CH-5-6 Information Systems and Business Transformation – Managing and Using Information Systems: A Strategic Approach : Book Guide

This Document Contains Chapters 5 to 6 Chapter 5: Information Systems and Business Transformation Chapter Overview The title for this chapter has been changed in this edition to emphasize transformative goals, rather than simply the systems or technologies responsible for the changes in business processes. This chapter explores the relationship between the transformation of business and information systems. There are three key concepts in this chapter: the first is that businesses operate as a set of business processes, rather than as a set of functions, departments, or other organizational forms; second is that business processes are redesigned using both radical (reengineering) and incremental techniques: and third, IS are used to transform a business (by way of changing their business processes). Two of the major concepts discussed in the chapter are Integrated Supply Chains and Enterprise Systems. Other subjects covered in this chapter are agility and the need for constant redesign of business processes. Also, business process management systems are introduced. Discussion Opener: The first slide for this chapter provides discussion questions and brief answers in the notes section of the slide. Alternate Discussion Opener: How might IS change your collaboration and communication while participating in a virtual team project? What are the main challenges you would anticipate? Key Points in Chapter IS can enable or impede business change. IS enables change by providing both the tools to implement the change and the tools on which the change is based. However, IS can impede change, particularly when the desired transformation is mismatched with the capabilities of the IS. The chapter starts out with the case study of Sloan Valve Company and how this company was able to change the way it did business through efficient management of its new product development processes. This is a good case to discuss with your students (using the slide and sample questions as suggested above) and to set the stage for the importance of the process management model. To understand the role IS plays in business transformation, one must take a business process, rather than a functional, perspective. A business process is a well-defined, sequential set of tasks that has a beginning and an end, a set of associated metrics, and cross-functional boundaries. Most businesses operate according to business processes, even if their organization charts are structured by functions rather than by processes. The text compares functional (or silo) perspective with the process perspective. Agile processes are flexible and simplified, focusing on iterative design rather than structural procedures for system design. Dynamic processes refer to systems that learn and develop as they are used in business. Both are critical for companies to remain competitive in rapidly changing, competitive industries. Making changes in business processes is typically done through either TQM or BPR techniques. TQM techniques tend to imply an evolutionary change, where processes are improved incrementally. Six Sigma is mentioned as an example of a TQM approach. BPR techniques, on the other hand, imply a more radical objective and improvement. Both techniques can be disruptive to the normal flow of the business; hence strong project management skills are needed. Business Process Management (BPM) Systems are a class of systems that emerged to help manage workflows in the business. They primarily help track document-based processes where people execute the steps of the workflow. They exceed the document-management capabilities, including features that manage person-to-person process steps, system-to-system steps, and those processes that include a combination. Systems include process modeling, simulation, code generation, process execution, monitoring, and integration capabilities for both company-based and web-based systems. The tools allow an organization to actively manage and improve its processes from beginning to end. Enterprise systems are large information systems that provide the core functionality needed to run a business. These systems are typically implemented in order to help organizations share data between divisions. However, in some cases enterprise systems are used to affect organizational transformation by imposing a set of assumptions on the business processes. SAP and Oracle are the most widely used enterprise systems around the world; the comprehensive software packages contain enterprise resource planning (ERP), customer relationship management (CRM), and supply chain management (SCM) software modules. Other vendors offer systems, and some companies have chosen to put together their own enterprise system rather than buy a single package from one vendor. Implementing an enterprise system, regardless of the vendor, is an enormous task. They are well-suited to drive business process design when organizations are just building their processes, when the operational business processes are not a source of competitive advantage, and when current systems are in crisis. It is inappropriate for the enterprise system to drive business process design when the strategic advantage of the organization is derived from these processes, since using a vendor-designed enterprise system might force the organization to change their processes and lose their advantages. Horizontal integration is a term for looking beyond individual business processes and considering the bigger, cross-functional picture of the corporation. Integrated databases, web 2.0 technologies and services, and common infrastructure are the tools IT brings to the implementation of horizontal integration. This model consolidates all individuals from all business units into a single organization, run centrally, and utilized by each business unit. Company decision makers must determine two primary design elements: integration and standardization. CEMEX is an example that is cited, which demonstrates how one company used these concepts to create a competitive advantage. ERP is an integrated solution, allowing users to access a centralized data repository and common applications that are easily coordinated. These solutions require large-scale implementations with sound project management, and are often costly to pursue. Due to the radical changes often associated with ERP implementations, particularly to business processes, end-users are often resistant to adopt the new processes. The issue of change is important to discuss with your students and why people will resist change. Figure 5.7, new to this edition, along with Figure 5.8, offer a clear differentiation of ERP vs ERP II and the tasks they cover. Figure 5.9 is quite useful for class presentation, showing the advantages and disadvantages of ERP systems. Another important discussion addresses how to match the system to the firm, choosing whether to have the ERP drive the transformation or when the redesign should come first. Geographic Lens: Global vs. Local ERPs – The major ERP vendors, like SAP and Oracle, show a Western bias in reporting best practices. Due to problems encountered, businesses in non-Western companies/locations are turning to local vendors. If the system is based on a cultural model that conflicts with the local customs and which cannot easily be accommodated by the ERP, it should not be implemented. Therefore, managers must be aware of the cultural intricacies of their organization and determine the best way to implement a system that will meet the needs of the organization as a whole. It would be helpful to brainstorm on this section to determine the best way to handle a situation where a system is being introduced in a cross-cultural environment. Perhaps the students can discuss ideas that may help to minimize issues as they relate to culture. The text has a section on integrated supply chains. This is the concept of linking business processes across companies. The instructor can direct students to review Chapter 2 (specifically, Figures 2.5 and 2.6). A supply chain is the process that begins with raw materials and ends with a product or service ready to be delivered to a customer. Integrated supply chains have to overcome several challenges such as information integration, synchronized planning, and workflow coordination. The challenges for integrating ERP systems between companies are covered in this section. Similarly to the integrated supply chain issues, there are issues of what to share, how to share it, what to do with it when it’s shared, and how to secure it. Another concern is the “neighborhood effect”: the high cost of transportation leading to identification of suppliers closer to the parent company. Product Lifecycle Management (PLM) is another type of enterprise system that tracks a product from idea to sales. Included are innovation, design, production, maintenance, components, vendors, customer feedback, and marketing. Since this is less familiar, students should be encouraged to investigate these systems and share their findings with the class. Social Business Lens: Crowdsourcing Change Innovation Processes – Companies use social networking to solicit ideas and gather feedback. Customers and interested participants voluntarily provide their opinions and comments, often without any promise of compensation. Examples are given. Illustrative Answers to Discussion Questions 1. Why was radical design of business processes embraced so quickly and so deeply by senior managers of so many companies? In your opinion, and using hindsight, was its popularity a benefit for businesses? Why or why not? Answer: This idea was embraced so quickly because managers realized they needed to change the way they did business and reengineering offered them a roadmap to do that. Reengineering was written up as the method to use to achieve very significant (75% or more) increases in productivity, decreases in costs, and increases in efficiency. It was a benefit for businesses in part because even if they didn't achieve the radical objectives they set for themselves, they did realize that changing their operations was not only possible, but also critical if they want to operate at a reasonable cost level. Other managers realized that business processes were the critical unit of business, not functional or geographical region. Still other businesses achieved real savings and real productivity gains from the process of reengineering. It was not necessarily a benefit to business because the process of reengineering was disruptive to daily operations. Many people were pulled out of the daily business and put on reengineering teams. Those left in the operations were overloaded, and in many cases, the business was forced to abandon reengineering efforts. This was costly. 