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Defining and Implementing
Technology Strategy
Discussion Framework
March 20, 2001
- 2 -© 2001 Athens Group, Inc. Confidential and Proprietary
Contents
1. Introductions / AG Overview (5)2. Strategic Analysis vs. Technology Strategy (5)3. Technology Due Diligence and other useful
Frameworks (15)4. E-Business Strategy Case Study (20)5. Q & A
- 3 -© 2001 Athens Group, Inc. Confidential and Proprietary
- 4 -© 2001 Athens Group, Inc. Confidential and Proprietary
Who We Are
“Athens Group is an employee-owned consulting firm, integrating technology strategy and software
solutions.”
- 5 -© 2001 Athens Group, Inc. Confidential and Proprietary
What We Do
Assessment Planning Implementation
•Risk Analysis•Risk Management Plan•Competitive Analysis•Recommendations
Due Diligence
•Technology Plans•Architecture Roadmaps
Strategic Planning
•Integration Architecture•Recommendations
Package Selection
•Turn-key solutions•“Glueware”
Package Integration
Complete software solutions
Software Development
Multi-project Oversight
Program Management
Dedicated Project Oversight
Project Management
- 6 -© 2001 Athens Group, Inc. Confidential and Proprietary
We Assist Clients in the Application of Information Technology to Increase the Value of Their Business
Assessment Planning Implementation
Emerging Technologies
Change Management
(Business Integration)
Technology Strategy
• Internet Evolution (e-Business)
• Technology Due Diligence
• Appropriate Technology Selection
• M&A Due Diligence
• IT Benchmarking
• Business Alignment Evaluation
• Project Assessment
• IT Strategy & Plan
• Architecture Design
• Disaster Recovery Plans
• Requirements Definition
• Package Selection
• S/W Development Process
• Business Alignment & Goal Deployment
• IT Strategy Implementation
• Business Process Improvement
• Program / Project Management
- 7 -© 2001 Athens Group, Inc. Confidential and Proprietary
What We Do: Knowledge Centers
eBusiness
CustomerRelationship
Management
Business PerformanceManagement
ManufacturingSystems
Hardware Integration
- 8 -© 2001 Athens Group, Inc. Confidential and Proprietary
A Few of Our Clients…
- 9 -© 2001 Athens Group, Inc. Confidential and Proprietary
A Few of Our Clients…
- 10 -© 2001 Athens Group, Inc. Confidential and Proprietary
A Few of Our Clients…
- 11 -© 2001 Athens Group, Inc. Confidential and Proprietary
Strategic Analysis vs. Technology Strategy• “Strategic” vs. “tactical” strategy• Response to specific situations:
– “We need to be an e-business by the end of the year!” --CEO
– “Should we acquire Abc corp?” --CEO– “Should I invest in Xyz.com corp?” --VC– “Do we need an ERP system? What is the best one for
us? –CIO– “How do we define and implement the right systems to
support our new business strategy?” --CEO
- 12 -© 2001 Athens Group, Inc. Confidential and Proprietary
Common Tools
1. Technology Due Diligence Process 2. Risk Analysis3. Business Case Framework4. Project Prioritization5. Package Selection Process6. IT Roadmap
- 13 -© 2001 Athens Group, Inc. Confidential and Proprietary
Technology Due Diligence
• Product vs. M&A• People• Process• Technology
- 14 -© 2001 Athens Group, Inc. Confidential and Proprietary
Technology Due Diligence - People
• Develop some usable frameworks and collect metrics. –value is in comparison
• Starting point: Carnegie-Mellon SEI– http://www.sei.cmu.edu/cmm-p/
- 15 -© 2001 Athens Group, Inc. Confidential and Proprietary
Technology Due Diligence - Process
• Business and Engineering• Examples: order processing, customer support,
software development• Starting point:
– http://www.sei.cmu.edu/cmm/cmms/transition.html
- 16 -© 2001 Athens Group, Inc. Confidential and Proprietary
Technology Due Diligence - Technology
• Very situation-specific• Code reviews• Performance benchmarking• Security validation (see http://www.iss.net)• Architecture validation
– Scalability, integration, skillset• Customer interviews
- 17 -© 2001 Athens Group, Inc. Confidential and Proprietary
Risk Analysis
• Simple Framework:– Identify Risks, Probability, Severity– Multiply Probability X Severity– Sort by risk– Develop mitigation strategy and contingency plan
for each high risk• Implement risk management process!• Example frameworks
- 18 -© 2001 Athens Group, Inc. Confidential and Proprietary
Product Development Risk AnalysisProduct Area Team Size
6 Number of Team Members - includes 3 developers, engineering mgt. and support
Requirements1 10 Is there a one sentence product team and product description?2 5 Can the product team describe the target user ?3 5 Are the prerequisites and customer operating business environment documented ?4 8 Are the product team objectives understood by all stakeholders?5 8 Is there a prototype of the product team's product(s) ?6 4 Are the competitions' features documented side by side with this product areas'?7 8 Does this product team have access to the domain expertise needed for success?
