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Date: 22Nov2007 WRY
Course: Multimedia Information Strategic Planning (MISP)
Course Code: TMI3411
Multimedia University, Cyberjaya, Trimester 2, Session 2007/2008.
ANSWERS TO SPICT1 – ASSIGNMENT NO. 3
SPICT1-A3Q1 – General ICT Strategic Planning Issues.
(a) Given the rapid rate of change in ICT capabilities, explain why you
would believe that strategic information system (IS) planning is a
worthwhile effort. Or if you believe otherwise, explain why it is not
worthwhile. (Hint: Good Book 3 on page 581)
ANSWER
Worthwhile – Strategic information system (IS) planning is worthwhile when
the information directly contributes to the operations of the business (e.g.
strategic business plan), which ultimately translates into generating income
and profits for the organization. For example, in the case of the Air Asia,
sharing business information directly with flyers is a critical success factor for
the airline company, so planning to provide real time, online, accurate and
complete information to potential clients is a crucial activity. With
technological changes, it is worthwhile for Air Asia to extend client access
down further to mobile equipment, like hand phones and PDAs. We do not
know what future gadgets will appear but if it is strategic to the business we
must consider them in our action plans.
Not worthwhile – It is not a worthwhile effort to conduct strategic
information system (IS) planning if for example, information requirements,
information flows, information gathering, etc, within the organization, with
suppliers or with customers is not one of our critical success factors.
Essentially, it is not worthwhile if information needs are not part of our core
business process. Information sharing and dissemination like the use of
electronic mail for communication, the intranet and company website
(internet presence) for information dissemination, and other office
applications like word processors, spreadsheets and presentation applications
are nowadays considered as common or standard IT applications for most
businesses. Once it has been setup, it is not worthwhile anymore to spend
time and effort in every future strategic information system (IS) planning
exercises since these applications are not directly connected to the core
business. The applications are used in the business but are not critical to the
success of the business.
(b) “Strategic advantages obtained by the effective use of ICT are not
sustainable”. If you agree with this statement, explain why. And if you
disagree with this statement, also explain why. Ha ha ha (Hint: Good
Book 3 on page 581)
ANSWER
Agree with the statement – If the technology that provided the ICT
strategic advantage is not owned by your company, i.e. the technology is
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owned by a third party, and is made available in the open market for other
competitors to acquire (buy) and implement, then you cannot sustain the
strategic advantage because it is a matter of time before others catch up with
you and create an even playing field.
Disagree with the statement – On the other hand, if the technology that
provided the ICT strategic advantage is owned by your company and you
have patented it (i.e. it is illegal for others to copy or use it, and you will not
sell the related products and services to others), then you can sustain that
strategic advantage up to the point until your patent expires, normally 15
years. After that it becomes an even playing field again. This patent concept
is the protection of intellectual property for a specified period. In life, there is
no intellectual property that you can claim ownership forever.
(c) Explain why in most cases, the strategic ICT plan is driven by the
strategic business plan and not the opposite? (Hint: Good Book 3 on
page 581)
ANSWER
If ICT is not the core business of the company (e.g. you are in manufacturing
and sales of non-ICT products), then it is the business that brings in the
money to pay for salaries and every other expense of the company. It is
common sense that the strategic ICT plan follow, is aligned to, or support the
strategic business plan. This is the situation in most cases where the ICT
department is one important part of the larger organization.
On the other hand, if ICT is the core business of the company (i.e. you
provide ICT products and services) then it is the strategic ICT plan that drives
the strategic business plan. More often than not, the strategic ICT plan
“merges” with the strategic business plan because in this special case “ICT is
the business”.
SPICT1-A3Q2 –Strategic Evaluation & Monitoring Tool – Balanced Scorecard.
(a) In your own words, explain how the Balanced Scorecard (BSC) process is
being used in strategic planning of ICT systems. You may illustrate using
suitable examples. (Hints: Good Book 1, pages 204 and 214)
ANSWER
The Balanced Score Card (BSC) process is a strategy evaluation, monitoring
and control technique. It is not a strategy formulation technique. The name
BSC is derived from the perception of an organization’s need to “balance”
financial measures, usually used exclusively in strategy evaluation, and
control with non-financial measures such as product quality and customer
service. The overall aim of BSC is to essentially balance the shareholder
objectives with customer and operational objectives.
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For example, to manufacture a product of high quality you need high quality
raw materials and high quality product designs. To achieve these two factors,
you need to spend more money as high quality raw materials cost more and
good product designers demand high salaries. You have therefore increased
your overall cost of the product (the financial measure) at the same time you
have increased your product quality (the internal business process measure).