2. Off-the-shelf enterprise IS often forces an organization to redesign its business processes. What are the critical success factors to make sure the implementation of an enterprise system is successful? Answer: The critical success factors would include things like a well-thought-out design of the business process when the enterprise system is used, a comprehensive communications plan to ensure everyone affected is adequately informed, and a well-tested technology to ensure that no technical problems inhibit operations. 3. ERP systems are usually designed around best practices. But whose best practices are the right ones? A Western bias is common; practices found in North America or Europe are often used as the foundation. When transferred to Asia, however, the resulting systems may be problematic. Why do you think this is the case? What might be different in the way different countries use processes (besides the standard “language” difference)? Answer: It would be helpful to have students from various cultures discuss this question based on their personal understandings of their native countries. As explained in the chapter, allocating beds in a hospital depends on expectations of a particular country. Other considerations involve accounting practices (credit or type of payment), level of granularity required of the data, decision rights of the personnel involved, time/task duration (conservative estimates or flexible), etc., would all be impacted by culture. The discrepancy in the effectiveness of ERP systems between Western and Asian contexts can be attributed to various factors beyond language differences. Cultural differences play a significant role, influencing business practices, communication styles, decision-making processes, and organizational structures. Additionally, societal norms, values, and expectations shape attitudes toward technology adoption, change management, and collaboration within and across organizations. Furthermore, regulatory environments, market dynamics, and economic conditions vary between regions, impacting the relevance and applicability of certain best practices. Moreover, historical contexts, legacy systems, and industry-specific requirements contribute to the unique operational challenges faced by Asian organizations when implementing Western-designed ERP solutions. Thus, successful ERP implementations in Asia necessitate cultural sensitivity, localization efforts, and adaptation to local business realities to ensure alignment with organizational objectives and user needs. 4. Have you been involved with a company doing a redesign of its business processes? If so, what were the key things that went right? What went wrong? What could have been done better to minimize the risk of failure? Answer: This is a very open-ended question. Depending on the students’ backgrounds, they may or may not have any insights to answer it. For a less-experienced student, the instructor might suggest trying to redesign a process at the school (or work location) to gain some insights. Typically, things that go right include a good process design, a high-energy team ready to make changes, good people working on the process design, and other technology- and process-oriented issues. Things that go wrong typically include insufficient resources (e.g. people, time, money), poor communication with those affected by the changes, lack of strong leadership (or senior leadership support), and other people-oriented issues. Try to get students to be specific in their responses. While I haven't been directly involved in a company's business process redesign, I can offer insights into key success factors and potential pitfalls based on common practices. Key things that typically go right include thorough analysis and understanding of current processes, involvement of stakeholders at all levels, clear communication of objectives and expected outcomes, and alignment with the company's strategic goals. However, potential challenges may arise from resistance to change, insufficient training and support for employees, underestimation of implementation timelines and resource requirements, and overlooking the impact on organizational culture. To minimize the risk of failure, it's essential to prioritize change management efforts, engage employees early and often throughout the process, provide adequate training and support, conduct pilot tests before full implementation, and regularly monitor and evaluate progress against predefined metrics. Additionally, fostering a culture of continuous improvement and flexibility can help adapt to unexpected challenges and ensure the success of business process redesign initiatives. 5. What do you think the former CIO of Dell, Jerry Gregoire, meant when he said, “Don’t automate broken business processes”? Answer: The system development process starts by looking at the current system. This is good for understanding the environment and determining problems with the current system. However, it may bias the system’s designers and keep them from seeing innovative approaches to resolving problems and meeting organizational needs. Business process reengineering involves radically rethinking how system components can best work together. Often this means coming up with a new set of processes instead of designing the system around current inefficient and/or ineffective processes. By automating a broken business process, it might only enable people to do the wrong activities more quickly. When Jerry Gregoire, the former CIO of Dell, said, "Don’t automate broken business processes," he likely meant that simply automating inefficient or ineffective processes without first optimizing or redesigning them will not lead to improved outcomes. Automating broken processes may only serve to amplify existing issues or inefficiencies, resulting in wasted resources and missed opportunities for improvement. Instead, organizations should focus on identifying and addressing underlying issues in their processes before implementing automation solutions. This involves conducting thorough process analysis, streamlining workflows, eliminating unnecessary steps, and ensuring alignment with business objectives. By fixing broken processes prior to automation, companies can maximize the benefits of technology and achieve sustainable improvements in productivity, efficiency, and quality. Ultimately, Gregoire's statement underscores the importance of prioritizing process improvement efforts and strategic planning before investing in automation initiatives. 6. What might an integrated supply chain look like for a financial services company such as an insurance provider or a bank? What are the components of the process? What would the customer relationship management process look like for this same firm? Answer: A bank may use this type of system to link payroll services that it sells to its customers, but which are actually purchased by the bank from a 3rd party organization; the bank in turn links directly to its customers through a web site where customers order the particular payroll items they want, which are then forwarded by the bank to the 3rd party organization and then sent to the customer. Another example could be the printing of new checks for clients of a bank. Clients order the checks from the bank which in turn automatically forwards the orders to a 3rd party printer, who in turn mails the checks directly to the clients. To clients, these transactions are transparent. They only know that they need checks, and ordering them online through their bank and getting them as soon as possible is their primary concern. The customer relationship management process would include all interactions, or touch points, between the company and the clients. The data repository would contain all personal information such as addresses and phone numbers, products purchased (including services), recent transactions, and any complaints registered. Corporate employees would have all of this information available to them whenever the clients use the call center, maintaining a positive, long-term relationship with the clients. 7. Tesco, the U.K. retail grocery chain, used its CRM system to generate annual incremental sales of £100 million. Using a frequent-shopper card, a customer got discounts at the time of purchase and the company got information about their purchases, creating a detailed database of customer preferences. Tesco then categorized customers and customized discounts and mailings, generating increased sales and identifying new products to expand their offerings. At the individual stores, data showed which products must be priced below competitors, which products had fewer price-sensitive customers, and which products must have regular low prices to be successful. In some cases, prices are store-specific, based on the customer information. The information system has enabled Tesco to expand beyond groceries to books, DVDs, consumer electronics, flowers, and wine. The chain also offers services such as loans, credit cards, savings accounts, and travel planning. What can Tesco management do now that they have a CRM that they could not do prior to the CRM implementation? How does this system enable Tesco to increase the value provided to customers? Answer: Tesco can implement differentiated pricing strategies based on detailed information about price elasticity. Previously, management did not possess this level of detailed information. The benefit to customers is that coupons and discounts can be targeted to their unique preferences. Rather than getting bombarded with sales announcements unrelated to their interests, this approach would be a welcomed change. Logically, both Tesco and its customers would benefit from this new system. Further Discussion Questions 1. What are some of the “hidden costs” that must be considered in BPR or the implementation of enterprise systems? Is incremental (or continuous) improvement preferable to BPR? Explain. Answer: Some of the hidden costs associated with business process reengineering (BPR) or the implementation of enterprise systems include expenses related to employee training and re-skilling, potential disruptions to business operations during the transition period, the need for ongoing maintenance and support of new systems, and the risk of project delays or scope creep. Additionally, there may be costs associated with data migration, integration with existing systems, and customization to meet specific business requirements. While incremental or continuous improvement approaches offer benefits such as reduced risk, shorter implementation timelines, and lower upfront costs, BPR may be preferable in cases where significant process inefficiencies or bottlenecks exist, requiring radical redesign to achieve transformative change. However, the decision between incremental improvement and BPR should be based on careful consideration of organizational goals, resources, and readiness for change, as well as the potential impact on stakeholders and business outcomes. Ultimately, both approaches have their merits and should be evaluated based on the specific context and objectives of the organization. 