ethier associates calgary cio forum june 509

© EAdirections 2009. All Rights Reserved.

Increasing Your Effectiveness By Analyzing Leadership’s Attitudes Toward

Information Technology

Calgary CIO Forum

Larry R. [email protected] Director

June 5, 2009

mailto:[email protected]�

© EAdirections 2009. All Rights Reserved. 2

Corporate Snapshot

• Founded by Larry R. DeBoever, George S. Paras, Tim Westbrock– 50+ years of combined leadership in Technology Strategy & Enterprise Architecture– Launched the Enterprise Architecture Strategies (EAS) service at the META Group in 1996– Launched the first EAC with in 1997; continuously chaired– Editor-in-Chief of Architecture & Governance Magazine– Associate Editors of the Journal of Enterprise Architecture– Founding members of SIM Enterprise Architecture Working Group (SIMEAWG)– Named one of the 5 ‘Pioneers’ of EA by SIM

• Our Mission - Improve the effectiveness of technology-enabled organizations by creating deep, mentoring relationships driven by independent research.

Thought Leaders. Mentors. Deep Relationships.

Larry R. DeBoever Tim WestbrockGeorge S. Paras


Our Approach to Building Effective Technology-Enabled Organizations

13© EAdirections 2008. All Rights Reserved.

Mapping the Application Systems to the FH

In the diagram below, the Application Systems are mapped to the FH. This can be very effective in understanding which applications support which functions as well as possible overlap. The Application Systems use the same color coding in this map as in the previous slide.

1.1

Pub

lic R

elat

ions

& C

omm

unic

atio

ns

1.2

Adv

ertis

ing

& Br

and

Man

agem

ent

1.3

Mar

ketin

g O

ps &

Lea

d G

ener

atio

n

2.1

Pro

spec

ting

& Le

ad M

anag

emen

t

2.2

Qua

lific

atio

n

2.3

Sal

es P

ropo

sals

2.4

Sal

es N

egot

iatio

ns &

Con

tract

s

3.1

Res

earc

h &

Dev

elop

men

t

3.2

Pro

duct

Dev

elop

men

t & D

esig

n

3.3

Pro

duct

Eng

inee

ring

4.1

Pro

cure

men

t

4.2

Man

ufac

turin

g

4.3

Inve

ntor

y

4.4

Shi

ppin

g

4.5

Cus

tom

er S

ervi

ce

4.6

Ret

urns

5.1

Pur

chas

ing

5.2

Acc

ount

s R

ecie

vabl

e

5.3

Acc

ount

s Pa

yabl

e

5.4

Fin

anci

al R

epor

ting

5.5

Inte

rnal

Aud

it

5.6

Hum

an R

esou

rces

5.7

Info

rmat

ion

Syst

ems

(IT)

5.8

Leg

al

Customer Relationship Management (CRM) Leads

Contacts Accounts Campaigns

Financial SystemGeneral Ledger Cash Management Accounts Payable Accounts Receivable Fixed Assets

Supply Chain ManagementOrder Entry Purchasing Inventory Forecasting

ManufacturingBill of Materials Scheduling Cost Management Quality Control Capacity Planning

Freight Management & ShippingFreight Management & Shippping

Human ResourcesPersonnel Payroll Benefits Time & Attendance

Content ManagentContent Management

etc.etc.etc.

System function

Com

pany

AB

C's

Info

rmat

ion

Sys

tem

s

LEGEND

Company ABC

High Level Functional Hierarchy

4.0 Operations 5.0 Finance & Administration3.0 Engineering1.0 Marketing 2.0 Sales

Ongoing Mentoring– Make our clients more effective– IT Strategy, Business/IT Alignment, Business Transformation,

Project Management, Application Portfolio, Enterprise Architecture, IT Governance, Cost Optimization, etc.

– Individuals or Teams– Retainer based

Providing ‘Jump Start’ Materials & Other Research– Provide ‘quick & dirty’ enterprise-wide templates for demonstrating

Business/IT Alignment , Enterprise Architecture, etc.– Templates for demonstrating Business/IT alignment– Tools for ‘Business Fit’ vs. Technical Fit’, etc.– Perform on-going research

Building the Extended Team– Refine mission, strategy, roles and responsibilities– Establish communications strategy to enroll support– Build a culture of collaboration and effectiveness focused on

‘enterprise outcomes’

Assessing Activities & Review Deliverables– Provide honest feedback and prescriptive advice– Critique documents to improve effectiveness especially for C-level– Guide development of new artifacts– Ongoing review of emerging issues


Topics

• Examples of Current Client Challenges• Typical Initial Questions from CEO• Basic Technology Positioning to Leadership• Analyzing Leadership: Overview• Exercise #1: Leadership’s Perception of IT Effectiveness• Exercise #2: Analyzing the Extent of ‘Holistic Optimization’

in the Organization• Exercise #3: Analyzing Leadership’s Attitudes Toward

‘Holistic Optimization’- - - - - - -• High-Level Approach to Demonstrating Business/IT

Alignment (Tactical)


Topic

Examples of Current Client Challenges

16-B


Current Client Challenges – Examples

• IT Cost Containment– Rationalizing systems & infrastructure– SaaS– Cloud Computing– Open Source– “Showback” (in lieu of Chargeback)– Etc.

