James Nowotarski

3 April 2008

IS 425Enterprise Information

Spring 2008

2

Understand what the course is about (i.e., course objectives)

Understand how the course will achieve its objectives Get acquainted Level set:

What is enterprise information? How do enterprises use information? What is the role of the enterprise’s IT function in all of

this?

Today’s Objectives

3

Topic Duration

Questionnaire & Intros 30 minutes

Role of IT 45 minutes

*** Break 15 minutes

Course overview 30 minutes

Trends & IT implications 30 minutes

Value chain framework 30 minutes

Wrap-up

Today’s Agenda

1%

2%

3%

4%

5%

6%

7%

8%

Total WW IT Spending In 2007 = $3.006 TrillionTotal WW IT Spending In 2007 = $3.006 Trillion

5.4%

2007 v.

2006

2005 v.

2004

7.3%

2006 v.

2005

5.5%4.8%

2008 v.

2007

4.5%

2009 v.

2008

3.6%

2010 v.

2009

1%

2%

3%

4%

5% Worldwide Projected IT Budget Growth

Projected 2007 Business Growth

Projected 2007 IT Budget Growth

Comparison of Business and IT Growth in Selected Industry Segments: 2007 vs. 2006

Financial Services

Healthcare/Pharma.

High Technology

Government

Insurance

Mfg.

5% 10%0%

4.5%

3.1%

4.3%

0.7%

2.4%

2.9%

Source: Global Insight January 2007

Source: Gartner EXP 2007 CIO Survey

4.0%

3.2%

5.7%

2.9%

2.5%

4.5%

2.7%2.5%1.6%0.0%

20042003

2005 2006

3.0%

2007

6

Role of IT

“Is IT central to economic competition

. . .

or is it simply glorified plumbing”

--- Diamond Management & Technology Consultants

7

Does IT matter?

As noted by Carr, IT is often viewed as a commodity and, thus, not “core”

• IT is like electric power -- a commodity that is required by all but provides distinction to none

• IT capability is broadly accessible and affordable

• New or proprietary technologies offer opportunity for companies to gain a step, but this advantage is short-lived

• Further evidence of IT commoditization:– overcapacity– price drops– vendors positioning selves as “utilities”

Source: Carr, N. (2003, May). IT doesn’t matter. Harvard Business Review, 81(5), 41-49.

8

Role of IT

Enterprises expect IT to deliver

_____________(fill in the blank)

9

Role of IT

Hardware, Software, Communication Networks

Information

Decisions

Performance

10

Role of IT

11

Develop new products and services Generate demand Fulfill demand Serve customers Plan and manage the enterprise

Role of IT

12

Technology provider

Role of the IT professional

Solution partner

OR

13

Role of the IT professional

“Being different is easy.

Making a difference is a challenge.”

14

Topic Duration

Questionnaire & Intros 30 minutes

Role of IT 45 minutes

*** Break 15 minutes

Course overview 30 minutes

Trends & IT implications 30 minutes

Value chain framework 30 minutes

Wrap-up

Today’s Agenda

15

Course Objectives

By the end of the course, the student will be able to:

Analyze … business forces that influence IT usage Analyze … business processes and information flows Evaluate current IT conflicts Analyze IS professional competencies

16

Course Prerequisites

IT215 – Analysis and Design Techniques or SE325 – Software Engineering Practices

and MSIS Prerequisite phase

17

MSIS Program Phases

Prerequisite Foundation Advanced Capstone

IS425 Enterprise InformationCSC451 Database DesignECT425 Technical Fundamentals of Distributed Information SystemsSE430 Object Modeling

18

CSC 212Programming

in Java II

ECT 425Technical

Fundamentals Of Distributed Info Systems

CSC 451Database

Design

SE 430Object-Oriented

Modeling

IS 425Enterprise Information

IT 215Analysis &

Design Techniques

ECT 310Internet

Application Development

CSC 211Programming

In Java I

ApplicationDevelopmentDatabase I

E-BusinessSystems

Data Mining& Analytics

Network Design

CapstoneIS 577

Level I

Level III

Level II

Foundation Phase

Prerequisite Phase

HCI MethodsInternet

ApplicationDevelopment

Database IIInformation

Assurance &Security

EnterpriseSystems

Integration

IT Project Management

I

Wireless &Mobile

Applications

Knowledge Management

IT Planning& Strategies

GlobalSystems

& Strategies

Competency Modules for MSIS

Legal & Social

Issues

Advanced Internet Tech.