2. How can organizations encourage end-users to adopt a new ERP system? Provide specific examples, possibly from personal work experiences. Answer: Organizations can encourage end-users to adopt a new ERP system by involving them in the implementation process from the outset, seeking their input on system requirements and design preferences. Providing comprehensive training and support tailored to the needs of different user groups can also increase user confidence and competence in using the new system effectively. Additionally, offering incentives or rewards for early adopters and showcasing success stories of how the ERP system benefits employees and improves work processes can foster enthusiasm and buy-in. Creating user-friendly interfaces and intuitive workflows within the ERP system can reduce resistance to change and make it easier for end-users to transition from legacy systems. Moreover, establishing a network of super-users or champions who can serve as advocates and provide peer support can encourage adoption and address user concerns in real-time. Furthermore, soliciting regular feedback from end-users and incorporating their suggestions for system enhancements can demonstrate responsiveness to their needs and foster a sense of ownership and investment in the new ERP system. Leveraging gamification techniques, such as leaderboards, badges, and challenges, can also make learning and using the ERP system more engaging and enjoyable for end-users. Lastly, fostering a culture of continuous learning and improvement, where employees are encouraged to explore new features and functionalities of the ERP system and share best practices with their peers, can sustain long-term adoption and maximize the value of the investment. 3. What are some of the challenges of managing the processes of an organization and how can BPM systems help? What are some of the challenges of integrating a BPM system? Answer: Some challenges of managing organizational processes include inefficiencies, lack of transparency, disparate systems and data silos, compliance risks, and difficulty in adapting to changing business requirements. BPM systems can help address these challenges by providing a centralized platform for modeling, analyzing, optimizing, and automating processes. They enable organizations to standardize workflows, streamline communication, track performance metrics, and enforce compliance with regulatory requirements. Additionally, BPM systems facilitate collaboration among cross-functional teams, promote accountability, and empower process owners to continuously improve processes based on real-time data and feedback. However, challenges of integrating a BPM system include the complexity of aligning disparate systems and legacy applications, data migration issues, resistance to change from employees accustomed to manual processes, and potential disruptions to business operations during implementation. Moreover, ensuring interoperability with existing IT infrastructure, customizing the BPM system to meet specific business needs, and managing costs and resource constraints can pose additional integration challenges. Despite these challenges, successful integration of a BPM system can yield significant benefits in terms of improved efficiency, agility, and competitiveness for organizations willing to invest the time and effort. Cases Case Study 5-1: SANTA CRUZ BICYCLES This case is to show how innovation of processes can significantly improve time to market of new designs through simulation prototyping. The company was able to significantly shorten the design-to-prototype process (from 28 to 14 months). 1. Would you consider this transformation to be incremental or radical? Why? Answer: It appears to be a radical transformation because it has sped up the simulation process significantly, and made it possible to track design changes using a PLM (Product Lifecycle Management) package. 2. What, in your opinion, was the key factor in Santa Cruz Bicycles’ successful process redesign? Why was that factor the key? Answer: The key change that improved time to market was Santa Cruz’s more efficient design and prototype process. This led to the implementation of a simulation and design system that permitted the prototypes to be designed and tested in a confined and semi-realistic environment much faster than in the past. Changing the process allowed the R&D team to work in a much more efficient and timely manner, reducing the cycle time from 28 months to less than half the time. If the organization had not changed the way it was doing R&D, they would have been in the same dilemma of a long design-to-prototype process. 3. What outside factors had to come together for Santa Cruz Bicycles to be able to make the changes they did? Answer: The introduction of PLM software. They were able to leverage the same type of system used by a large, global manufacturer which was obviously affordable to Santa Cruz Bikes. This permitted the designers to create and modify the designs and model them in a simulated environment. Also, the company hired a master frame builder so that construction of new designs could be done more quickly and with greater control. Lastly, they purchased a new system for fabricating parts for the prototype, accomplishing these tasks in-house rather than outsourcing the production. All of these changes were made due to the change in how the company viewed the processes that were currently being performed. 4. Why is this story more about change management than software implementation? Answer: Software implementation can be done by any organzation, at least theoretically. This new way of doing business by Santa Cruz Bicycles was spurred by a willingness to change the way the company performed R&D. If they had not been willing to change their business processes, then the new software would probably never have been implemented. Case Study 5-2: Boeing 787 Dreamliner This case explores the challenges of implementing a radical process change into a large organization and relying on an extensive supply chain that is integrated globally across many companies. 1. Why did Boeing adopt the radical redesign for designing and developing the 787 Dreamliner? In your opinion, was it a good move? Defend your choice. Answer: Boeing decided to rely on collaboration and to use collaboration as a competitive tool, rather than relying on just technical know-how in a new global supply chain process. It hoped that this change would spur cost and time savings for the company. The company was confident (perhaps overly so) that it could pull off such a radical process change. (This next part of the question is opinion, so there will be a variety of possible answers. Ensure that students are able to substantiate their answers.) If a student states that it was a good move, then they need to discuss such things as the long term effect of the new system on Boeing and how it could radically change and improve the way things are done once the kinks are worked out. If they say that is was not a good move, they may say that Boeing should have tested the new system on a lower risk and lower profile project. Boeing adopted the radical redesign approach for the 787 Dreamliner to address market demands for increased fuel efficiency, reduced operating costs, and improved passenger comfort. The company aimed to leverage advanced materials, manufacturing techniques, and technology to achieve these objectives while also streamlining production and reducing development time. In my opinion, it was a good move for Boeing, as it allowed the company to introduce groundbreaking innovations and differentiate itself in the highly competitive commercial aircraft market. The Dreamliner's composite fuselage, more efficient engines, and modular assembly approach offered significant advantages over traditional aircraft designs, attracting orders from airlines worldwide. Despite initial challenges and delays, the 787's innovative features and performance capabilities have positioned Boeing as a leader in the next-generation aircraft market, demonstrating the benefits of bold innovation and risk-taking in the aerospace industry. 2. Using the Silo Perspective vs. Business Process Perspective analyze the Dreamliner program. Answer: The dreamliner program suffered from some of the disadvantages of the silo perspective. Vendors were not communicating with each other in the supply chain which led to delays and defects in the components delivered to Boeing. The goal of the program was to change the process and adopt a perspective that links all members of the supply chain together into one giant seamless process. So even though Boeing set out to capitalize on the business process perspective, and that was the design of the new system, the company encountered problems that would normally occur in a silo perspective environment. 3. What are your conclusions about the design of the integrated supply chain? Give some specific ideas about what could have been done to integrate it better. Answer: Obviously, the integrated supply chain failed in its implementation. Theoretically, the plan had merit, but the components did not communicate well or work together for a common successful outcome. Focusing on skills as the measure of comparison is an interesting change from costs, however, the project failed at the intersections and handoffs of the deliverables. More time and energy needed to be devoted to meeting detailed specifications. Setting quality requirements would have eliminated some of the negative outcomes. Creating cross-functional teams that were forced to communicate regularly would have prevented some of the flaws. There was obviously a lack of a coherent communications program since several of the vendors were not communicating with each other, which led to the major set backs of the project. There was probably unnecessary complexity in the new system for a process that had worked in previous iterations of Boeing airliners. The new integrated supply chain system had not been proven on a less critical project. Lastly, Boeing outsourced some of the major components-- wings and fuelage-- for the first time in design history , while attempting to reengineer the entire design and production process. This may have created an environment in which the employees failed to embrace the system. 