• Demonstrating/Communicating IT’s Value• Demonstrating/Communicating IT’s Alignment with

Business Strategy• High Availability & ‘Zero Downtime’ (cost effective)• “How do I more effectively engage executive leadership?”


Typical Initial Questions from CEO

“Are We Doing the Right Things in IT?”Or

“What Are Other People Doing?”

16-B


Favorite “Stories”

• Sabre – reduced OpEx $20M year– HP nonstop to HP/Intel/LAMP– Less than 200 millisecond delay– Horizontal scaling with 350 servers– 60% of all travel reservations in North America

• Mayo Clinic – 6 TB of new data per week with only 22 minutes of downtime this year– ‘Zero downtime’– A planned outage is just as bad as an unplanned outage if you

offer customer self-service 24/7

• Russell Companies – 30% reduction in IT cost during a period of 35% growth– $220 billion in assets– Complete

• H&R Block – 20% increase in revenue by integrating customer data

• Wal-Mart embracing SaaS for employee scheduling – 2.1 million employees


Consistent Themes

Basic Technology Positioning to Leadership

16-B


A Primary Business Challenge

The rate of change in business is accelerating.

Significant ProcessChange Initiated

18 Months

Significant ProcessChange Initiated

Significant ProcessChanges Initiated

The timeframe that ‘change’ must occur is often shorter than IT’s planning cycles.

IT must enable rapid change in the business rather than inhibit it.


Understanding Technology Trends

TechnologyPrice/Performance

Time

T0 Tn

“Tech-tonics: the study of the basic, inexorable forces which cause fundamental changes in the development, adoption and use of information technology on a global basis.”

1.10

1.00

.90

.80

.70

.60

.50

.40……

Today’s Price/PerformanceRegardless of Technology


TechnologyPrice/Performance

TimeT0 Tn

1.10

1.00

.90

.80

.70

.60

.50

.40……

NETWORK STORAGE

PROCESSOR

ENTERPRISESOFTWARE

STAFFING

Relentless improvements in price/performance in technology

Concept of ‘Tech-tonics’


Topic

Analyzing Leadership: Overview

16-B


Analyzing Executive Leadership: Overview

Holistic Optimization• “To what extent is the organization holistically optimized?”• “What are the CEO & Leadership Team’s attitude toward holistic

optimization?”

IT Effectiveness• “How does the CEO & Leadership Team evaluate IT’s current

effectiveness?”• “How effectives does the CEO & Leadership Team believe IT

needs to be for the organization to achieve its strategic objectives?”

FORMAT FOR 3 EXERCISES1. Analysis Framework2. Perform Exercise3. Example (if no one volunteers…)


Exercise #1

Leadership’s Perception ofIT Effectiveness

16-B


FRAMEWORK

Perception of IT Effectiveness

Current IT Effectiveness

Level of IT EffectivenessThat Is Needed

(to Achieve Strategic Goals)

LOW

LOW

HIGH

HIGH


EXERCISE





LOW

LOW

HIGH

HIGH

CEO CFO Cx3 Cx4 Cx5 Cx6


EXAMPLE





LOW

LOW

HIGH

HIGH

CEO

CFO

Cx3

Cx4

Cx5

Cx6


Exercise #2

Analyzing the Extent of ‘Holistic Optimization’ in the Organization

16-B


FRAMEWORK

Analyzing Extent of Holistic Optimization

Current Enterprise-Wide Optimization

Future Enterprise-WideOptimization

LOW

LOW

HIGH

HIGH


EXERCISE




LOW

LOW

HIGH

HIGH

GLOBALPROCESSES

CORPORATEPLANNING CUSTOMER

EXECUTIVEBONUSES


EXAMPLE




LOW

LOW

HIGH

HIGH

GLOBALPROCESSES

CORPORATEPLANNING

CUSTOMER

EXECUTIVEBONUSES


Exercise #3

Analyzing Leadership’s Attitudes Toward ‘Holistic Optimization’

