slide 1 implementing it projects frameworks for analysis work centered analysis for bpm integration...

Implementing IT Projects

Frameworks for analysisWork centered analysis for BPMIntegration of systemsIssues with IT projectsAlternative approaches for IT projects Strategies and roles for ITMoving to B2B and B2C

Frameworks for analysis

Frameworks Analyzing “Organizations and IS”

• Frameworks can assist us in:- sharing and clarifying our thinking- analyzing how ‘things work’ - assessing ‘proposals for change’

• This session highlights 4 IS related frameworks:

• Work Centered Analysis (Lecture, Amazon example)

• Management, Organization, Technology – ITI interaction (used in several cases)

• MIT 90s framework (Lecture)

• ITPOSMO framework (Articles by Richard Heeks)

Work Centered Analysis

• Strategic/tactical/operational in kind, helps to• direct the set-up of Work Systems towards high

performance for end-users/stakeholders • put strategy into action

• Work System = a Business Process and its resources: People, Information, Technology

• WCA is related to System Dynamics, e.g. when making Balanced Scorecards

• More details in this presentation and handout

Management-Organization-Technology Framework

• Discusses- organizational- managerial- technological issues

• Introductory in kind – no link to strategy, no link to processes, no link to stakeholders

• Shows major causes of IS related problems, clarifies opportunities

MIT 90’s Framework (1)

• Strategic/tactical in kind – helps to align and balance the Organizational Strategy and the Technology Strategy

• Principle: if Technology is to support Strategy (or if Strategy is to be led by Technology): Structure, Management Processes and Individuals and their Roles have to be addressed, balance has to be obtained, often changes have to be made)

MIT 90’s Framework (2)

ITPOSMO Analysis

• Information, Technology, Processes, Objectives –Values, Staffing – skills, Management systems and structures, Others (time and money required)

• Can help to understand IT, e-Business, e-Government and any stakeholder context

• Distinguishes design and reality gaps

• Articles by Richard Heeks (University of Manchester)

Work Centered Analysis for BPM

Viewing an organization as a system – an example (1)


• What is a System ?

• Several definitions exist…….

• A set of elements working together to achieve a common goal

• An organized coordinated process turning inputs (often data, raw materials, etc.) into outputs (often information, products)

• Systems in Organizations, but also in Nature


• What is an Information System (IS) ?

• Since when does the world have IS ?

• We will assume: IS = CBIS (Computer Based)

• A definition for IS can therefore be: Applications of Information Technology

• Part of Work Systems (were defined before)

• A better definition would be: the part of a Work System relying on Information Technology

POS: Bar code scanners and computers to identify items sold and calculate the bill

Work system supported by the information system: Performing customer checkout

Aspects of the work system not included in the information system: Establishing personal contact with customers, putting the groceries in bags

- What are key advantages of a POS?- What are problems associated with POS?

Focus on Work Systems not just on Information Systems (1)

Word Processing and Internet used for typing/revising and finding resources

Work system supported by the information system: Writing a book, article or thesis

Aspects of the work system not included in the information system: Deciding what to say in the book, article or thesis and how to say it, saying something new that way (the core idea)

- Advantages of IT being clear, what are the risks?


Interactive computerized system used by top executives/managers to monitor their organization’s performance

Work system supported by the information system: Keeping track of organizational performance

Aspects of the work system not included in the information system: Talking to people to understand their views about what is happening

- Example: what is the objective of time registration?


“Don’t worry. We can get busy when the national employee monitoring satellite

comes overhead.”

The Work Centered Analysis Frameworkfor Thinking about any (Inter-)Organizational System

Where is the Information System ?

WorkSystem

InformationSystem

Besides this: who are the users ?

Definitions of Topics in a System Snapshot

CUSTOMERS or STAKEHOLDERS

Product users: Internal or external customers who use or receive direct benefit from the product (=often a service): end-users

Other stakeholders: People who have a significant stake in the work system or its product (=often a service) even though they do not use the product directly and do not participate directly in the work system

Examples: the owner of a boots company, parents in the case of primary education

“And that, as my four dimensional graphclearly shows, is why our stakeholders can’tunderstand what on earth it is what we do.”

