hierarchy of Human Needs Self- Actualization Needs Esteem Needs Belongingness Needs Security Needs Physiological Needs GENERAL EXAMPLES ORGANIZATIONAL EXAMPLES Challenging Job Job Title Friends in Work Group Pension Plan Base Salary Achievement Status Friendship Stability Shelter

Parallels Among Need Theories of Motivation Achievement Work Itself Responsibility Advancement and Growth Recognition Supervision Interpersonal Relations Security Company Policies Pay Working Conditions Self-Actualization Needs Self-Esteem Esteem Needs Respect of Others Belongingness Needs Interpersonal Security Security Needs Physical Security Physiological Needs Growth Needs Relatedness Needs Existence Needs Need for Affiliation Need for Power Need for Achievement Herzberg‘s Two-Factor Theory Maslow‘s Hierarchy of Needs Alderfer‘s ERG Theory Other Key Needs Motivation Factors Hygiene Factors

The Individual-Organization Exchange Process Time Effort Knowledge Skills Creativity Energy The Employee The Organization Pay Benefits Vacation Status Opportunities for Creativity Occasions for Social Contributions which rewards with to for which contributes

The Meaning of Organizational Rewards Intrinsic and Extrinsic Rewards The Individual Surface Value Symbolic Value Attitudes and Behaviors

A Total Compensation Package Awards Perquisites Incentives Benefits Salary Annual Compensation for an Employee

The Historical Development of Job Design General Craft Jobs Specialized Craft Jobs Scientific Management Job Enlargement Job Rotation Job Enrichment Job Characteristics Theory Social Information Processing Autonomous Work Groups To 1900s Around 1900 to Late 1940s Late 1940s to Early 1960s Early 1960s to Present Low High TIME DEGREE OF JOB SPECIALIZATION

Four Factors that Affect Group Performance Group Performance Composition Size Cohesiveness Norms

Likert‘s Overlapping Work Groups (The Linking Pin Organization)

Mintzberg‘s Five Coordinating Mechanisms M A O O M A O O M A O O Manager Analyst Operator Operator (1) MUTUAL ADJUSTMENT (2) DIRECT SUPERVISION STANDARDIZATION INPUT SKILLS (3) WORK PROCESSES (4) OUTPUTS (5)

A Matrix Design Marketing Department Manager Research and Development Department Manager Purchasing Department Manager Production Department Manager FUNCTIONAL DEPARTMENTALIZATION PROJECT DEPARTMENTALIZATION Alpha Project Project Leader Beta Project Project Leader Gamma Project Project Leader E E E E E E E E E E E E

Basic Communication Process Encoding Transmission Decoding Receiver/ Responder Source Decoding Medium Encoding Noise FEEDBACK LOOP (Verification) SENDING

Small Group Communication Networks WHEEL CIRCLE CHAIN ALL CHANNEL

Four Major Problems in Change Management People RESISTANCE POWER CONTROL REDEFINITION Information Systems Structure Tasks Organization as Social System

Hierarchy and Decision Making Increasing number of people Increasing reward Increasing stature Decreasing power in decision making

Cellular Structures Placed into Hierarchical Structures

The Non-Linearity of Power and Decision Load Decreasing power; extreme narrowing of responsibilities Increasing responsibility importance of decision making; perceptual requirements A B A B Managerial and Organizational Integration Within the Organic Enterprise Level B Level A HIERARCHICAL LEVEL Responsibility Information load Cost of wrong decisions

Technological Innovation as a Result of Complex Interactions Project champion Creativity Evaluation systems Analysis Strategic considerations Project management R&D Design Production Marketing Innovation INNOVATIVE INTERNAL ENVIRONMENT EXTERNAL ENVIRONMENT THE COMPANY Scientific and technological knowledge Knowledge of market needs Idea Project proposal Project Product R&D Dept. Marketing Dept.

