MIS Assignment

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INDIVIDUAL ASSIGNMENT

REPORT ON ICT ENVIRONMENT & RELATED ISSUESOf

SRL LANKA INSURANCE CORPORATION LTD.

Information Systems for Managers CIS5001

BY

R.P.Gayan Rajapaksha

(E-Mail- [email protected])

Course Coordinator

Dr.wui Gee Tan

Student Number

0050082407

Date of Submission

11 October 2010

MBA PROGRAMME

UNIVERSITY OF SOUTHERN QUEENSLAND

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SRL LANKA INSURANCE CORPORATION LTD.

REPORT ON ICT ENVIRONMENT & RELATED ISSUES

BY

R.P.Gayan Rajapaksha

Presented to

General Manager (CEO)

Sri Lanka Insurance Corporation Ltd.

11 October 2010

TABLE OF CONTENTS

1. EXECUTIVE SUMMARY

2. PART I: TITTLE & INTRODUCTION

1.1 Introduction

i. The Organizationii. Corporate structure

iii. The major business processes

1.2 Statement of the problem

1.3 Hindrances & Limitations

4. PART 2: IT INFRASTRUCTURE: ISSUES & CHALLENGES

2.1 Organization’s IT infrastructure.

i. Evolutionii. Ecosystem & Availability of resources

2.2 Issues & Challenges of Corporate mission.

i. Issues in deploying resources.ii. Managerial issues & decision making problems.

iii. System break downs & High response time for trouble shooting.iv. Disposal of hardware.v. Deficiency of service level workers & programmers.

vi. Green IT issues of SLIC and Environmental impact.

5. PART 3: GREEN IT AND ITS BUSINESS BENEFITS & COSTS

3.1 Green computing & its Evolution.

3.2 Benefits & costs of Green computing.

6. PART 4: RECOMMENDATIONS OF GREEN IT MEASURES

7. PART 5: CONCLUITION & RECOMMENDATIONS

5.1 Conclusion.

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5.2 Recommendations

i. Deploying resources.ii. Managerial efficiency & effective decision making.

iii. System maintenance & reduce response time for trouble shooting.iv. Disposal of hardware.v. Recruitment of service level workers & programmers.

8. LIST OF REFERENCES

i. In – text references.ii. Internet sites.

iii. Meetings and interview references.

9. APPENDICES

Appendix 1 – The Journal

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EXECUTIVE SUMMARY

The purpose of this report is to submit in the form of an assignment for the MBA (finance special) program conducted by the University of Southern Queensland. This report is to be submitted to Dr.Wui Gee Tan course coordinator – Information Systems for Managers (CIS5001). The specific problem addressed in this study is to identify the ICT issues and miss management of ICT resources in the organization to and ascertain what extent the management had involved in applying Green Computing principles and practices within the organization and the recommendations to over come the issues identified. The report also highlights a clear idea of the organizational and societal benefits of adopting green computing principles within the organization. The role taken is in the form of an internal employee and the report is to be presented to the CEO.

Research was conducted by means of telephone, personal interviews and direct observations. The organization which analyzed was the Sri Lanka Insurance Corporation Ltd. (SLIC) is a leading insurance company in Sri Lanka founded in 1962.

Since then, it provides all kinds of insurances solutions to its customers. The official website is accessible for the outsider’s world wide. Therefore the organization is offering a valued service to its customers and a multi functioned ICT system should be maintained island wide.

SLIC has some of the barriers to maintain successful ICT system within the organization under the current environment such as management issues, decision making problems, issues in deploying resources, lack of knowledge workers.

The organization would face many issues in disposing hardware and to maintain an eco-friendly ICT environment. Therefore recommendations were made to create and apply green computing principles and practices to the existing structure of practice.