Now somebody must make the decision on how to “balance” these two
opposite and inter-dependent issues – one is the increase in product quality
(which is good) while the other is the increase in product cost (which is not
good). The management must decide which way to go i.e. to consider the
overall business objectives. Therefore, a strategy must be put in place to
evaluate and control the balance between these two issues.
The above is precisely how the BSC is being used in strategic planning together with strategic thinking and opportunistic decision making.
(On this one, please refer to the answers to SPICT1 Assignment No. 1
Question No. 2 under Strategy versus Planning) Ensuing from these strategic
business decisions, the ICT infrastructure and ICT strategic plan to support
the new business operations must also be incorporated accordingly.
(b)Describe the four (4) mandatory perspectives (i.e. the views or
parameters of measure) of the Balanced Scorecard for an organization.
ANSWER
The four (4) mandatory perspectives of the Balanced Scorecard (BSC) for an
organization are as follows:
(1) Organization financial performance – e.g. data in numbers regarding
profits generated, manufacturing costs and other factors like borrowings,
loans, etc to run the business.
(2) Customer perception – e.g. customers believe that our products are of
high quality standards, meet their diverse needs, priced accordingly, etc.
(3) Internal business process – e.g. efficient manufacturing process like
200 units per day output, energy cost RM 0.35 per unit, and equipment
maintenance cost averaging RM 2.50 per unit, etc. These numbers reflect
efficiency when compared to other manufacturers in the same business.
(4) Internal learning and growth – e.g. the measure of human resource
capabilities in the organization. The increase in skills, knowledge and
competency for product engineering through research and development,
competence in sales and marketing, the continuous learning programs
implemented by the company for staff, etc.
(c) Provide four (4) examples, i.e. one each for the four (4) perspectives of
the Balanced Scorecard. Include in your examples, the KPI as the
measurement statement, the targets, the weights and the scoring
mechanisms.
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ANSWER
The BSC table below provides one KPI example for each of the four (4) BSC
perspectives with the set targets, set weights, scoring tables, actual scores and the
total points achieved.
BSC PERSPECTIVE and KPI
1
ACTUAL
SCORE
TOTAL
POINTS
10% max
0.30
5% less = 10
(5 - 8)% = 8
(8 – 10)% =4
10% more =0
8
2.40
50 less = 0
(50 - 60) = 5
(60 – 80) = 7
80 more = 10
7
2.80
3% less = 10
(3 - 5)% = 8
(5 – 7)% = 4
(7 – 9)% = 2
9% more =0
4
1.00
2
2
4
5
2
0.60
0.30
0.7 min
INTERNAL BUSINESS PROCESS
KPI = Electricity cost percent of
product total cost per unit
4
SCORING
TABLE
CUSTOMER PERCEPTION
KPI = Product quality by customer
survey for product A
3.
SET
WEIGHT
0.30
FINANCIAL PERFORMANCE
KPI = Gearing ratio for operations
(borrowings/assets)
2
SET
TARGET
0.20
7% max
LEARNING & GROWTH
KPI = R & D to achieve number of
new product models per year
0.40
0.25
0.20
5 models
0.30
less = 0
or 3 = 2
or 5 = 7
more = 10
(d)How do you calculate the individual performance index for each one of
the four (4) perspectives? How do you calculate the overall performance
index of the organization?
ANSWER
Normally, the number of KPIs for each BSC perspective is more than one. Each KPI
will have its own set weight contribution, which must total up to 1.0 for each BSC
perspective. The individual performance index for each perspective will be the sum of
the total points achieved for that perspective. This is just like “one trimester GPA of
study at MMU”.
For the overall performance index of the organization, we must first establish the
weight contributions of each of the four (4) BSC perspectives. In the example BSC
table above, these weights are 0.30, 0.30, 0.20 and 0.20, respectively, and adds up
to 1.0. The overall performance index is then the weighted sum of the individual
performance indices using these weight values. This is like the “the single CGPA for a
student at MMU”
SPICT1-A3Q3 – Industry Analysis: External Factor Evaluation (EFE) Matrix
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(a) An External Factor Evaluation (EFE) Matrix allows strategists to
summarize and evaluate what we call PEEST – the political, economic,
environmental, social, technological, demographic, governmental, legal
and competitive information. What are the five (5) steps in the
development of an EFE matrix according to the author of Good Book 2,
described on page 101?
ANSWER
(1) List the external factors as identified in the external-audit process covering
both the opportunities and threats to the organization.
(2) Assign to each factor a weight that ranges from 0.0 to 1.0, with a score that
indicates the relative importance of that factor to contribute to the success of
the organization. The higher weight is for the more important factor. The sum
of all the weights must equal 1.0.
(3) Assign a rating score (e.g. range from 0 to 10) to each external factor to
indicate how effectively the organization’s current strategies respond to that
factor. The higher rating is for the more effective strategy.
(4) Multiply each factor’s weight by its rating to determine a weighted score.
