enterprise value chain training (ppt)

48
1 3-Year IT Management 3-Year IT Management and Budget Plan and Budget Plan Eisenhower 4 Eisenhower 4 th th Floor Floor Auditorium Auditorium May 26, 2006 May 26, 2006 Enterprise Value Enterprise Value Chain and Chain and Application Map Application Map Training Training

Upload: alistercrowe

Post on 28-May-2015

748 views

Category:

Documents


2 download

TRANSCRIPT

Page 1: Enterprise Value Chain Training (ppt)

11

3-Year IT Management and 3-Year IT Management and Budget PlanBudget Plan

Eisenhower 4Eisenhower 4thth Floor Auditorium Floor Auditorium May 26, 2006May 26, 2006

Enterprise Value Chain and Enterprise Value Chain and Application Map TrainingApplication Map Training

Page 2: Enterprise Value Chain Training (ppt)

22

Value ChainsValue Chains

Page 3: Enterprise Value Chain Training (ppt)

33

ObjectiveObjective

To give agency personnel a better To give agency personnel a better understanding of Enterprise Value Chains.understanding of Enterprise Value Chains.To give agency personnel multiple To give agency personnel multiple examples in order to increase examples in order to increase understanding and to find a starting point understanding and to find a starting point to create their own value chainto create their own value chainTo give agency personnel techniques that To give agency personnel techniques that could make creation of the value chain could make creation of the value chain easiereasier

Page 4: Enterprise Value Chain Training (ppt)

44

What is a Value Chain?What is a Value Chain?

Value Chain theory comes from Michael Porter’s Value Chain theory comes from Michael Porter’s book book Competitive AdvantageCompetitive Advantage (1985) (1985)A model that breaks down an organization into a A model that breaks down an organization into a series of value-generating activitiesseries of value-generating activitiesA Value Chain is aA Value Chain is a– Business ModelBusiness Model– High Level ModelHigh Level Model– Performance Feedback ModelPerformance Feedback Model– Beginning stages of an Application MapBeginning stages of an Application Map– Beginning stages to look at the State’s business goals Beginning stages to look at the State’s business goals

as one enterpriseas one enterprise

Page 5: Enterprise Value Chain Training (ppt)

55

Parts of the Value ChainParts of the Value Chain

Support ActivitiesSupport Activities

Primary ActivitiesPrimary Activities

Page 6: Enterprise Value Chain Training (ppt)

66

Porter’s ModelPorter’s Model

Page 7: Enterprise Value Chain Training (ppt)

77

Support ActivitiesSupport Activities

Do not directly add value, but are still Do not directly add value, but are still necessary in providing the services or necessary in providing the services or productsproducts

Close to universal for every agencyClose to universal for every agency

Page 8: Enterprise Value Chain Training (ppt)

88

Support Activities (continued)Support Activities (continued)

Porter’s Breakdown of Support ActivitiesPorter’s Breakdown of Support Activities– Firm Infrastructure: organizational structure, Firm Infrastructure: organizational structure,

control systems, company culture, ect.control systems, company culture, ect.– Human Resource Management: employee Human Resource Management: employee

recruiting, hiring, training, development, and recruiting, hiring, training, development, and compensation.compensation.

– Technology Development: technologies to Technology Development: technologies to support value-creating activities.support value-creating activities.

– Procurement: purchasing inputs such as Procurement: purchasing inputs such as materials, supplies, and equipment.materials, supplies, and equipment.

Page 9: Enterprise Value Chain Training (ppt)

99

Support Activities (continued)Support Activities (continued)

State of Kansas agencies have modified State of Kansas agencies have modified support activities to include:support activities to include:– Administration ManagementAdministration Management– IT ManagementIT Management– HR ManagementHR Management– Financial ManagementFinancial Management– ProcurementProcurement– Supporting AssetsSupporting Assets

Page 10: Enterprise Value Chain Training (ppt)

1010

Primary ActivitiesPrimary Activities

The links in the value chain are the The links in the value chain are the “strategic relevant activities” that add value “strategic relevant activities” that add value to the services or products you are to the services or products you are providing.providing.