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SRI LANKA INSURANCE CORPORATION LIMITED

THE ICT ENVIRONMENT & RELATED ISSUES

1.1 INTRODUCTION

i. The Organization

Sri Lanka Insurance is the largest and strongest composite insurance provider in Sri Lanka, with Rs.71.8 billion in assets, over half a million policies in force and an average claims settlement of Rs.15 million a day. It is the first and only insurance company in the country to be assigned a prime AA- rating for Insurance Financial Strength from the global rating agency Fitch Rating London. The official web site is <http://www.srilankainsurance.com/>. With strong re-insurance arrangements, a highly experienced technical knowledge base and the widest network across the country, the company has nearly 50 years experience in fulfilling the insurance needs of the Sri Lankan people. Sri Lanka Insurance was incorporated by a special Act of Parliament in 1961by late Minister Mr. T.B. Ilangaratne under the guidance of her Excellency late Prime Minister Sirimavo Bandaranayake. In 1988, the insurance field was liberalized ending the virtual monopoly enjoyed by the corporation and consequently was subjected to operate in a competitive environment. In 1993 with the objective of providing greater autonomy to operate in this environment the corporation was converted to a fully Government owned limited liability corporate entity and subsequently sold to the “Distilleries-Spence Consortium” under the Government Privatization Plan in April 2003.in june 2009 the supreme court however held that the processes of privatization was illegal and void the contract with the “Distilleries-Spence Consortium”. There fore the ownership of the SLIC shifted again to the Government of Sri Lanka as a 100% government owned corporation.

Subsequently when the competitors came in to market SLIC began to loose its market share rapidly and there was an essential requirement of changes in Information systems, advance Marketing and Operational strategies which should be upgraded to meet the market challenges,

ii. Corporate structure

Presently the SLIC is operating with a work force of nearly 1800 permanent employees and nearly 12,000 field staff working in 175 branches island wide with the head office located in Colombo, Sri Lanka. The structure of the organization complied with marketing department, finance department, human resources department, information technology department and other service departments such as internal audit department, insurance underwriting departments and claims departments. Related IT systems are

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implemented to each and every department for their operational requirement and linked with each other. The integrated system is maintained and serviced by the ICT department.

The organization is ruled by the chairman and board of directors, they declare their decisions over the organization by the flow of managing director, general manager, deputy general managers, assistant general managers, senior managers, managers and executives. All the departments and the network of branches including foreign branches (Maldives) are governed by unique operational and administrative policy under the government of Sri Lanka.

iii. The major business processes

The major business process is insurance, the organization gives the all kinds of the insurance solutions to its customers over island wide and overseas. The process basically divided in to two main divisions as Life and General insurance, Life division totally handles the life business and the general division is with Motor insurance, Non motor and Marine. The reinsurance department handles all the reinsurance activities with the foreign markets. Even though the major business activity is insurance, the organization gradually invest large amount of money in treasury bonds and share market, investments bring rate of income for the profit annually.

1.2 Statement of the problem

The study has been taken place to identify the issues and challenges of the IT infrastructure of the SLIC and to identify the short comings of inefficient decision making of Key IT personalities, mismanagement of resources, and environmental impact on disposals and to suggest an effective green IT solution for the organization.

1.3 Hindrances & Limitations

As confidentiality was an area that had to be maintained, the staff working at the lower levels was quite reluctant to give out information as they were more worried about technology taking over human power, and mostly me submitting this report to the management. Therefore some of the information obtained was not quite accurate. Also some critical issues could not be get disclosed by the main characters.

2. IT INFRASTRUCTRE: ISSUES &CHALLENGES

2.1 Organization’s IT infrastructure.

i. Evolution

The history of the ICT Division dates back to the early 60s when Sri Lanka Insurance Corporation Ltd, then known as the Insurance Corporation of Ceylon (ICC), was inaugurated as the sole transactor of Insurance business in Sri Lanka. Data Processing started in what was

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called the IBM Machine Room in the ground floor of the 3 storied building at 288, Union Place which was the Head Office of ICC. The machines used were the series of IBM Unit Record Machines consisting of the 143x Tabulator, xx Collator and yy Sorter which had the input produced through IBM Card Punch xx and the Verifier 26. The noteworthy milestones in the long journey towards the present Mainframe are.

