W12 - Process Redesign (3) and Implementation

Source / Reference:
1)  "The 10 biggest failures in IT history " by J Wallen 2009
http://www.techrepublic.com/blog/10things/the-10-biggest-failures-in-it-history/1126

Subject:
In Lec 12 – Google search & report the top 10 IT failure in history. What was common to all? How might the failures have been made into successes?
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Response:

According to the blog written by Jack Wallen in TechRepublic website, he listed out 10 of the biggest failures in IT.

1: Windows Vista

2: NeXT

3: BeOS

4: Cobalt Qube

5: Y2K

6: MP3

7: Richard Stallman

8: WordPerfect

9: IPv6

10: Mesh networks

I’ve spotted the following common attributes of these IT failures:

1. They introduced the new innovation or the new I.T revolution

2. They brought in the new technology or platform.

3. Their purpose were either to replace the existing technology which is end of life or address the anticipated problem that left by the existing products. 

4. The impact that brought by the existing problem were overblown

5. Mostly they were new but not user friendly

6. They could not sustain long in the market

7. The end result of the new product in fact downgrade the system capability

There are some examples to elaborate those common attributes are as follows:

First, Windows Vista is the replacement of Window XP, the overall comments were negative and not widely been used.  Most of the end-uses / enterprise decided not to go for this O/S due to the stability and compatibility concerns.

Second, Y2K brought the impact to the most of the enterprise application, some of them threaten that the airplane engine would stop during flying. Or people started thinking to withdraw all their money from bank as they afraid the systems faults after 2000. In fact the impact was overblown.  Most of enterprise carried out the immediate action to fix the bugs and certified before 2000. We looked back and found most were software related and they are pretty old software.

Third, IPv6 is the next version of IPv4, it was introduced due to the anticipated IPv4 address exhaustion. IPv6 is different format than IPv4 and suppose it provide more IP capacity.  However IPv6 is not being commonly used and the IPv4 impact hasn’t been reached seriously.

How might the failures have been made into successes?

Most of the people always expected the new technology coming out which could bring in the new features that could satisfy their additional wants from the existing technology. However, some of the new changes were not recognized and eventually became redundant features that would be finally forgotten.  Even worse, some of the changes became the new platform that totally different from the existing version.  Although the users had the background knowledge but still got confusing like learning the brand new technology. People may not want to change their skill set hence they finally retain the existing version.  On the other hand, people suffer the pain to use the new features one if the benefit brought by the new features is greater.

Although the research and analyst processes has been went through, sometimes developers always neglect the impact behind the technology changes and under estimate how likely the user adopt the new features.

Developer should consider the necessity of the new features, could it be really needed by the entire industry. For instance, Redhat Linux o/s is commonly use in financially industry, Redhat would regularly introduce the new o/s version which fix the bugs and enhance some features. However these features may not be required by the financial industry. Financial industry used Redhat because the o/s is stable, not the features.  Hence the new o/s will not be upgraded. Later on when the existing o/s reaches end of support life, financial enterprise may consider the migration to other Linux platform to avoid using Redhat again which introduce the new version too frequent.

Sometimes the new platform and application will introduce the new skill set.  In general most people are interested in learning the new skill set, but not all of them.  Developers should consider how the skill set can easily be picked up. People would lose their interests if people require spending a lot of time to learn it. In addition, the new feature must be commonly recognized, otherwise people will ignore it.

W6 - Business Process Reengineering (BPR)

Source / Reference:

1) "The Xerox Non-Production Procurement BPR Project"  by Paul Harmon 2002 
http://www.bptrends.com/publicationfiles/BPT%20Case%20Study-Xerox%20Procurement%2011-02.pdf

Subject: 

In Lecture 6 - Basics of Business Process Re-engineering (2)

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Response: 

In lecture 6, there are three major parts, including design mindset and organization adaptation, BPR evolution and life cycle of business process improvement.

