+ All Categories
Home > Documents > W5 FINAL - Strategic Information Technology Plan, Reddit

W5 FINAL - Strategic Information Technology Plan, Reddit

Date post: 26-Dec-2015
Category:
Upload: alan-l-schroeder
View: 35 times
Download: 0 times
Share this document with a friend
Description:
MGT 497 final
Popular Tags:
34
Running Head: STRATEGIC INFORMATION 1 Strategic Information Technology Plan: Reddit Alan L. Schroeder Ashford University Dr. Corey H. Thomas MGT497: Strategic Technology Planning for Organizations August 28, 2014
Transcript
Page 1: W5 FINAL - Strategic Information Technology Plan, Reddit

Running Head: STRATEGIC INFORMATION 1

Strategic Information Technology Plan: Reddit

Alan L. Schroeder

Ashford University

Dr. Corey H. Thomas

MGT497: Strategic Technology Planning for Organizations

August 28, 2014

Page 2: W5 FINAL - Strategic Information Technology Plan, Reddit

STRATEGIC INFORMATION 2

Strategic Information Technology Plan: Reddit

Reddit is an entertainment and news site, based on social networking voting and

comments on user-submitted text, images, and links. Having formed alliances, merged to

incorporate a crucial technology, and played party to its own external acquisition, this firm has a

good understanding of the processes required for each of these business ventures. This paper will

discuss the strategies required to perform each of these maneuvers, as well as options that should

be considered while moving forward and continuing to grow.

Company Overview

Reddit.com was formed by two individuals, Steve Huffman and Alexis Ohanian, in 2005

and had user traffic of about 12,000 people a day at the time that this Guardian article was

written (Adams, 2005). Reddit then merged with Infogami by early 2006 and later that year, the

site’s popularity attracted the attention of Condé Nast, which promptly acquired Reddit’s newly

formed parent company, Not a Bug. Writing on the site’s own blog, Erik Martin said, “When

Reddit was acquired in October 2006 by Condé Nast, it was receiving about 700k page views per

day. Now, Reddit routinely gets that much traffic in 15 minutes” (Martin, 2011).  Not until 2011

did Reddit become its own subsidiary under Condé Nast’s parent company, Advance

Publications.

Advertising accounts for most of the firm’s profits through banner ads and strategically-

placed sponsored posts. Reddit Gold is a user feature that allows users the ability to gift a

month’s worth ($2.99) of extra site features to each other and this exclusivity is sometimes

Page 3: W5 FINAL - Strategic Information Technology Plan, Reddit

STRATEGIC INFORMATION 3

enough to make people buy the feature for themselves. Most advertising revenue is used to pay

workers, which in turn provides more features for the site’s visitors.

The customer base is comprised of internet users who enjoy the most current internet

media, the trending memes, in addition to user-generated stories and comments. This steady flow

of users ensures a multitude of potential banner clicks, as well as a diverse forum for testing new

ideas. The value of the information gleaned from the registered user base alone, results in

another revenue stream based off sales of their personal metadata information.

MTI Capabilities

Innovative strategy is at the core of Reddit’s social media website structure. The user-

focused orientation of the content drives advancements in interface, usability, automation and

interaction technology. As long as the site remains financially feasible to the site owners and

their invested interests, it will continue to operate as-is.

Because of the semi-decentralized structure (Subreddits), in which a group of dedicated

users are elected to moderate the forum, Reddit itself is rarely the subject of user ire. Users feel

confident knowing that their opinions are heard by Mods, and possibly Reddit administration, if

there is enough popular support. People love this fact, and continue to use this social media site,

knowing that when new features or limitations are implemented that it was a democratic vote

that approved the implementation.

Despite the chosen method or medium, a business must make a plan to qualify and

quantify their resources. The text says that while most innovative products and processes are

inherently unstable, “managers need to develop a systematic approach to assess how much time,

Page 4: W5 FINAL - Strategic Information Technology Plan, Reddit

STRATEGIC INFORMATION 4

effort, and resources should be spent and which opportunities should be pursued” (White &

Bruton, 2011).

Managing Innovation

Capabilities and value creation are interconnected with the management of technology

and innovation. Firms must consider their capabilities to meet the challenges of value capture

and value delivery. Most often, in business context “the value added impact of innovations

means most often a commercial success” (Malinen, 2005, Para. 7), and this is important in

adding value for all of an innovation’s stakeholders. Any time a firm lacks a necessary

capability, it must seek this out from among its external partners in the business network.