1962: Data Processing activities started with IBM Unit Record Machines as the 1st customer of IBM Sri Lanka.

1967: Installation of the 1st Mainframe Machine – IBM System/360 -20 with 4 MB Memory and Tape Operating System. Input was through punched cards and magnetic tape.

1983: Installation of the IBM 4331 with x MB memory and the VSE/ESA (Virtual Storage Extended / Extended System Architecture) Operating System. This used Virtual Telecommunication Access Method (VTAM) for communicating with x terminals consisting of Dumb Terminals and Printers both in the IT Division and User Departments. The first micro computer (IBM PC with Micro Channel Architecture) was also introduced to the IT Division during this time. The first Branch to be linked up was Kandy and this too occurred with the 4331 Machine in 1983. Instead of Dumb Terminals, IBM Value Point PCs were used both as terminals and for local processing of the users.

1997: Multiprise 2003 with the first ever AS/400 (as a sub-system for data transfer from diskettes).

2000: Under the Y2K Assistance Program, memory upgrade (from 128 MB to 256 MB) and other enhancements ( Hard Disk Capacity expanded to 9 GB x 4) to the Mainframe (Multiprise 2003) were done. Also, another AS/400 Machine (Model 9406/170) was obtained. Another AS/400 for Lotus Notes another AS/400 for IFS.

2003: Link-up of Negombo, Gampaha and Union Place. Towards the end of the year more branches were linked to the WAN.2004: Memory Upgrade of Mainframe from 256 MB to 512 MB to accommodate more branch link-ups.

Presently SLIC is operating with the largest intranet linked with the branch network in the insurance industry of Sri Lanka. The system also service enhanced with Wi-Fi and wireless network facilities.

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i. Ecosystem & Availability of resources

Sri Lanka Insurance Corporation continues the business operations with an integrated IT system linked with all local and foreign branches. Generally all users have been facilitated with PCs and the departments have been facilitated with other resources such as printers, scanners digital cameras ,fax machines, telephones etc.while facilitating this IT infrastructure it is advisable to study about the IT infrastructure Ecosystem of the organization .theoretically the ecosystem could be illustrated as follows.

Source: Laudon & Loudon 11th edition

It could be seen all the major seven platforms illustrated in above have been effectively installed within the organization. It could be identified Billions of rupees had been invested on the IT infrastructure and for the maintenances of Computer hardware includes PCs (Dell, IBM and HP), Printers (Lexmark, cannon).

2.2 Issues & Challenges of Corporate mission.

Even though the organization had invested in billions of rupees on assets to facilitate the IT infrastructure and maintenance, SLIC was unable to utilize its resources in a higher capacity to meet the market challenges due to following reasons.

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i. Issues in deploying resources.

The IT department currently practices a poor distribution, installation and restoration process due to lack of technical specialists and poor communication between the channels and the IT department. It has been reported users some times waited for several days to get their broken computers mended, even some times two or more days had taken to reinstall a mouse for a broken mouse.

ii. Managerial issues & decision making problems.

Very often the organization falls in to difficulties as the correct decisions have not been taken at the right time. Entering in to service or purchase agreements without having a proper negotiation with buyers some times cause for after sale service and maintenance problems. The process of recruiting employees for vacant positions has become very slow and irregular process within the organization.

iii. System break downs & High response time for trouble shooting.

During working hours the main system some times goes down for few hours and the server delays have become very critical , this happens as a habit for four or five days per month. This failure brings unnecessary delays for customers and loss of confidence. Customer care officers also become very inconvenient among customers.

iv. Disposal of hardware.

Correct and effective policy has not been implemented on disposals. Therefore the environment become untidy and also required additional storage area for disposing items ,as some disposals have been kept for more than one or two years.

v. Deficiency of service level workers & programmers.

It could be clearly identified the organization had not taken steps to recruit sufficient knowledge workers and programmers for vacant positions. Due to this issue unnecessary could be seen in system and hardware maintenance and as well as in system modifications.

vi. Green IT issues of SLIC and Environmental impact.

