Managing Computing
Practices for managing an
architecture in which
programmers do not
report to IS
Business Within a
Business
Most firms manage IT as a business
within the business, with IT having its
own
career paths
job descriptions
personality profiles
Aligning IT with the
Business
Technology
Excellence
(Systems)
IT
User
Business Profitability
(Applications)
Organization Structures
Contractor
Formal agreements for services
Utility
Reliable information in standard form
Vendor
IS recommends solutions for business problems
Partner
IS and Line share responsibilities for success
Organizational Structures
Technology
Need
Partner
Vendor
Utility
Contractor
Non technology need
Contractor
The traditional organization for IS units in
the mainframe era.
Service level agreements
Negotiated services
Formal separation between users and
technical personnel
Contractor
IT
Business
Users
Negotiation
Contractor
Example: outsourcing.
While this model describes the internal
structure for many firms, it is the model
for any functions that are outsourced.
(See: Clermont, ‘Outsourcing without
guilt’, MoIS, #5.4).
Utility
Hopper, HBR, 1990
IS provides common interface among
business units. Common structure in
client/server architectures.
Is responsible for standard data or
software; users responsible for business
use.
IS monopoly
Business units are the innovators
Utility
Business
User
IT
Support
Utility
Example: cost centers.
IS units set up as standard interfaces
among relatively independent business
units.
Vendor
Quinn & Paquette, Sloan MR, 1990
IS competes with outside services for
resources. Acts as internal consultants.
IS responsible for understanding business
tactics
User accepts IS proposals
Vendor
Business
User
IT
Sell
Vendor
Example: profit centers.
Organizations that emulate consulting
firms and set up their IS organization as a
separate profit center do this. IS
competes for funding dollars against
outside organizations. (See: Allen, Make
IS pay its way, MoIS #5.7)
Partner
Henderson, Sloan MR, 1990
IS tightly integrated with business
strategy. Most common in high tech
businesses.
Users and IT consult on both technology
and business solutions
Shared rewards for business success or
failure.
Partner
IT
Business
User
Share
Partner
Example: distributed resources. Many
companies have distributed IT personnel
into business units so that the IT function
would report directly to the business unit
manager.
Relationship Choice
Contract
Utility
Vendor
Partner
The appropriate relationship depends on the
business strategy of the company, the
maturity of the organization and the
experience with IT
Business Strategy
Type A: seeks to obtain business
advantage from the use of technology
Type B: uses technology for business
advantage, although possibly not IT, and
is comfortable paying for quality
Type C: seeks to compete on a commodity
or cost containment basis
Four Stages of EDP Growth
Gibson & Nolan, Managing the four stages of EDP growth, HBR,
1974
1.
Initiation: new concept, exploring
the technology. No control.
2. Expansion: some applications found,
need to get people on board.
3. Formalization: costs become and
issue. Effective controls developed.
4.Maturity: technology well integrated and
managed.
Managerial Tactics
Laissez Faire
Monopolist
Acceleration
Marketing
Operations
Alavi, Nelson, Weiss, JMIS,
Critical Success Factors
Boynton & Zmud, An assessment of critical success factors, HBR,
1984
Those few things that must go well to
ensure success
Require continued monitoring
Measurable
Cover business requirements
IT
Business