4. If you were the program manager, what would you have done differently to avoid the problems faced by the Dreamliner program? Answer: They could have made sure that the system was tested on part of the new system prior to roll out to the entire massive Dreamliner project. The manager could have tested the idea on a different, less high-profile product that still had a large number of suppliers in the supply chain. Careful monitoring and testing is critical. Also, the manager should have established a clear communication flow chart for the suppliers that needed to interact with each other, and closely monitored and facilitated this communication. (Your students will have a plethora of suggestions for the project manager. Take the time to discuss this question as many of them will be either involved in a project like this, or may even be the manager of such a project.) As the program manager for the Dreamliner, I would have implemented several measures to avoid the problems faced by the program. Firstly, I would have conducted more thorough risk assessments and feasibility studies during the initial design phase to identify and mitigate potential technical, supply chain, and regulatory challenges. Secondly, I would have prioritized communication and collaboration between Boeing's internal teams, suppliers, and regulatory agencies to ensure alignment and transparency throughout the development process. Additionally, I would have implemented stricter quality control measures and performance benchmarks to address issues related to component reliability and manufacturing defects. Furthermore, I would have established contingency plans and alternative sourcing strategies to mitigate disruptions caused by supply chain bottlenecks or production delays. Moreover, I would have implemented a more incremental and iterative approach to testing and certification to identify and address issues earlier in the development cycle. Additionally, I would have ensured better coordination and integration between different subsystems and components to minimize compatibility issues and integration challenges during assembly. Furthermore, I would have provided more comprehensive training and support for Boeing's workforce and supply chain partners to ensure smooth adoption of new technologies and processes. Finally, I would have fostered a culture of accountability, transparency, and continuous improvement within the program team to encourage proactive problem-solving and innovation at all levels. Supplemental Cases Continental Airlines Continental Airlines entered into a ten-year outsourcing agreement with EDS when Continental Airlines was suffering financial setbacks and bankruptcy. This agreement was initially designed to provide expertise to Continental in an area that was not a core competency and to also help cut costs for the airline. However, Continental successfully turned their business around in the mid-1990s, and this case discusses the implications this has for the relationship between Continental and EDS. While this relationship had worked well initially, there were some strains developing by the mid-1990s, and this case focuses on where Continental should have gone with their relationship with EDS. Integrated Systems: Management Approaches To Acquiring Them in Australian Universities This case describes the situation that Central Queensland University (CQU) found itself in during the late 1990s as they faced increasing pressures from the government for information reporting, internal pressures to decrease administrative requirements of their systems and yet provide increasing responsiveness to their students, and the deadline of December 31, 1999 to solve their Y2K problem. To address all of these concerns, CQU decided to implement PeopleSoft. This case describes the process that a consortium of universities in Australia went through in trying to address these issues, and then the process that CQU specifically went through. Integrated Systems in State Government This case describes the process that the State of Louisiana went through in implementing SAP R/3. They were the first state government to make this transition, and the process was not always a smooth one. This case describes the interactions between the State and their consultants. It also stresses the importance of planning for the changes inherent in any systems development effort of this magnitude. This is the key focus of this case. Stately Furniture and Décor This case describes the various business processes involved in taking and filling customer orders for custom-built furniture at Stately Furniture. These processes are explored from the view of a number of different departments in the firm: information systems, production, quality control, sales and marketing, and accounting and finance. WWW.Flexlease.com The Flexlease case describes a unique combination of two traditional businesses - an auto leasing firm and an Internet Service Provider (ISP). These two enter into a joint venture to offer automobile leases via the World Wide Web. This case could be used in the BPR case, as it describes how the current business processes had to be revised in order to make Flexlease a reality. The case further points out how some of the benefits of the system cannot be recognized because not all of the trading partners of Flexlease have the ability to tie into their electronic systems. This case concludes with a brief appendix that describes the workflow modeling technique used in the case. Implementing Sales Force Automation at Quantum Technology; by Lattin, J., & Nunn, D.; Stanford Graduate School of Business; M311, 12 pages, 2008 (setting: California). This case presents challenges faced during the implementation of a CRM sales force automation software solution. Students will be expected to make recommendations regarding future directions for the project. Oracle vs. salesforce.com; by Yoffie, D.B., and Wagonfeld, A.B., Harvard Business School; 9-705-440, 29 pages, 2006 (setting: USA). This document describes the progression from software to service, including the use of a CRM solution as a Web-based service. Clothes ‘R’ Us Point-of-Sale Initiative: Managing IT Programs; by Jeffery, M., Norton, J.F., Yung, D., and Gershbeyn, A.; Kellogg School of Management, KEL304, 22 pages (setting: USA). This case covers a complex CRM implementation and new POS system in 400 stores of a national retail chain. Students will be challenged to evaluate the spreadsheet data and come up with solutions to the essential questions of what to do next and how best to gain competitive advantage using the new system. Carnival Cruise Lines; by Applegate, L.M. & Robert J Kwortnik, Gabriele Piccoli; Harvard Business School Publishing; 33 pages, 07/07/2005. This case highlights the potential value of customer data and the choices and challenges the firm faces when attempting to capture this value. Carnival collects a significant amount of individual-level behavioral and demographic customer data. Senior management must now decide how to leverage such a wealth of data. An Experiential Case Study in IT Project Management Planning: The Petroleum Engineering Economics Evaluation Software Imperative by Davis, C. K.; Idea Group Publishing; 2005. The case covers key issues in information technology dealing with developing a full set of project plans, including milestones, tasks, schedules, staffing, deliverables, and projected costs, for a complex software development project. Change Management of People & Technology in an ERP Implementation by Edwards, H. E.; Humphries, L. P. Idea Group Publishing; 2005. Eighteen months after adopting an enterprise resource planning (ERP) system the chief executive officer wanted an investigation into the performance of the system. The results of the investigation reported here reveal problems with the acquisition and implementation process. Pillsbury: Customer Driven Reengineering by Robert Kaplan (HBS Case 195-144) After initial successes applying activity-based costing to manufacturing operations, two senior executives decide to collaborate to propose a major reengineering project across the company's entire value chain. The case describes the project's definition and scope to yield projected annual cost savings and margin improvement between $100 and $300 million. Cisco Systems, Inc: Implementing ERP by Robert Austin, Richard Nolan and Mark Cotteleer (HBS Case 699022) Reviews Cisco System's approach to implementing Oracle's Enterprise Resource Planning (ERP) software product. This case chronologically reviews the diverse, critical success factors and obstacles facing Cisco during its implementation. Articles *Note: There are a very large number of articles and readings on this topic. Refer to the instructors’ community webpage for the most current resources. Harvard Business Review and Sloan Management Review have dozens of articles on related issues. A few new and classic readings are listed here. Mashhadi, Fereshteh, Adel Azar, and Arash Shahin. "Proposing a method for implementing business process re–engineering." International Journal of Services and Operations Management 20.4 (2015): 398-417. Hooda, Apeksha. "Emergence of Business Process Reengineering: A Literature Review." IUP Journal of Information Technology 10.3 (2014): 61. Christin Jurisch, Marlen, et al. "Which capabilities matter for successful business process change?." Business Process Management Journal 20.1 (2014): 47-67. Rettig, C. “The Trouble with Enterprise Software.” MIT Sloan Management Review, 49(1), 2007, SMR259, 9 pages. The author uses evidentiary materials to support the claim that enterprise systems have not delivered the value anticipated and/or promised. This paper will lead to critical discussion of the topic, forcing future managers to evaluate the practicality of implementing enterprise systems. Davenport, T. H. “The Coming Commoditization of Processes.” Harvard Business Review 83(2), 2005. A new world is coming, says the author, and it will lead to dramatic changes in the shape and structure of corporations. A broad set of process standards will soon make it easy to determine whether a business capability can be improved by outsourcing it. Such standards will also help businesses compare service providers and evaluate the costs vs. the benefits of outsourcing. Davenport, T. "Need Radical Innovation and Continuous Improvement? Integrate Process Reengineering and TQM," Planning Review, May/Jun 1993. Davenport, T. and Short, J. "The new Industrial Engineering: Information Technology and Business Process Redesign," Sloan Management Review, Summer 1990, pp. 11-27. Hall, G., Rosenthal, J. and Wade, J. "How to Make Reengineering Really Work," Harvard Business Review, November-December 1993, pp. 119-131. Markus, Lynne and Robert Benjamin, "The Magic Bullet Theory in IT-Enabled Transformation" Sloan Management Review, Winter 1997, pp. 55-68. Venkatraman, N. "IT-Enabled Business Transformation: From Automation to Business Scope Redefinition," Sloan Management Review, Winter 1994, pp. 73-87. Austin, Robert, Cedric Escalle and Mark Cotteleer, "Enterprise Resource Planning Technology Note," Harvard Business School Press, product number 699020, February 1999. Plotkin, Hal, "ERPS: How to make them work." Harvard Management Update, Harvard Business School Press, March 1999, product number U9903C. Davenport, T. "Putting the Enterprise into Enterprise Systems," Harvard Business Review, July 1998, product number 98401. Koch, C. “The ABCs of ERPs”, CIO.com, http://www.cio.com/research/erp/edit/erpbasics.html Books Friedman, T.L. The World is Flat: A Brief History of the Twenty-First Century. NY: Farrar, Straus and Giroux, 2006. This