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Managing & Developing Information Systems, Innovation & Strategy

Business Innovations with IT, Using IT for Competing, Information Goods, Information Systems &
Competitive Strategy.

Vendor Management, Role of CIO, IT Governance, Challenges for the Manager

IT Infrastructure Decisions.

Overview of IT Security, Basics of IT Operations and Lean IT.

Business Process Analysis Overview

Business Process Integration,

Life Cycle Models,
Introduction to Software Project Management.

Text Case: Ola Case study and A-MIS Bangladesh

Prof. Shreekant Deshpande

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Business Innovations with IT
Invention and Innovation
IS and IT are used in different ways in business for
introducing new products/services.
• Products : Mobile handsets, Laptops, etc..
• Processes : Internal – Automation,
• Services : self service kiosks in airport,
ATM, Online learning MOOCs, etc..
• Business Model : Different ways of delivering
value to customers- Ola, Flipcart, etc..
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IS and IT are used in different ways in business. Results
in new business models, products and services.
Some important types are:
1.Industry transformation : Digital world-
photography, news, movies
2.Diversity and variety: e-channels
3.Personalization: recommend books
4.Experimentation: try with diff offers
5.Plug-and-play innovations : extension to main
device(analytics, plug wifi to TV)
6.New marketing opportunities ; boundary less
7.Use of smart technologies : smart watches,
fitness bands collect data
8.Natural language interfaces : voice based
services- Siri
9.Analytics: to understand the trend and modify
offerings
10.Crowd sourcing : getting ideas from masses
(Mc Burger, Lays, etc..)
11.Business Model : Ola, Oyo
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Information Goods

Availability of CD’s or floppy disks in digitized

Using IT for Competing
formats (MP3) sold and distributed over the
Competition based on : internet. Digital books, Kindle reader,

Cost : By introducing new products and Live cricket scores shared over mobile phones,
automated processes, achieve low cost of laptops, etc..
operations: Ex: Mobile services in India,
Share prices, News, Air line ticket prices shared
Walmart – low prices
over network are digital goods.
Differentiation:
Properties of Digital goods:
Products and services offered with special
• Can be easily reproduced
features and premium prices charged.
• Devices can store large volumes of
Ex: Apple products, Amazon books at
information goods
starting ( at regular prices)
• Different versions or variants can be easily
made for different customers

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Technology lock-in and switching
Network externalities
costs
Benefit derived when more and more users
Technology changes/evolves very
adopt the a technology.
fast.
Benefit/value of using the technology goes up.
Organizations have to use technology
Same time cost may come down due to large
till investment is recovered.
number of users.
Technology Lock-in can be overcome
Ex: Mobiles,
by incurring Switching cost

Ex: Unix, Windows, ERP

Positive Feed back Tippy Markets

The positive feedback people receive
of using a technology.
Ex: Facebook, LinkedIn, WhattsApp,
Mobile handset model,
In a fierce competition among few players in the
market, only one survives – referred to as Tippy
market.
Video recording standards- Betamax and VHS

Negative feed back reduces the new

users

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Information Systems & Competitive Strategy

Competitive strategies Porter’s Value Chain:

Commercial firms leverage IS to implement Primary Activities: Inbound logistics, Production, Outbound
their strategies and plans logistics, Sales and Marketing, Maintenance

Objective is to remain competitive in the Support Activities:

market based on cost or differentiation. HR, R&D, Procurement, Infrastructure management.

The selected strategy will result in plans and IS are used to run Primary and Support activities.
activities at different level of the
Ex: SCM, ERP, CRM
organization. IS provide means to implement
the plans/activities. HRM, SRM, etc..
Governments also use IS to provide services
efficiently and at lower costs.

Case : Ola Cabs

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Vendor Management
Vendor Management Vendor contracts and SLA

Organizations generally outsource IS and IT to vendors Contracts bind Organizations and vendors technically
for development and maintenance/support . and legally.

• Hardware, Cloud services SLA (Service Level Agreement):

• Software, Testing 24*7 support, to register complaint in 1 hour, to attend

to complaint in 4/8/24 hours depending on level of
• Human Resources
SLA.
Long term contracts are common.
SLA levels: Platinum, Gold or Silver
Vendor selection:
Ongoing Vendor Relationship management:
• RFI
Regular review meetings, Vendor audits
• RFP
Vendor retention or Termination:
• Demo
At the end of contract period, contracts are reviewed
Negotiations for scope, schedule, cost and quality following regular RFI/RFP process.

Technical bid, Demo, Pilot, Commercial bid Invite rival vendors for the selection process.

Govt: May go for L1 approach Share work with two/three vendors.