Definitions of Topics in a System Snapshot (1)

PRODUCTS (is often a service)

Information content: The aspects of the product that consist of informationService content: The aspects of the product that consist of services performed for specific customersPhysical content: The aspects of the product that consist of physical things

Trend: towards tertiary sector, service becomes key, think of the roles of education, health, financial services

Trend: to add value in the form of information or service to physical products (e.g. cars)

The new internet based technologies drive these trends


(INTER-)ORGANIZATIONAL PROCESS

Major steps: Listing/diagramming of the major process steps

Processes providing inputs: External processes outside the work system that produce inputs of information, physical things, or services needed for the process to operate

Processes receiving the product: Stakeholder’s processes that receive and use the product (output) of the work system

To be added is a “Rationale”: Describing the overriding idea or approach that determined how the process would be performed using the current approach, rather than another


PARTICIPANTS

People who perform the work

Shared human infrastructure

INFORMATION

Created or modified within this systemReceived from other work system

Shared information infrastructure

TECHNOLOGY

Technology within the system

Shared technology infrastructure

Summarizing the Work Centered Analysis Framework (WCA FW)

Customers: the end-users andother stakeholders

Products: includes info+services. Terms also usedare ‘results’ and ‘outputs’

Work System (WS):a BP and its resources

IS: that part of the WSthat relies on computers

FW is customer oriented

IS

WS

Amazon Provided an Alternative Way to Shop for Books

CUSTOMERS (= STAKEHOLDERS)

Persons (consumer/business) interested in

books (and who will perhaps purchase books).

Wholesalers supplying the books (Ingram)

Deliverers of service (Fedex)

Amazon sales, marketing, planning departments

- We will focus book and potential book buyers


PRODUCTS (a selection….)

Information about books that might be purchased

Information about author

Information about related books

Customer reviews

Information describing the book order, tentative delivery date, books underway for delivery

Books that are eventually delivered

- What is the major point here?


(selected) BUSINESS PROCESSES

Major Steps (for most books): Purchaser logs on to amazon.com, identifies desired book or gives search criteria, looks at book-related information and decides what to order, and enters order. Amazon.com orders book from wholesaler, Fedex packages order, sends it to the purchaserRationale: Instead of forcing book buyers to go to typical bookstores, permit them to use online access from home or from work.

- Do we agree with words Instead and Alternative ?


PARTICIPANTS

People interested in purchasing books

Partners of Amazon

Some people in Amazon

INFORMATION

Orders for books

Price

Book reviews

Customer profile

TECHNOLOGY

Personal computer used by purchaser

Computers and networks used by Amazon.com for order processing

Internet

- Technology includes software


Who is a toy factory’s customer?

Issues Raised when Understanding Work Systems

ARCHITECTURE (what and how)• What are the components of the system that

performs the work (activities) • Who uses the work product?• How are the components linked?• How do the components operate together?

PERFORMANCE (how well)• How well do the components operate individually?• How well does the system operate? - How well is

the work performed?• How well should the system operate?

Architecture (or: design) Performance (or: behavior)

Linking WS Structure and Stakeholder Satisfaction

Causes:what andhow?

Effects: how well?

When Improving Performance: Avoid Vague Descriptions (1)

ACCURACY(information performance aspect)

Vague description: The information doesn’t seem accurate.Measurement: at least 97.5% of data are correct within 5%.Interpretation:This is (or is not) accurate enough, given the way the information will be used.

Note: taking a sample always carries along some uncertainty


SKILLS (participants performance aspect)

Vague description: The sales people are very experienced.Measurement: Every salesperson has 5 or more years of experience; 60% have more than 10 years.Interpretation:This system is (or is not) appropriate for such experienced people.

Example: a training program called “selling over internet”

CYCLE TIME (business process performance aspect)

Vague description: This business process seems to take long.Measurement: The three major steps take about 1.3 days each, but the waiting time between the steps is around 5 days.Interpretation: This is (or is not) better than the average for this industry, but we can (or cannot) improve by eliminating some of the waiting time.

Example: emitting a new passport


PRODUCT QUALITY (product performance aspect)

Vague description: We produce top quality frozen food, but our customer’s aren’t enthusiastic.Measurement: 65% of our customers rate it average or good even though our factory defect rate is only .003%Interpretation: Our manufacturing process does (not) seem OK, but we do (not) need to improve customer satisfaction.

