Professional Documents
Culture Documents
Mcgraw-Hill/Irwin ©2008, The Mcgraw-Hill Companies, All Rights Reserved
Mcgraw-Hill/Irwin ©2008, The Mcgraw-Hill Companies, All Rights Reserved
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Learning Objectives
4. Explain the effect on global business/IT strategy of the
trend toward a transnational business strategy by
international business organizations.
5. Identify several considerations that affect the choice of
IT applications, IT platforms, data access policies, and
systems development methods by a global business
enterprise.
6. Understand the fundamental concepts of outsourcing
and offshoring as well as the primary reasons for
selecting such an approach to IS/IT management.
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Case 1: Hewlett-Packard: Managing
Radical Change in IT to Support New
Business Goals
• It is important for CIOs to understand not only the
technology and how it could be used to improve a
business but also how to deliver those benefits.
• Companies like Hewlett-Packard face major challenges
when implementing changes to make the IT function more
efficient and vital contributor to their business success.
• Radical changes suggested by the CIO of HP, Randy Mott
can lead to thousands of layoffs and changes in their
culture.
• If these changes are not managed properly, it could lead
to a disaster.
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Case Study Questions
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Case Study Questions
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Real World Internet Activity
1. Use the Internet to discover the current
financial performance of HP and determine if
HP’s major changes and spending on IT are
being viewed as a positive or negative
contributor to its performance. Then
investigate HP’s competitive performance in
market share, units sold, and other areas
compared with Dell, Leveno, Sun, IBM, and
any other competitors you find, as well as the
reasons given for HP’s current competitive
stance.
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Real World Group Activity
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Components of IT Management
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Managing Information Technology
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Business/IT Planning Process
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Components of Business/IT
Planning
• Strategy Development
– Developing business strategies that support a
company’s business vision
• Resource Management
– Developing strategic plans for managing or outsourcing
a company’s IT resources
• Technology Architecture
– Making strategic IT choices that reflect an information
technology architecture designed to support a
company’s business/IT initiatives
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Information Technology
Architecture
• Technology Platform
– Networks, computer systems, system software and
integrated enterprise application software
• Data Resources
– Operational and specialized databases
– Store and provide data and information for business
processes and decision support
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Information Technology
Architecture
• Applications Architecture
– Integrated architecture of enterprise systems that
support strategic business initiatives as well as cross-
functional business processes
• IT Organization
– Organizational structure of the IS function within a
company and the distribution of IS specialists
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Organizing IT
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Organizational Components of IT
at Avnet Marshall
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Application Development
Management
• Managing activities such as:
– Systems analysis and design, prototyping, applications
programming, project management, quality assurance,
and system maintenance for all major business/IT
development projects
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IS Operations Management
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System Performance Monitors
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Features of Systems Performance
Monitors
• Chargeback Systems
– Allocate costs to users based on the information
services rendered
• Process Control Capabilities
– Systems that not only monitor but automatically control
computer operations at large data centers
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IT Staff Planning
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IT Executives
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Managing User Services
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Outsourcing
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Outsourcing’s Top Ten
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Why outsource?
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Offshoring
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IT Management Failures
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Management Involvement and
Governance
• Managerial and end user involvement
– Key ingredient to high-quality information systems
performance
• Involve managers in the management of IT
– Governance structures such as steering committees
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Senior management’s involvement in
business/IT decisions
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Case 2: IBM Corporation: Competing
Globally by Offshoring IT Workers
and Giving Away Technology
• IBM is expanding their development centers in India to
compete with companies like Wipro, Infosys, and TCS.
• IBM is also giving away technology and its intellectual
property to expand its business.
• According to Fortune magazine, IBM gives away at least
$150 million worth of technology every year.
• The idea that giving things away makes the pie bigger for
everybody is being embraced by IBM.
• When IBM gives away free tools, it often sells additional
software and consulting services.
• As long as IT remains hard to use, expensive, and labor
intensive, with customers continuing to need help solving
business problems, IBM will have the opportunity to thrive.
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Case Study Questions
1. Do you agree with IBM’s employment response to
competition from software development contractors in
India, like Wipro, that are expanding into IT consulting
services? Why or why not?
2. Will IBM’s plan to give away some of its IT assets and
intellectual property and increase its support of
opensource software products like Linux be a
successful growth strategy in the “brutally competitive
marketplace” in which it operates? Why or why not?
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Case Study Questions
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Real World Internet Activity
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Global IT Management
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Global IT Management
Dimensions
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Global IT Management
Challenges
• Political
• Geoeconomic – effects of geography on the
economic realities of international business
activities
• Cultural
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Political Challenges
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Cultural Differences
• Languages
• Cultural Interests
• Religions
• Customs
• Social Attitudes
• Political Philosophies
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Transnational Strategies
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Transnational Business/IT
strategies
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Global Business Drivers
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Global IT Platform
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International Data Communications
Top 10 Issues
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Internet as a Global IT Platform
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Key Questions for Global
Websites
• Will you have to develop a new navigational logic
to accommodate cultural preferences?
• What content will you translate, and what content
will you create from scratch to address regional
competitors or products that differ from those in
the U.S.?
• Should your multilingual effort be an adjunct to
your main site, or will you make it a separate
site, perhaps with a country-specific domain?
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Key Questions for Global
Websites
• What kinds of traditional and new media
advertising will you have to do in each country to
draw traffic to your site?
• Will your site get so many hits that you’ll need to
set up a server in a local country?
• What are the legal ramifications of having your
website targeted at a particular country, such as
laws on competitive behavior, treatment of
children, or privacy?
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Internet Users by World Region
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Global Data Access Issues
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U.S.-E.U Data Privacy Requirements
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Internet Access Issues in Most
Restrictive Countries
• High Government Access Fees
• Government Monitored Access
• Government Filtered Access
• No Public Access Allowed
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Global Systems Development
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Systems Development Strategies
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Systems Development Strategies
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Internet-enabled Collaboration in IT
Development
Source: Adapted from Jon Udell, “Leveraging a Global Advantage,” Infoworld, April 21, 2003,
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5735.
Case 3: Northwestern Mutual Life,
GE, and Boeing: The Business
Challenges of Outsourcing
• Outsourcing of IT services provides cost savings.
• Financial-services companies like Northwestern Mutual
Life can cut the cost of IT work by 39 percent by
outsourcing it to vendors in low-cost countries.
• Companies that are outsourcing their IT services have
to manage many challenges.
• Key challenges are: privacy, security, and effective
management of the outsourcing relationship.
• Key issues to successful outsourcing are often unique
to the company and its needs.
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Case Study Questions
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Real World Internet Activity
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Real World Group Activity
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