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The Computing Eras ---
S.No. Era Period IT Focus IT Set Up Justification
1. DP Era 1960-1980 Industrial economy
Organizational Efficiency
2. Micro Era 1975-1995 Period of creative destruction
Individual Effectiveness
3. Network Era 1995-2010 Period of transformed enterprise
Inter-organizational
Strategic
STRATEGIC GRID – CASH & MCFARLAN
Strategic MIS Grid
Level of Dependence on Existing Applications Level of Dependence on Planned Applications
Planned Applications
Existing Applications
Low High
High
Low Turnaround
Strategic
Support
Factory
Level of Dependence on Existing Applications
How critical is it that existing systems run in a reliable, cost efficient fashion 24 hors a day, 7 days a week, 52 weeks a year?
High Dependence:
Reliable functioning of the systems is at the absolute core what the company must do right if it is going to be successful.
Low Dependence:
If there is unevenness is computer services, it is irritating but not fatal.
Strategic Impact of the Planned Applications
How crucial are the new systems that are going to be developed over the next few years?
High Impact:
IT development is on the short list of three or four things the firm must do right to be successful and profitable.
Low Impact:
IT developments will be useful but not on the short list of three or four things that have to be done right.
IT Management Environments--
A. StrategicWhat is under development is absolutely critical to the firm’s long-term success and the firm is highly dependent on IT on a daily basis.
IT’s position in the organization is right at the TOP.
B. TurnaroundWhat is under development is very important, but there is more tolerance for uneven support by existing systems.
Oil Industry
IT Management Environments--
C. FactorySmooth operation of existing technology is crucial for survival, but future IT developments are not a major element of differentiation.
Credit Card Processing Operation.
D.SupportWhat is under development is not on the shortlist of things that must be done right and problems with existing IT systems are irritating but not fatal.
Consulting Firms, Grocery Stores.
Strategic MIS Grid
Planned Applications
Existing Applications
Low High
High
Low Turnaround
Strategic
Support
Factory
Generic IS Strategies
Centrally Planned Totally integrated with business strategy Very demanding in terms of top management time Could be very difficult to be made effective Desires complete understanding of the business situation
Leading Edge Acceptance of the fact that IT will create competitive
advantage Results in many wasted investments Requires senior management commitment Could be expensive
Generic IS Strategies
Free Market Internal services must compete with outside vendors Requires little attention from the top management Could lead to duplication of efforts/investments
Monopoly The department is a sole source of service within
organization User satisfaction is the main measure of effectiveness Innovation could be slow due to lack of competition Users usually do not perceive their role in IT activity
Generic IS Strategies
Scarce Resources Careful management of IT resources using financial
controls Investments analyzed in hard financial terms IT treated as a cost centre IT not considered as a business weapon Most popular strategy to be found in organizations
Necessary Evil IT deployed basically to fulfill legal requirements Investments made only for very high return projects
Strategic MIS Grid
Suitability of IT Environments
Planned Applications
Existing Applications
Low High
High
Low
Factory•Monopoly•Scarce Resources
Strategic•Centrally Planned•Leading Edge
Support•Scare Resources•Free Market
Turnaround•Leading Edge•Free Market•Centrally Planned
Failures of Conceptualization
Project fails to meet a real customer need Use of product does no become ingrained in
user behaviour Project is too easy to replicate Project wakes up a sleeping giant Project triggers a monopoly litigation Technology lowers entry barriers Project is rejected by the customer culture
Failures of Execution
Dimensions of Implementation Risk:
Structuredness: Greater the Structuredness, lower the risk Lesser the Structuredness, higher the risk
Company-relative technology: More familiar the technology, lower the risk Less familiar the technology, higher the risk
Size: Larger the project, higher the risk Smaller the project, lower the risk
Implementation Risk Matrix
Low structure High Structure
High Technology High Medium
Low Technology Low Low
Twelve Principles of Killer App Design
Reshaping the Landscape
Outsource to the Customer
Cannibalize your markets - develop new ones
Treat each customer as a market segment of one
Create communities of value
Twelve Principles of Killer App Design(contd)
Building New Connections
Replace rude interfaces with learning interfaces
Ensure continuity for the customer, not yourself
Give away as much information as you can
Structure every transaction as a joint venture - between you and the customer
Twelve Principles of Killer App Design
Redefining the Interior
Treat your assets as liabilities - and digitize ASAP
Destroy your value chain - or someone else will
Manage innovation as a portfolio of options
Hire the children - they’re tech savvy
Long Term Competitiveness thru IT Assets
The three IT Assets
build a strong IT Staff procure a reusable technology develop a partnership between IT and
business management
Challenges for IT Exploitation
Business and IT VisionDesign an IT ArchitectureDelivery of IS Systems
IT Role Profiling
We deploy IT to overcome weaknesses in our current operations
We see IT as an expense to be managed