There are four strategic capabilities that a firm needs to create a competitive advantage:

leadership, culture of support for innovation, structure, and skills. According to the authors of

our text, developing strategic capabilities help a firm “successfully meet its goals and objectives

as well as maintain competitive viability” (White & Bruton, 2011, p. 311-312). An

organization’s leadership should be provide the central focus and use a show-by-doing approach

to work ethics. The culture of support for innovation helps encourage every team member to

freely contribute, to the best of their abilities. The structure must be conducive to the type of

business, or be re-organized as such. Lastly, the skills have to be present, in order to put any

strategy into action.

When a firm is in trouble, a difficult turnaround is called for if there is any hopes of

reversing its current poor situation. The book discusses four different “dimensions” of a firm to

be addressed in order for this turnaround to be successful. For example, retrenchment begins by

Page 5: W5 FINAL - Strategic Information Technology Plan, Reddit

STRATEGIC INFORMATION 5

re-establishing control of the cash flow by delaying payments, reducing expenses, and cutting

operating costs (such as personnel, inventory, facilities, or equipment).

Sustainability

Reddit’s social responsibility stems from the firm’s rationale of providing the newest,

freshest internet content to the world. The site’s reputation stems from the fact that every

registered user’s opinion is counted; whether via “up votes”, “down votes”, lack of votes or

commentary. Most long-time users exude a certain elitist view of the “way things should be”.

This internal hive-mind system of voting helps keep old users honest, and new users on their

toes. The rationale behind this method is based on the fact that Reddit users can feel like part of a

club, which helps ensure the user’s return visits.

The customer base is comprised of internet users who enjoy the most current internet

media. The Critical Success Factor (CSF) for Delivery Scheduling Program would include most

of the trending memes, in addition to user-generated content. This steady flow of users ensures a

multitude of potential banner clicks, as well as a diverse forum for testing new ideas. The value

of the information provided from the registered user base alone, results in a profit from

advertising sales.

Some people see the move to consolidate content providers and advertising firms as a

poor development already; they are surely opposed to the merger between two of the largest

firms treading that grey line. Reddit’s evaluation and control are both periodic and constant

processes, which provide valuable feedback at any stage of this site’s life-cycle. The innovation

strategy is based on each of these four basic stages: choosing an end result, making efforts to

pursue and accomplish that result, monitoring and assessing the level of achievement towards the

initial goal, and making changes to keep the momentum aligned with the desired end results.

Page 6: W5 FINAL - Strategic Information Technology Plan, Reddit

STRATEGIC INFORMATION 6

Responsibility

Product development is a huge part of business today. Research personnel are devoted to

finding improvements for existing products, branching off similar products, or creating entirely

new product designs. The text writes, “no matter how the firm chooses to structure its R&D

efforts, it must be clear where it s in the R&D process and the type of innovation efforts that are

needed” (White & Bruton, 2011, p. 94).

Process innovation focuses on making the overall organization better. The text says

that,”if properly applied, process innovations offer the organization and its personel

opportunities to improve the value of the organization and to continue the organizaton’s

viability” (White & Bruton, 2011, p. 97). Sometimes the only way to improve a business is

through reorganization, because products aren’t the only thing that makes a firm successful.

Reddit was founded in 2006, and their main capabilities are centered on their ability to

adapt to people’s natural need to socialize, via the Internet. An organization’s capabilities are

defined by the “set of characteristics that an organization possesses to facilitate and support its

strategies” (White & Bruton, 2011, p. 29). This organization makes it a point to stay current, up-

to-the-minute, and preferably “bleeding edge”. The newer, and most intriguing headlines get the

most attention, just as every other form of media in the United States of America.

This business model is popular in America, as most of our culture is centered on fast-

paced, in-the-moment, and once-in-a-lifetime experiences whenever they can be goten. Most of

the everyday doldrums are whisked away by weekends fishing, camping, or hiking. This

freedom (the sweet taste of time off) is what helps our culture continue innovating.