Example: ice cream launched by dairy cooperative


Integration of systems

Processes and functional areas of an organization (example)

Continuously higher levels of integration

• 1970s: Focus: tasks, functions– Eg: Automation of inventories, accounts payable

• 1980s: Focus: department, business unit – Eg: Purchasing System, Financial System, Marketing IS

• 1990s: Focus: entire organization (entire corporation) – Eg: ERP from SAP or Oracle,

• 2000s: Focus: cross-business, inter-organizational– Eg: Complete E-Business Solutions, linking up to Buyers– Eg: SCM systems including external suppliers (eg VMI)

(was not visualized in the last slide)• Technologies support, enable these business trends

ICT and E-Business 40

Different aspects of Integration

Issues with IT projects

Steps in improvement for business professionals

What is new here ?- Feedback- WCA framework

The 10 Issues in the Work-Centered Analysis Method

Systems analysis step

1. Define the problem

2. Describe (and analyze) the current work system in depth

and

3. Design potential improvements

4.Decide what to do

Corresponding issues for thinking about a system

Issue 1: Problem Definition

Issue 2: Improvements from product changesIssue 3: Improvements from process changesIssue 4: Improvements related to work system participantsIssue 5: Improvements from better informationIssue 6: Improvements from better technologyIssue 7: Improvements from shared infrastructureIssue 8: Improvements related to the business contextIssue 9: Improvements from risk reduction

Issue 10: Recommendation

Four phases of an IT project (leading to a system)

Activities in each phase of moving to a new work system

INITIATION• Identify beneficiaries, establish needs and requirements, identify priorities• Feasibility study for different ‘rough’ alternatives – go or no-go

DEVELOPMENT• Analysis ands design of processes, programming• Make, Use and adapt existing components, Go for tailor-made, Buy or Rent • Technical Testing: hardware, software, performance levels obtained?• Preparation of process changes and preparatory training

IMPLEMENTATION• User Acceptance Test; conversion ; direct, pilot, parallel or phased

approach• Process changes and new roles and extensive training

OPERATION AND MAINTENANCE• Maintenance due to: bugs, mistakes, new needs, new technologies• The earlier the ‘mistake’ and the later the ‘correction’, the more costly….

Common issues in each phase of moving to a new system

INITIATION• Can we agree on the purposes and goals of the proposed system?• Are the requirements unnecessarily elaborate and expensive?

DEVELOPMENT• Can we assure that the system genuinely solves the end-user’s problems?• Can end-users and other users participate effectively in the design process?

IMPLEMENTATION• Can we convert effectively and painlessly from the old to the new system?• Can we solve political issues related to changes in power relationships?

OPERATION AND MAINTENANCE• Can we keep system performance and uptime at acceptable levels?• Can we correct bugs and enhance the system to keep it focused on current

business problems? Can we easily incorporate new technologies?

Common Problems with IT Projects and Causes

• Budget overruns • Time overruns • Goals, end-user requirements not met (quantity, quality)• Main Causes:

– Needs were not known, end-users were not involved– Lack of goal related performance criteria– A hardware/software in stead of process/people approach– The conversion was too direct, no pilots were used, etc.– Process and structure change were not well addressed– Affected partners (e.g. suppliers) were not involved – Political, cultural issues related to management of change– A simultaneous focus on efficiency and effectiveness– Lack of training (often – incorrectly - seen as THE reason)

Alternative approaches for IT projects

Main Differences in 4 Key Methods for IT Projects TRADITIONAL SYSTEM/PROJECT LIFE CYCLEIssue addressed: ControlSummary: Go through a fixed sequence of steps with signoffs after each step and careful documents.

PROTOTYPINGIssue addressed: KnowledgeSummary: Quickly develop a working model of the system; use the model to gain experience and decide how the final system should operate.

APPLICATIONSIssue addressed: Resources and timingSummary: Purchase an existing system from a service provider or vendor; customize the system if necessary.

END-USER DEVELOPMENTIssue addressed: Responsiveness Summary: Provide tools and support that make it practical for end-users to develop and implement their own systems.

Alternative: PLC based on Prototyping

INITIATIONEnd-users and developers agree to develop a prototype because they need experience with a working model before designing a final system.

DEVELOPMENTWorking iteratively with end-users and users, a prototype is developed and improved. Later, decide whether to complete the prototype or switch to a traditional life cycle.

IMPLEMENTATIONAccomplish parts of implementation along with development as end-users and users work with the prototype system. Dispel skepticism about whether the system will meet end-users’ needs.

OPERATION AND MAINTENANCEMay be similar to a traditional life cycle. May require less maintenance because the system fits the end-users’ needs more accurately. May require more maintenance because the system is not constructed as well.

Using a Prototyping approach

Alternative: PLC for acquiring an Application

INITIATIONMay start with end-user’s or manager’s recognition of a business problem or with a sales call from a service provider or a vendor.