Studying about the IT environment of SLIC it could be clearly identified some Sevier environmental issues practicing within the organization. The concepts of energy saving could not be seen and no action had been taken to reduce the level of power consuming. Users like operators, programmers, managers often leaving their work stations without shutting down their computers and other accessories. It could be identified 25% of the daily energy usage wastes on vacant work stations with turned on computers. Each PC in use like this may generates about a ton of carbon dioxide every year to the environment and releases thousands of kilojoules as heat. It seems the organization directly contributes for global warming and adverse climate changes.

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SLIC on the other hand had not taken adequate steps on managing disposal of computers, monitors, printers and other network and electronic items. Hundreds of old computers, monitors, printers and other equipments had been stocked in a vacant floor for couple of years.

Most of these items could be repaired and reusable. But the adverse impact is the decisions have not been taken to remove or reuse. These items contain toxic chemicals. Exposure these items have been ended up with land fills and polluting water and air. Unnecessary storage requires additional office apace which could be useful for another activity in a limited office premises.

3. GREEN IT AND ITS BUSINESS BENEFITS & COSTS

3.1 Green computing & its Evolution.

With the rapid development of technologies most activities all around the world have become very efficient and computer managed. To meet the demand of technical and computer infrastructure most manufacturing industries started to double their output all around the world. On the other hand the volume of raw materials and production of chemicals has to be doubled to meet the requirements of industries with the enhancement of industrial processes and innovative technologies caused by the Earth’s growing population. The rapid development of innovative technologies may cause for damage or deplete natural resources and in every moment releasing toxic gases, wastes and harmful by products to the environment all around the world. With these endless activities of humans, energy has become the outpacing production of most renewable and non-renewable resources. Because ICT and its’ subsystems have become the key part of the problems it has been regarded as a social responsibility to find out smart and innovative solutions for the issues

With the scope of finding solutions for minimize environmental issues of information technology, communication and networking technology the key words like Green computing, Green IT, Green information systems, Green IT management, sustainable IT etc. have been taken in to study by IT professionals’ researches. All the key words generally speak about study and practice about designing, manufacturing, handling and disposing of IT and communication resources such as computers, servers, monitors, printers, storage devices and

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networking and communication systems, in an environmental friendly way. Those concepts were based to minimize or make no impact on the environment.

It has to be realized that computers and other IT infrastructure consume more electricity power, by affecting heavy burden on electric grids and contributing to green house gas emissions. Not only production and consuming but also disposals of IT creates a significant influence to the environment it self. As computer users each and every person and organizations have a duty to minimize or eliminate the environmental impact on IT and should be contributed to create a more sustainable environment.

3.2 Benefits & costs of Green computing.

As humans all users of it have been legally, ethically and socially bound to green our services, practices, applications and products. Developing green IT will be benefited to improve energy efficiency, save resources, use less harmful raw materials, reduce green house emissions and imposed to reuse and recycling.

While developing an eco - sustainability green IT inside the business in world wide it has been recorded a noticeable increase in interests. It has still been required to create a positive public perception on air and land pollution and climate changes rather than engaging in practices that will be having significant impact on energy saving. On the other hand business owners not likely to invest heavily on eco – sustainability factor without getting a significant return on investments.

But it has been proven that most organizations have been able to gain a considerable rate of energy and cost saving by greening their organizations’ hardware and, communication and network infrastructure. as an example looking to reduce energy consumption some businesses invested in ways to lower cooling costs. On the other hand organizations can reduce their operational costs by implementing eco – sustainability IT infrastructure and procedures. This practices also help to increase operational efficiencies while enjoying green benefits at the same time logistic companies can leverage the recent M2M technology for more efficient fleet management which resulting by time saving, lower energy and fuel consumptions. Effective disposal strategies may benefit organizations in saving costs of purchasing new resources and earn some additional income by reselling the scraps.

4. RECOMMENDATION OF GREEN IT MEASURES.

It is advisable to study about the green IT policies deeply before implementing green IT system within the organization. To address the environmental impact of IT comprehensively and effectively the important approaches defined by many specialists, a holistic approach could be illustrated by considering the following complementary instruments.