book is referenced extensively in business courses. It quickly became a “must read” book for business executives. Berger, S. How We Compete: What Companies Around the World Are Doing to Make it in Today’s Global Economy, NY: Doubleday, 2006. This book presents the complicated picture of globalization, from lower costs of production to the concerns of rapidly changing high tech companies. Hammer, M. & Champy, J. Reengineering the corporation: a manifesto for business revolution NY: HarperBusiness Press, 2001 Hammer, M. & Champy, J. Reengineering the Corporation. NY: Harper Business Press, 1993. This classic is the one that got reengineering started. There have been many subsequent books on the topic of reengineering, and a few from M. Hammer or J. Champy. But the original still best describes the concepts that caused the business world to really, fundamentally rethink how they did business. Davenport, T. Process Innovation: Reengineering Work through Information Technology. MA: HBS Press, 1993. This was one of the first books published on the topic. This book gives a good description of how to redesign business processes and it more clearly links it to information systems. It has a more practical approach than the Hammer/Champy book, but is less well known. Sethi, V. & King, W. Organizational Transformation Through Business Process Reengineering: Applying Lessons Learned. NY: Prentice Hall, 1998. This is a textbook with a number of readings of "classic" reengineering and related topics. It also includes measurement issues, operational aspects, and quality improvement readings. Davenport T. Mission Critical: Realizing the Promise of Enterprise Systems. MA: Harvard Business Press, 2000. This book takes the point of view that companies must change information systems, business processes, and business strategies at the same time, and offers many examples of real organizations that do that. It is a good book for understanding the challenges as well as the benefits of enterprise information systems. Cook, M. Building Enterprise Information Architecture: Reengineering Information Systems. NY: Prentice Hall, 1996. This is a good basic book to use to understand what an Enterprise architecture is and how to develop one. The book provides a step-based approach to help a company define and evolve its enterprise architecture. It's not a technical book, but has enough jargon to be useful to the management and information systems student. El Sawy, O. A. Redesigning Enterprise Processes for e-Business NY: McGraw-Hill, 2001. This is one of the newer books in this area, and nicely combines reengineering concepts with enterprise information systems and process flow concepts. It includes a CD-ROM with an academic version of business process redesign software (Workflow.BPR from HoloSofx Inc.). Websites www.zara.com This website provides more information on the integration of IS in the enterprise, leading to a competitive advantage. Innovative designs are produced and presented to customers quickly. The responsiveness of the decision making process keeps customers coming back time and again. www.boeing.com This is the official company website for the Boeing company. Students can discover innovative uses of technology through press releases and reports to stakeholders. www.eil.utoronto.ca/tool/BPR.html Tools for business process reengineering. News September 16, 2015: Zara is featured in chapter 5. The Sept 16, 2015 announcement states that Zara's parent company, Inditex, has enjoyed a 26% increase in profits in its newest half-year results. Have students read the very brief piece at http://www.theguardian.com/business/2015/sep/16/zara-owner-inditex-boost-profits-26-per-cent- and ask them the following: (1) Are there other signs of health at the company? (2) Is there any evidence at all that their unique supply chain is responsible for the increase? (3) Is there evidence in the article that the increase is an overall industry trend? Or does Inditex seem to be unique in this increase? January 30, 2015: Tablets just got a lot more useful after Microsoft released the final versions of Office for Android, which followed a similar release on the iPad. http://www.informationweek.com/software/productivity-collaboration-apps/microsoft-outlook-office-on-ios-and-android-first-look/d/d-id/1318881. Ask students to read the short post and answer the following: (1) Could tablets change how people do their work? (2) Think of a specific job that would be changed to a large degree by using Office on the tablet rather than a laptop. How would that job be changed? (3) Would a tablet provide an excellent tool for reengineering that job? (4) Outline a possible new workflow that would be enabled to help make the job easier or more productive. Chapter 6: Architecture and Infrastructure Overview This chapter focuses on how organizations move from strategy (vision) to architecture (design) to infrastructure (implementation of design). This is a good chapter in which to include discussions of hardware, software, and network technologies that make up the infrastructure of an organization. That includes the latest architectural trends (mainframe, client/server, peer-to-peer, wireless, etc.), business communications trends (broadband, ISDN, DSL, etc.), and information management trends (data warehousing, database management, web services such as Web 2.0, etc). This should be supplemented appropriately based on the instructor's and the student's interests and background. Consult the instructor’s community site for current technologies and trends. Discussion Opener: In the slides, questions are furnished about the Mohawk opening case, as well as answers in the notes section of the first slide. Alternate Discussion Opener: What are some of the challenges companies face when they implement large, complex information systems, such as ERP systems? Summarize actions managers can take to mitigate the effects of end user resistance. Key Points in Chapter Most students believe they need a thorough understanding of technologies to understand how their businesses can prosper with information systems. They are both right and wrong. A basic, fundamental understanding of technologies is necessary; but a detailed, technical understanding of all technologies is not only unnecessary but a fruitless exercise. Any technology covered in a course today will most likely be out of date by graduation time. Therefore it is the point of view of this book, and this chapter in particular, to offer a very basic framework for understanding technologies and for learning how to manage them. It is envisioned that students will use the basic framework, but in any specific situation, they will need to deeply study the specific technology they intend to use. The beginning of this chapter describes Mohawk paper’s transformation of their business due to opportunities presented by a major bankruptcy in the envelope industry. Mohawk was able to make use of business partners to assist in their adaptation of particular product lines, on the road to insourcing each product line. This chapter focuses on architecture and infrastructure using comparisons to a structural architecture approach. First, there is a vision of what should be built. This equates to the strategy. Then, the architect develops plans based on the vision. The plans provide guidance and direction for others involved in building the system (or building). The architecture is the blueprint which translates the business strategy into a workable plan. The infrastructure includes the physical components which, once assembled, execute the plan. The large number of IT choices available, coupled with the fast pace of technology changes, makes it nearly impossible to build the perfect architecture. But managers must, nevertheless, make decisions in this environment. The first step is translating strategy into architecture, and the second is to translate architecture into infrastructure. Strategy drives a number of business goals. The goals, in turn, drive business requirements, which drive architectural requirements. The architecture drives a number of functional specifications, which drive decisions about hardware, software, networks, and data. Essentially, the process model begins with an abstract concept and finishes with tangible elements that satisfy the original vision. A simple framework is presented for use by managers who seek to understand both what a current information system looks like, and what questions to ask in order to build a new one. The framework is shown in the table below (this is a simplified version of the Figure 6.3 in the textbook). Component What Who Where Hardware Software Network Data This framework is most useful when applied to both architectural and infrastructure decisions. Figure 6.4 describes common architectures, and software-defined architecture is new to this edition. This new concept is still emerging and new cases and examples are likely to be found in the future. The concept “Bring Your Own Device” is described. This topic can be used to engage students in a friendly debate on the pros (e.g. transfer the cost of the device to the employee, familiarity using a personal device, less training required) and cons (e.g. security, lack of standardization, maintenance headaches for IT staff) of a BYOD corporate policy. Consumerization of IT is also discussed. This involves creating mobile applications for employee and customer convenience. The expectation is that you will provide an online “app” for most software functionality that is web-enabled. Enterprise Architecture includes four key components: core business processes, shared data (e.g. centralized repository or data warehouse), linking and automation technologies, and customer groups. Information from experts Ross, Weill and Robertson from their book “Enterprise Architecture as a Strategy” (2006) is the main source of information for this section. Enterprise Architecture is important to highlight as many companies have embraced enterprise systems (SAP, Peoplesoft/Oracle, etc.). A good discussion point for this section may be to discuss the challenges of implementing such a framework, particularly within a global organization, or use the GiantCo.com case (later in the chapter). Virtualization and cloud computing are two concepts that move computing requirements to third party vendors, transferring the responsibilities and maintenance from the corporate IT group to a separate entity. Core components that are typically offloaded to vendors are servers, storage, backup, network, and disaster recovery. Other managerial considerations when designing and implementing an appropriate information system are explored. The first is to understand existing architecture, which allows the manager to evaluate the requirements of an evolving business strategy in terms of current IT capacity and capability. Second, there is the issue of strategic timeframe. By the time an IT decision is made, the technology is often already out of date. The architecture