DEVELOPMENTThe service provider or vendor develops the system, although the purchase still performs some typical development activities, such as determining detailed requirements. Development may include customization of processes, software and user documentation.

IMPLEMENTATIONImplementation starts by deciding exactly how the system will be used. It often relies on the provider’s or vendor’s staff because they have the greatest knowledge of the system.

OPERATION AND MAINTENANCEOperation occurs as it would with a traditional life cycle. Maintenance is different because the provider or vendor maintains the system based on requests from customers and demands of the market.

Vendor responsibilities for applications (eg a SAP system for SCM)

Alternative: PLC for end-user development

INITIATIONBecause the end-users will develop the system, a formal functional specification is unnecessary.

DEVELOPMENTEnd-users develop the system using tools that do not require a professional level of technical knowledge. Systems that are critical to the company or have many end-users require more extensive testing, documentation, and usage procedures.

IMPLEMENTATIONImplementation is simplified because developers are end-users.

OPERATION AND MAINTENANCEEnd-users are responsible. Long-term maintenance and technical quality become larger issues because the end-users have other work to do and are not technical professionals, e.g. not programmers.

“There’s nothing wrong with the system.Therefore, we’ll have to perform

exploratory brain surgery on you.”

© Ted Goff

Why is it hard to develop the right system?


When it was delivered The disaster

recovery plan

The opensource version

How patcheswere applied

Strategies and roles for IT

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Success drivers for IT

• Senior management champion & willingness to invest • Willingness to arrange processes and structures• Ability to manage change, resolve political issues• Adequate methodology to build and implement• Decide: make/buy – in-house or outsource ?• Strong and flexible IT infrastructure• Involvement of end-users and “content owners”• Adequate strategic positioning, e.g. not only addressing

customers, also suppliers, employees…

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© Ted Goff

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Reaching a next level in IT Strategy

• Buying decisions today are on “value added”• So: can our business increase customer value?• Strategies are now oriented to value-added

• IT adoption is moving from “experimental” to “integration” to “transformation” stages

• New business models are possible – a breakout strategy (e.g. IBM moving into services)

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Three levels of IT Strategy

• Experimental level: IT is organized by function, no IT strategy, just a support function, efficiency gains.

• Integration level: an IT strategy that supports the

business strategy, efficiency and effectiveness gains, links to suppliers and customers, information is supporting and helping to improve business processes.

• Transformation level: IT drives the business strategy, links to business networks, the main lever is the intellectual capability that creates opportunities.

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• Is our technology (HW/SW) infrastructure supporting our business?

• Is IT just residing with departments or functional units?

• Are we experimenting with IT?• If yes to all: we are at level I


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Customer Supplier Life Cycle

SUPPLIERAdvertise/Scan

Evaluate & respond

Receive payment & deliver

Receive payment

Evaluate process

CUSTOMER

Scan/Request & specify

Select & order & pay

Receive goods & pay

Evaluate process

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• Has an IT strategy been formulated?• Does it support the business strategy?• Does it integrate the processes of the CSLC?• Are suppliers and customers included in the

automated business processes?• If yes to all: we are at level II


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Reminder: different aspects of Integration

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• Do competitors have higher quality and achieve higher customer satisfaction ?

• Is valuable information or knowledge available, not yet used for growth ?

• Are strategic alliances with others possible and/or desirable ?

• Are we prepared to change business model ? • If yes to all: prepared to go to level III


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Summary: Role of IT

• IT can help to:– Reduce complexity (disintermediation)– Forecast market trends, estimate demand, etc. – Design supply chains, plan for supplies, etc.– Achieve efficiency (lower cycle times & resource usage) – Improve data/info integration (across the supply chains)– Integrate and increase the customer’s/supplier’s responsiveness– Enable new business models (disintermediation, re-intermediation,

outsourcing)– Increase flexibility, innovate and add value (e.g. by using third

parties, such as IT Service Providers and 3PLs)

Moving to B2B and B2C

Setting the stage for B2B/B2C

• IT helps us moving to B2B/B2C: how important is it? – Many companies (e.g. Cisco, Easyjet) are getting most of

their revenues through sales on internet– Many B2C companies (e.g. the dot-coms) failed, reason is

often related to inadequate back-office + SCM– We have to be innovative– At the same time we should avoid risks

• What are appropriate strategies and tactics ?