8 8Is there a published schedule for the products and first customer deliveries for this product area ?
9 4 Has a complete cost analysis been completed along with break even scenarios ?10 0 Has a life cycle been defined for this product area ?11 8 Is a marketing/business development person part of the product team ?12 5 Is a staffing person part of the product team?
Risk Analysis Results
NewProduct v1.0 73 Preliminary score 80.3 Final score (preliminary score adjusted for team size)
Chance of Success: FairEvaluation: A good first pass. A product area with this score will likely experience high stress and shaky
team dynamics, and the product will ultimately be delivered with less functionality than desired at greater cost and with a longer schedule.
For each question, give the product development team 10 points if it is definitely true, 8 points if 80% true, 5 points if 50% true, 4 points if No but planned and 0 points if No and NOT planned. There is a maximum of 10 points per question.
- 19 -© 2001 Athens Group, Inc. Confidential and Proprietary
The Business Case Is Built In A Logical Sequence Of Steps
StepStep55
StepStep44
StepStep33
StepStep22
StepStep11
• Understanding economic drivers of business• Understanding financial projections and historical trends
Financial DecompositionFinancial Decomposition
• Studies covering the key levers identified in the financial analysis• Baseline development
Findings based Opportunity Identification and BaselinesFindings based Opportunity Identification and Baselines
• Opportunity charts• Financial and operational assumptions
Finalizing the Business CaseFinalizing the Business Case
Validating Benefits with process ownersValidating Benefits with process owners
Quantifying Opportunities and determining Benefit LogicQuantifying Opportunities and determining Benefit Logic
- 20 -© 2001 Athens Group, Inc. Confidential and Proprietary
Prioritization Frameworks
• Simple (matrix)• Weighted• Gated
- 21 -© 2001 Athens Group, Inc. Confidential and Proprietary
Simple Prioritization – Applications Example
Strategic Impact
STRATEGICHIGH POTENTIAL
KEY OPERATIONALLEGACY
Applications that are critical to company’s
current business strategy
Applications that may be important to company’s future business strategy
Applications which company needs to run
business
Applications targeted for replacement / no further investment
Critical to Business Strategy
- 22 -© 2001 Athens Group, Inc. Confidential and Proprietary
Weighted Prioritization ExampleProject Type
Project Name Estimated Project Costs / Year 1 (*1000)
Recurring Costs / Year
(*1000)
Strategic Alignment
25pts. Total
Mission Effective-
ness 20pts. Total
Organi-zational Impact 10pts. Total
Risk (of not
doing) 20pts. Total
Benefit Cost Ratio
25pts. Total
Total Score
100pts. Total
Strategy ERP $65 $5 23 20 10 18 22 93
Project Infrastructure Upgrade $400 $50 23 20 10 20 20 93
Project Web Applications $150 $75 23 20 7 17 21 88
Strategy Security $75 $5 20 17 8 18 24 87
Project ERP $1,350 $125 23 20 10 18 15 86
Project M & A Integration $125 $125 20 18 8 17 20 83
Strategy Web $75 $5 20 18 10 14 20 82
Strategy Acquisition & Remote Site Integration $40 $5 20 17 5 18 20 80
Project EIS $75 $10 20 17 7 13 20 77
Project External Website $75 $35 23 15 5 12 20 75
Strategy Customer Relationship $30 $5 20 15 7 12 20 74
Project Intranet $100 $25 18 16 8 13 17 72
Project CRM $350 $100 20 18 7 12 15 72
Strategy Infrastructure & System Reliability $45 $5 15 15 5 15 18 68
Project Professional Services Automation $75 $20 18 15 5 10 15 63
$3,030 $595
- 23 -© 2001 Athens Group, Inc. Confidential and Proprietary
Gated Prioritization Example
P4: eBusiness Project Portfolio Prioritization Process
1: eBusiness Criteria
2: Define PotentialProjects2: Define PotentialProjects
Customers
Athens Group
DPI Execs
Customers
Athens Group
DPI Execs Distinct projects which mayprovide value in the eBusiness space
StakeholdersWhich stakeholders are most important to advance or maintain through eBusiness projects?