must take into account technological advances and have the capability to adapt as technologies evolve. Third, technical issues including adaptability, scalability, standardization, maintainability, and security are introduced. It is important to focus on the security portion of this discussion since that is a tremendous risk for organizations and must be carefully and properly planned. Fourth, financial justifications for IT investments are difficult, if not impossible, to calculate since they include both tangible and intangible costs. Payback calculations in the form of increased productivity, increased interoperability, improved service, and others are often considered "soft numbers." (Financial issues are discussed in greater detail in Chapter 8: The Business of IT.) This chapter takes students through a simple case, GiantCo.com, to illustrate how to go from strategy to infrastructure, using the framework and questions posed in the chapter. Figure 6.7 provides an example of the managerial considerations using the GiantCo.com case. Social Business Lens: Building Social-Mobile Applications – Given the ubiquitous usage of mobile communications devices, social mobile applications are becoming an expectation by this population. The widespread adoption of smartphones is changing digital communications in general. Corporations must respond to this demand. Illustrative Answers to Discussion Questions 1. Think about a company you know well. What would be an example of IT architecture at that company? An example of the IT infrastructure? Answer: This is an open-ended question, asking students to draw upon their personal experiences. An answer would include a description of the architecture as distinct from the infrastructure, and the advanced student might even start with a strategic business goal and show how it was translated into both an architectural goal and an infrastructure. Others might use the matrix framework from the chapter to describe the architecture or infrastructure. Architectural goals might be used to build an information system that efficiently connects employees, customers, and vendors, and supplies them with information they need at the time they need it. The infrastructure that supports that architectural goal might be an intranet connecting personal computers in every office, supporting software, and a centralized data warehouse with the data available. At a technology company like Microsoft, the IT architecture would likely consist of a robust and scalable cloud-based infrastructure built on Microsoft Azure. This architecture would encompass a wide range of services and components, including virtual machines, storage solutions, networking resources, databases, and security features. Additionally, Microsoft would leverage various software applications and platforms, such as Office 365 for productivity and collaboration tools, Dynamics 365 for customer relationship management (CRM), and Azure DevOps for software development and project management. The IT infrastructure would also incorporate hybrid cloud capabilities, allowing seamless integration between on-premises data centers and cloud environments. Furthermore, Microsoft would utilize advanced technologies such as artificial intelligence (AI), machine learning, and Internet of Things (IoT) to drive innovation and enhance customer experiences across its products and services. Overall, the IT architecture and infrastructure at Microsoft would be designed to support the company's strategic objectives, enable agility and scalability, and ensure the reliability and security of its operations and offerings. 2. What, in your opinion, is the difference between a decentralized architecture and a centralized architecture? What is an example of a business decision that would be affected by the choice of the architecture? Answer: This is a more difficult question for a non-IT manager. Decentralized architecture (previously referred to as client/server architecture) would be one where the personal computers (e.g. laptops or desktops) and the network itself contain intelligence, store data, and perform localized processing. In comparison, a centralized architecture (previously called mainframe architecture) is one where the majority, if not all, of the data storage and processing functions are performed by the server. In a centralized architecture, the local systems simply "connect" to the server and the server does all the work. An example of a business decision that might be affected is the decision to open up the company's systems to customers. If the architecture is centralized, the customers need only connect to the server. If the system is decentralized, the customers need to be added as separate and independent nodes on the network. Security concerns differ for both architectures, based on where the data is stored and where the processing is performed. For example, centralized architectures would need protection against problems that might bring down the whole system. Decentralized architectures would need protection from corrupting the data and software that might be stored on the local PCs. 3. From your personal experience, what is an example of software as a service? Of BYOD? Answer: Students will offer a variety of answers from their personal experiences. Google Docs is a useful starting point for classroom discussion. The software is maintained by the vendor, not installed on the personal device. The local (or client) device uses the applications through an Internet connection, making the software universally available and accessible, as long as the user is online. BYOD is a hot topic being discussed by managers, without a clear consensus on the outcome. Students should critically assess the benefits and risks associated with a BYOD corporate policy. For example, the benefits might include employee familiarity with the devices, transferring the cost of the device to the employee, and less training required by the employer. Risks might include network security, lack of standardization and compatibility across the network, and maintenance headaches for IT staff trying to troubleshoot a large variety of device malfunctions. Finally, a clear and comprehensive BYOD corporate policy would be required in order to protect the company from liability with employees and customers. An example of Software as a Service (SaaS) from personal experience is Google Workspace (formerly G Suite), which provides cloud-based productivity and collaboration tools such as Gmail, Google Drive, Google Docs, Sheets, and Slides. With SaaS, users can access these applications over the internet without needing to install or maintain software on their local devices, making it convenient and cost-effective for individuals and organizations to use. On the other hand, an example of Bring Your Own Device (BYOD) is allowing employees to use their personal smartphones, tablets, or laptops for work purposes, accessing corporate resources and applications remotely. BYOD policies enable flexibility and mobility for employees, allowing them to work from any location and use devices that they are comfortable and familiar with. However, BYOD also introduces security and privacy concerns, as organizations need to ensure the protection of sensitive data and compliance with regulatory requirements while allowing access from personal devices. 4. Each of the following companies would benefit from software-defined architecture or conventional, owned hardware and software. State which you would advise each of the following fictitious firms (plus the IRS) to adopt and explain why. a. StableCo is a firm that sells industrial paper shredders. Its business has remained steady for two decades and it has a strong and diverse customer base. b. DynamicCo is a fast-growing six-year old firm that has relied on three to five key wholesale customers for its entire existence. However, the list of key customers changes every year, and during two of the years, sales declined sharply. c. Plastics3000 is an old, stable plastics manufacturing firm that has kept its sales steady in the face of competitors as the result of an active research and development team that uses advanced software to analyze large amounts of data to develop new compounds. Once or twice a week, office personnel complain of the network becoming very slow. d. A downtown Las Vegas casino monitors each slot machine continuously for early detection of malfunctions such as winnings or losses trending beyond their threshold limits. e. CallPerfect provides call center services to pharmacies. Phone calls are routed to the company after hours and messages are delivered to the pharmacy manager the next morning. f. At the IRS, tax forms are available online for citizens to complete and file with the IRS electronically by April 15. A call center routes calls to agents who answer taxpayers’ questions. g. At LittlePeople, Inc., a day care center, parents are called using software on the administrator’s computer when there is a weather emergency. The school has averaged 120 families for many years. Answer: a. Stableco could benefit from a conventional approach, as they do not suffer from dynamic changes. They are also not dependent on one or two customers. If they intend to move into new markets, however, they might need to adapt to a software-defined architecture. b. DynamicCo requires agility and could benefit from software-defined architecture. Their needs change often, and they are dependent on a small number of customers that change often as well. c. Plastics3000 sometimes requires R&D to have more capacity and a software-defined network would be very useful in allocating capacity when necessary. d. The casino is likely to need only small amounts of data communication for performing the monitoring. A small amount of telecommunications bandwidth would likely be adequate, and there would be little gain from “borrowing” from it. e. If the call center’s bandwidth needs are high during the day but needs are low overnight, a software-defined architecture would make sense. f. Because the website takes care of high-bandwidth needs (complex and graphical forms), the greatest concern is the call center. Like CallPerfect in (e) above, if the call center’s needs for bandwidth are high during the day, a software-defined architecture would be quite appropriate. g. Because the day care center has only intermittent needs to use a relatively small number of regular telephone calls, a conventional architecture would save money and complexity without missed opportunities. Further Discussion Questions 1. The use of mobile technologies in the workplace has the potential to provide advantage to the organization. When thinking of mobile computing and communication devices such as a smartphone, how does this affect the complex interplay between choices of IT infrastructure, architecture, and software? Answer: The use of mobile technologies in the workplace introduces additional considerations for IT infrastructure, architecture, and software choices. Firstly, organizations need to ensure that their IT infrastructure can support seamless connectivity and access to resources from mobile devices, requiring robust networking capabilities and scalable cloud-based solutions. Secondly, the architecture of software applications must be optimized for mobile use, with responsive design, lightweight interfaces, and support for various operating systems and screen sizes. Thirdly, the choice of software platforms and applications should align with the mobility requirements of employees, offering mobile-friendly features and functionalities that enhance productivity and collaboration on-the-go. Moreover, organizations may need to implement mobile device management (MDM) solutions to secure and manage a diverse array of devices accessing corporate networks and data. Additionally, considerations such as data synchronization, offline access, and integration with backend systems must be addressed to ensure a seamless user experience across mobile and traditional computing environments. Furthermore, organizations may need to invest in training and support programs to help employees adapt to mobile technologies and leverage them effectively in their work. Lastly, the strategic alignment of IT infrastructure, architecture, and software choices with business objectives is essential to maximize the advantages of mobile computing while minimizing risks and ensuring a positive return on investment. 