First, let me review what design mindset is. Design mindset has clear concept of business strategy, it includes business strategy, business processes which achieves business strategy and IT which is highly implemented by BPR. Business Strategy contains Business Processes which means a top down approach is used by the company and the top management will responsible for designing Business Strategy so as to support the redesign in Business Process. On the other hand, Business Processes contains IT, which means the use of new technology can help improve as an enabler to facilitate the redesign in Business Processes.

                                                  

Next, I am going to explain the organization adaptation. The Leavitt Diamond which consisted of Business Process, Information Technology Use, Organizational Form and Requisite People Skills is the main concept of the organization. The concept of The Leavitt Diamond is four variables will co-ordinate with each others. If there is anyone variables changed, the other variables need to be adjusted accordingly. It can help to balance the IT-enabled organizational transformation.

Then, I am going to talk about the BPR evolution. Total Quality Management (TQM) is to improve the quality continually which is the BPR evolution. It is composed of three paradigms, total, quality and management. When collecting enough improvement, it is time for BPR to change. In the following, there is a table interpreting the difference between BPR and TQM.

	BPR	TQM
Size of change	Revolution	Evolution
Magnitude of targeted improvement	Quantum	Incremental
Execution approach	Top down	Bottom up
Type	One-shot project	Continuous improvement
Based	IT based	Non-IT based

 Then, I will talk about the Life Cycle of Business Process Improvement.

In this diagram, we can see there is an integration of BPR and TQM which is the way of modern business process redesign. As it is impossible for a company only take BPR once only and without any follow up action like TQM for ensuring its quality impact in the future. Also, if a company only take TQM for redesigning the business process, it is also impossible to see there is a radical change on their performance improvement.

After talking about lecture content, I have do research about the whole process of how BPR is implemented step-by-step and how BPR transforms the current process (AS-IS) to an improved process (TO-BE). Then, I have found an article about BPR on non-production procurement conducted by Xerox Corporation in 1994. After redesigning the business process, a very significant portion of the money formerly spent on administrating purchasing had been saved, hundreds of activities had been reduced to dozens, numerous redundant sub-processes were now combined into three major sub-processes, and hundreds of suppliers had been reduced to four major suppliers and so on. The Xerox NPP process improvement effort is a great example of successful BPR. In this case, the company didn’t completely reinvent the process, but they simplified it and improved it a many different ways.

W5 – Basics of BPR(1)

Source / Reference:
1)  "Business process reengineering: A tutorial on the concept, evolution, method, technology and application” by Varun Grover and Manoj K.Malhotra 1996
http://www.sciencedirect.com/science/article/pii/S0272696396001040

2)  http://en.wikipedia.org/wiki/Business_process_reengineering

3)  http://dyag-0313.blogspot.com/2012/02/w4-strategic-alignment-model.html

Subject:
Lecture 5 – Key points in business process, the Myths, and Comment on http://dyag-0313.blogspot.com/2012/02/w4-strategic-alignment-model.html  ====================================================================

In Lecture five, it is mainly about Business Process Re-engineering (BPR). The first question that was asked by Helen today was why we need to have this process? At that moment, I did not have strong view on this question or even I do not know what BPR is actually. However, after Helen explaining on it in the lecture, my understanding towards BPR is become clearer.

The basics of BPR were introduced in lecture five. First of all, BPR can be divided into three components: Business, Process and Reengineering. Each of them has their own focus and description, but these are just hard information, so I am not going to talk about the details here.

Key points in business process

The key points in business process are rationale and the role of I.T. I am going to talk about the details here.

In Business process, rationale is one of the key points. The traditional organizations usually apply the top-down control, which means only the frontline staffs can reach the customers; however, this is not sufficient for nowadays market, so the horizontal view of organizations reflected by BPR is introduced. It emphasizes that both ends of the process have customers and de-emphasize the hierarchical structures. The horizontal view of organization can help organizations reduce confusion, increase accountability and performance of the process, and reduce wasteful activities, etc.