Business GoalsWhich DPI business goals are most important to advance through new eBusiness projects?
ImplementationCriteriaWhich implementation criteria are most important to consider when trading off potential projects?
PrioritizedPortfolio
Fund,Implement,Iterate
3: Rate Projects
Rate the capability of each project to fulfill each criteria
Athens Group
DPI Execs
Sco
ring
Alg
orit
hm
- 24 -© 2001 Athens Group, Inc. Confidential and Proprietary
Package Selection Process
Confidential and Proprietary
Foundation
Develop Idealized Architecture
Task 2Review Business Process Map
Task 1 Define Critical MES Criteria
Task 3
• Release Project Website • Target Vendor List• Initialize DB Tools • Kickoff Meeting
Initiate
Select Top 4 Candidates
Evaluation
Select Top 2 Candidates
Decision
Integration Analysis
Task 10
Detailed Vendor Review & Demo
Task 11
Final Selection
Phase 2 Readiness
Develop Integration Plan and Systems
Architecture
Task 12
Evaluation Report
Task 13Develop
Implementation Plan
Task 14
Define Integration Requirements, Arch.
Constraints
Task 6
Define Requirements, Categories, Priorities Task 5
Vendor Risk Analysis Task 7
Detailed Vendor Scoring Task 9
• Web
site/
Plan
Upd
ates
• W
eekly
Sta
tus
Repo
rt / M
eetin
g• R
equi
rem
ents
Man
agem
ent
• C
lient
Rev
iew
Proj
ect M
anag
emen
t
Compare to Vendor Capabilities
Task 4
Initial Demos Task 8
• Define Project Plan/Process
Package SelectionImplementation PlanArchitecture
4/26
6/7
6/27
8/2
- 26 -© 2001 Athens Group, Inc. Confidential and Proprietary
Requirements Management / Package Selection Tool Example
- 27 -© 2001 Athens Group, Inc. Confidential and Proprietary
Process Map (IDEF0) Example
- 28 -© 2001 Athens Group, Inc. Confidential and Proprietary
Four Components of the Technology Strategy
Purpose:• Defines the organization’s reason for
existence• Identifies customers of the technology
organization & the value Technology provides
Guiding Principles:• Set the general direction for the
technology organization• Defines how it will operate• Provide a focal point for employees
Critical Success Factors:• Limited in number – the critical few• Identifies things that must go right to
be successful
Customers
New CustomersShare of WalletService Revenue
Financial
ROIBudget% of revenue
Employees
SatisfactionRetentionProductivity
Innovation
InvestmentsSkillsPatents
Measurement:
- 29 -© 2001 Athens Group, Inc. Confidential and Proprietary
Framework for a Technology Roadmap
Framework• Time horizon• Strategic Elements
Current Environment
• Surveys• Staff Interviews• Management
Discussions• Capability
Assessment
Future Environment• Purpose• Guiding Principles• CSF’s• Measures
Build the Roadmap• Identify the gaps• Define objectives• Establish priorities• Target completion dates
People
Leadership
Processes
Structure
Applications
Computing
Technology
Networks
- 30 -© 2001 Athens Group, Inc. Confidential and Proprietary
eBusiness Case Study
Integrating Business and Technology Strategies
- 31 -© 2001 Athens Group, Inc. Confidential and Proprietary
The Assignment
• You are the CIO !
• The CEO informs you the BoD has requested a strategy & plan to
develop & implement competitive eBusiness capabilities for the
company.
• The initial set of these capabilities must be in-place within 12 months.
- 32 -© 2001 Athens Group, Inc. Confidential and Proprietary
The Situation
• Global manufacturer of custom engineered, consumable production tools for the semiconductor industry
• 12 sites in 7 countries; growth through acquisition • Critical business drivers changing from technology leadership and
quality to also include speed of delivery and common face to global customers
• Your competitors are six months ahead of you in building their eBusiness capabilities
• Six months earlier you were assigned as CIO to form a consolidated, global IS organization reporting to yourself
• Last quarter, you began the implementation of a global ERP project as your top priority for the next 18 to 24 months
- 33 -© 2001 Athens Group, Inc. Confidential and Proprietary
What Would You Do?
• What can you hope to accomplish in 12 months? What are some realistic objectives?
• What should be your approach? What “common tools” can be applied?
• What challenges should you expect? Within the IS organization; with other functional managers; with customers; with vendors / consultants?
• Where do you start?