Many different terms….often “new”…

• Lots of terms: E-Marketing, E-Tailing, E-HRM, m-Commerce, i-Government

• Whatever the meaning, what matters are the services/benefits that consumers and businesses (and governments) can obtain

• We will use E-Commerce and E-Business

Many definitions exist…..

• E-Commerce defined– Electronically mediated transactions with others (this class)– Ability to perform major commerce transactions

electronically (by author of the text book)• E-Business defined

– Electronically mediated transactions (this class)– Collection of business models and processes motivated by

Internet technology and focusing on improvement of extended enterprise performance (by author of the text book)

• EB = EC (sell+buy) + internal electronic transactions

Sell side versus buy side

• Sell side: transactions to sell products and services to a customer

• Buy side: transactions to get the needed resources from a supplier

• Note: transactions have two perspectives

Implications to Managers

• What is the impact of E-Business etc. on our business/organizational environment ?

• Is it urgent, is it important to respond ? • What are the priority areas ? • How should we invest and where?• How to go about implementation ?

Barriers to adopt EB/EC

– operating in poor environmental infrastructure– not understanding (potential of) new technologies– no options to ‘outsource’ to IT service company– fearing fraud, the lack of confidentiality– not seeing how to involve suppliers or customers– considering costs too high, while benefits unclear

Benefits of EB and EC

• Cost reduction / efficiency– Reduced costs of sales, purchasing, marketing,

inventory, transportation, administration • Increased speed to dispatch goods, obtain supplies

• Competitiveness / effectiveness– Increased revenues

• increased reach to larger groups of customers• the ability to add value by new info/services

– Image/brand enhancement– Disintermediation, Reintermediation, Outsourcing

B2C and B2B

• B2B accounts for more than 95% of the overall (B2B+B2C) value. Why ?

• The relative percentage of B2B is growing, why was (20-10 years ago) internet based B2C larger than internet based B2B ?

• Note that C2C & C2B can also be considered (C2C requires an intermediary – eg eBay)

Supplierssource from

suppliers who

source from

suppliers who

source from……

New Channels, New Structures

• Opportunities of the new technologies can alter the relationship of company and its partners dramatically– Partner (or company itself !!) is bypassed: disintermediation– New intermediaries arise (eg. an E-Auction): re-intermediation– Increased reliance on third parties (3PL, IT): outsourcing

• Examples:– travel agents on street corners closing, internet ones coming in– computer Manufacturer Dell went direct (now: blended models)– increased role for value adding third party logistics providers

• Can a Producer of Daily Commodities go direct?• Think of: EoS, Lead Time, Demand uncertainty

Virtual B2B Marketplaces

• We can distinguish 3 types, based on ‘location’ of trade• Sell side, seller controlled

– Vendor site, home site with EC (EasyJet, Amazon, Intel)– Intermediary controlled by (group of) sellers (Oneworld)

• Buy side, buyer controlled– Procurement site, home site with EC (Shell Chemical) – Intermediary controlled by (group of) buyers (Covisint)

• Neutral intermediaries (yahoo, ebay)

Roles of Auctions

• Price setting (e.g. sothebys.com)• Efficient resource allocation (lastminute.com)• Market expansion (increased offer/demand)• Co-ordination (eg telecom frequency licenses)

• Dutch auction: seller is leading, but downward• Auctions can be C2C, B2C or B2B, examples:

ebay, lastminute, isteelasia (= the first vortal)

Business Models

• Architecture for business processes, its actors, its benefits and sources of revenue (Work System !)

• We can take 3 perspectives:– Marketplace (manufacturer or primary service provider,

reseller/retailer, exchange, supply chain provider or other support activity (e.g. technology))

– Revenue model (direct sales, subscription or rental, commission, advertising). TREND!

– Commercial model (fixed, brokered, auction). TREND!

Bricks and/or Clicks ?

• Yahoo is – still - more ‘pure’ than Amazon. Why ?• Digital: product, delivery process, transaction process

• Bricks & Mortar, Clicks-Only and (now) Bricks & Clicks• Advertising may help to increase the traffic• Main issue is, particularly when we are dealing with

physical goods, whether the company able to deliver…..• This is a planning issue, a supply chain issue !!• Boom due to high reputation, bust due to low service levels

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© Ted Goff

slide 1 implementing it projects frameworks for analysis work centered analysis for bpm integration...

Documents

analysis slide

bpm slide

information technology

handout slide

b2c slide

nature slide

richard heeks slide

information system