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Role of CIO

Responsible for managing INFORMATION and IT

at organizational level and reports to CEO.
In par with CFO or COO.
May lead a team of Functional and Technical
experts or coordinate departmental MIS teams.
Information system plan: aligning IS with
organizational strategy,
• IT processes
• Centralized/De-centralized IS
• IT architecture
Vendor coordination:
Selection, monitoring of vendors,
Budget/resources management
Technology Updates:
Technology selection and upgrade
Technology Road map
Return on Investment of Technology:
Life cycles are short. Essential to reap benefits
before next IT is introduced.

• Buy/Build proportion Quality of processes

• Employee reporting structure Speed of transactions
• Policies for data retention, security, BCP/DR, Number of transactions
etc..

Visit cio.com for regular updates on cio activities/projects

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IT Governance

High level decision making , Policies and procedures, Data ownership

IT Principle: High level ideas on how to use IT- processes, Automation, responses, large number of
users, etc..

IT Architecture: Road map for hardware, software and networks

IT Services: Help desk, security services, Commercial transactions, BPO, etc..

Business application needs: decisions for adopting ERP, SCM, CRM etc…

IT Budgets: Prioritization of projects, centralized or decentralized allocation, investment or expenses,

etc..

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Challenges for the IS Manager/CIO

What IS to implement first: Prioritization to meet different need- transactions, automation, office
processes, ERP, etc…

How much to spend on IS?: Budgeting, ROI, etc..

How much capabilities in IS? : Buy/Build, What capacities, etc..

How fast/response and accuracy the services be?: response speed, accuracy,

Security levels required: Physical security and Information security. Data theft, Virus attacks, etc..

How much Cloud services to be adopted?: New way to use hardware and software. Confidential
information stored inside the company and rest on cloud due to data confidentiality/security reasons

Deciding on IT Road map for the organization: How long should be long term plan in IT, investments
in a particular technology, networking and telecommunications equipment, etc..

Questions like : When to upgrade to 4G/5G, to Big data,

Analytics….

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IT Infrastructure Decisions

IT Infrastructure constitutes the following:

• Desktops and laptops, used by employees, which are connected to servers

• Servers that host the applications (ERP, Talley, database, etc..)

• Routers, Switches, cables which form the network

• Collaboration and communication software- email, Webex, Document management, etc..

• Support facilities- Helpdesk for technology and application support

• Physical facilities like air conditioning for facilities that house hardware, software and people

• Training and development facilities with hardware and software

• Creating and maintaining standards for IT, including procurement of IT components

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IT Infrastructure Decisions

IT Infrastructure : is determined by the needs of business and work

needs of an organization. (Ex: servers, printers, Network devices, etc..)

IT Architecture: Technical design/layout of hardware, software and

network to provides a platform to perform the work for employees.

( Servers and PCs configured to deliver different services as per the

priority of an organization:
Help desk in a bank. CAD and CAM in a manufacturing organization like
Tata motors, e-commerce app in retail like Flip Cart).

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IT Infrastructure Decisions
IT Infrastructure decisions are made mainly for Business needs and Technology concerns .

Business needs Technology Concerns

• What business needs to be met with • Is the technology scalable?

infrastructure components
• How technology helps organization to
compete
• Is the technology appropriate for the
task?
• Is the technology interoperable?
• What is the Technology Roadmap?
• What is the renewal cycle?
• How is the vendor support?

• Is the technology best in class? (Value • What is the nature of Technology lock-in
for money) Trade off considered • Make or Buy?

Business : Manufacturing, trading, service, online trading

Work needs: Conversion, Transactions, Automation, providing service, after sales service

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The Technology Hype cycle

• High level of innovation in Technology

industry

• Some new technologies succeed while

some fail and disappear

• Every new technology creates a hype in

the market- high level of expectations.

• Hype may lead to

success/failure/realization and then
stabilize

• Referred to as Hyper Cycle

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The Technology Hype cycle

Examples

Ex: Big-data, Google glass, block-

chain, etc..

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Overview of IT Security

Two main types: Managing Information security:

Physical security of IS: Protecting IS
components from Physical damage, theft,
floods, fire, AC, etc…using BMS (Building
management System)
Information security : Securing information,
network and processes from hackers, data
theft, identity theft, virus, etc..
• Software
• Data/Information
• Network
The four important features to enable a secure IS
infrastructure in an organisation -
• Confidentiality: Only intended users should be
able to access the message/data
• Authentication: Identity of both sender and
receiver of information is guaranteed
• Message Integrity: Message is intact, not
tampered, changed, corrupted.
• Access and Availability: Access permissions to
business and power users, user groups is
defined in applications and database