Further Developments of Multidirectional Communication and Involvement Marketing department Strategic analysis R & D Process development Design Product planning Maintenance and services Financial control and analysis

Organizational Effectiveness Organization Internal activities and processes Product and service outputs Resource inputs System resource approach Internal process approach Goal approach

Formal and Informal Organization Routines Norms, values Group / inter-group behavior Coalitions, alliances, power Perceptions, mental maps Organizational culture Structure Hierarchy Task and role definition Performance measurement Coordination and control Rules and procedures

Optimum Degree of Formal Organization Degree of formal organization Organizational effectiveness

Contingency Framework for Organization Design organization design environment task strategy member characteristics fit differentiation integration organizational effectiveness contingency factors outcome

Organization Chart, Role Diagram, Job Description Processes Positions Position Tasks Competencies Responsibilities Reporting relationships ... Who does what in which process? (action, decision, information, ...)

Levels of Organization Design => different design issues on different levels CEO SBU A SBU B SBU C R&D Prod. Sales R&D Prod. Sales R&D Sales functional unit single business multi- business

Functional, Divisional, Multidivisional Structures Logistics Manufacturing Sales Finance CEO CEO Cement Concrete Chemicals R&D Controlling CEO Europe Asia Motor Marine North America Motor Marine Fire Motor Marine Fire CEO Europe North America Asia Cement Concrete Chemicals

Project Structures CEO Unit A Unit B Unit C Project Project 3 Project 2 Project 1 Strategy Finance IT CEO Unit A Unit B Unit C CEO Project

Mechanistic vs. Mechanic Designs in Context ENVIRONMENTAL COMPLEXITY Simple Complex Stable Unstable ENVIRONMENTAL CHANGE Low Uncertainty Low-Moderate Uncertainty High Uncertainty High-Moderate Uncertainty 1. Mechanistic structure; formal, centralized 2. Few departments 3. No integrating roles 4. Little imitation 5. Current operations orientation 1. Mechanistic structure; formal, centralized 2. Many departments, some boundary spanning 3. Few integrating roles 4. Some imitation 5. Some planning 1. Organic structure, teamwork; participative, decentralized 2. Many departments: differentiated, extensive boundary spaning 3. Many integrating roles 4. Extensive imitation 5. Extensive planning, forecasting 1. Organic structure, teamwork; participative, decentralized 2. Few departments, boundary spanning 3. Few integrating roles 4. Quick to imitate 5. Planning orientation

Problems of Traditional Organization Design hierarchical boundaries functional boundaries operational islands => filtering of information => functional closure => leadership problems => coordination problems + =

Link between Structure and Process CEO Procurement Production Administration Sales Customer Order Production order Procurement order Inventory operation Production Transportation Shipping Order documents Billing

Organizational Value Chain Company infrastructure Human Resource Management Technology development Procurement Entry logistics Operations Marketing and sales Exit logistics Customer service Support processes Primary processes

The Development of Organization Design over Time large small Size of Organization Age of Organization young mature creativity direction delegation coordination collaboration leadership autonomy control red tape "?"

The Five Basic Parts of Organizations Technostructure Support Staff Strategic Apex Middle Apex Operating Core

Structures to Deal with Residual Interdependencies (a) Hierarchical Structure (b) Line and Staff Structure (c) Liaison Overlay Structure (e.g., Task Force) (d) Matrix Structure

A Continuum of Liaison Devices Pure functional structure Liaison positions superimposed on a functional structure Task forces and standing committees superimposed on a functional structure Integrated managers superimposed on a functional structure Matrix structure Integrated managers superimposed on a market structure Liaison positions superimposed on a market structure Pure market structure Decisional Power with the Market Managers Decisional Power with the Functional Managers

Functional Specialization President Vice President Manufacturing Vice President Marketing Vice President Finance Vice President Industrial Relations Vice President Engineering

Process Specialization President Vice President Manufacturing Vice President Marketing Vice President Finance Vice President Industrial Relations Vice President Engineering Painting Department Manager Assembly Department Manager Shipping Department Manager Shaping Department Manager Stamping Department Manager

Product Specialization President Vice President Motor Scooter Division Vice President Motorcycle Division Vice President Snowmobile Division Vice President Tricycle Division Vice President Bicycle Division

Customer Specialization President Vice President Marketing Vice President Finance Vice President Industrial Relations Vice President Engineering Director Institutional Marketing Director Consumer Marketing Director Government Marketing Director Wholesale Marketing Senior Vice President Marketing