Page 7: W5 FINAL - Strategic Information Technology Plan, Reddit

STRATEGIC INFORMATION 7

Reddit’s managers should concentrate on the general mood of the users, (the Internet as a

whole,) and the nation. If user demand is great, for a reasonably manageable feature

implementation: develop it! If the entire Internet is trending a new meme, or the government is

rolling out a new wave of propaganda: develop it.

Hindrances to Product Demand

The mismanagement of user-based innovation would be the largest roadblock to speeding

user adoption. This site treads a fine line between outside regulation, and user freedom. For

instance, there are many NSFW (Not Safe For Work) Subreddits that feature nudity and gore.

One of the main task that moderators undertake is approving submissions. Underage nudity is

explicitly banned, yet there are entire communities dedicated to amateur fights, videos where the

subject is severely injured and even beheadings and accidents where people die.

There are certain sites that offer a degree of Reddit’s content, but as it is an aggregator

not much competition is viable. By combining the best content (from Imgur, Buzzfeed,

YouTube, etc.), Reddit lets users browse the most popular content from the entire Internet.

Commercialization costs are covered by ads and donation gifts to other users, known as

“Reddit Gold”. According to the website’s “About” page (http://www.reddit.com/gold/about),

“It comes with extra features to make your experience here better as well as special benefits from

gold partners for exceptional products and services. Reddit takes no payment from gold partners

for being in this program”. It goes on to say that instead of accepting payment from these

partners, that Reddit wishes the companies would “give all the benefits to … our users”. This is

also a great way to tell users that a site is selling their data for additional ad money; the meager

Page 8: W5 FINAL - Strategic Information Technology Plan, Reddit

STRATEGIC INFORMATION 8

income from Reddit Gold is used only to cover the costs associated with running the website

itself.

Reddit’s novelty results from its appeal to users, and the site is usually on the bleeding-

edge of most global and cultural issues and most costs are covered by ad revenue. There are a

myriad of opportunities that exist for a company like this, based on the ability to keep the stream

of users flowing. The greatest area for damage would involve a sudden outflow of users who

either found a similar site or app, or who got bored with the site or its structure.

Organizational Innovation Checklist

The Checklist for Innovation Strategy in Fig 4.7 (White & Bruton, 2011, p. 147),

provides a sure guide to keeping innovation at the forefront of your firm’s priorities. Innovation

is important to any company’s advancement, and essential to growth. By going through the

questions in each quadrant, a firm’s focus can be analyzed.

The first step in assessing Reddit’s innovation is to define its vision. The site’s About

page offers up only quote, and information describing how the voting and submission systems

work. There is no clear vision, therefore no one participated in its formation, and it is not

logically attainable. But alas, the goal of the site’s innovation is to secure future revenue.

The second set of points to examine is the process that the Reddit’s team employs.

Currently the number of staff members stands at: 53 (http://www.reddit.com/about/team/); this is

a relatively small and geographically diverse group. This team definitely challenges standard

practices, and works together to achieve

The third object of note is Reddit’s leadership policies and practices. By default, the site

is decentralized and popular users are promoted to Mod roles, and sometimes even hired. Open

Page 9: W5 FINAL - Strategic Information Technology Plan, Reddit

STRATEGIC INFORMATION 9

idea exchanges are an integral part of Reddit’s innovation, therefore new, odd, and “out-of-the-

box” thinking s encouraged among team members.

The last segment of the checklist includes resource management. The overall culture of

an open, information aggregator is that of new ideas. This beneficent staff mentality is

encouraged by the higher levels of management, and propagates down to influence the users. In

this order, all practical help is either supplied by: other users, Mods (mega-users), or staff.

An additional area to be considered would be the random variable that some staff

members embody. Sometimes a person comes along that breaks every rule and policy, yet who’s

vision inspires the next new technology. The best way to manage such an employee would be an

individual audit and interview, to make sure that a mutually beneficial relationship can be

established.

Sometimes the freedom to create leads to a certain inspiration which allows humanity to

evolve. Many of our technological innovations have occurred with the blessing of time, or even

by accident. The ability to recognize and manage these sparks of innovation is the key to a firm’s

success or failure.

“For-Profit” Scorecard

The BSC approach involves generating strategic elements to evaluate, based on their

relation to the keys that continue to maximize financial results. Sometimes these are not the most

important assets though, and auditing is the only way that a firm may form a new perspective on

performance evaluation. This approach was “designed to encourage firms to look beyond

financial outcomes and take a more balanced review of performance” (White & Bruton, 2011, p.

