Enterprise Systems: Sound Investment or Necessary Evil? IT Systems FINAL sm.pdfآ  Enterprise Systems:

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  • Prof Jeff Haywood & Simon Marsden Information Services

    University of Edinburgh

    jeff.haywood@ed.ac.uk simon.marsden@ed.ac.uk

    Enterprise Systems: Sound Investment or Necessary Evil?

    1 U21 Annual Network Meeting 11-05-12

    mailto:Jeff.haywood@ed.ac.uk mailto:Jeff.haywood@ed.ac.uk mailto:simon.marsden@ed.ac.uk

  • “Why do corporate IT systems cost so much and yet

    sometimes appear to deliver so little for the

    investment?”

    Structure of the session:

    1. How are U21 partners approaching enterprise IT?

    2. Why is enterprise IT so often problematic?

    3. How do we find good solutions?

    4. Where next?

    U21 Annual Network Meeting 11-05-12 2

  • How are U21 partners approaching enterprise IT?

    U21 Annual Network Meeting 11-05-12 3

    Enterprise IT - 1

  • U21 Systems Survey

    • We asked 3 questions – How was the software you use developed – How do you deliver the service – Who are your suppliers

    • For each of 8 major functions – Finance - CRM – HR - Virtual Learning Environment – Payroll - Email & Diary – Student Records - Library Management System

    • 18 institutions responded – 80%

    U21 Annual Network Meeting 11-05-12 4

  • What we found

    • On average we run more than one system for each function • Commercial package software is a strong preference - 83% of

    systems • Hosted solutions account for 13% of our systems • Oracle and Microsoft are our two biggest suppliers • ERP approach in 45% of institutions

    U21 Annual Network Meeting 11-05-12 5

  • No of systems per institution

    U21 Annual Network Meeting 11-05-12 6

    0

    0.5

    1

    1.5

    Finance HR Payroll Student Record

    CRM VLE E-mail Library MS

  • Development method

    U21 Annual Network Meeting 11-05-12 7

    83%

    10%

    6%

    1%

    All Functions

    Commercial In House Open source Bespoke

    54%

    14%

    32%

    0%

    Virtual Learning Environment

    69%

    26%

    0%

    5%

    Student Record

  • Delivery - In house v Hosted

    U21 Annual Network Meeting 11-05-12 8

    86%

    14%

    All Functions

    In house Hosted

    64%

    36%

    CRM

    59%

    41%

    E-mail

  • Suppliers

    U21 Annual Network Meeting 11-05-12 9

    All Functions

    Oracle

    Microsoft

    Blackboard

    Ex Libris

    Google

    Moodle

    Millenium

    Other

  • Suppliers by Functions

    U21 Annual Network Meeting 11-05-12 10

    Microsoft

    Google

    Other

    E-mail

    Blackboard Moodle

    Other

    Virtual Learning Environment

    Ex Libris Millenium

    Other

    Library Management System

    Oracle

    Microsoft

    Other

    "Corporate"

  • Enterprise Resource Planning

    • Using integrated systems from the same vendor for multiple functions:

    >2 functions = Enterprise Resource Planning (ERP)

    – 44%, 8 institutions implemented ERP – 5 use Oracle, 1 SAP, 1 Elucian (Banner), 1 in house – UK survey of 150 CIOs,

    • 60% adopted ERP and of these • 63% reported less duplication with better cross departmental

    process alignment • 75% improved business intelligence

    U21 Annual Network Meeting 11-05-12 11

  • How much IT spend is enough?

    • How much should my university spend on corporate IT? – probably “more not less”

    • How much do others spend? – Very difficult to know – Gartner shows

    • financial services: 12% turnover • Pharmaceuticals: 8% • Education: 2.5%

    – UK survey of research intensive U’s (Russell Gp) suggests in region of 3-6% of turnover (4.5% +/- 33% !)

    U21 Annual Network Meeting 11-05-12 12

  • U21 Annual Network Meeting 11-05-12 13

    Questions for discussion:

    • Do these data accord with your expectations?

    • How generally satisfied are you with your enterprise IT?

    • If dissatisfied, what are you main areas of unhappiness?

  • Why is enterprise IT so often problematic?

    U21 Annual Network Meeting 11-05-12 14

    Enterprise IT - 2

  • Where to invest?