Every agency is going to have unique Every agency is going to have unique “strategic relevant activities”“strategic relevant activities”– Some may be similarSome may be similar

Page 11: Enterprise Value Chain Training (ppt)

1111

Primary Activities (continued)Primary Activities (continued)

Porter’s Breakdown of Primary Activities Porter’s Breakdown of Primary Activities – Inbound logistics: the receiving and warehousing of Inbound logistics: the receiving and warehousing of

raw materials, and their distribution to manufacturing raw materials, and their distribution to manufacturing as they are required.as they are required.

– Operations: the process of transforming inputs in Operations: the process of transforming inputs in finished products and servicesfinished products and services

– Outbound logistics: the warehousing and distribution Outbound logistics: the warehousing and distribution of finished goodsof finished goods

– Marketing and Sales: the identification of customer Marketing and Sales: the identification of customer needs and the generation of sales.needs and the generation of sales.

– Service: the support of the customers after the Service: the support of the customers after the products and services are sold to them.products and services are sold to them.

Page 12: Enterprise Value Chain Training (ppt)

1212

Primary Activities (continued)Primary Activities (continued)

Porter’s list does not have a direct one-to-one correlation Porter’s list does not have a direct one-to-one correlation to State government in many cases.to State government in many cases.– His focus is mostly directed to manufacturing companies that His focus is mostly directed to manufacturing companies that

have a certain product they are producinghave a certain product they are producing– His primary goal is the get the company to get more value out of His primary goal is the get the company to get more value out of

the sale of those goods.the sale of those goods.

Value chains give a good starting point to think about Value chains give a good starting point to think about what your agency does to meet their goalswhat your agency does to meet their goals– The services that our state agencies provide might in some The services that our state agencies provide might in some

cases do not have goods that are sold, but the services provided cases do not have goods that are sold, but the services provided are still importantare still important

– The benefits of the value chain can still be realized in the The benefits of the value chain can still be realized in the governmental arena. We care about getting the most out of our governmental arena. We care about getting the most out of our limited money. Value chains can help in that goal.limited money. Value chains can help in that goal.

Page 13: Enterprise Value Chain Training (ppt)

1313

Primary Activities (continued)Primary Activities (continued)

The value chain links are not independent The value chain links are not independent activitiesactivitiesLinks exist inside of value chainsLinks exist inside of value chains– Horizontal LinksHorizontal Links– Vertical LinksVertical Links

These links can help lead to optimization These links can help lead to optimization and coordination of activitiesand coordination of activitiesAlso provide a basis for quality assurance Also provide a basis for quality assurance and monitoring performanceand monitoring performance

Page 14: Enterprise Value Chain Training (ppt)

1414

Page 15: Enterprise Value Chain Training (ppt)

1515

Page 16: Enterprise Value Chain Training (ppt)

1616

Page 17: Enterprise Value Chain Training (ppt)

1717

Page 18: Enterprise Value Chain Training (ppt)

1818

Page 19: Enterprise Value Chain Training (ppt)

1919

KBOR Value Chain

SupportingActivities

PrimaryActivities

CoreBusinessProcess

ProcessManagement

QualityManagement

ProductInformation

Support AssetInfo

SupportingProcesses

Supporting (Financial, HR, IT, …) Assets

User Feedback and Program Management

Process Management

New or Existing

Program orPolicy

BudgetSubmission

To Board

BoardReview

BudgetReview

Board Approval

FundingRequest

Policy &ProcedureDevelop. /Revision

FundingApproval

Review

Fundsdispersed

Program and Policy Review

Students, Citizens

“Through its diverse postsecondary education system, the KBOR seeks to provide educational opportunities for all of Kansas’ citizens to achieve their greatest potential.”

Policy and Quality Programs

HR Management

Financial Management

IT Management

Administration Management Goal

Customers

Governance and Coordination of Public Higher Education

Funding of Public Higher EducationAdequate Funding for Programs and Services

Page 20: Enterprise Value Chain Training (ppt)

2020

Fort Hays StateFort Hays State

Financial Management

HR Management

IT Management

Administration Management

Supporting ( Financial, HR, IT, Admin ) Assets

Individual Instructor Research

Process Management

Product / Service Assets

AQIP / Accreditation

Instructor Level Assessment

Supporting Processes

Support AssetInformation

Product Information

Quality Management

Core Business Process

Process Mangement

PrimaryActivities

SupportingActivities

Public Service

Goal“Instructing students within a computerized environment in order to provide a foundation for entry into graduate school, for employment requiring well-developed analytical and communication skills, and understanding an American society of increasing diversity and global complexities of the 21st century.”