16-B


FRAMEWORK

Attitudes Toward Holistic Optimization


Desired Amount of Enterprise-Wide

Optimization

LOW

LOW

HIGH

HIGH


EXERCISE




Optimization

LOW

LOW

HIGH

HIGH

CEO CFO Cx3 Cx4 Cx5 Cx6


EXAMPLE




Optimization

LOW

LOW

HIGH

HIGH

CEO

CFO

Cx3

Cx4

Cx5

Cx6


Topic

High-Level Approach to Demonstrating Business/IT Alignment (Tactical)


Using A Matrix to Demonstrate ‘Tactical’ Alignment• Developed this approach over many years – very effective

– Toyota’s HEAT map is a version of this• Successfully used by numerous clients where CIO wanted to

demonstrate that IT projects supported immediate business objectives– Of greatest interest to Business Unit leadership and, typically, COO– Effective way to communicate to IT staff near-term priorities

• First step is to place Business Objectives for 2008 on horizontal axis

SALES

Integrate all Customer data

Increase customer self-service by 30%

Provide 7x24 customer access

Real-time visibility into

Supplier inventory

Provide Supplier

performance reports on-line

CUSTOMER SERVICE PROCUREMENT

CORE BUSINESS OBJECTIVES - 2008Best Stuff Inc.


Using A Matrix to Demonstrate ‘Tactical’ Alignment

SALES





Supplier inventory

Provide Supplier





Put IT Projects On Vertical Axis

• Use sub-bullets to provide more detail as required• A Best Practice is to also show CapEx and OpEx requirements

Total Capital Expenditure

($000s)

2008 Operating

Expenditure ($000s)

4,460$ 835$

2,900$ 675$

1,745$ 854$

690$ 250$

875$ 430$

1,250$ 640$

BUDGET

11,920$ 3,684$

TECHNOLOGY INITATIVES - 2008

Achieve 7x24 Continuous Operations • Open 2nd data center in Cinn; share workload

Major Network Upgrade • Significant increase both domestic & international capacity

Implement Real-Time Customer Data Integration (CDI) • Replace existing LOB solutions

Implement Transaction Data Management Solution • Enables both CDI and ContinuousOps initiatives

Upgrade Customer Portal (Release 3.0) • Improve scalability, cross-selling & personalization

Implement Supplier Performance Portal (Release 1.0)

• Initial release to top 9 suppliers (45% of revenues)


Put IT Projects On Vertical Axis




Implement Real-Time Customer Data Integration (CDI) • Replace existing LOB solutions

Implement Transaction Data Management Solution • Enables both CDI and ContinuousOps initiatives


Implement Supplier Performance Portal (Release 1.0)

• Initial release to top 9 suppliers (45% of revenues)


Simple Business/IT Alignment (Tactical) Matrix

• Very effective with most Leadership• Recent client experience illustrates effectiveness• In the example below, bullets are used to identify strength of

applicability

ALSO NOTE:• Different ‘size’ bullets can be used to show size of spend• Different ‘color’ bullets can be used to show urgency

SALES






Supplier inventory

Provide Supplier


Total Capital Expenditure

($000s)

2008 Operating

Expenditure ($000s)

Achieve 7x24 Continuous Operations 4,460$ 835$ • Open 2nd data center in Cinn; share workload

Major Network Upgrade 2,900$ 675$ • Significant increase both domestic & international capacity

Implement Real-Time Customer Data Integration (CDI) 1,745$ 854$ • Replace existing LOB solutions Implement Transaction Data Management Solution 690$ 250$ • Enables both CDI and ContinuousOps initiatives

Upgrade Customer Portal (Release 3.0) 875$ 430$ • Improve scalability, cross-selling & personalization

Implement Supplier Performance Portal (Release 1.0) 1,250$ 640$ • Initial release to top 9 suppliers (45% of revenues)


BUDGET

11,920$ 3,684$



Simple Business/IT Alignment (Tactical) Matrix

SALES






Supplier inventory

Provide Supplier




Implement Real-Time Customer Data Integration (CDI) • Replace existing LOB solutions Implement Transaction Data Management Solution • Enables both CDI and ContinuousOps initiatives


Implement Supplier Performance Portal (Release 1.0) • Initial release to top 9 suppliers (45% of revenues)




Topic

Summary

16-B

© EAdirections 2009. All Rights Reserved.

Increasing Your Effectiveness By Analyzing Leadership’s Attitudes Toward

Information Technology

Calgary CIO Forum

Larry R. DeBoeverManaging Director

June 5, 2009

ethier associates calgary cio forum june 509

Documents

research eadirections

effectiveness of technology

application systems

project management

effectiveness exercise

downtime cost effective

cost optimization

accounts recievable