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Holistic approach to Green IT

Green use – Reduce the energy consumption of IT resources and information systems and to be used in an environmental friendly way.

Green disposal – Properly recycle the unwanted IT and communication and network equipments and refurbish and reuse the old computers and other devices.

(Source: January/February 2008 IT PRO)

Green design - Design energy saving and eco friendly IT and Communication components and cooling devices.

Green manufacturing - Manufacture computers, electrical components and other related subsystems with minima or no impact on the environment.

The green IT includes benefits for environment and organization such as energy efficiency, environment sustainability and minimizes the total cost of ownership which includes the cost of recycling & disposal. Reusing or refurbishing of unnecessary monitors, computers, printers, storage devices and communication and networking systems may help organizations to minimize their financing on replacing new IT equipments mentioned in above. This could be deeply understood by studding the three Rs (Reuse, Refurbish and Recycle) which describe greening unwanted computers.

Appling the green IT principle on identified green IT issues of SLIC it is also advisable to study the green computer’s entire life cycle illustrated bellow in the diagram.

Recommending the solutions for the identified green IT issues of the SLIC it could be recommended to implement green IT principles in an environment sound manner and the management should try to minimize the energy wastes and efficient the cooling systems.

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Recommending solutions for disposal of unwanted computers and other IT and communication resources, Disposals could be done in two ways; one way is resale of unusable items for scrap value may bring some additional income for the organization and other way is disposing properly environmentally friendly was, both ways save the office space reserved for the storage of junk IT equipments.

5. CONCLUSION & RECOMMENDATIONS

5.1 Conclusion

As far as Green IT is concerned, it is relatively new in Sri Lanka. Companies are still to look at this option and to explore, reap the benefits of green IT implementation. The initial investment in implementing on green IT will be benefited In future environment in Sri Lanka, while considering about the issues identified an the recommendations given to issues the SLIC must look into restructure the IT department and should seek benefits. This also allows the business to build brand image among the market players and to improve customer loyalty.

5.2 Recommendations

During this study many important details could be pointed out about the IT issues of Sri Lanka Insurance Corporation Ltd; the system could be upgraded without incurring much expenditure on recommendation given bellow.

i. Deploying resources.

More efficient strategy should be implemented with using adequate employees in installation and restoration processes and should improve the efficiency of the help desk to communicate the user department requirements quickly.

ii. Managerial efficiency & effective decision making.

Board of directors should put much weight on top and middle managers of the IT department and the IT professional should be influenced to be efficient and effective e in decision making.

iii. System maintenance & reduce response time for trouble shooting.

Special task force should be appointed to hunt the system break downs within minimum time lap and management should formulate strategies to minimize the system failures.iv. Disposal of hardware.

Green IT implementations should be formulated within the IT department of SLIC and the green IT principles should be applied on hardware disposals.

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v. Recruitment of service level workers & programmers.

Clearly identified a short of employees engaged in IT department in several levels, the top management should immediately analyze the employee requirements and immediate actions should be taken to refill the vacancies.

8. LIST OF REFERENCES

i. In-text References

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1. Laudon & Laudon, Management Information Systems – Managing the Digital Firm (11th

edn.)

2. Article “Harnessing Green IT: Principles and Practices” – (IT PRO January/February 2008).

ii. Internet Sites

1. Guidelines for citing references and electronic sources of information n.d., viewed 17th August 2010 <http://www.srilankainsurance.com/>

2. Guidelines for citing references and electronic sources of information n.d., viewed 6th

September 2010 <http://thefutureofthings.com/articles/1003/green-computing.html>

3. Guidelines for citing references and electronic sources of information n.d., viewed 10th September 2010 <http://www.greenit.net/whygreenit.html >

4. Guidelines for citing references and electronic sources of information n.d., viewed 10th September 2010 <http://greenpowermgt.com/>

5. Guidelines for citing references and electronic sources of information n.d., viewed 12th September 2010 <http://www.sustainableitarchitecture.com/>