Community Outreach

Alumni RelationsRegional & State

OutreachSternberg Museum

Academic Advising

UndergradCourses / Seminars

Graduate Courses / Seminars

Virtual College

Recruiting / Retaining

Research

Instruction

Department Level Assessment

University Level Assessment

College Level Assessment

Job Placement

/ Career Services

FHSU-SponsoredResearch

Docking Research

Page 21: Enterprise Value Chain Training (ppt)

2121

Value Chain TemplateValue Chain Template

Page 22: Enterprise Value Chain Training (ppt)

http://www.netmba.com/strategy/value-chttp://www.netmba.com/strategy/value-chain/hain/

2222

Why a Value Chain?Why a Value Chain?

Uniform way of looking at all agenciesUniform way of looking at all agencies

Start to look at how IT helps each one of Start to look at how IT helps each one of the links of the value chainthe links of the value chain– netMBA.com has Information Systems at netMBA.com has Information Systems at

every level of the value chainevery level of the value chain– KDOT’s application maps prove this for their KDOT’s application maps prove this for their

particular agencyparticular agency

Building block for Application MappingBuilding block for Application Mapping

Page 23: Enterprise Value Chain Training (ppt)

2323

Technology and the Value ChainTechnology and the Value Chain

Technological change is not important for Technological change is not important for its own sake. It is important to the value its own sake. It is important to the value generating activities of your organizationgenerating activities of your organizationTechnology is imbedded at every link of Technology is imbedded at every link of the value chainthe value chainInformation / Data is becoming more Information / Data is becoming more pervasivepervasiveOverall technology is playing a greater roll Overall technology is playing a greater roll in business strategyin business strategy

Page 24: Enterprise Value Chain Training (ppt)

2424

Value Chain LinkagesValue Chain Linkages

Activity to ActivityActivity to Activity

Business Unit to Business UnitBusiness Unit to Business Unit

Agency to AgencyAgency to Agency– Department of Education to Regents Department of Education to Regents

InstitutionsInstitutions– KCJISKCJIS

Page 25: Enterprise Value Chain Training (ppt)

2525

Value Chain Linkages (continued)Value Chain Linkages (continued)

Human Resources Management

IT Management

Finance Management

Asset Management

Program/Project Management

Planning ConstructionPre-Construction Maintenance Real-TimeOperations

Safety

Research/Laboratory

Highway Infrastructure Assets

Administration / Services

Procurement

Local Support

HighwayImprovements

Aviation, Rail, Water andPublic TransportationNetworks

Page 26: Enterprise Value Chain Training (ppt)

2626

Vertical LinkagesVertical Linkages

Human Resources Management

IT Management

Finance Management

Asset Management

Program/Project Management

Planning ConstructionPre-Construction Maintenance Real-TimeOperations

Safety

Research/Laboratory

Highway Infrastructure Assets

Administration / Services

Procurement

Local Support

HighwayImprovements

Aviation, Rail, Water andPublic TransportationNetworks

There are easy to see vertical linkages between planning and real-time operations. They span the entire three chains

But there are also be linkages between supporting activities and primary Activities that are harder to see with the model alone

Page 27: Enterprise Value Chain Training (ppt)

2727

Horizontal LinkagesHorizontal Linkages

Human Resources Management

IT Management

Finance Management

Asset Management

Program/Project Management

Planning ConstructionPre-Construction Maintenance Real-TimeOperations

Safety

Research/Laboratory

Highway Infrastructure Assets

Administration / Services

Procurement

Local Support

HighwayImprovements

Aviation, Rail, Water andPublic TransportationNetworks

Changes made in each activity could change how other activities are performed

Page 28: Enterprise Value Chain Training (ppt)

2828

Performance / Quality AssurancePerformance / Quality Assurance

Human Resources Management

IT Management

Finance Management

Asset Management

Program/Project Management

Planning ConstructionPre-Construction Maintenance Real-TimeOperations

Safety

Research/Laboratory

Highway Infrastructure Assets

Administration / Services

Procurement

Local Support

HighwayImprovements

Aviation, Rail, Water andPublic TransportationNetworks

At the Activity Level:

When you start looking at advanced usage of the Value Chains one canbegin to look how each activity is performing.