- 34 -© 2001 Athens Group, Inc. Confidential and Proprietary
Athens Group Approach
Global ITStrategy &Roadmap
eBusinessStrategy
PrioritizationProcess
WebPlatformSelection
OrderEntryWeb
Application
OrderStatusWeb
Application
FutureWeb
Applications
• Athens Group provided consulting services every step of the way:
- Strategy- Planning- Implementation
Business Goals and Priorities
- 35 -© 2001 Athens Group, Inc. Confidential and Proprietary
Global IT Strategy & RoadmapGlobal IT
Strategy &Roadmap
eBusinessStrategy
PrioritizationProcess
WebPlatformSelection
OrderEntryWeb
Application
OrderStatusWeb
Application
FutureWeb
Applications
Business Goals and Priorities
• Large global client with complex and diverse business needs • Information technology is a key competitive factor in overall
business success• Rapidly evolving technology landscape• Many priorities & limited resources
• Athens Group led a systematic analysis of business needs and technology trends in order to help create a unified IT strategy
• Client is assured that IT infrastructure can satisfy their business needs and keep them competitive
• IT organization can focus on delivering individual componentsOf the overall IT strategy
Business Need
Solution
Value
- 36 -© 2001 Athens Group, Inc. Confidential and Proprietary
Global IT Strategy & Roadmap
• IT Strategy mapped to specific projects and laid out in a timeline over the next three years
• IT organization can forecast resource requirements and capabilities far in advance
- 37 -© 2001 Athens Group, Inc. Confidential and Proprietary
Global eBusiness Strategy
Global ITStrategy &Roadmap
eBusinessStrategy
PrioritizationProcess
WebPlatformSelection
OrderEntryWeb
Application
OrderStatusWeb
Application
FutureWeb
Applications
Business Goals and Priorities
- 38 -© 2001 Athens Group, Inc. Confidential and Proprietary
Global eBusiness Strategy• eBusiness strategy integrated with other IT projects to be completed in
the three year time horizon• Investments in eBusiness infrastructure can be made with confidence
App ServersP
ersonalization
AppleWebObjects
SunNetDynamics
SilverStream
B2B
XM
L
Open Market TransactIBM Net.CommerceEtc ...
Netegrity SiteminderVignette StoryServerEtc ...
Sterling Commerce(CONNECT, GENTRAN)
webMethods B2B 3.0
E-C
omm
erce
- 39 -© 2001 Athens Group, Inc. Confidential and Proprietary
Prioritization ProcessGlobal IT
Strategy &Roadmap
eBusinessStrategy
PrioritizationProcess
WebPlatformSelection
OrderEntryWeb
Application
OrderStatusWeb
Application
FutureWeb
Applications
Business Goals and Priorities
- 40 -© 2001 Athens Group, Inc. Confidential and Proprietary
P4 Prioritization Process
P4: eBusiness Project Portfolio Prioritization Process
1: eBusiness Criteria
2: Define PotentialProjects2: Define PotentialProjects
Customers
Athens Group
DPI Execs
Customers
Athens Group
DPI Execs Distinct projects which mayprovide value in the eBusiness space
StakeholdersWhich stakeholders are most important to advance or maintain through eBusiness projects?
Business GoalsWhich DPI business goals are most important to advance through new eBusiness projects?
ImplementationCriteriaWhich implementation criteria are most important to consider when trading off potential projects?
PrioritizedPortfolio
Fund,Implement,Iterate
3: Rate Projects
Rate the capability of each project to fulfill each criteria
Athens Group
DPI Execs
Scor
ing
Alg
orit
hm
- 41 -© 2001 Athens Group, Inc. Confidential and Proprietary
Web Platform Package Selection
Global ITStrategy &Roadmap
eBusinessStrategy
PrioritizationProcess
WebPlatformSelection
OrderEntryWeb
Application
OrderStatusWeb
Application
FutureWeb
Applications
Business Goals and Priorities
- 42 -© 2001 Athens Group, Inc. Confidential and Proprietary
Web Platform Package Selection• Systematic analysis of
platform technologies and vendors with consideration of many factors:
- Scalability- Security- Personalization- Internationalization- Fault tolerance- Developer availability- etc …
• Client can make a rational selection based on a documented comparison of the options
- 43 -© 2001 Athens Group, Inc. Confidential and Proprietary
Online Order Entry System
Global ITStrategy &Roadmap
eBusinessStrategy
PrioritizationProcess
WebPlatformSelection
OrderEntryWeb
Application
OrderStatusWeb
Application
FutureWeb
Applications
Business Goals and Priorities
- 44 -© 2001 Athens Group, Inc. Confidential and Proprietary
Online Order Entry System
•Order entry wizard leads the customer through a complex process step-by-step
•System creates custom screens for an order based on answers from earlier screens
•Orders are entered more quickly and with fewer errors
•Client saves time and money; Client’s customers save time and money.