    IT as an investment

    ‘better business’

    Should lead to…

    U21 Annual Network Meeting 11-05-12 15

  • Balancing your IT investment

    • Run – Reduce costs no increase in revenue

    • Grow – Increase revenue from existing products

    • Transform – New products, new markets

    IT Strategy Awayday September 2011 16

    60% ‘run’ 20% ‘grow’ 20% ‘transform’

  • 17 U21 Annual Network Meeting 11-05-12

    University of Edinburgh Strategic Plan 08-12

  • 18 U21 Annual Network Meeting 11-05-12

    IT contributions to UoE SP Strategic Goals

    VLE & e-learning systems / e-assessment Classroom technologies

    Microlabs & software Student application & self-service systems

    Accommodation services IT +?

    High Performance Computing Digital research data management

    Open access research publications/PURE Research software

    +?

    ‘directory of experts’ Open access research outputs

    Online CPD tools Managing IPR/patents etc

    +?

  • Challenges for strategic ICT

    JISC / HE Leadership Foundation – Strategic ICT Toolkit ‘Are the foundations on which ICT are delivered sufficient to facilitate the level of ICT that will meet corporate objectives?’ Strategic ICT needs to address these challenges for the

    university: – Lack of IT agility – Lack of IT integration – Duplication of IT facilities & services – Data held in sealed silos – Lack of useful Management Information – Senior managers cannot identify if what is delivered is vfm

    U21 Annual Network Meeting 11-05-12 19

  • A return on your investment

    Is $50M too much for a new X system? NO, if the Total Cost of Ownership < Return on Investment

    DIRECT COSTS

    (all staff+ all stuff + all services) during lifetime of

    system - calculate/estimate OPPORTUNITY COSTS

    Could have done something more productive

    QUANTITATIVE JISC Impact Calculator

    (eg 5 days pa, 1000 staff , 5 years = £1.5M-£5M)

    Compare to Do-Nothing Option QUALITATIVE

    Sweat the assets Drive data quality up

    Streamline processes (eg LEAN) Reputation

    U21 Annual Network Meeting 11-05-12 20

  • U21 Annual Network Meeting 11-05-12 21

  • U21 Annual Network Meeting 11-05-12 22

    Questions for discussion: • Do you routinely require TCO and ROI estimates for large IT

    projects?

    • Do you review whether these were achieved afterwards (or just

    sigh and move on…)?

  • Pick the right stuff

    U21 Annual Network Meeting 11-05-12 23

    Enterprise IT - 2

  • Strategic Sourcing for IT Systems

    Sourcing options

    1. Commercial systems (implemented by vendor or in-

    house)

    2. Open source systems

    3. In-house built systems

    ‘(re-)design business to fit software’?

    ‘design software to fit business’?

    Implementation options

    1. Do-it-alone

    2. Shared services

    U21 Annual Network Meeting 11-05-12 24

  • U21 Annual Network Meeting 11-05-12 25

  • U21 Annual Network Meeting 11-05-12 26

    Questions for discussion: • What are your main reasons for choosing particular suppliers

    or sources?

    • Do you expect this to change over the next 5 years?

    • Few U21 partners use open source even though governments

    often ‘promote’ their use. Why is this?

  • How do we find good solutions?

    U21 Annual Network Meeting 11-05-12 27

    Enterprise IT - 3

  • Major IT projects are ‘change’ projects

    Good governance they need

    U21 Annual Network Meeting 11-05-12 28

    Is there such a thing as an IT Project?

  • U21 Annual Network Meeting 11-05-12 29

  • U21 Annual Network Meeting 11-05-12 30

  • If Score 20 or over, then project is a “Strategic” project If Score is 10-19, then project is a “Major” project

    Defining Strategic & Major Projects – Edinburgh Toolkit

    U21 Annual Network Meeting 11-05-12 31

    Project criteria Score range Features Budget (gross) 1 – 15 £25M Impact students & staff 1 - 4 Direct impact across U – local

    impacts Complexity 1 - 4 Low - High Reputation 1 - 4 Local – international

    For S & M Projects, Governance Board must be established as Project Oversight with Senior Responsible Owner at SMT level for S Projects.

  • Guiding Strategic Projects and learning from them Edinburgh