In terms of the role of I.T. IT contributes a lot to business process; for example, IT was used to automate and speed up processes in early year, and it enables a more effective creation and sharing of knowledge. In a BPR project, IT can also shape new possibilities for business process, not only assist it. Designing IT solution is a way to shape the new business process, since it can help find out the chance and hence to improve the process.

The Myths

After understanding the definition of BPR and the key points of the lecture, as there are already many success cases and story to glorify the importance and impact of BPR, now i would like to talk about the seven myths of BPR described by Grover & Malhotra (1997) are as follows:

Myth 1: “Reengineering is a radical one-time approach” is changing as many firms are not willing to invest the money and time to implement change from a “clean state”.

Myth 2: “Reengineering involves breakthrough performance gains” is being challenged as benchmarking and measurement of these gains can prove elusive.

Myth 3: “Reengineering enables change primarily through IT” is being moderated by the numerous organizational innovations involving people, jobs, skills and structures that facilitate process-oriented behaviors.

Myth 4: “Reengineering should focus on cross-functional core business processes” is fine, but many piecemeal improvements within functions can also add up to significant change and have proven very successful.

Myth 5: “Reengineering enhances individual capacities through empowerment and teams” is all well and good but many process-change projects are being defended based on cost objectives achieved through downsizing with few opportunities for retraining.

Myth 6: “Reengineering can use a standardized set of methods touted by armies of consultants” is being questioned given that no standardized approach exists to date.

Myth 7: “Reengineering must be conducted from the top down” is being challenged since often detailed understanding of process design resides with people who do the work.

After reading these myths, I think some of the myths are partially correct, it depends on the situation and current circumstances of the business. As there are many factors like economic situation and the size of business may lead to different result by using BPR, so it may be true to the small and medium enterprise but not the large companies.

Comment on http://dyag-0313.blogspot.com/2012/02/w4-strategic-alignment-model.html

In my opinion, there is no the best or the worst alignment perspective. Each alignment perspective has their own performance criteria which is adoptable to different scenarios, background and future roadmap of the firms.  Management even sometimes should shift across different alignment perspective in different stages in evolution or I.T generation changes. In addition, management would consider multiple perspectives when the performance criteria are involved multiple goals.

Management should understand the needs of internal and external domain and two strategies as the driver to make the right choices of strategic alignment. Besides, both strategies derive two alignments perspective. Management should conduct the due consideration to two alignments perspective to apply the best possible link between business strategy and IT infrastructure.

I agree with you that there many factors in an organization. Even the authors of the paper were asked the same question, and their response was the identical. Business models and information technology are both growing and changing each day. As a result, there is no universal model to simplify the business/IT/IS integration environment.

Also, I agree with you that it is good to study how to apply, utilize, and implement the strategic alignment model to further the business goals of a company using information systems, strategy, and infrastructure. And I think your finding about Summary of evaluation of strategic alignment for medium‐sized designer and builder enterprises are quite interesting.

W4 - Which alignment strategy in SAM model is the best? and why?

Source / Reference:
1)  "Strategic Alignment: Leverage Information Technology for transforming organization" by J C Henderson and N Venkartraman 1993
http://search.proquest.com/docview/26252741/134A6C8B53F19A4F606/1?accountid=16210

Subject:
In Lec 4 - Which alignment strategy in SAM model is the best? and why?
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Response:

In my opinion, there is no the best or the worst alignment perspective. Each alignment perspective has their own performance criteria which is adoptable to different scenarios, background and future roadmap of the firms.  Management even sometimes should shift across different alignment perspective in different stages in evolution or I.T generation changes. In addition, management would consider multiple perspectives when the performance criteria are involved multiple goals.

Management should understand the needs of internal and external domain and two strategies as the driver to make the right choices of strategic alignment. Besides, both strategies derive two alignments perspective. Management should conduct the due consideration to two alignments perspective to apply the best possible link between business strategy and IT infrastructure.