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Overview of IT Security
Threats to Organization
Malware – various kinds of malicious software.
Viruses – Infect and spread across
networks, infecting PCs and destroying
data and files
Worms – damage network.
Trojans – spread to computers and allows
external software/people to invade the
computer and use its resources.
Denial-of-service Attack : Slowing down the
servers response or bringing server down.
Cracking and Espionage – Entering into
computers and networks illegally to create
fraud/mischief. Used to steal information
(industrial and political espionage)
Ethical Hacking – similar to cracking, but
motivation is to expose weaknesses.
Phishing and Identity Theft – lure
unsuspecting users to reveal their private
information ( emails sent by ids of other people)
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Handling Security
These measures can either be preventive or
detective.
Preventive controls inhibit/stop unauthorized
users from free access to computing resources.
Detective measures are taken once the threat has
penetrated the system to identify and nullify
impact.
Technologies for handling Security
• Encryption and Decryption
• Public-key Cryptography/Digital signatures
• Firewall
• Antivirus
• Virtual Private Network- tunnel on public net
work
• Wireless Technology
Wi-Fi Routers, Bluetooth, BlackBerry,
RFID,
Wireless Sensor Networks

Overview of IT Security
Managing security
• Securing the Network
Perimeter Security : Servers
protected by a separate set of
firewall.
Two Factor Authentication:
Card+PIN, OTP, Biometric scan, etc..
• Securing the Client
Desktop Firewalls
Password Policy
• Creating a Secure Environment:
regular Antivirus updates, strong pw,
regular changing of pw, using secured
networks, etc..
• Security Audit and Risk Assessment :
Periodic audits of security practices
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Managing security
• Disaster Recovery (DR) and BCP (Business
Continuity Planning): Plan to resume operations
with minimum disruption after a man-made or
natural disaster.
• Mirror facilities of servers, network, data in
different site, city, country
• Servers, databases or networks can be damaged
and need to be restored quickly
Two important time measures of BCP:
• RTO: Recovery Time Objective - Time to restart
the IS after a disaster by using mirror servers or
alternate sites . Ex: We can restart the services
after 4 hours.
• RPO: Recovery Point Objective ( How much
recent data can be restored. Consider that data is
taken to backup memory every 2 hours, say at
10.00 AM. If disaster strikes at 11.00 AM, then
data of last ONE hour will be lost and earlier to
that can be restored from the alternate site)
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Basics of IT Operations

Basics of IT Operations
(Maintenance activity to support Internal and external users)
IT operations provide support for hardware, software and network, for
both internal and external clients.
• Monitor IT servers and systems
• Develop Department policies - SLA, password policy
• Support Helpdesk operations
• Negotiate vendor contracts
• Carryout installations and updation/patches

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Basics of Lean IT

Basics of Lean IT
Lean IT is defined as the extension of lean manufacturing and lean services
principles to the development and management of IT products and services, with a
central concern of eliminating waste.
- Time, data, people, Hardware, software, network

Examples of Waste in IS/IT

Examples of Waste in IS/IT
Reduce Defects
Reduce rework Outdated requirements
Reduce low-value work Partially completed applications
Analyze busy work ( Root Cause Underutilized hardware/database
analysis or Fish bone diagram) Resources on bench
Analyze slow decision-making ( time Firefighting cases
waster) Knowledge loss (Repeat work)
On-site/manual tasks Unused applications

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Case analysis

Mahesh wants to study MBA after completing his graduation. Presently he is in the final year of UG
program and is seriously looking out for a good institute/University offering a TWO years MBA
program with a good standing/rating in the industry.

Assuming yourself to be Mahesh, analyze the above scenario and present your findings and final
recommendation as per the format below:
Important:
Time for Case study in Exam
1. Problem statement
2. Alternatives
3. Criteria for evaluation of alternatives
4. Comparative analysis of alternatives
5. Recommendation of the best option
6. Contingency plan
7. Lessons learnt
8. Conclusion ICICI bank Case study (6)

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Project management and Process Flow diagrams

Life Cycle Models – Traditional (SDLC) and new ( Agile, Scrum, etc..)

Business Process Analysis Overview

Business Process Integration

Introduction to Software Project Management.

Text: 13.1-13.3

Text Case: Bangladesh (13)

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SDLC ( S/w Development Life Cycle)

AS-IS and TO-BE Scenarios : Requirement gathering and analysis

AS-IS : Describing current IS status

TO-BE : Planned IS status

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Life Cycle Models
System Development Life Cycle (SDLC)

Waterfall Model
• Project Requirements
• Analysis
• Design
• Coding and Testing
• Implementation and Integration
• Maintenance

Software: An application ex: Billing

System: Consisting of many applications ex: ERP

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Life Cycle Models
System Development Life Cycle (SDLC)

Waterfall Model
• Project Requirements: High level requirements, AS_IS and TO-BE, Project
Charter, Feasibility study and approval