IT Architecture

Design

SoftwareEngineering

IT Project Management

II

19

Your grade

Homework Assignments 45%

Midterm & Final 45%(both take-home)

Participation/Discussion 10%

--------

100%

20

Course Assignments

• Assignment 1 – IS Competency Analysis

• Assignment 2 – Case Study

• Assignment 3 – Current Event Report

• Assignment 4 – Issue/Trend Briefing Report

21

Road map:http://facweb.cti.depaul.edu/jnowotarski/is425/default.htm

All readings are web available Most readings at DePaul Online Library's 24x7 E-

Books COLWEB is course repository

https://col.cti.depaul.edu Office hours: Thursdays, immediately before and after

class

Course logistics

22

My role

Facilitate learning Plan, prepare, and conduct lectures and learning activities

Assess student progress and provide feedback

Relate concepts to real-world problems Provide classroom environment conducive to learning

Clearly state expectations Gather and implement suggestions for improving the class Keep it fun

23

email: jnowotarski@cti.depaul.edu phone: 312-261-3838 office hours: Thursdays, immediately

before and after class

My coordinates

24

Your role

Be proactive

Share your experience

Come to class prepared

Collaborate with other students as appropriate

Ask if you don’t understand or if I’m not clear

Provide constructive feedback (“This class would be better if . . .”)

25

Class Participation

Subjective evaluation of participation:

A Consistently asks good questions, makes valuable observations, and answers questions effectively

B Frequent participant, but not all questions, answers, and observations are effective, or not consistently active

C Participates infrequently, or questions/answers do not reflect adequate preparation, or late to class

D Very rare participation, or questions/answers reflect little or no preparation, or very late to class

F Displays no sign of life, or absent for entire class

26

Topic Duration

Questionnaire & Intros 30 minutes

Role of IT 45 minutes

*** Break 15 minutes

Course overview 30 minutes

Trends & IT implications 30 minutes

Value chain framework 30 minutes

Wrap-up

Today’s Agenda

27

Holistic view

Technology

ProcessPeople

28

Social and business trends

Volatility in market environments Aging population Extreme meritocracy Regulation, security, liability Emerging nations, globalization

“Chindia”

Consumerization/Digital natives “guerilla IT”

29

Implications for IT organizations & professionals Partner with the business Align efforts with the business strategyPossess business skillsPossess people skills

andSustain and increase mastery of technology

30

Social and business trends

http://www.glumbert.com/media/shift

31

Gartner 2008 CIO survey

2008 Business Expectations

To what extent will each of the following be a top priority for you in 2008?

* New question for 2008 ** New question for 2007

Improving business processes 1 1 1

Attracting and retaining new customers 2 3 3

Creating new products or services (innovation) 3 10 9

Expanding into new markets or geographies 4 9 **

Reducing enterprise costs 5 2 2

Improving enterprise workforce effectiveness. 6 4 **

Expanding current customer relationships 7 * *

Increasing the use of information/analytics 8 7 6

Targeting customers and markets more effectively 9 * *

Acquiring new companies and capabilities (M&A, etc) 10 * *

2008 2007 2006

2008 Business Expectations

To what extent will each of the following be a top priority for you in 2008?

* New question for 2008 ** New question for 2007

Improving business processes 1 1 1

Attracting and retaining new customers 2 3 3

Creating new products or services (innovation) 3 10 9

Expanding into new markets or geographies 4 9 **

Reducing enterprise costs 5 2 2

Improving enterprise workforce effectiveness. 6 4 **

Expanding current customer relationships 7 * *

Increasing the use of information/analytics 8 7 6

Targeting customers and markets more effectively 9 * *

Acquiring new companies and capabilities (M&A, etc) 10 * *

2008 2007 2006

32

IT must adapt to shorter time spans to execute projects and to recover costs

Implications: Shorter or incremental projects Rapid return IT spending/recover cost cycle

is more like a business unit Focus on cross-project,

enterprise-level valueSource: Gartner Executive Programs

5

3

1

1990

< 1.5 years

2000 2010

Date

Time to ROI

Source: Gartner Group

33

Holistic view

Technology

ProcessPeople

34

Topic Duration

Questionnaire & Intros 30 minutes

Role of IT 45 minutes

*** Break 15 minutes

Course overview 30 minutes

Trends & IT implications 30 minutes

Value chain framework 30 minutes

Wrap-up

Today’s Agenda

35

Porter’s Value Chain Model

                                                     Figure 3.6: Porter's value chain model for a manufacturing firm. (Source: Reprinted with permission of the Free Press, a Division of Simon & Schuster Inc. from Competitive Advantage: Creating and Sustaining Superior Performance. Copyright © 1985 by Michael Porter.)

Porter’s Value Chain Model

Value chain model addresses the activities that create, deliver, and support a company’s product or service.

Two broad categories:Primary activities – relate directly to the value

created in a product or service.Support activities – make it possible for the

primary activities to exist and remain coordinated.

37

The Value Chain: Firm’s Perspective

38

Basics

Which Primary activities are categorized as Costs? As Sales? Input Logistics Operations Output Logistics Sales Service

Which Secondary activities are categorized as Costs? As Sales? Firm Infrastructure Human Resource Management Technology Development Procurement

39

The Value Chain for Firms

Clarifies: key processes core competencies activities

• Strengths• Weaknesses• Value-adding potentials• Cost-reduction potentials

Develops: strategy strategic advantage

40

Suppliers Manufacturers Distributors Customers

OL

IL OL

IL OL

The Value Chain: Industry Perspective

Supplier

Manufacturer

Distributor

41

Suppliers Manufacturers Distributors Customers

The Market RolesExample: Auto Industry

Create component products or provide services, raw materials or talent

Design and build products, services, and solutions that meets a specific customer or market needs.

