Part 1 – Leadership issues
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Leadership
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Information systems management
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A part of the leadership team:
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IS (Information System)/IT leadership
CIO (Chief Information Officer)
CEO (Chief Executive Officer)
SMEs (Small and Medium Enterprises):
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Often no IT department, or perhaps only a few
positions to maintain equipment
IS leadership has to be performed by the company
management, often in cooperation with outside
consultants
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Managing the IS organization
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Newer IT trends:
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More hardware?: in machines, point of sale
terminals, automatic counters…
Distribution of systems to end users
More knowledgeable users.
Better ”off-the-shelf” products
Improved techniques for development, improved
tools.
Outsourcing by the use of an ASP (”Application
Service Provider”.)
Computing in the “cloud”
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Important
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Internet, Web, new IT tools, etc. are
changing the business infrastructure
New competition
New possibilities
IT becomes more important than before
But there are also many opportunities in
client-server applications
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From old to new tasks
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Traditional tasks such as running and
maintaining equipment are reduced and
often outsourced
New, often more strategic tasks,
emerge
Also applicable to IT-consultants:
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system development is still an important job, but
the most important task is to be able to see what
the company needs!
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The role of the CIO
(Chief Information Officer)
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Understand the company: its markets, business ideas,
competitors, challenges…
Let the IT department offer good service
Increase the IT maturity level in the company, education,
infrastructure…
Define visions of the future, let the company understand that IT
is an important factor in making the company more competitive
Implement the IS-architecture.
Develop and maintain a contact network to management,
suppliers, customers, experts…
Consider new applications that can give the company an
advantage
Develop new systems?
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Understanding the business
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Establish project teams to study the
marketplace.
Concentrate on lines of business.
Sponsor weekly briefings.
Attend industry meetings with line executives.
Read industry publications.
Hold informal listening sessions.
Partner with line executives.
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The market
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The company’s history
Current industry environment
Business ideas
The competitors (strength and
weaknesses)
External constraints (regulations, …)
Resources
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Lines of business
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Focus on each line (e.g., Molde College:
B.Sc. studies, master studies, doctoral
studies, research) instead of looking at
the whole organization.
The market, the customers, the
technology are line-oriented
Many SME companies have only one
“line”
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For each line ask the following
questions:
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Are we organized to support this line?
Do we have an ”account manager” responsible for
this line?
Do we have someone within that line of business
who oversees IT activity?
Do we have a sponsor here?
Do we have the attention of the line’s management?
Does the line of business offer an opportunity to use
systems in new ways?
As consultants for SMEs we can ask the same
questions!
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Important figure
Parker and Benson, Information Economics: Linking Information Technology and Business Performance,
Prentice Hall, 1988.
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Systems development
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Listen to users:
 Many problems can be solved with very
moderate effort (hours, days)
 With prototyping and modern development
tools it is possible to solve many times
within weeks or months
 Make realistic time prognosis and budgets
for large projects
 Try to avoid very large projects!
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For the consultant in an SME:
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Catch the environment in the company (structure, dynamic or static,
competitive or not, safe or uncertain future, entrepreneurial or not…)
Focus on strategy and business ideas
Understand the market, the competition, technology, type of company
Identify and analyze problems
What is the competence level of the employees – talk to them in their
language
Define IT needs
Understand what resources are available
Risk analysis
Work with central people in the organization: foremen, division managers,
IT-department (if any), and NECESSARY: top management!
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Our role as consultants
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Show willingness to listen and to understand
Solve real problems
Start with the problems that are easiest to solve
Be modest, underselling is better than overselling
Deliver good results within time limits and budget
constraints
Implement if necessary
Give guarantees, take risks on your own account?
Work hard if necessary
Establish confidence with users
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Aims and goals are important
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We need to know where we are going,
what our aims are
"If you don't know where you're going, it
doesn't matter which way you go." (Lewis
Caroll, Alice in Wonderland)
Can be stated as vision or mission
statements, for organizations as well as
systems
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Vision for the future
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Examples:
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”The customer shall have the packet by 09.00 tomorrow” (Federal
Express)
”The customer shall be able to satisfy his insurance needs by one
phone call” (USAA - insurance)
Any salesperson can order an elevator in a day (OTIS Elevator)
”By the end of the decade, we will put a man on the moon” (John
F. Kennedy)
”I have a dream” (Martin Luther King, Jr.)