Page 10: W5 FINAL - Strategic Information Technology Plan, Reddit

STRATEGIC INFORMATION 10

178). This next section will discuss the strategies that help Reddit make a profit, and how a

merger with a rival website would affect this firm.

A strategy scorecard helps to conceptualize every element that is required to develop an

evaluation and control process. After an organization identifies its key issues, it must then create

an evaluation process that presents them in a balanced manner (White & Bruton, 2011, p. 178).

In addition to these areas,

If Reddit were to focus on profit margins, this synthesized scorecard would best represent

that strategy:

Critical Success Factor (“for

profit”)Rationale

Key Performance Indicator

Who is Responsible?

Financial ResultsAdvertising

ProfitMore clicks

= more money

Add clicks / user Execs

Customers Content

The newest content

generates the most traffic

Meme/ Content popularity

Mods / Users

Human Resources

Social Responsibility

People won’t visit an

offensive website

User feedback Mods / Admins

Sustainability Web TrafficUnique visitors /

dayAdmins / Marketing

“Non-Profit” Scorecard

The table would look quite different for a “non-profit” organization of the same type.

Although profit is not the ultimate goal, the Reddit Gold initiative is meant to encourage users to

help subsidize the operating costs of the website. Remember: registration is free, but required to

participate in these extra incentive programs. A user may still earn “karma” for link and

Page 11: W5 FINAL - Strategic Information Technology Plan, Reddit

STRATEGIC INFORMATION 11

comment submissions, (and possibly earn badges or awards,) without paying a cent, after the free

registration.

Below is the synthesized scorecard for Reddit’s not-for-profit strategy:

Critical Success Factor (“non-

profit”)Rationale

Key Performance Indicator

Who is Responsible?

Financial Results

Donations Reddit Gold purchases

sustain the site’s functionality

“daily reddit gold goal”

Admins

Customers

Awards / Badges Small, permanent user tokens display

accomplishments

Dependent upon specific award

Admins

Human Resources

Moral Obligations

Exec / Admins

SustainabilityReputation /

MoraleExec

Merger & Acquisition Plans

The three stages of strategic planning include: Planning, Implementation, Evaluation &

Control. The planning stage involves gathering data that can be used to plan an eventual strategy.

By determining the mission, the firm can move on to “establish measureable objectives and

performance targets that will help it achieve its mission” (White & Bruton, 2011). This phase

lays the groundwork for future processes that affect the company’s effectiveness in their product

market. Jeff Bezos started Amazon with an e-book revolution in mind, and used that success to

fund further ventures.

The implementation stage makes the plans become reality. The details of system

coordination, automation, and even physical staffing occupy this stage. Before the new system

Page 12: W5 FINAL - Strategic Information Technology Plan, Reddit

STRATEGIC INFORMATION 12

can be evaluated, a system must me in place. Amazon does a wonderful job implementing

customer-to-warehouse ordering. The next stage will help evaluate feedback related to this

system.

The evaluation and control stages are combined in our text; they are both periodic and

constant processes, which provide valuable feedback, at any stage of a firm’s life-cycle. After a

new system is implemented, there must be constant monitoring of its efficacy. This last stage

ensures that feedback is used to positively enhance the systems which result from your plan.

Amazon continually monitors customer feedback and uses the information to refine, adjust, and

invent processes. The innovation strategy is based on each of these four basic stages: choosing an

end result, making efforts to pursue and accomplish that result, monitoring and assessing the

level of achievement towards the initial goal, and making changes to keep the momentum

aligned with the desired end results.

In the planning stage, evaluation is pretty basic, as the strategy has just begun. “Where

are we now?” (White & Bruton, 2011, p. 159), is answered by “the beginning”. The control’s

focus is to move forward with changing the plan details so that implementation can be started

with everyone on the same page. Evaluating implementation phase can be quite challenging, as it

could fluctuate greatly during each audit cycles. Control adjustments could be focused on

different goals in the short and long terms. Sometimes policies are put in place to enhance

production to drive down costs; at other times a loss may be incurred in hopes of increasing

market share and future profits.