At the lowest level you can look at each specific activity

This metric will let you know if each activity is performing optimally.

Page 29: Enterprise Value Chain Training (ppt)

2929

Performance / Quality AssurancePerformance / Quality Assurance

Human Resources Management

IT Management

Finance Management

Asset Management

Program/Project Management

Planning ConstructionPre-Construction Maintenance Real-TimeOperations

Safety

Research/Laboratory

Highway Infrastructure Assets

Administration / Services

Procurement

Local Support

HighwayImprovements

Aviation, Rail, Water andPublic TransportationNetworks

The same type of performance metric can be applied to an entireValue chain.

Value chain level:

At this level you can begin to start measuring the success of your process in meeting your high level business goal

This could done via the results gained from each activity level evaluation, or done via a macro level approach

Page 30: Enterprise Value Chain Training (ppt)

3030

Performance / Quality AssurancePerformance / Quality Assurance

Other ways to think about thisOther ways to think about this– ““White Space Gaps”White Space Gaps”– Prioritized Processes / FocusPrioritized Processes / Focus– Agency to Agency PerformanceAgency to Agency Performance– Pier Agency PerformancePier Agency Performance

Other Kansas AgenciesOther Kansas Agencies

Federal PartnersFederal Partners

Local partnersLocal partners

Other state partnersOther state partners

Page 31: Enterprise Value Chain Training (ppt)

3131

Where to begin?Where to begin?

Goals FirstGoals First– Define the goals of the agencyDefine the goals of the agency

Budget Documents, Strategic Plans, Responsibility Budget Documents, Strategic Plans, Responsibility and Authority documents, Organizational Charts, and Authority documents, Organizational Charts, surveyssurveys

– Determine what steps occur to carry out each Determine what steps occur to carry out each goalgoal

Use Porter’s model along with other agency Use Porter’s model along with other agency examples as a reference pointexamples as a reference point

Page 32: Enterprise Value Chain Training (ppt)

3232

Where to Begin (continued)Where to Begin (continued)

Application catalogApplication catalog– Group applications according to services they Group applications according to services they

provideprovideThis should be a good alternative to finding goals This should be a good alternative to finding goals of the agencyof the agency

– (If possible) Break down the group of (If possible) Break down the group of applications into smaller linksapplications into smaller links

Again use Porter’s model and other agencies Again use Porter’s model and other agencies examples as a reference pointexamples as a reference point

Page 33: Enterprise Value Chain Training (ppt)

3333

Where to Begin?Where to Begin?

Combination ApproachCombination Approach– Define the goals of the agencyDefine the goals of the agency– Find group applications based on the goals Find group applications based on the goals

defineddefined– Break down the groups into smaller linksBreak down the groups into smaller links– Fill any holes in the value chain using other Fill any holes in the value chain using other

methodsmethodsDocument review, survey, organizational charts, Document review, survey, organizational charts, ectect

Page 34: Enterprise Value Chain Training (ppt)

3434

Level of DetailLevel of Detail

Collect at the level of Detail that works for Collect at the level of Detail that works for you.you.

Include Summary level on the ITMBInclude Summary level on the ITMB

Page 35: Enterprise Value Chain Training (ppt)

3535

Enterprise Application MapsEnterprise Application Maps

Page 36: Enterprise Value Chain Training (ppt)

3636

ObjectiveObjective

To give a quick review of Value ChainsTo give a quick review of Value Chains

To understand what an application map isTo understand what an application map is

To understand the scope of the application To understand the scope of the application mapmap

Page 37: Enterprise Value Chain Training (ppt)

3737

What is an Application MapWhat is an Application Map

An Enterprise Application Map is an An Enterprise Application Map is an extension of the value chain extension of the value chain

It seeks to categorize the applications and It seeks to categorize the applications and systems in your agency with links on the systems in your agency with links on the value chain.value chain.