Firstly we need to understand what the cause of making the I.T strategy alignment was.  In traditional and historical views, people had realized that I.T. is the back office which is a support function but not essential to the business. The general feeling of I.T is that it has slight influence to the business strategy.  However to date, I.T is the core part of business strategy as I.T is considerable factor to differentiate the products from competitive markets, increasing the service efficiency, making the process is effective and secure, and lowering the cost, etc.  I.T. has been transforming from its traditional role to a strategic role that not only supports chosen business strategies, but also to shape new business strategies and cater for the future changes. It is necessary of strategy alignment between I.T and the business in order to realize the value from I.T. investment.  In order to reflect the value of I.T. strategy, the alignment perspective must align external domains and internal domains.  External domain is the strategy attribute that differentiate the products/services from the competitive markets or the decision of acquiring competitors as well as aligning vendors.  Internal domain is the strategy against internal organization structure and the specific critical business processes.  It is failure to derive benefits from I.T. investments if there is inadequate fit between external and internal domains.

Henderson and Venkatraman proposed Strategic Alignment Model (SAM). SAM consists of four fundamental domains – “Business Strategy”, “I.T. Strategy”, “Business Infrastructure” and “I.T. Infrastructure”.  The concept of strategy alignment is based on two components – “strategy fit” and “functional integration”. Strategic fit is the process to identify the needs for any strategy to address both external and internal domains.   Functional integration is the link between business and I.T. strategy reflecting external components as well as the link between organizational infrastructure and IT infrastructure reflecting internal components that deal with the capability of IT functionality.

Strategy alignment and functional integration has lined up the relationship across the four domains in SAM which forms 4 cross-domain relationship of alignment. The first 2 are driven by Business Strategy and the other 2 are driven by I.T. Strategy. In addition, it is important to assign the specific role of management to make the perspective successful.

Business Strategy driven:

Perspective 1 is “Strategy execution”

A business strategy is the driver of both organizational design choices and the design of I.T. infrastructure. It’s the most common alignment perspective.

Top management is the strategy formulator to articulate the logic and choices from business strategy perspective.

I.T. manager is strategy implementer who implements the infrastructure and process that support the chosen business strategy. 

This perspective bases on the financial parameter to assess the performance of IT function, hence it is mainly cost center focus.

The performance criteria are based on the financial parameters to reflect the cost center focus.

                                                            

Perspective 2 is “Technology transformation”

Business strategy is the driver of this alignment perspective that uses the appropriate I.T. strategy to assess the implementation of the chosen business strategy. This alignment is to identify the best possible IT competencies through appropriate positioning in the IT marketplace.

Top management is the technology visionary that endorse the technology that would best support the chosen business strategy.

IT manager is the technology architect who designs and implements the infrastructure that is consistent with IT vision.

The performance criteria are based on technology leadership to access the position in the marketplace by using benchmarking approach.

I.T. Strategy driven:

Perspective 3 is “Competitive Potential”

I.T. strategy is the driver of this alignment perspective that allows the adaption of business strategy via IT capabilities; this seeks to identify the best set of strategic options for business strategy and the corresponding decision for organizational infrastructure. This perspective aims to deliver value added service to customers as well as the consequent implications to the internal organization processes. 

Top management is the business visionary who articulate how the IT competencies and functionality would impact business strategy

I.T. management is the catalyst who provides the futures trends in I.T. environment to business management to understand the potential opportunities and threats.

The performance criteria are based on business leadership corresponding measuring to the product leadership in terms of market share, growth or new product.

Perspective 4 is “Service Level”

I.T. strategy is the driver of this alignment perspective that ensures the effective use of IT and focus on how to build up the world class IT service organization.  The role of business strategy is indirectly providing the direction to stimulate customer demand.  Performance Analytical methodologies are user survey, service level agreement and infrastructure planning.

Top management is to prioritize how to allocate the resources within organizational and in the IT marketplace.

The performance criteria are based on customer satisfaction using internal and external benchmarking.