2. To supplement this chapter in a classroom setting, students can be asked to research and report on a current technology. The reporting can take place in a number of ways: students can prepare a written report (I suggest making it 5 pages or less, since writing less is much more difficult than writing more); students can prepare a 1-2 page briefing (which they can copy or post on a web site for their classmates); students can deliver a presentation on the topic and distribute a one-page “take away” summary; or students can be charged with teaching the topic to classmates (which, in my class, meant anything but a PowerPoint-type presentation; it had to be fun, entertaining, and teach something specific about their chosen topic). Answer: To supplement the chapter in a classroom setting, students can be assigned to research and report on a current technology using various formats. They could prepare a concise written report, limited to 5 pages or less, to practice the skill of conveying complex information concisely. Alternatively, students could create a 1-2 page briefing, suitable for distribution or posting on a website, to provide a succinct overview of the technology for their classmates. Another option is for students to deliver a presentation on the topic, accompanied by a one-page "take away" summary to highlight key points for their peers. Additionally, students could be tasked with teaching the topic to classmates in a creative and engaging manner, encouraging them to explore unconventional presentation formats that are both educational and entertaining. This approach fosters active learning, critical thinking, and effective communication skills among students while enhancing their understanding of current technologies. To supplement the chapter, students can be assigned a research project on a current technology. They can choose from various presentation formats, including written reports, briefings, presentations, or teaching sessions. The project encourages students to explore contemporary technological trends, analyze their impact on society or business, and present their findings to their peers. By engaging in research and presentation activities, students develop critical thinking, communication, and presentation skills. Additionally, they gain a deeper understanding of how technology shapes our world and the importance of staying informed about emerging trends. Overall, this project fosters active learning, collaboration, and creativity in the classroom while providing valuable insights into the ever-evolving field of technology. 3. Corporations are making the assumption that everyone uses a smartphone. For example, QR (Quick Response) codes can be found in magazines, on posters, and on brochures for all sorts of products. How does this perpetuate the negative outcomes created by the “Digital Divide”? What can companies do to change this perception of alienating a sub-population of their customer base? Answer: Corporations assuming widespread smartphone usage perpetuates the negative outcomes of the Digital Divide by excluding segments of the population without access to or proficiency in using smartphones, widening existing disparities in digital access and literacy. This exclusion undermines inclusivity and equity in accessing information, services, and opportunities, further marginalizing disadvantaged communities. To address this, companies can adopt a multi-channel approach, incorporating traditional and digital communication methods to reach diverse audiences. They can provide alternative means of accessing information, such as offering QR code alternatives like web URLs or toll-free phone numbers. Additionally, investing in digital literacy programs and infrastructure development initiatives can empower underserved communities to participate more fully in the digital economy. Moreover, companies can collaborate with community organizations and government agencies to bridge the Digital Divide through initiatives aimed at increasing access to technology and digital skills training. Ultimately, fostering inclusivity and accessibility benefits both businesses and society by broadening their customer base and promoting social equity. Cases Case Study 6-1: Enterprise Architecture at American Express This case covers American Express’s use of enterprise architecture to provide a framework to unite IT and business strategies. Individual units use a common set of road maps to develop and build architecture and governance processes. 1. What are the key components of the architecture American Express has created? Answer: The key components presented in the case focus on reference architectures and road maps. Using a standardized language and initiatives, the company is able to create applications that work on a common platform. 2. Why was it important to standardize so much of the architecture? What are the advantages and disadvantages of a standard EA for American Express? Answer: American Express was determined to maintain a common architecture to improve efficiency. The advantages include easier maintenance for the IT staff, common language and general understanding for American Express employees, and a consistent interface for customers. The disadvantages will focus on the requirement for units to comply with the standardized architecture. This might require significant changes and modifications, leading to some initial confusion. There might be resistance from individuals less convinced of the importance of developing a common architecture. 3. Describe how the new architecture supports the goals and strategy of American Express. Answer: The corporate goals are to align IT and the business strategy. This includes a consistent customer experience and the ability to evolve as the industry changes. The enterprise architecture will facilitate the presentation of new products and services that come along. This structure will permit the company to grow and change as necessary. 4. What types of future payment products and services should be anticipated and prepared for by the EA group? What is your vision of how payments might work? If you were advising the CIO of American Express, what would you suggest his group prepare for? Answer: With the consumerization of applications, customers will expect to be able to make mobile payments, check their accounts using their smartphones, and use American Express services at any time. Smartphone apps will need to include scanner features to deposit checks. Customers will expect to be able to reconcile problems with their accounts without having to interact with a human service agent. Electronic signatures will be the norm, allowing for real-time processing of transactions. American Express will have to continue to innovate. Maintaining a continuous dialogue with customers and listening to their feedback will allow the company to respond quickly to new demands. This feedback can also be obtained through social networking outlets. Case Study 6-2: The Case of Extreme Scientists This case discusses the use of cloud computing to analyze large, complex data sets. No longer will individuals require expensive, proprietary technologies to perform intensive calculations. These functions can be performed relatively cheaply, requiring users to only pay for the capacity required. Sample answers to discussion questions: 1. How would you describe the architecture Dr. Schadt uses to do his research? Answer: The architecture used by Dr. Schadt is a service-oriented architecture (SOA). Amazon.com is a web-enabled service that the scientist can access using an Internet connection. 2. What are the risks Dr. Schadt faces by using Amazon for his supercomputing? What are the benefits? Answer: The risks would include security, reliability, and scalability. Dr. Schadt must rely on the third party vendor to ensure that any sensitive data is adequately and reasonably protected from unauthorized access. Users are dependent on the vendor for 24/7 reliability as part of the contractual agreement. Dr. Schadt is also counting on Amazon to ensure that the capacity is available, even if his needs increase dramatically. In each case, the end-users must trust that the vendor will meet their needs. The benefits are that Dr. Schadt can use an advanced analytical system to process his data while not having to maintain that system himself. He pays a relatively minimal cost for only the services he uses, without having the expense of hardware, software, network, and IT staff to ensure the operation of the system. This meets the user’s needs while shifting the burden of responsibility to the vendor. 