US: Both “mission” and “vision”
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Mission statement (Univ. of
Michigan)
Mission Statement
The mission of the University of Michigan is to serve
the people of Michigan and the world through
preeminence in creating, communicating, preserving
and applying knowledge, art, and academic values,
and in developing leaders and citizens who will
challenge the present and enrich the future.
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Vision statement (Univ. of
Michigan)
Vision Statement
As we enter the twenty-first century, the University of Michigan intends
 To be a source of pride for all the people of Michigan and have a place in the heart of every
member of the University community.
 To have a place in the dreams of every potential member of the community of students, staff,
and faculty.
 To be recognized as a university that honors human diversity.
 To be a scholarly community in which ideas are challenged, while people are welcomed,
respected, and nurtured.
 To be an institution whose environment fosters creativity and productivity among all faculty,
staff, and students.
 To occupy a position of unique leadership among the nation's universities in research and
scholarly achievement.
 To be a community whose members all share responsibility for supporting its mission and
receive recognition for their contributions.
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How to develop a ”mission
statement”
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A goal or direction, what do we want to achieve
Business ideas (how shall we reach this goal)
Value basis (what do we believe in)
Example:
At the Developmental Studies Center we develop, evaluate, and
disseminate programs [business] that foster children's ethical, social,
and intellectual development [purpose]. While nurturing children's
capacity to think skillfully and critically, we also strive to deepen
children's commitment to prosocial values such as kindness,
helpfulness, personal responsibility, and respect for others - qualities
we believe are essential to leading humane and productive lives in a
democratic society [values].
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Vision
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Important – we agree on where we are going
(direction, inspiration, understood by everyone)
A vision is more general than a strategy, and can
therefore be kept even if the world change:
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Tactics:
Strategy:
Vision:
Mission:
How to win the battle
How to win the war
What we want to achieve by winning the war.
Why we want this
Should be operative (compare Federal Express and
Univ. of Michigan)
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How to develop a ”vision
statement”
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Start with dreams, intuition, creativity
Alt. 1: Start with the current situation: what is bad,
what is good, how can we improve
Alt. 2: Try to look into the future: what are the
challenges, paradigm shift, ”disruptive technologies”
Brainstorm process
Time horizon: 5-10 years
This is not team work, but a central task for the
management
The vision must be “sold” to the employees.
Everybody has to be told that this is important.
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Vision for IT
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IT will be an important competitive factor for
many institutions
It should therefore be a part of the vision
E.g.:
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A bank: The challenge is to let our bank be the
leading Internet based bank in Norway, letting the
customers perform all standard bank services over
the net.
An industry: By using IT we shall be able to
deliver customized products within lead times of
standard products, and with prices that are
comparable to serial produced products
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For a grocer
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Vision: To be the best alternative for
customers in our area
Strategy: We shall use IT to become effective
Goals:
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Reduce out-of-stock
Reduce over-date items
Offer what customers want
Be competitive
OMpro (Oshaug Metall)
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Vision for PPK (IT support system for propeller manufacturing):
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PPK shall enable the company to produce propellers with higher quality and
less costs than today
The company's competence on propellers shall be implemented within this
system
The system shall be able to retrieve, store and handle all data on propellers,
independent of the format that the customer use
The degree of automation should be as high as possible
Where automation is not possible the system should support users so that
the task can be performed accurately and efficient.
The system should be able to communicate directly with production
machinery
Employees should be able to use the system with a minimum of training.
There should be good procedures to catch and to handle error situations.
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Case: BP
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Organized as business units (150 i 100
land)
Just a small hierarchy above this
There is good communication between
the head office and each unit, but the
units enjoy a great degree of autonomy
“Peer-groups”, advice and discussion
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BP - IT
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Standards (Windows, Office, etc.)
Digital Business organization:
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Strategy and leadership, in parallel with BP’s
central strategy
Chief Technology Office, study ways of improving
BP as a digital organization
Projects
DB should be the knowledge division when it
comes to IT
Web (everything will be put on the Web)
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Case: Boeing
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Produce commercial as well as military
airplanes
Vision 1 (1960): ”The right part in the right
place at the right time”
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Problem: missing parts
Non existing parts were replaced by a ”tag”
2.500-5000 tags used each month
IS system to remedy this situation
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Boeing: A new market situation
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Reductions in defense budget (US)
Use of smaller airplanes (”hub” system)
Competition from Airbus (today the largest
manufacturer of passenger aircraft)
IS to:
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Increase Boeings response to market changes (design to
cost, reduced lead times, customer orientation)
Improve the service functions (after-sale-support).