It an application map is aIt an application map is a– Business and technology hybrid modelBusiness and technology hybrid model– High LevelHigh Level

Page 38: Enterprise Value Chain Training (ppt)

3838

Page 39: Enterprise Value Chain Training (ppt)

3939

Application Map ExampleApplication Map Example

Page 40: Enterprise Value Chain Training (ppt)

4040

Map Example #2Map Example #2

Page 41: Enterprise Value Chain Training (ppt)

4141

Application Map Example #3Application Map Example #3

Full Version (JPG)Full Version (JPG)

Page 42: Enterprise Value Chain Training (ppt)

4242

Why an Application Map?Why an Application Map?

It will allow agencies to see where each specific It will allow agencies to see where each specific application fits in relation to the high level business application fits in relation to the high level business areas in the organizationareas in the organization

To find gaps where IT does not have any To find gaps where IT does not have any applications in a particular business areaapplications in a particular business area

To find how pervasive technology is in your To find how pervasive technology is in your organizationorganization

Can be used to illustrate justification for IT spendingCan be used to illustrate justification for IT spending

Starts the process to visually see IT / Business Starts the process to visually see IT / Business alignment. alignment.

Page 43: Enterprise Value Chain Training (ppt)

4343

What Applications to include?What Applications to include?

Applications that show up in Section 3 of the 3-Applications that show up in Section 3 of the 3-Year PlanYear PlanOther things that do not show up in section 3.Other things that do not show up in section 3.– Access databasesAccess databases– Big excel spreadsheetsBig excel spreadsheets– Ad hoc software running in someone’s officeAd hoc software running in someone’s office– Applications that are shared by agenciesApplications that are shared by agencies

KDOT also added different goals and business KDOT also added different goals and business areas to their map.areas to their map.– This model can be tailored to help your agency in a This model can be tailored to help your agency in a

wide variety of rangeswide variety of ranges

Page 44: Enterprise Value Chain Training (ppt)

4444

Creating the Application MapCreating the Application Map

Place each application / system / ect on Place each application / system / ect on the appropriate area of the value chain.the appropriate area of the value chain.– If it is used in multiple different functions then If it is used in multiple different functions then

put it in all of them that applyput it in all of them that apply

There is really not much more to it than There is really not much more to it than that. Creating the value chain is the that. Creating the value chain is the biggest hurdle.biggest hurdle.

Page 45: Enterprise Value Chain Training (ppt)

4545

Level of DetailLevel of Detail

Provide what ever level of detail you can Provide what ever level of detail you can realistically complete in the given time.realistically complete in the given time.

We would rather see a partial application We would rather see a partial application map than no application mapmap than no application map– Submit it to us as a “draft” and we will not Submit it to us as a “draft” and we will not

publish itpublish it

Page 46: Enterprise Value Chain Training (ppt)

4646

ReminderReminder

Deadline for the IT Management and Budget Deadline for the IT Management and Budget Plan is September 1Plan is September 1stst..

Submit the optional models later than Submit the optional models later than September 1September 1stst if you need the extra time. if you need the extra time.

Contact us if you are having any problems, or Contact us if you are having any problems, or have any concerns. The sooner the better, as have any concerns. The sooner the better, as we are getting busier by the day.we are getting busier by the day.

Page 47: Enterprise Value Chain Training (ppt)

4747

Training Provided Training Provided (9:00-11:00)(9:00-11:00)

June 23 June 23 Business Partners ModelBusiness Partners Model Eisenhower 4Eisenhower 4thth Floor AuditoriumFloor Auditorium

July 21July 21 Data MapsData Maps Eisenhower 4Eisenhower 4thth Floor AuditoriumFloor Auditorium

TBDTBD Other needed training / one-on-Other needed training / one-on-one support / Out of Topeka one support / Out of Topeka TrainingTraining

September 1September 1 Three Year Plans DueThree Year Plans Due

Page 48: Enterprise Value Chain Training (ppt)

4848

Questions?Questions?

Bill Roth, CITA, 785-296-2108Bill Roth, CITA, 785-296-2108– [email protected]@da.state.ks.us

Bryan Dreiling, 785-296-2809Bryan Dreiling, 785-296-2809– [email protected]@da.state.ks.us

http://da.state.ks.us/kito/ITMBP.htmhttp://da.state.ks.us/kito/ITMBP.htm