3. If you were advising a company trying to make a decision about using cloud computing for key business applications, what would you advise and why? Answer: My advice would be to research carefully before signing any contracts. The company needs to be confident that the vendor is reliable and that the data will be secure. A mutually acceptable fee structure would be negotiated, as well as intentions for the vendor to maintain current technologies. It would be unacceptable for the vendor to allow the technologies to lapse, ignoring any relevant innovations that enter the market. I would consult other clients to determine their satisfaction with the vendor, and assess the stability of the firm. I would also prefer a vendor that is somewhat familiar with the needs of companies in our industry. Supplemental Readings: Other Cases: Saab mini-case (now available at https://books.google.com/books?id=gQkAAAAAMBAJ&pg=PA34&lpg=PA34&dq=cio+magazine+saab&source=bl&ots=aCcIDYW8i8&sig=Lh4rITasF1IHNSGS5bM6JURA2Bs&hl=en&sa=X&ved=0ahUKEwjQloyggbLJAhXMND4KHbdwA3UQ6AEIOTAG#v=onepage&q=cio%20magazine%20saab&f=false). The case is described in more detail at the source. It shows how Saab’s vision is embodied in its infrastructure. They were able to facilitate dealer access to corporate information to improve the timeliness of the information and to consolidate the information about vehicles, customers, warranties, sales, and service that is accurate to the xxx% level. These requirements were then translated into infrastructure: this IRIS system is written in Java using IBM DB2 running on the IBM AS/400. Lotus Domino is the middleware that mediates between the legacy system and the front-end Web interface. Cisco Systems Architecture: ERP and Web-Enabled IT by Nolan, R.L., Harvard Business School, 301099, 23 pages, 2005 (setting: California) This case discusses Cisco’s replacement of legacy back-office systems with its strategic I-Net. This includes the ERP implementation and connecting with customers over the Internet. Students will gain an appreciation of the complexity of implementing an ERP system. Mercedes-Benz India by Chandrasekhar, R., Haggerty, N., and Venkatagiri, S., Richard Ivey School of Business, W11084, 13 pages, (setting: India) While relocating a manufacturing facility to India, the company’s CIO must decide on the appropriate architecture, IT infrastructure, and IT skills necessary to support the new plant. Students will be required to consider various tradeoffs as they make managerial decisions. The international setting will also help students to appreciate the added complexity of global operations. Offshoring at EDC by H.W. Lane & D.T.A. Wesley; Richard Ivey School of Business Education Development Center (EDC), a non-governmental organization, is an example of offshoring best practice and will help identify factors for successful implementation of an outsourcing project. Up In Smoke: Rebuilding After an IT Disaster by S. C. Ross, C. K. Tyran, D. J. Auer Idea Group Publishing, 2005 (18 pages) This case discusses the issues faced by the college as they resumed operations and planned for rebuilding their information technology operations. The almost-total destruction of the college's server assets offered a unique opportunity to rethink the IT architecture for the college. End-User System Development: Lessons from a Case Study of IT Usage, by M. E. Jennex; Idea Group Publishing; 2005; (14 pages) This case looks at a study of end-user computing within the engineering organizations of an electric utility undergoing deregulation. The case was initiated when management perceived that too much engineering time was spent doing IS functions. Power Conflict, Commitment & the Development of Sales & Marketing IS/IT Infrastructures at Digital Devices, Inc., T. Butler; Idea Group Publishing. 2005; (18 pages) The case reports on the web of individual, group and institutional commitments and influences on the IS development and implementation processes in an organizational culture that promoted and supported user-led development. Prudential Chamberlain Stiehl: The Evolution of an IT Architecture for a Residential Real Estate Firm, A. Borchers and B. Mills, Idea Publishing Group, 16 pages, IT5622, (setting: U.S.) This case describes the evolution of an IT architecture for Prudential Chamberlain Stiehl Realtors (PCSR), a 14 office, 250 sales agent real estate firm located in Southeast Michigan. Information Systems Development and Business Fit in Dynamic Environments, P. Kanellis, P. Papadopoulou, and D. Martakos, Idea Publishing Group, 12 pages, IT5669 This case describes the effects of privatization on a large industrial organization and sets the context for illustrating the vulnerability of information systems in turbulent environments. The case presents a detailed chronology of the events that lead to an increased awareness of the importance of information systems flexibility. The case examines the difficulties faced by an organization when its information systems were incapable of dealing with frantic changes in environmental contingencies. Nation-Wide ICT Infrastructure Introduction and Its Leverage for Overall Development, P. Pale and J. Gojsi, Idea Publishing Group, 24 pages, IT5690 This case describes a ten-year effort of creating an information and communications technology infrastructure in Croatia. Although initially an independent agency, five years after it began operation, the Croatian Academic and Research Network – CARNet—had been transformed into a government agency. The case explores the question of whether or not CARNet has truly been successful and seeks to answer the question of whether the initial goals have been realistic and achievements sufficient, considering the low penetration of ICT into the Croatian society. Outrigger Hotels and Resorts: A Case Study, Gabe Piccoli, 2005, Communications of AIS, Volume 15, Article 5 This case describes the history, strategy, and current information systems infrastructure of a mid-size, privately owned hospitality firm. The case is designed to provide the substantial background information needed to engage successfully in setting a direction for IS resources and their use at Outrigger Hotels and Resorts headquartered in Hawaii. Supplemental Readings/Articles Stamas, Paul J., Michelle L. Kaarst-Brown, and Scott A. Bernard. "The Business Transformation Payoffs of Cloud Services at Mohawk." MIS Quarterly Executive 13.4 (2014). Grisot, Miria, Ole Hanseth, and Anne Asmyr Thorseng. "Innovation of, in, on infrastructures: articulating the role of architecture in information infrastructure evolution." Journal of the Association for Information Systems 15.4 (2014): 197-219. McAfee, A. “What Every CEO Needs to Know About the Cloud,” Harvard Business Review R1111J, November, 2011. This article provides a general discussion of the anticipated benefits of cloud computing. It also includes a discussion of the challenges associated with the conversion to cloud computing, and the resources necessary to facilitate a smooth transition. Apgar, M. & Keane, J.M. “New Business with the New Military,” Harvard Business Review. 82(2). 2004. Virtually all aspects of the military are changing to ensure that it can fight unpredictable threats while sustaining the infrastructure needed to support and train forces. The military is turning to nontraditional business partners to meet a wide range of needs, from health care to housing to information technology. Kane, K. “Leveraging the New IT Infrastructure for Strategic Agility,” Balanced Scorecard Report. Harvard Business School Publishing, 2003 (5 pages). In most companies, IT infrastructure is built in an ad hoc, piecemeal manner, with heavy investments made on a project or operational basis--and little forethought given to how it must support the enterprise's evolving strategy. IT infrastructure along with thoughtful, deliberate decision-making made jointly by business and IT leaders delivers the strategic agility organizations need in a rapidly changing world. Managing Your 'Ecosystem', William M. Ulrich, Computerworld, (January 22, 2001) Component-based frameworks for E-commerce, Peter Fingar, Communications of the ACM Volume 43, No. 10 (Oct. 2000). Pages 61 - 67. Personalized communication networks, Doug Riecken, Communications of the ACM Volume 43, No. 8 (Aug. 2000). Pages 41 - 42. Capturing human intelligence in the net, Paul B. Kantor, Endre Boros, Benjamin Melamed, Vladimir Meñkov, Bracha Shapira and David J. Neu. Communications of the ACM Volume 43, No. 8 (Aug. 2000). Pages 112 - 115. New I/O architecture draws strong backers, Nancy Weil, Computerworld, (January 08, 1999). See also the companion article on this architecture at: I/O Rivals Declare Truce, Plan New Architecture, Stacy Collett, Computerworld, (September 06, 1999). Schwab simplifies Web trade architecture, Carol Sliwa, Computerworld, (February 22, 1999). Architecture's promise of better performance will take a while, April Jacobs, Computerworld, (April 27, 1998). Books NOTE: There are many books written about IT architecture and infrastructures, ranging from very technical to highly managerial. Interested faculty and students should visit local bookstores and/or online bookstores for the most current titles. Below is just a sampling. McGovern, J. The Practical Guide to Enterprise Architecture. NY: Prentice Hall, 2003. Wiell, P. and Marianne Broadbent Leveraging the New Infrastructure: How Market Leaders Capitalize on Information Technology. MA: HBS Publishing, 1998. Cook, M. Building Enterprise Information Architecture: Reengineering Information Systems. Prentice Hall, 1996. Fitzgerald, Jerry, and Alan Dennis. Business Data Communications and Networking. John Wiley, 1996. Keen, Peter G.W. & Cummins, J. Michael. Networks in Action: Business Choices and Telecommunications Decisions. Belmont, CA; Wadsworth, 1994. Rowe, Stanford H., Telecommunications for Managers. 3rd. ed., Prentice Hall, 1995. Stallings, William, & Van Slyke, Richard. Business Data Communications. 2nd. ed., Macmillan, New York, 1994. Stallings, William. Data and Computer Communication. MacMillan, 1993. Websites www.techweb.com/encyclopedia TechWeb's TechEncyclopedia offers definitions and links for more than 20000 information technology terms. A dictionary of more than 1,000 terms is available at http://www.consp.com/it-information-technology-terminology-dictionary A glossary of thousands of technology definitions can be found at http://whatis.techtarget.com/ News Sept 25, 2015: Fortune says there is mounting evidence that we have a "multi-cloud" world. Have students read the article at http://fortune.com/2015/09/25/multi-cloud-management/ and ask them the following: (1) Why would a firm use multiple clouds? (2) Are many vendors supporting multi-cloud environments? (3) What are "bare metal" implementations? What is an advantage and a disadvantage of "bare metal" applications? January 29, 2015: Microsoft has released Office for Tablets, which can have powerful implications on infrastructure decisions. Have students read the article at http://www.informationweek.com/mobile/mobile-applications/microsoft-office-arrives-on-android-tablets-/d/d-id/1318861?itc=edit_in_body_cro and ask them to think of a situation in which a firm would provide Android tablets to managers who travel quite a bit. Ask them the following: (1) Would the absence or presence of Office on tablet platform affect the decision? (2) Given the roll-out, how would a tablet now be more attractive than a thin laptop for the travelers? (3) Would the pricing model have an impact on the screen size that you would choose to provide to the travelers? (4) What infrastructure decision would you make in the area of soft keyboards versus keyboard cases with real keys? Would keyboard size enter into your decision-making? Solution Manual for Managing and Using Information Systems: A Strategic Approach Keri E. Pearlson, Carol S. Saunders, Dennis F. Galletta 9781119244288, 9781118281734