Evaluating the evaluation phase is basically a great checkpoint to stop and refine your

audit methods, and even modify the evaluation of other innovation phases. Some speculation is

Page 13: W5 FINAL - Strategic Information Technology Plan, Reddit

STRATEGIC INFORMATION 13

included in this step, as preventative maintenance and forward-thinking are also included in this

step. The main evaluation of the control step, is determining what still needs to be changed, after

all of the evaluation and control from the last phase-cycle has run its course.

Usually a merger occurs when a firm decides that instead of competing against another

company’s products or services, that instead they will simply purchase the division, patent

technology, or even the entire organization. The text writes that there are “three critical

implementation question no matter which approach is pursued when obtaining innovation or

technology externally” (White & Bruton, 2011, p. 232). These include discussing current and

future plans, the resources required to complete each stage of the acquisition, and the strategy for

delegation of tasks.

This competitive environment leads to most of the mergers today, and it also justifies the

hassle of difficult innovation periods and processes during the transition period. Although short-

term costs will most likely be incurred, the eventual predicted profit line would normally be seen

to rise when an effective competitor is eliminated from the market. This profit promise is usually

enough to convince most upper-level management and investors from both firms that the

proposed merger’s success will continue to make everyone more money.

Although increased profits logically leads me to assume that employees will enjoy greater

job stability, this is not always the case. Wages rarely increase, and sometimes thousands of jobs

are eliminated or made obsolete through the restructuring that takes place after the merger. For

instance, the firm does not need two separate HR departments, and can combine services like

tech support into a larger single group. More realistically, the IT team will not double, and not be

completely eliminated, but there are a lot of redundant jobs that each company most likely had

an individual for.

Page 14: W5 FINAL - Strategic Information Technology Plan, Reddit

STRATEGIC INFORMATION 14

Value Analysis Process

Reddit has both merged with other website technologies, and itself been acquired by a

larger media firm in its relatively short decade of existence. This paper will focus on the

implementation process that Reddit should use when obtaining innovation or technology from

external sources. The main part of this paper will discuss the value analysis process and

suggestions which Reddit can use to evaluate the benefits of potential future mergers and

acquisitions.

The value analysis process is useful for determining the advantages that may be gained as

the result of combining the technology of two firms. This process is also useful in determining,

and even justifying, some of the headaches that are associated with integrating the “various

systems and processes of two entities” (White & Bruton, 2011, p. 258). “The Management of

Technology and Innovation: A Strategic Approach” discusses a few questions to consider, as

well as a break-down of the four-stage value analysis process.

When considering an alliance, merger or acquisition, the first question to be considered

is: what are the components that will add value to each party? Does Reddit desire a certain new

piece of code which will help enhance the site’s user experience? When Reddit started working

with Aaron Swartz, they obtained a valuable piece of community software, as well as a talented

and intelligent programmer to help them continue to innovate (Swartz, 2006).

Another question that needs to be addressed is: what will this alliance actually do? An

article at Language Log explains that “the Infogami wiki platform was a key to Reddit's early

success” (Zimmer, 2013, Para. 1). This platform for posting comments and voting is now

indistinguishable from Reddit; it is Reddit.

Page 15: W5 FINAL - Strategic Information Technology Plan, Reddit

STRATEGIC INFORMATION 15

The next set of questions needs to consider overall costs. Although acquiring an open-

source software platform may not cost much in upfront assets, the resources and time spent

during its implementation can be enormous, or even cost-prohibitive. Reddit is by no means a

rich company, and most of the technological innovations acquired are usually based upon these

types of costs, rather than cash.

Next, Reddit should consider whether the proposed technology can be obtained any other

way. If the project is open-source, could they just fork the code? Do they have enough available

staff to put in the work that it will take to craft the source into a finished product that functions

better than what they have now? Again, as in the case of Swartz, sometimes when acquiring a

proprietary technology, it is more efficient to bring along the current staff who are most familiar

with the specifics of the system.

Finally, after listing the possible alternatives, their costs must then be determined so that

they can be compared to the original consideration. Keeping in mind that the end result is to add

value, any alternatives that end up costing more to acquire should be eliminated. The future

value of team members needs to also be considered when comparing costs.

The value analysis process happens in four stages: information, speculation, evaluation

and analysis, and implementation. These phases can be used in a cyclical fashion to evaluate

multiple possibilities or ideas, all the while keeping in mind the questions that these results help

to answer. The phase definitions themselves are pretty vague, therefore allowing the process to

be applied across a wide variety of businesses or problems.