We view IT outsourcing as a threat to our operations
We use one rigid criterion for assessing value from IT
Our IT operations reflect a captive, internal monopoly
We view IT as a fundamental driver of future business
We see IT as a resource to be leveraged
Our sourcing strategy balances insourcing with outsourcing
We adopt multiple criteria for measuring IT value
Our IT operations act as a solutions integrator to business requirements
Business Organization
Business Vision
Business Strategy
Shared IT Vision
IT Strategy
IT Architecture
Developing an IT Architecture
Interpreting Technology Hype – Gartner Research
VIS
IBIL
ITY
MATURITY
Technology Trigger
Peak of Inflated Expectations
Trough of Disillusionment
Slope of Enlig
htenmentPlateau of Productivity
Magic Quadrants – Vendor Positioning Gartner Research
Challengers
Are doing well today Future market movement is
not clear
Leaders Are doing well today Have great prospects for
Future Have the talent, capability
and resources to drive and shape the future
Niche Players
Are executing well to plan Fail to keep pace with the
realities of market demand
Visionaries
Have the vision to become leaders if they can muster the execution skills required for long-term staying power
Completeness of Vision
Ab
ilit
y to
Exe
cute
The Competitive Advantage
Three Generic Strategies related to Competitive Advantage
Focus
Cost Leadership
Product Differentiation
Porter’s Five Force Model
Threat of New Entrants
The Industry : Existing Rivals
Threat of Substitute Products
Bargaining Power of Suppliers
Bargaining Power of
Customers
Opportunity Framework
New Entrants Erect/Demolish Entry Barriers
Suppliers Erode/Share the Bargaining
CustomersSwitching Costs/Customer Information
Substitute Products/ServicesInnovate New Products/More Value
Existing RivalryChange the Basis of Competition
Six Key Questions
Can IT be used to create defensible entry barriers
Can IT help us induce switching costs Can IT help us change the ground rules of
competition Can IT help us change the competition from
cost-based competition to sustainable product differentiation
Can we use IT to build links to our suppliers
Can IT be used as a part of the product No : We are more closer to Support-Factory side of the grid
Yes - We are more close to the Strategic-Turnaround side of the grid
Porter’s Five Force Model
Threat of New Entrants
The Industry : Existing Rivals
Threat of Substitute Products
Bargaining Power of Suppliers
Bargaining Power of
Customers
The New Forces :•Globalization
•Digitization
•Deregulation
NOLAN’S STAGE GROWTH MODEL
Leavitt’s Balancing Act
Mapping of Organizational Culture on Nolan’s Stage Growth Model
Mapping of Contemporary IT on Nolan’s Stage Growth Model
The Four C’s of Digital Transformation
Commerce - the way we transact
Content - the information we use
Community - the people we interact with
Collaboration - the ways we interact with them
First Mover Advantages -- Today, first movers walk away with all the
marbles
Internet Life Cycle - the adoption curve rises quickly and falls quickly against PLC
You’ve got to think differently Can you deliver function without form :
CRM Diagnostic Software applications
Can you set up a mega-exchange - Planet-M
Bottomline - Web is not kind to followers
B-2-B Challenges ---
Like CISCO, Intel has used digital transformation to :
Cut costs Increase customer satisfaction Maintain growth Empower employees
B-2-B e-Business Results ---
CISCO, FedEx and Intel experience suggests that this leads to :
Lowering latencies Lowering operational costs Creating seamless partnerships Virtual manufacturing
B-2-C E-Commerce --
Advertise - “We are here” - Can you sustain interest
Who’s out there -
Internet population has grown multifold Online shopping is increasing More people, more frequently access the Net
B-2-C E-Commerce --Popular Myths
Hits is a good measuring stick
Great content leads to repeat visits
To get traffic to site, depend on search engines
Web is just like TV
You need to be cutting edge to succeed
To succeed in B-2-C E-Commerce --
Your entire supply chain must be optimized
Forget the level playing field - indulge in one-to-one marketing
Greater operational efficiencies
Expanded customer base
Bottomline - Can your systems evolve?
E-Business Mantra ---
The winning strategy is fast and flexible
The winning system is versatile and scalable
The winning team is totally committed
Settle for nothing less.
Concluding Remarks
Emerging technologies are providing level playing field
Process innovation is a must Proprietary architectures are indispensable for
CA Just good products are not enough Architectures should be able to evolve Cannibalization of old ideas is essential IT Leadership has no substitute
YOU & I
A man is flying around in a hot air balloon, and realizes that he is lost.He reduces altitude and spots a man down below. He lowers the balloon near the man and shouts: “Excuse me, but can
you tell me where I am?” The man down below says: “Yes! You’re in a hot air balloon, hovering 30 feet above this field.”
“You must work in Information Technology” says the balloonist.“As a matter of fact, I do!” replies the man, “how did you know?”“Well,” says the balloonist, “everything you’ve told me is technically
correct, but it’s of no use whatsoever.”The man below says: “Well then! You must be in upper management!”“I am,” replies the balloonist, “but how did you know that?”“Because you don’t know where you are of where you’re going, and
you expect me to be able to help! Plus, you’re just as lost as you were before we met, but now you think it’s all my fault!”
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