- 45 -© 2001 Athens Group, Inc. Confidential and Proprietary
Order Status System
Global ITStrategy &Roadmap
eBusinessStrategy
PrioritizationProcess
WebPlatformSelection
OrderEntryWeb
Application
OrderStatusWeb
Application
FutureWeb
Applications
Business Goals and Priorities
- 46 -© 2001 Athens Group, Inc. Confidential and Proprietary
Order Status System•Customers can see the status of all their orders in just the format they want – even set up multiple custom views.
•Customers can get additional details on an order with another click of the mouse.
•Customers can set up a schedule to get status delivered by email or fax just when they need it.
•Customers can even request that order status be delivered to their local system via XML.
- 47 -© 2001 Athens Group, Inc. Confidential and Proprietary
Questions/Discussion
- 48 -© 2001 Athens Group, Inc. Confidential and Proprietary
Athens Group Overview
- 49 -© 2001 Athens Group, Inc. Confidential and Proprietary
Mission Statement• Be a trusted partner of our clients.• Provide solutions to business problems through a marriage of
systems thinking and appropriate technology.• Maximize the potential of knowledge workers through a work
environment based on mutual support, cooperation, and professional excellence.
• Provide the foundation for high quality of life for our employees.• Demonstrate that humanizing the workplace is not only
compatible with business success, but is a competitive advantage.
• Be an asset to our communities.
- 50 -© 2001 Athens Group, Inc. Confidential and Proprietary
How We Do It: Our Strengths
• The best people• The right process• The appropriate
technology
- 51 -© 2001 Athens Group, Inc. Confidential and Proprietary
How We Do It: People
• Our employee-owned model attracts the very best talent
• Industry-leading retention rate• Employee-owned = Personal responsibility• Respect for the project and project team
The best people = the best results for our clients
- 52 -© 2001 Athens Group, Inc. Confidential and Proprietary
How We Do It: Technology
• Technology breadth and expertise• Industry-leading domain experience• Commitment to up-to-date technical training • No ties to any particular vendor, environment or
tool-set
- 53 -© 2001 Athens Group, Inc. Confidential and Proprietary
How We Do it: the Right Process
Needs Assessme
nt
Plan
Project
Plans
Specifications
Databases
ROI Analysi
s
Risk Analysi
s
Adap
tIm
prov
e
Observe
Analyze
Management Plan
Risk
Reduction Planning
Estim
atin
g
Training
Configuration
Managem
ent
Qu
ali
tyR
esearch
- 54 -© 2001 Athens Group, Inc. Confidential and Proprietary
Value to Clients
• Three levels of value: – Technology– Process– Domain
• High-value consulting • Experienced (>15 years on average)
- 55 -© 2001 Athens Group, Inc. Confidential and Proprietary
Additional Value to Clients• Experienced consultants that combine business
strategy with technical knowledge• Proven, effective process• Automated tools • No allegiance to a specific vendor• Extensive domain and industry knowledge• Full Lifecycle Capability
- 56 -© 2001 Athens Group, Inc. Confidential and Proprietary
What We Do: Knowledge Centers
• Knowledge Center: a specific solution area in which Athens Group has deep experience and proven expertise.
• Knowledge Centers are supported by our knowledgebase of successful client engagements and internal investments.
- 57 -© 2001 Athens Group, Inc. Confidential and Proprietary
Employee Value Proposition
• Organizational: Employee Control– Employee ownership– Democratic decision-making
• Professional: Challenge and Growth– Technology, process and domain skills– A commitment to training
• Personal: Quality of Life– Excellent compensation and benefits– Overtime discouraged, not congratulated
- 58 -© 2001 Athens Group, Inc. Confidential and Proprietary
Value to Community
• Five Leadership Austin alumni ++• Two Profiles in Power award winners• One assistant faculty member at Southwest Texas State
University
- 59 -© 2001 Athens Group, Inc. Confidential and Proprietary
Value to Community (2)
• Community leadershipCommunity leadership: Greater Austin Chamber of Commerce, Austin YouthWorks, Open Door School, Austin Music Commission, Women’s Legislative Days Steering Committee, Big Brothers Big Sisters, United Way, Leadership Austin, Leadership Texas and GACC Blue Ribbon Task Force on Light Rail, ACC Center for Non-Profits
• Professional leadershipProfessional leadership: Software Quality Institute, Her Domain of Austin, Delphi Users Group, Oracle Users Group, Austin Software Council, Austin Software Process Improvement Network (ASPIN), Technology Business Network, Computer Science 2000