Documentation from design data, spare parts handling,
diagnosis systems)
Streamline design and production process
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Boeing: Vision 2 (1980)
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Improved information flow
To build an airplane is an information process!
Every step in the process (design or production) give
more information
”Virtual production line”
Breaking apart the organizational structure to allow free
flow of information over organizational borders
Streamlining processes before automating
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Boeing: Vision 3 (-2010)
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Strategic Business Process Architecture
A study showed:
 The cart before the horse (IT controlled the business
processes, not the opposite)
 Clear vision for IT (not for the business ideas)
Important questions:
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What kind of business processes should we use?
What kind of information do we need?
How are the processes linked to the information?
How do we handle data?
What hardware and software do we need?
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Boeing: New IT architecture
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Boeing: Vision
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(www.boeing.com/vision)
People working together as a global enterprise for aerospace leadership
Detailed customer knowledge and focus. We will seek to understand, anticipate
and be responsive to our customers' needs
Large-scale systems integration. We will continuously develop, advance and
protect the technical excellence that allows us to integrate effectively the systems
we design and produce.
Lean enterprise. Our entire enterprise will be a lean operation, characterized by the
efficient use of assets, high inventory turns, excellent supplier management, short
cycle times, high quality and low transaction costs.
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Detailed customer knowledge and focus
Large-scale systems integration
Lean enterprise
Run healthy core businesses
Leverage strengths into new products and services
Open new frontiers
Leadership
Integrity
Quality
Customer satisfaction
People working together
A diverse and involved team
Good corporate citizenship
Enhancing shareholder value
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To day (About us)
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Boeing is the world's leading aerospace company and the largest manufacturer of
commercial jetliners and military aircraft, with capabilities in rotorcraft, electronic and
defense systems, missiles, satellites, launch vehicles and advanced information and
communication systems. Our reach extends to customers in 145 countries around the
world, and we are the number one U.S. exporter in terms of sales.
Boeing has a long tradition of aerospace leadership and innovation. We continue to expand
our product line and services to meet emerging customer needs. Our broad range of
capabilities includes creating new, more efficient members of our commercial airplane
family; integrating military platforms, defense systems and the warfighter through networkcentric operations; creating advanced technology solutions that reach across business units;
e-enabling airplanes and providing connectivity on moving platforms; and arranging
financing solutions for our customers.
Headquartered in Chicago, Illinois, U.S.A., Boeing employs more than 153,000 people in
more than 67 countries. This represents one of the most diverse, talented and innovative
workforces anywhere. More than 83,800 of our people hold degrees--including more than
28,900 advanced degrees--in virtually every business and technical field from more than
2,800 colleges and universities worldwide. Our enterprise also leverages the talents of
hundreds of thousands more skilled people working for Boeing suppliers worldwide.
This is another way of describing the company. Perhaps better than “mission” or “vision”
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Airbus – ikke så høytflyvende
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Airbus is a leading aircraft manufacturer whose customer focus,
commercial know-how, technological leadership and manufacturing
efficiency have propelled it to the forefront of the industry.
Airbus’ modern and comprehensive product line comprises highly successful
families of aircraft ranging from 107 to 525 seats: the single-aisle A320
Family, the wide-body long-range A330/A340 and the all-new next
generation A350 XWB Family, and the ultra long-range, double-decker A380
Family. The company also continues to broaden its scope and product range by
applying its expertise to the military market. It is as well extending its
portfolio of freighter aircraft that will set new standards in the general and
express freight market sectors.
Across all its fly-by-wire aircraft families Airbus’ unique approach ensures that
aircraft share the highest possible degree of commonality in airframes, on-board
systems, cockpits and handling characteristics, which reduces significantly
operating costs for airlines.
Dedicated to helping airlines enhance the profitability of their fleets, Airbus also
delivers a wide range of customer services in all areas of support, tailored to
the needs of individual operators all over the world.
Airbus - ansatte
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Airbus takes pride in the diversity of its employees, and values the special
experience and expertise that come from more than 80 nationalities
represented among its 52,000 employees.
The company thrives on the mix of ideas, vision and knowledge such a combination of
cultures creates. At the same time, Airbus encourages its employees to develop individual
talents and to be proud of their heritage.
Diversity is the essence of Airbus. With its global presence growing Airbus is now an even
bigger international family.