Enable buyers and sellers to connect, communicate, and transact business.

Consumers or business willing to pay for a product, service, or solutions.

42

Suppliers Manufacturer

Distributors

Customers

Customer Direct

Disintermediation

Channel Conflict

The Value Chain for Firms

Targeted Activities that improve Value Chain Find Information Systems to fill need

Use Value Chain to analyze each competitor’s Strengths Weaknesses

Use Value Chain to determine usefulness of employing Inter-Organizational Information Systems (IOIS), e.g., Supply Chain Management (SCM)

44

Porter’s Value Chain Model (with examples of IT apps)

The Information Value Chain highlights the difference between data and information

Application Silos

Enterprise Data Warehouse

Enterprise Search

External Search

Communities

Web 2.0

"Power of Me"

SaaS, DaaS*

Storage as a Service

*DaaS = database as a service

Where and What Is My Information?

Perso

nal

Perso

nal

Pro

fess

ion

alP

rofe

ssio

nal

CommunityCommunity

FamilyFamily

Comms

Services

Content

SchoolSchedule

Tax InfoNewsSports

Standings E-Gov

Shopping School

E-MailRSSMemories

Music

Hobbies

FinancialInfo

Banking

Banking

Broadband

Cell

Wi-Fi

TVCalendar

Memories

MedicalFinancial

HomeSecurity

IM E-Mail

PersonalRecords

Corp.Archives

Training

Pro

duct

ion

Dat

aMeetingRecords

Work at

Home

CorpApps

Benefits

Conferencing

VOIP

LAN

Wi-Fi

Cell

Devices

47

Gartner 2008 CIO survey

2008 CIO Technology Priorities

To what extent will each of the following technologies be a top five priority for you in 2008?

* New question for 2008 ** New question for 2007

2008 2007 2006

Business intelligence 1 1 1 11.20%

Enterprise applications (ERP, SCM, CRM, etc) 2 2 ** 8.02%

Servers & storage technologies 3 5 9 8.45%

Legacy modernization, upgrade or replacement 4 3 10 5.79%

Security Technologies 5 6 2 8.53%

Technical Infrastructure 6 8 12 4.67%

Networking, Voice and Data 7 4 8 6.83%

Collaboration technologies 8 10 4 7.75%

Document management 9 9 ** 7.91%

Service oriented (SOA, SOBA) 10 7 6 6.71%

2008Unweighted Average

Budget Change

2008 CIO Technology Priorities

To what extent will each of the following technologies be a top five priority for you in 2008?

* New question for 2008 ** New question for 2007

2008 2007 2006

Business intelligence 1 1 1 11.20%

Enterprise applications (ERP, SCM, CRM, etc) 2 2 ** 8.02%

Servers & storage technologies 3 5 9 8.45%

Legacy modernization, upgrade or replacement 4 3 10 5.79%

Security Technologies 5 6 2 8.53%

Technical Infrastructure 6 8 12 4.67%

Networking, Voice and Data 7 4 8 6.83%

Collaboration technologies 8 10 4 7.75%

Document management 9 9 ** 7.91%

Service oriented (SOA, SOBA) 10 7 6 6.71%

2008Unweighted Average

Budget Change

48

Topic Duration

Questionnaire & Intros 30 minutes

Role of IT 45 minutes

*** Break 15 minutes

Course overview 30 minutes

Trends & IT implications 30 minutes

Value chain framework 30 minutes

Wrap-up

Today’s Agenda

49

Read assigned readings for weeks 1-2 Complete Assignment #1 – IS Competency Analysis Sign up for a date to present Assignment #3 – Current Event

Report Additional items for DL students:

Submit survey in COL Participate in discussion topic in COL (initial and reaction postings)

For April 10

50

Extra slides

Course Scope = IT FunctionIT Function

IS PlanningSoftware

Engineering DataBusiness

Technology

Administration

Production

• Enterprise Arch• Advanced

Technologies

• Business analysts• Program managers

• Developers• Development tools• Processes, standards

• Operations• Network• Help desk• Application support

• Data admin• Data warehouse

• IT HR• IT Finance

• Procurement

52

Value

So, to determine our value chain, what must we have?

Information? What is data? What is information? What is knowledge?

New Accounting Equation

Old Equation Assets = Liability + Equity

New Equation Data + Insight = Information

The new accounting equation forces managers to use their analytical abilities and insights to assess value. Without insight, “untransformed” data is likely to be of significantly less use and of substantially less value in today’s market. Business professionals are therefore forced to reconsider the work they do and the value they create.

54

IT Outsourcing

Buy

Build

Commodity Differential

Critical

Useful

StrategicImportance

Potential for Differentiation

Buy vs. build