Geographic Specialization President Vice President Latin American Division Vice President Pacific Division Vice President Domestic Division Vice President European Division Director Northeast Director Midwest Director Southern Director Western

Various Forms of Specialization in a Single Organization President Vice President Domestic Marketing Vice President International Marketing Vice President Industrial Relations Vice President Finance Shaping Department Stamping Department Painting Department Assembly Department Shipping Department Assistant to President Executive Vice President Executive Vice President Vice President Motor Scooter Division Vice President Motorcycle Division Vice President Snowmobile Division Vice President Tricycle Division Vice President Bicycle Division Director Europe Marketing Director Latin America Marketing Director Pacific Marketing Director Institutional Marketing Director Government Marketing Director Wholesale Marketing Northeast Midwest Southern Western

Multiform Organization Traditional Contemporary Matrix Bureaucratic Democratic Managers Specialists

What Type of Intervention? Strong Weak Weak Strong Top-down Initiatives Participative Taks Force Buttom-up Initiatives EXTERNAL FORCES RESISTANCE

Typical Improvement Actions Automation Big Picture Improvement Customer/Supplier Partnership Simplification Process Cycle-Time Reduction Bureaucracy Elimination Duplication Elimination Value-Added Error Proofing Standardization Simple Language Upgrading Reduce 1 Change 2 3 Prevent Innovate 4

Improvement Agenda Focused Restructuring Business Process Innovation Focused Improvement Continuous Improvement (TQM) Fast Measured Strategic Tactical ORGANIZATIONAL CHANGE MANAGEMENT MEASUREMENT DEGREE OF CHANGE PACE OF CHANGE

Assessment Management Good Poor Good Poor Change the Top Support the management What happened? Why are they still alive? CORPORATE STRATEGY IMPLEMENTATION SKILLS

The Initial Decision Matrix Positive Negative High Low Sell Restructure Keep as is Close Dispose of STRATEGIC RELEVANCE PROFITABILITY

Organizational Practices in the Five Phases of Growth CATEGORY Management Focus Organizational Structure Top-Management Style Control System Management Reward Emphasis PHASE 1 Make and sell Informal Individualistic and entrepreneurial Market results Ownership PHASE 2 Efficiency of operations Centralized and functional Directive Standards and cost centers Salary and merit increases PHASE 3 Expansion of market Decentralized and geographical Delegative Reports and profit centers Individual bonus PHASE 4 Consolidation of organization Line staff and product groups Watchdog Plans and invest- ment centers Profit sharing and stock options PHASE 5 Problem solving and innovation Matrix of teams Participative Mutual goal setting Team bonus

Imaginary Organization and Relationship Marketing - Two Perspectives PARTNER BASE CUSTOMER BASE Imaginary Organization Relationship Marketing Delivery Systems Market Communication Customers Relations Transactions LEARNING ORGANIZATION Core Compe- tence IO- Leader

Imaginary Organizations and Some Related Concepts Learning Organizations as Processes Imaginary Organizations Relations Transactions CORE SYSTEMS SERVICE DELIVERY PARTNERSHIP NETWORKS, RELATIONSHIP MARKETING, VALUE CONSTELLATION CORE VS. PERIPHERY MARKETS VS. HIERARCHY LEARNING ORGANIZATIONS THE CLIENT-DRIVEN FIRM CONTINUOUS IMPROVEMENT

Role of Virtual Organizing and Knowledge Management in Business Networking Electronic Commerce Supply Chain Mgmt Relation- ship Mgmt DIMENSIONS OF VIRTUAL ORGANIZING Customer Interaction Asset Configuration Knowledge Leverage BUSINESS NETWORKING STRATEGIES

Business Engineering Model Applied to Business Networking Strategy level Business network Process level Process network IS level IS network Business unit Business process Information system Business unit Business process Information system Communication link Transactions and coordination techniques Cooperation strategy

Major Strategy Decision eProcurement for C goods Content Management for Z catalogs SCM for X parts with Y partners Electronic Commerce Supply Chain Management Relationship Management Outsourcing Virtual Organization Insourcing ORGANIZATIONAL RESOURCE DECISION NETWORKING DECISION

Virtual Organizations and Virtual Cultures Virtual Organization Culture E-Business Culture E-Market Culture