Nowadays strategic alignment is apparently necessary between business and I.T, especially strategic fit is important. The research was showing that inadequate fit alignment between external and internal would lead to failure of to derive benefits from IT investments. However there is no straight forward way to tell the firm to adopt with which strategy as the driver at the beginning.

Strategy execution translate the implications of business strategy for the organizational infrastructure with subsequent demands for IT products and services.

Technology transformation is achieved through the effective positing of the firm in the market places.  Manager should consider both perspectives to obtain the best linking between business strategy and IT infrastructure.

Competitive potential identifies the potential impact of IT strategy on business strategy with consequent implications for the organizational infrastructure.

Service Level provides the best possible service to the internal client by developing the appropriate basis for the redesign of the IT infrastructure. 

Furthermore, management should always conceptualize to evaluate the IT performance by using four criteria: as cost center, as service center, as profit center and as investment center. Then management should shift in the criteria to assess the performance of the IT function and assign appropriate criteria to the alignment perspectives.

 

Moreover, manager must recognize that the needs to evolve from one perspective to another base on fast changing business environment in both internal and external. Management should always consider different perspective as alternative conceptual lenses and be well prepared to adopt the different.  Management should understand strategy alignment is a continuous process and adoption.

In conclusion, Henderson and Venkatraman stated that “there is no universally superior mode to formulate and implement strategy; it would not be strategic because all firms would adopt it.” This statement is true that it will be no longer a strategic if all the firms adopt the same strategy.

Week 3 - Systems Planning in the Information Age

This literature review is based on the content of Lecture 3 and the suggested reading of Lecture 3 of COMP 326. After reading those materials, I have learnt a lot of things

The article illustrated how the system planning and strategy is of great significance to different environments and emphasized how to make the planning relevant and effective in the emerging information age. It introduced the frameworks that emphasized two factors – Infusion and Diffusion which are highly correlated to reflect the system planning in today’s environment. It also summarized the past and current system planning practice as well as the introduction of the information technology architecture planning in the different environment.  It highlighted the transition in different stages with different information system planning:  stages of growth (SOG), Business System Planning (BSP), Critical Success Factor (CSF) and Complex.

We learnt that in 60’s, it was the initial stage where the firms started the information technology planning, and the leading approach was called stages of growth (SOG). During this stage, the firms built a lot computer room massively and hired numerous programmers and analysts to undertake the first large scale system development projects. The system planning was base on a notion that organization must go through this kind of change through a predictable sequence of steps at a modest pace. 

However, SOG was gradually weeded out by the technological changes after mid 60’s due to  two factors, first was the inexpensive mass-storage devices, second was the online system.  The environment was shifting from applications and processing management to data and information resources management. According to this shift, a different set of planning requirements was introduced. The well represented in this planning was IBM’s Business Systems Planning (BSP) which mainly coordinated intersystem view rather than identifying isolated application projects; it focused on conceptualizing and designing the overall corporate data resources. BSP changed the system planning to become highly customized goals which became more strategic to the company. However the disadvantages of BSP were, first it was too idealistic that rationalized the data structure, not too many firms could build a corporate database dramatically; second it was designed for centralized system, since IBM promoted mainframe, whereas some organization’s computing resource were decentralized.

In the late 70’s, the transformation started again where decentralization was begun since the popularity of the mini and micros computers. At that time management realized the impact of technology to their business operation is significant, they started to control over the system activities directly. The system planning has been replaced by new planning called Critical Success Factors (CSF) which was to identify the individual requirements for information system.

CSF planning was useful but it was good in dealing with isolated problem but not whole at a time.  CSF was ineffectual in the complex environment which both infusion and diffusion are high. 

Infusion is the degree to the information technology influencing to the company in terms of importance.  For example, a firm realized that information technology could make their products more competitive; lowering their cost and increasing their revenue, so the infusion is high.

Diffusion means decentralization, which is the degree to which technology has been scattered throughout the company. For example, a firm is low degree of diffusion if its with centralized mainframe and strong data processing within one hierarchy; on the other hand a firm is high degree of diffusion if its with numbers of minicomputers and microprocessors in different places and its not managed by same team and business unit manager is responsible for the development and operation of the systems.