The information phase requires defining the problem first. If Reddit noticed issues with

slower loading times on their pages, this would become the problem to address in the next step.

Page 16: W5 FINAL - Strategic Information Technology Plan, Reddit

STRATEGIC INFORMATION 16

At this point, gathering as much data about the problem is most important, as that will help

further along in the process.

The speculation phase involves the generation of ideas that may possibly work. This

brainstorming stage at Reddit would involve listing things like: increasing server bandwidth,

fine-tuning load-balancing services, optimizing the site’s code, and reducing images on screen.

Obviously there are different costs associated with each option, but that is not the focus at this

point.

The evaluation and analysis phase is used to identify those specific costs related to each

of the ideas formed above. Although purchasing more rack space or additional load-balancing

servers may be too expensive to be feasible, they would most definitely fix the issue

immediately. Because Reddit’s staff consists mainly of talented web coders, either of the last two

options would result in less out-of-pocket costs, as they would just be paying their own

employees’ budgeted salaries. Both options would increase page loading time, but as Reddit

relies so heavily on advertising revenue, removing any amount of image content from the site

will result in less screen real-estate to display ads.

Finally, according to the text, the implementation phase should, “Propose how to

implement the integration or ideas that is best for the organization and the conditions” (White &

Bruton, 2011, p. 258). After determining to clean up the CSS and HTML, programmers will need

to examine the code and then tasks will need to be assigned in order to comb-through and

optimize it. If a technology is available that will help increase the speed, with a low price tag, the

acquisition of personnel, software, or even an entire company could be recommended.

Page 17: W5 FINAL - Strategic Information Technology Plan, Reddit

STRATEGIC INFORMATION 17

A prospective merger between Reddit and 9gag.com (a similar content site), would

probably lead to a disharmonic (and even chaotic at times) cultural environment. Some things to

be considered are the user metrics such as: age, race, religion, and creed. Reddit is diverse, on the

whole, yet 9gag seems to cater to teenage Caucasian Christians, who create memes that are

generally viewed as juvenile.

Despite the fact that both companies share a certain similar business climate, their

management of technology and innovation processes is different. Reddit’s drive focuses around

the ability to provide features and content that their members enjoy, as opposed to 9gag’s

opinion of what memes the internet wants. Although Reddit has its fair share of cat pictures and

funny GIFs, these are contained in their own individual subreddits, which users can choose to

subscribe if they wish.

Reddit has demonstrated its ability to hold the attention of internet users for years. Its

approach involves providing premium content in exchange for advertising information gleaned

from user accounts and comments. In the end, a merger is not recommended as Reddit fulfills a

necessary niche in modern society.

Metrics

When developing an analysis metric for a platform or portfolio, the firm’s environmental

context is crucial. In the case of Reddit, managers need to consider four main areas that influence

the overall strategic direction of a firm’s technology policies.

An economic metric that could be used to measure Reddit’s platform success, would be

its income. The site’s relatively grass-roots beginnings are reflected in the way that they offer

their services for free, and full functionality only requires a free registration. Despite this

Page 18: W5 FINAL - Strategic Information Technology Plan, Reddit

STRATEGIC INFORMATION 18

seeming money-pit strategy, users continue to purchase subscription gifts (in the form of Reddit

Gold) that provide enough revenue to maintain the site’s operating costs.

Because the server costs are billed periodically, we can establish a similar timeframe in

which to request user donations. If the webhosting cost is $X per month, then the daily goal for

Reddit Gold donations can be divided accordingly. Every day, 1/30th of the last month’s utility

bill can be expected to balance out one of the site’s most basic expenses. Actively displaying the

percentage of donations received for the day, as a percentage of this fraction, helps to encourage

user donations based on the bandwagon methodology.

Process and Innovation

The management process checklist helps a firm determine their strategic approach to

technology and innovation. It is a simple pair of questions that must me continuously asked,

considered, evaluated and implemented. These simple queries are “where are we now?”, and

“where do we want to be?” (White & Bruton, 2011, p, 301). Examining these strategic options

always depends on the fact that a change has been suggested. Whether or not to move forward

with that option is what will be determined by using a checklist to determine the level of

complexity that is desired.