Models of Virtuality The Virtual Face Co-alliance Model Star-alliance Model Value-alliance Model

Virtual Alliance Models Virtual- Face co- alliance star- alliance value market virtual broker Interdependence/ Strength of Organizational Links colocation culture synchronicity shared risks High Low Autonomy/Substitutability or virtual links satelite star virtuality High

Virtual Organizational Change Model (VOCM) Structual Alliances ICT Knowledge Management Virtual Culture Electronic Market Ecosystems e-Business Strategy

The Cycle of Knowledge Creation Conversation Codification Learning & Internalization Re-Use & Combination TACIT KNOWLEDGE EXPLICIT KNOWLEDGE (4) The new employee discusses the process with a colleague over coffee and it provokes a further improvement idea (1) An employee comes up with & posts an idea to improve response to service calls (3) A new Call Center employee uses the process and gets complimented by the customer (2) The idea gets built into the company‘s automated Call Response System processes 

Knowledge Management Life Cycle Class I Localized View (supportive) Class II Expanded View (performative) CREATE ORGANIZE EVOLVE FORMALIZE APPLY DISTRIBUTE

Knowledge Management Organization Technology Process Knowledge Management

Choosing Pilot Groups High Visibility Group Works with Current Info Big Impact on Revenue Willing to Share Info Pilot Group

KWorld Knowledge Base (The Right Problem) Scheduling (The Right Time) Consultants (The Right People) KWorld

Consultant Network Availability Best Practices Skills Solutions

A Typical Knowledge-Management Platform Knowledge Desktop Knowledge Services System Knowledge Portal Knowledge Tools Search and Deliver Collaboration Tracking and Workflow Document Management Data Warehousing and Business Intelligence (Data Analysis) Business Logic Security Replication Communication Directory Administration

Knowledge-Management Modules Complete Intranet Messaging and Collaboration Communities, Teams and Experts Portals and Search Content Management (Publish&Metadata) Real Time Collaboration Data Analysis (Data Warehousing and Business Intelligence) KM Enabling Modules Pre-requisites

Graph of Evolving Technology and Knowledge Management Over Time Knowledge management Content management Communities, Teams and Experts Portals and Search Data Analysis (Real Time Collaboration) LEVEL OF INTEGRATION The KM-Enabled Enterprise INFRASTRUCTURE OVER TIME Pragmatic Visionary Platform Integration Application Integration Publishing and Approval Subscription and Notification Document Management Data Warehouse, Complete Catalog Services Sophisticated Comprehensive Workflow and Tracking Meta Directory Messaging and Collaboration Complete Intranet Metadata Basic Intranet Search Real Time Collaboration

Graph of Technology and its Effectiveness LEVEL OF INTEGRATION EFFECTIVENESS OF THE KM SYSTEM User Usability Ratio Knowledge management Content management Communities, Teams and Experts Portals and Search Data Analysis (Real Time Collaboration) Messaging Integration The KM-Enabled Enterprise

The Five C‘s that Differentiate Data from Information Categorization Condensation Calculation Correction Contextualization Data Data Information

The Basic Elements of Knowledge Utilization and Typical Technology Tools Elements of knowledge utilization and basic technology support Utilization Sharing Acquisition Databases Browser Web Pages Document Distribution Systems Collaborative Tools Sharing Tools Collaborative Tools Communications Links Networks Intranets Databases and Capture Tools

The Four Levels of Knowledge, Levels of Leverage Derived, and Possibilities of Technology Support LEVEL OF KNOWLEDGE LEVERAGIBILITY KNOWLEDGE STAGE Initial Desirable Desirable Know-What Know-How Know-Why Care-Why Knowledge management system supported Current State of Most Companies

The Framework of Technologies Required to Support Knowledge Management and their Functionality Knowledge Management Technologies Transparent Capture tools e.g., Crosspads Web Conferencing Expertise Pointers Workflow Document Management Project Management Watercoolers Telephones Data Warehouse Digital Whiteboards GroupWare Decision Support Systems Case-based Reasoning Intranets Informal Capture Dialog Conversation Routing Electronic Conversation Informal Conversation Making Conversation Problem Solving Brainstorming Tacit Knowledge Capture Operational Data Knowledge Discover Validation Cleansing Collaboration Distribution Connectivity Publishing Activity Publishing Control Distribution Independent Thought Mind Maps Visual Thinking Tools Data Mining Data Cleansing Validating Informal Capture Document Exchange Collaboration