The correlation of these 2 main factors could draw out a 2 dimension matrix and form 4 combinations, i.e. low infusion & low diffusion; high infusion & low diffusion; low infusion and high diffusion; and high infusion and high diffusion.

Firstly the article pointed out that in low infusion & low diffusion environment, the most appropriate approach of system planning was SOG. 

Secondly, in high infusion and low diffusion environment, the most appropriate approach of system planning was BSP.

Thirdly, in low infusion and high diffusion environment, the most appropriate approach of system planning was CSF.

Lastly, in high infusion and high diffusion i.e. nowadays the complex environment as know as the information age.  The system planning in this environment would take an electric approach which is tailored to meet specific needs.  The planning must focus on business strategy planning.  The firms have to develop its unique information age requirements in order to make themselves are competitive. Firstly technology must be designed and used to support new forms of organization design.  Secondly network resource management must be enforced since companies turn to information exchange where the network becomes a viable point of coordination in highly distributed systems.  Thirdly developing information system architecture would consider the requirements and relationship among different business process as a whole.

In conclusion, we could see nowadays banking and financial industries are taking the electric approach in the complex environment since the market competition is keen and the customer needs is increasing, i.e. how the banks allowing their customer to access the financial data or trade the stocks or buy their insurance anywhere and anytime.  In addition to the different Smartphone technology coming out, the banking is facing new challenges all the time.  The technology is influencing their banking products and technology could help them to differentiate their products in the markets.

                                                  

Week 2: Successful Reengineering Demands IS/Business Partnerships

This literature review is based on the content of Lecture 2 and the suggested reading of Lecture 2 of COMP 326. After reading those materials, I have learnt a lot of things.

Enterprise Re-engineering is unavoidable due to the competitive business environment. Reengineering is not the short term projects. Indeed, it aims to increase the strength of the enterprise relative to competitors in the long term. In order to survive in the markets, the cycle of reengineering becomes shorter and frequent to fulfill the market needs.  

In the business reengineering, the top management will have to decide the business goal, objectives, and directions of the changes, these processes consist of strategic thinking, strategic planning and opportunistic decision making. Nowadays revolutionary business change is always facilitated by leveraging the power of technology. So, along with the strategy management processes, Information System (IS) is an inseparable part in the effective business strategic management. As the article mentioned that the IS organization is a source of another key ingredient to business reengineers success.

We know IS strategy is crucial but how can it make the reengineering success. Top management will have to clearly deliver the message of the new business strategy to IS. IS can’t be an order taker anymore in nowadays model.        In the success model that IS has to understand the requirements of the business strategy correctly and then contributes creative and innovative ideas which are feasible to supports the business and align with corporate strategy. In addition, these ideas are also feasible to be delivered and supported by the IT.

Business reengineering is a large scale project. We know IS is crucial in the reengineering project but IS should not take the leadership of overall project. On the other hand, Business should not lead the overall project either. Business and IS should agreed to take the appropriate roles in different reengineering areas. There are three appropriate roles -Leadership; Partnership and Support. Both Business and IS will certainly involve in each area but act in different roles only.  If inappropriate roles are assigned, it will lead to fail because of underestimating the complexity of the process and implementation; taking longer time to reengineer; or using up some unnecessary resources. We have learnt that it is appropriate to assign both parities as partnership in some areas, such as business reengineering idea generation area, it is because Business is the right party who contributes the business ideas, and this idea will be moving toward implementation, so IS professional skill will be required.  IS and business has to balance in reengineering.

In conclusion, IS has been redefined itself in the new role that is no longer taking order from business and no longer incrementally fulfilling the business requirements. In preparing for the challenges of business reengineering, IS should be working closely to the business, knowing what is happening in the business trend, trying to interpret the what is being said the by the chairman, focusing on the future; contributing creative and innovative ideas and then preparing itself to be able to manage a large scale reengineering projects.