Since we used a rating range of 0 to 10, the maximum value of a weighted
score is 10.
(5) Sum the weighted scores for each variable to determine the total weighted
score for the organization. By the same reasoning as item (4) above, the
maximum value of a total weighted score is also 10.
(b)In what way is the EFE matrix using the SWOT concept? Is EFE an
extension or an enhancement of the SWOT process? (Hints: Study tables
3.7 and 3.8 carefully in Good Book 2, pages 102 and 103).
ANSWER
Essentially the EFE matrix is the “second half” of SWOT, specifically the analyses and
evaluations of Opportunities (O) and Threats (T), for factors which are external to
the organization. That is why the EFE is called the External Factor Evaluation.
The EFE matrix can be called an extension of SWOT if your normal SWOT analysis
does not include the weighting and rating assessments. It is not an extension if you
have already included the weighting and rating assessments in your normal SWOT
analysis.
(c) What are the major differences between the EFE matrix and the IFE
matrix? Is the IFE matrix also related to the SWOT process? If it is
related, explain how. (Hint: Good Book 2 on page 147).
ANSWER
The IFE matrix is basically the “first half” of SWOT, specifically the analyses and
evaluations of Strengths (W) and Weaknesses (W), for factors which are internal to
the organization. That is why the IFE is called the Internal Factor Evaluation.
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Similarly, the IFE matrix can be called an extension of SWOT if your normal SWOT
analysis does not include the weighting and rating assessments. It is not an
extension if you have already included the weighting and rating assessments in your
normal SWOT analysis.
(d)In the IFE matrix referred in (c) above, what do they mean by the
statement “Ratings are thus company-based, whereas the weights are
industry-based.”
ANSWER
According to Good Book 2, a weight is an assignment of relative importance of the
external factor to the success of the organization, while a rating is an assessment of
the effectiveness of the strategy being implemented in response to the external
factor.
The “ratings are company-based” means that the company must make its own
assessment on how effective its strategies are (i.e. self-evaluation), and there is
nobody outside to help them on this. This makes sense because the company itself is
the only one that can rate “what it believes” to be the effectiveness in the
performance (i.e. achievement) of its strategies.
On the other hand, “weights are industry-based” means that the relative importance
of the external factors to the organization is similar to other companies that belong
to the same industry (or market segment). This makes sense since every company is
“open to the environment” that provides the same opportunities and threats. It is a
matter of whether the company “sees” the opportunities and threats or it does not.
SPICT1-A3Q4 – Mini Case: SPICT1-Assn-03-Q4-At-Mashup-Camp.pdf
In this mini case titled “At Mashup Camp, geeks plot future of Web” answer the
following three (3) questions:
(a) Chris Radcliff said "This is taking the SOA idea and applying it to the
mess that is the real world. You can grab pieces from here and there. It
makes it a lot more informal, which increases adoption". Is this the idea of a
mashup?
ANSWER
Yes. The above statement is really the idea of a mashup. In fact, the word mashup
came from the words “messed up”.
(b) According to the author of this article, Martin LaMonica, there is a major
difference between a mashup and web services running on SOA (serviceoriented architecture). What is the difference?
ANSWER
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A web service on SOA is a formal specification with strict rules that must be
obeyed, built through highly structured and complex web architecture. The service
oriented architecture (SOA) comprises a suite of Web services standards and
infrastructure software built on a modular design. The application codes that serve
this web service are normally large and powerful, and thus can at times be slow and
sluggish. This web service queries data from various distributed sources, for
example, data of the organization in its own internal network, and sometimes
subscribed data (paid and licensed) on the internet from public and private sources
(i.e. with permission). Most large corporate software run complex web services on
the SOA following certain shared standards.
Mashups also use the web service SOA idea described above, except that mashups
are smaller, stripped-down, and lightweight web applications. Mashups are a lot
more informal than a web service on SOA and at times do not follow strict
communication rules. Mashups also pull together data from different sources on the
internet, for example, weather information and product shipping information, etc, by
querying for data from these different websites. Mashups sometimes grab data from
websites without permission. Mashups in contrast to the web service on SOA, tend to
focus on speed and simplicity, wiring together different Web sites using quick and
lightweight methods.
Because of the simplicity, lightweight and execution speed of mashups over web
services on SOA, mashups are already gaining wide acceptance in the ICT world.
This can be inferred from the statement in the article: "You see SOAs and Web
services struggling to get critical mass (i.e. wide acceptance), and this lightweight
programming model (i.e. mashup model) is already hitting critical mass."
(c) Explain why mashup developers have a “fear of getting cut off”.
ANSWER
Mashups operate by grabbing pieces of information from here and there on or off the
internet. A mashup application can be written such that it uses a Web site's API
without prior permission to get whatever information it wants. This is contravening
the law and has been said to be pushing the legal limits.