• Analysis (FRS) : Functional and Non-Functional requirements, Collection

and analysis of requirements, Traceability Matrix, FRS

• Design (SRS) : Data tables, Screens, algorithms, reports, workflow,

interfaces, etc.. ( CASE tools Computer aided s/w engineering tools), logical
and physical design (Table design) , SRS

Functional experts/MBA play role in Requirements analysis and Testing

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Life Cycle Models
System Development Life Cycle (SDLC)

Waterfall Model
• Coding and Testing : Prototype, Road show, Programming logic, interfaces,
workflow and database, Testing, Test Cases, module integration

• Implementation and Integration: Going live, May take a few hours

or a weeks time, Putting code to client servers, MNC challenges
• Application and Data migration: Green-field implementation,
Brown field projects. Application and Data need to be migrated to
new design.
• Maintenance and Support: BAU and changes/enhancements

Functional experts/MBA play role in Requirements analysis and Testing

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Testing

Cost of correcting errors increases, if error is • Test case preparation

identified at a later stage
• Unit testing
• Integration testing
• Performance testing/variety of
loads
• Stress testing/Failure point
• User acceptance testing

Types Testing
• Manual testing
• Automated testing
QA: Quality Assurance, 4 Eye principle
QC: Quality Control

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New models for Life Cycle management

Mainly to cater to small and medium projects and for accommodating
changing scope and requirements of the project

• Rapid Prototyping : small working model

• The Spiral Model : iterative model for building prototypes for
expanding scope.
• Agile Methods : Inspired by quality manufacturing processes, smaller
cycles to reduce risk. Bugs and design flaws detected early.
• Extreme Programming : Suitable for small-medium size projects.
Stories, Short releases, Testing, Iteration, Refactoring (Changes),
pair programing, Work environment, Metaphors
• Scrum : Product backlog, Spring backlog, Scrum Master, Team
member Burn down chart

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Business Process:

Process of conversion of material, information and creating/adding utility to meet

customers needs and wants, Logistics, trading, services, etc…

Common processes: Attendance, Recruitment, Purchase, Sales, etc..

Process involves: Material, process of conversion, exchange of goods, finance and

information.

Ex: Selling goods, Purchasing goods- Transactions

Loan issue, ATM cash withdrawal, etc,,

Business/Functional Analyst:

Functional analyst, expert in the domain who defines the process and identifies
Material, conversion process, actors/people involved, finance exchanged and
information exchanged.

Case Study: A-MIS for Farmers in Bangladesh ( Agricultural MIS)

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Flow diagrams
Flow diagrams are used to
depict high level tasks and the
movement of data.

Example : Customer order

processing

Flow Chart
Diagrams that show (more
details) the logic/decision
points and flow control in
computer programs/algorithm
(YES/NO).

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Data Flow Diagrams (DFD)

Diagrams that show exchange of data/data between people, processes and finally data
storage (sinks).
Data source and data store for PO process

Ex: order registration and despatch process

DFD Notations

A/C
data base

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Guidelines for drawing DFD:

• A process must have at a minimum one input and produce at least

one output
• All data stores (sources and sinks) and entities must either receive
or send out at least one data element/flow
• All the data exchanges/flows must originate or end in a process
• Entities show groups, departments or individuals, even though in
many cases the behaviour of members of groups are different with
respect to the system. Interaction with system has to been in a
particular context.

Software tool for DFD:

Microsoft Visio,
EdRaw, etc…

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Use cases

A technique/tool for
analysing a business
process that covers
• Activities/tasks
• People/actors
• information that flows
between them.

UML Tools
• IBM Rational Rose tool
• StarUML

Exercise:
A. Draw a DFD for Ticket booking process in Railways using IRCTC
B. Draw a Use case showing actors, activities for Loan approval process starting from loan
application by customer.

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Software Project Management

Triple Constraints of Project Management

(Scope, Time and Cost)

• Projects and Programs

• PMP Certification from PMI (Project management Institute)

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Software Project Management

• Top Management support- Buy in from top management to get support from all the
departments during integration
• Team composition : skill set, diff departments, matrix organization
• Vendor/Supplier selection: Hardware items, Outsourcing
• Project estimation: Size estimation, effort, schedule, cost
 Function point analysis:
 Based on function points, number say 250, medium size, takes around 100 person-
days effort.
 Data Functions: Variety of data input and output
 Transaction functions: Manipulation, communication, data exchange,
Reports, queries, etc..

Text case : Bangladesh

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Thank You

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 Extra slides:
Project Management - Process groups

PMP Certification from PMI (Project management Institute)

1. Project Integration 6. Project Human Resources
Management Management
2. Project Scope Management 7. Project Communications
8. Management
3. Project Time Management
9. Project Risk Management
4. Project Cost Management
10. Project Procurement
5. Project Quality Management Management

11. Project stakeholder

Management