Connecting Islands of Data with a Knowledge Server Centralized Knowledge Server Public Sites & Information Services Telecommuters Notes-type Discussion Databases Exchange Servers File Servers Intranet 

Nonaka‘s SECI Model and the Places where IT Support Fit in Socialization Externalization Internalization Combination Face-to-Face Communications Video Conferencing Tools Web Cams Virtual Reality Tools Process Capture Tools Traceability Reflective Peer-to-Peer networks Expert Systems Discussion Platforms Collective Knowledge Networks Notes Databases / Org Memory Pattern Recognition Neural Networks Systematic Knowledge Tools Collaborative Computing Tools Intranets, Groupware Discussion Lists Web Forums Best Practice Databases I I I S E I C I G I I I G C G G C Legend C: Company‘s Knowledge G: Group or Team Knowledge I: Individual Employee‘s Knowledge Tacit >> Explicit Explicit >> Explicit Explicit >> Tacit Tacit >> Tacit

Customer Valuation, Interactivity, and the Need for Relationship Management Mass Marketing Frequency Marketing Niche Marketing CRM Customer Needs Customer Valuation Differential Consistent Differential Interactivity High

Consistency of Interaction Across all Channels is Key Sales and Marketing Cross-selling Up-selling Customer Support Pre-sales Post-sales Fulfillment Retention and Loyalty Incentives Offers Rewards Consistent Interaction Web Telephone Catalog Brick-and- Mortar Store

The Evolution of Knowledge-Oriented Business Processes Low High High KNOWLEDGE INTENSITY Transaction-oriented Business Processes Activity-oriented Business Processes Knowledge-oriented Business Processes PROCESS COMPLEXITY

New Approaches to Customer Knowledge Management Customer-specific Knowledge High Low High Basket Analysis Loyalty/Reward Programs Database Marketing Data Mining Interactive Marketing KCRM Interactivity

The KCRM Strategic Framework Environment Market Trends Competitive Threats Regulatory Controls Interpretation barrier Interpretation barrier Strategic Context Product/Services Market Opportunities Customer Segments Value Proposition Alliances Expression barrier Expression barrier KCRM Strategy E-Business Strategy Competitive Differentiation Knowledge Digital Capital Adaptability Specification barrier Specification barrier KCRM Technology E-Business Infrastructure KCRM Architecture Interaction Channels Integration Implementation barrier Implementation barrier Enables Aligns Impacts Influences Enables Impacts Impacts Drives

Stages of the Customer Relationship Management Process and Knowledge Intensity Advanced Basic KCRM Level Identify Differentiate Interact Customize Registration Enticements Recognize Returning Customers Profiling of Data Detailed Customer Profiling Differentiated Customer Service Community Building Needs Prediction Automatic Replenishment Clicks-&-Mortar Integration Personalized Recommendations Seamless Partner Integration Customizable Web Experience Stage

Responding to Uncertainty – The Organization Design Options Uncertainty and change Creates a need to cope with more information Create slack resources Allow more time Allow more resources Environmental management Vertical integration Marketing Co-operation Create self- containted tasks Change from functional task design to group with all necessary resources Invest in vertical information systems Plan much more frequently Create lateral relations Move decision- making down and across funcional boundaries Reduce need for information processing Increase capacity to process information The scope of transformation

Levitt‘s Diamond: The Interaction of Social Forces in an Organization Task Technology People Structure

Organization Design Parameters Task Factors: Diversity Difficulty Variability Reward systems Factors: Compensation Promotion Leadership style Job design People Factors: Selection Training and development Promotion Information and decision making Factors: Scope of database Formalization of process Frequency Decision mechanism Structure Factors: Division of labour Departmentalization Horizontal and vertical distribution of power Strategy and goals

Matching Management Style and Organizational Model Entrepreneurial Conservative Mechanistic Organic Effective entrepreneurial Efficient bureaucratic Pseudo- entrepreneurial Unstructured unadventurous ORGANIZATIONAL MODEL MANAGEMENT STYLE