Mashup developers have a “fear of getting cut off” means the developers feared that
some of the current sources that allow mashups to query for data may shut off (shut
down) access to the mashup applications. The reasons for cut off could be legal (e.g.
must subscribe and pay for the data, or must be licensed, etc,) or the mashups had
become serious commercial competitors, or the mashups had consumed too many
resources, such as bandwidth, which slowed down the services or the original web
services.
Note: The “fear of cutoff” is real for mashups because their operations of freely
grabbing pieces of information from here and there on and off the internet rely on
the data provided by Web services providers. When data access is cutoff, mashups
will not function anymore because they have no data on their own. Ha ha ha.
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SPICT1-A3Q5 – Mini Case: SPICT1-Assn-03-Q5-Business-Mashup-Enterprise2.0.pdf
In this mini case we provided three (3) short and related articles listed below:
(1) Business-Ready Mashup Platforms
(2) Making use of the world-wide services cornucopia
(3) The state of Enterprise 2.0
(a) With so much hype about “mashup”, what does mashup really offer
business users according to Dion Hinchcliffe in the article Business-Ready
Mashup Platforms?
ANSWER
According to Dion Hinchcliffe, his vision for what mashups can really offer business
users is summarized in the statement: Mashups could theoretically allow business
users to move — when appropriate — from their current so-called “end-user
development tools” such as Microsoft Excel that are highly isolated and poorly
integrated to much more deeply integrated models that are more Web-based and
hence more open, collaborative, reusable, shareable, and in general make better use
of existing sources of content and functionality. These tools could let thousands of
workers solve their situational software integration problems on the spot themselves,
instead of waiting (sometimes forever) for IT to provide a solution.
(b) In the article titled Making use of the world-wide services cornucopia
(i.e. abundance, large amount of available services), what does the author
mean by the statement “that the blurriness between the boundaries of your
systems and others - and your organization and others – will only increase
over time”?
ANSWER
One of the premises of Enterprise Web 2.0 is that not only are these "re-mixing"
techniques (i.e. mashups) valid and viable within the organization, but that the
blurriness between the boundaries of your systems and others - and your
organization and others – will only increase over time.
The above statement means that in the long run, if you were to implement many
little, lightweight mashups applications in your system, you will end up not being
able to identify the boundaries of your own applications from others because there is
so much “messing up” or “mashup” of your data coming from various sources; - and
that is precisely the idea of a mashup - a web application that combines data from
more than one source into a single integrated tool and relying on others to provide
the data. The statement above uses the phrase “increase in blurriness of the
boundary” which means “the decrease in sharpness of the boundary” to a point
where we eventually cannot identify the boundary anymore. Ha ha ha.
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(c) What are the two (2) questions about the “State of Enterprise 2.0” to
those companies that are not sure (undecided) about its successful
adoption?
ANSWER
The two (2) big questions for many companies regarding their indecisiveness on the
adoption of Enterprise 2.0 are:
(1) Do we now have the right capabilities in terms of ready Enterprise 2.0 products?
(2) Do we generally understand how to apply them properly to obtain good returns
on our investment (ROI) in them?
The companies believed that knowing the answers to both questions will almost
certainly tell them if they were ready for mainstream adoption of Enterprise 2.0 any
time soon.
(d) Summarize the seven (7) lessons on Enterprise 2.0 with “just one
sentence” for each lesson. It means that you put down seven bullet points,
and each bullet point is just one sentence for each lesson. (Now you get to
practice making bullet summaries that you liked so much. Ha ha ha.)
ANSWER
The following seven (7) lessons are what we’ve learned about “The state of
Enterprise 2.0” up to this point of Fall 2007 (October 22nd, 2007):
(1) Enterprise 2.0 is going to happen in your organization with you or without you.
(2) Effective Enterprise 2.0 seems to involve more than just blogs and wikis.
(3) Enterprise 2.0 is more a state of mind than a product you can purchase.
(4) Most businesses still need to educate their workers on the techniques and best
practices of Enterprise 2.0 and social media.
(5) The benefits of Enterprise 2.0 can be dramatic, but only builds steadily over time.
(6) Enterprise 2.0 doesn’t seem to put older IT systems out of business.
(7) Your organization will begin to change in new ways because of Enterprise 2.0.
Important: You must visit the websites below to see a real life Enterprise 2.0 being
implemented and used in MMU, Cyberjaya for FIT students and staff. Register and
join in the discussions. Ha ha ha.
http://groups.google.com/group/fit-cafeteria
http://groups.google.com/group/fit-cafeteria/browse_thread/thread/d57c1d00183716a5
http://groups.google.com/group/fit-cafeteria/browse_thread/thread/9029f9440e36ecd0