For an Airbus employee it is usual to work side by side with people from a range of
cultures. Career advancement within the company can take an employee not just to another
floor or another building – but to another country.
Airbus takes pride in the diversity of its employees, valuing the special experience and
expertise people from different backgrounds bring to the industry. The company thrives on
the mix of ideas, vision and knowledge such a combination of cultures creates. At the same
time, it encourages employees to develop their individual talents and experience and to be
proud of their roots.
But diversity is not just about nationality. An increasing number of Airbus employees are
women, who are working in a full range of jobs and responsibilities – including those
considered as traditional male roles.
Opera Software
IS architecture
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IS-architecture:
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How is the information organized in a company?
En IS-architecture cover:
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What IS systems do we have? What databases?
Do they interchange data? How?
What computers do we have? Other equipment?
Networks?
What standards do we use?
Who is responsible for what in the IS-architecture?
How do the IS-architecture support the goals of the
organization, -strategies, -processes etc?
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Implementing an IS architecture
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Modern organizations are complex – can IT be used
to control this complexity?
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Improved communication between people within and
outside of the organization (ref. Boeing)
Removing intermediates, flatter structures
Organize information for simpler access
Support goal-oriented activities
Automate
Web technology important (Intranet, Internet)
More ”business” directed than technological
We need support from the executives
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Future tasks for the IT-department
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The five waves of innovation:
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1. Reducing costs.
2. Leveraging investments.
3. Enhancing products and services.
4. Enhancing executive decision making.
5. Reaching the consumer (B2C, Web,
Internet, B2B)
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Waves of innovation
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The SABRE system (classical example)
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Wave 1 and 2 (ca 1965):
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Wave 3 (from 1976):
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Expanded to encompass hotels and car rental.
Wave 5 (1980-årene):
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Terminals in travel agencies, booking also for other airlines…
Wave 4 (78-79):
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Booking system for American Airlines (Costs: > 2 billion 2005-dollar.)
AAdvantage — frequent flyer program
Customer database to support strategic decisions.
EAASY SABRE over net (1996 on the Internet, travelocity.com).
Strategic alliances with Citibank and MCI.
e-savers
A separate company (separated from AA due to thrust regulations)
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The future of the IS department?
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4 functions:
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Managing operations (servers, net,
databases)
Systems (development, maintenance)
Development of an IS architecture
(strategy, framework)
Identify needs, what the company needs to
improve its competitiveness
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4 major IS activities
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The squeeze on traditional IS activities?
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Roles for IS
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IS Governance
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Driving innovation
Managing change
Supporting infrastructure
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Task for an IT consultant in an SME
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Develop IT strategy (often also participating in
defining an overall business strategy)
Define a systems architecture
Find areas where IT can have a strategic significance
Monitor competitors, customers and suppliers
Analyze, selecting and installing systems (”broker”)
Develop prototypes and system specifications
Help users to employ the systems
These are iterative, continuous tasks
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Case: Oshaug Metall AS
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40 employees, mold and machine
propeller blades for the world market
Business idea: Handle all types of
orders, independent of complexity,
secure delivery, competitive prices
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My task:
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Develop IT strategy
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IT
IT
IT
IT
IT
IT
IT
to improve efficiency
to improve quality
to reduce delays
for better contact with customers
to be able to handle complex orders
for better leadership
for a more flexible company
Until now their advantage has been in their
knowledge of the production process (molding,
machining), but their use of IT is becoming more and
more important in their effort to be competitive.
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Oshaug Metall: The company
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Management understand the importance of IT
Management are directly involved in the IT process
A dynamic company, non-bureaucratic, willing to take
calculated risks
Willingness to change processes and methods, to try
new ways of doing business
Employees are motivated to do a better job, see this
as their best possibility of maintaining their jobs in a
competitive market
New technology also in other areas than IT
(machinery, etc).
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Oshaug: Systems
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OM2000: Administrative system
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PPP: Planning system
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System for ISO control of propellers
Documentation
Best-Fit algorithms
Electronic transfer of propeller data
Model development
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Advanced algorithm to make an effective production plan
OmPro/CMMPPK:
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All data on orders and models
Process support (molding, delivery, material control)
Documentation
e-Business functionality
A system that produces a model geometry automatically based on the nominal
geometry (the blade required by the user) and a table of allowances
Integration between proprietary programs and standard programs (e.g. OM2000
and Visma)
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