Thorn – A Realigned Strategy Systems strategy From an emphasis on control, administration and cash accounting To an emphasis on decentralization, commitment and added value business activity Organization strategy From a centralized, mechanistic orientation To a more decentralized, organic and committed orientation Business strategy From an emphasis on administration and cost reduction To an emphasis on marketing, service and growth

Using CSFs to Generate the Business Vision Business objectives Raise earnings per share Increase market share Improve productivity Development new businesses Develop internationally Critical success factors Information systems contributions Create new markets Develop new products Automate production Concentrate on profitable activities Develop a group image world-wide Maintain company- wide control Improve product quality/ reliab i lity Develop customer intelligence systems Install new products/ services Build flexible manufacturing systems Develop profit analysis DSS (Decision Support System) Investigate electronic links with customers Enhance financial control reporting system Develop an online diagnostic service

Positioning an Organization‘s Approach to Strategic Systems Planning High Low Low High Attack Safe Beware Explore benefits EXISTING SYSTEMS SCALE/EXPERIENCE POTENTIAL SYSTEMS CONTRIBUTION TO TOTAL VALUE ADDED

The IT Strategic Grid Distinguishes Levels of System Criticality High Low Low High Factory IT is crucial to current business operations, but is not key to the organization‘s strategic development BUSINESS IMPACT OF APPLICATION DEVELOPMENT PORTFOLIO BUSINESS IMPACT OF EXISTING SYSTEMS Strategic IT has been critical for business success in the past and will remain so for the future Turnaround IT has not been critical to the business so far, but is vital for the future if the organization is to achieve its strategic objectives Support IT is not critical to the business, either in the past or for the future

Technology Impact on Competitive Forces High Low High RELATIVE IMPORTANCE OF COMPETITIVE FORCES IMPACT OF IT ON COMPETITIVE FORCES Suppliers Buyers Substitutes Entrants Rivals

The Interaction of Strategic Elements in an Organization Technology Processes Strategy People: individuals and roles Organization structure and culture Technological environment Socio-economic environment

The Potential Impact of IT on Transformation Low High High DEGREE OF BUSINESS REDESIGN Stage 1 Func t ional improvements POTENTIAL BUSINESS IMPACT Stage 2 Cross-functional integration Stage 3 Process redesign Stage 4 Business re-engineering

The Emphasis of IT Management Has to Change EXPLOITATION OF IT FOR BUSINESS BENEFIT Emphasis on management of computers: Centralized computing Proprietary applications Minimal connectivity Technology push Emphasis on management of data resources: Distributed computing Standardization (open systems) High connectivity User pull First S-curve Second S-curve TIME

Traditional Approaches to System Design are Technically Focused Open Closed Feasibility Implementation Design DESIGN DEGREES OF FREEDOM Organizational learning Technical design process TIME

Traditional Approaches to System Design Allow Little Scope for User Input Open Closed Feasibility Implementation Design DESIGN DEGREES OF FREEDOM Organizational learning Technical design process TIME Window for user contributions to design

Assessing the Business and Technical Contribution of Applications High Low Low High Renew Systems in this category may have suffered from a lack of maintenance and the organization might suffer if it were to fail TECHNICAL QUALITY (PROVIDERS) BUSINESS VALUE (USERS) Maintain and enhance These systems are critical to the business and are technically successful – they must be maintained and enhanced to ensure their continued success Reassess Such systems might be outmoded in business terms, hence they can be divested, or they may have been developed in advance of the business need or capability, hence a need for user training. Before action is taken on the system, reassessment to determine the business value is necessary Divest Systems may be outdated or not necessary – but consumers scarce resources

The IS Responsibility Matrix High Low Low High Specialist dominance Operational efficiency is primary objective STRATEGIC IMPACT OF FUTURE SYSTEM APPLICATIONS MATURITY OF THE TECHNOLOGY „ Hybrid“ Users need to be in control of the systems strategy, while specialists control systems development User dominance With a high technical risk and a high strategic impact, applications should be under user control, with a major emphasis on effective exploitation Risk dominance High technical risk with limited business potential suggests the application should not be developed

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