6. Guidelines for citing references and electronic sources of information n.d., viewed 12th September 2010 < http://blog.tmcnet.com/next-generation-communications/2010/01/the_eco-benefits_of_green_it_for_the_dynamic_enterprise.html>

7. Guidelines for citing references and electronic sources of information n.d., viewed 15th September 2010< http://www.sitr.com/>

iii. Meetings and Interview References

1. Dinesh. K. interview, 18th August 2010, <mailto:[email protected]>

2. Chandima H. interview 18th August 2010 , <mailto:[email protected]>

3. Sugath L. interview, 28th August 2010 <mailto:[email protected]>

4. Gihan G. interview, 30th August 2010 <mailto:[email protected]>

5. Silva M. interview, 5th September 2010 <mailto:[email protected]>

Appendix 1

ACTIVITY A: The Journal

17 th August 2010: 15

I visited official web site of the Sri Lanka insurance corporation ltd;(SLIC) the place which I have been presently working (2.15 pm).I studied about the history of the SLIC and studied about the IT background by referring the data available in their official web site (http://www.srilankainsurance.com/).

18 th August 2010

Visited to SLIC’s IT department and met Mr. Dinesh Kodikara Assistant Manager ICT (mailto:[email protected]) and explained my requirement. I discussed about the basic details of the IT environment of SLIC and also discussed about the trends and short comings of the present environment. (8.45am)

18 th August2010

I went to meet Mr. Chandima Hemachandra the Additional General Manager - Head of IT (Silva M. interview, 15th September 2010 <mailto:[email protected]>And introduced my self and explained about my requirement also told him that I’m presently working in the same organizations’ finance department as an Accountant. (2.30pm)

28 th August 2010

I visited to meet Mr. Sugath Liyanage <mailto:[email protected] IT Executive >, explained the requirements and the scope of my study. I interviewed Mr. Liyanage to realize the help desk operations and the ways of handling internal customer requests. I discussed about the existing practice of maintenance and trouble shooting. I was able to gather facts to cover 2/3 of the part 2 of my study. (3.30pm)

28 th August 2010

I referred the text references of the pages 210-11 of the Laudon & Laudon (11 th edn) and the literature on computer infrastructure. (9.00pm)

30 th August 2010

I met Mr. Gihan Ganage IT technician <mailto:[email protected]> and interviewed and Also visited with him to a junk yard that maintained by IT department for store unused computer equipments. There I gathered adequate facts to cover full part 2 of my study. (3.00pm)

5 th September 2010

I visited to Mr. Mahendra Silva <mailto:[email protected]>, Senior Manager – HR and interviewed him, verified the ability for recruiting new employees to fill the departmental requirements. (8.45am)

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6 th September 2010

I browsed www.thefutureofthings.com/articles/1003/green-computing.html and abstracted information about green computing and referred articles published in the site about green computing. (7.30pm)

6 th September 2010

I referred the article “Harnessing Green IT: Principle and Practices” published in the USQ web site which gives a deep understanding about green computing. (9.3pm)

10 th September 2010

I logged on to http://www.greenit.net/whygreenit.html and downloaded information on green IT. Also visited the web site http://greenpowermgt.com/ to study the green power management principled and referred the articles published in the web site. Necessary literature had have been Downloaded which could be helpful to prepare the report. (9.00pm)

12 th September 2010

I visited to http://www.sustainableitarchitecture.com/ and red more about green computing and also logged to http://blog.tmcnet.com/next-generation-communications/2010/01/the_eco-benefits_of_green_it_for_the_dynamic_enterprise.html by logging on to these two web sites I realized the principles and policies about the sustainable IT environment and eco benefits of green computing. (9.10pm)

15 th September 2010

I visited the web site http://www.sitr.com/ this web site contains much details about disposals of computer hardware and more details o Reuse, Refurbish, and Recycle. Relevant findings were downloaded and studied further. This information is an important material to formalize the part 4 of the study. (9.00pm)

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