Assessing risk is the first step when deciding what level of complexity Reddit should

pursue when evaluating the acquisition of an external technology. The amount of time a

transition takes can often outweigh the monetary costs. At this point, it is determined whether or

not the change is actually necessary for the company’s future growth.

The decision analysis step requires the firm to evaluate whether the change is feasible.

The current staff and technology will play a large role at this point of the assessment, as wages,

Page 19: W5 FINAL - Strategic Information Technology Plan, Reddit

STRATEGIC INFORMATION 19

resources and costs must be balanced. Another factor to consider is how long the new product or

process’s life cycle will span; short, medium, or long term options may skew results.

After the problem is identified and the decision is complete, strategic options need to be

examined. Will Reddit develop the new technology in-house? If the current staff members

possess the required abilities, this method will usually be cheaper and afford more control, in the

long run. If this is not an option, then external alliances or acquisitions must be considered.

Lastly, Reddit needs to determine how much of a shift is desired from the starting

position, before this process. Will this result in a new product or process? For instance, will the

site’s core voting, commenting, or submission system change, or will the user interface be

updated? The gap analysis of this change will help the firm anticipate the overall impact of the

new technology.

Conclusion

In conclusion, Reddit is an interactive, online discussion board that demonstrates the

successful collaboration of thousands of individuals on the Net. According to the “about” section

of the website, Reddit is a, “type of online community where users vote on content”

(http://www.reddit.com/about/). Reddit’s capabilities are centered around the ability to adapt to

people’s needs via the Internet. An organization’s capabilities are defined by the “set of

characteristics that an organization possesses to facilitate and support its strategies” (White &

Bruton, 2011, p. 29).

Reddit allocates resources as needed, according to the demands of its strategy: users and

their content. Because the business is entirely online, cloud providers enable the IT resources to

be expanded as necessary. User donations, in the form of “Reddit Gold”, also help to finance the

site. These gifts consist of a $2.99 fee that users may purchase to reward other’s comments. This

Page 20: W5 FINAL - Strategic Information Technology Plan, Reddit

STRATEGIC INFORMATION 20

monthly subscription allows access to a special subreddit (see below), and also unlocks certain

extra features of the site that are not accessible to regular, free subscriptions.

I believe that Reddit’s voting system is the key to the culture of its internal

entrepreneurship. Only users that have registered with the site can participate in its unique voting

system, and post comments, discussions and links to images or videos. There are certain

communities, called “subreddits”, that allow like-minded people to form groups ranging from

dancing cats, to beautiful landscape photography.

The site’s profits are entirely dependent on users; advertising and user contributions

provide for the site maintenance costs and help to cover staff salaries. The main information to

be gleaned would be any metrics related to users, and their usage. This would include metadata

from web visits sold to advertising firms, income from sponsored ads, user contributions, and

foresight into popular or trending items.

Reddit has had plenty of experience with alliances, mergers and acquisitions since it was

founded in 2005. When a future need develops, it is crucial to consider every innovation

technology available. In order to proceed forward successfully and help Reddit continue to

dominate its unique social news content niche, the recommendations in this paper will prove

very useful to the powers that be.

Page 21: W5 FINAL - Strategic Information Technology Plan, Reddit

STRATEGIC INFORMATION 21

References:

Adams, Richard (December 8, 2005). Reddit.com . London: The Guardian. Retrieved December

23, 2006. Retrieved from

http://www.theguardian.com/technology/2005/dec/08/innovations.guardianweeklytechnol

ogysection1

Malinen, P. (2005). Key drivers of innovation management. HUT, Finland: Helsinki University

of Technology. Retrieved from

http://www.researchgate.net/profile/Pekka_Malinen/publication/230885904_KEY_DRIV

ERS_OF_INNOVATION_MANAGEMENT/links/0fcfd505c1d3598dca000000

Martin, Erik. (September 6, 2011). Independence. BLOG.Reddit. Retrieved from

http://www.redditblog.com/2011/09/independence.html

Swartz, Aaron (February 27, 2006). Introducing Infogami. Infogami. Archived from the

original on December 2, 2008. Retrieved from

http://www.infogami.com/blog/introduction via archive.org on August 28, 2014

White, M., & Bruton, G. (2011). The management of technology and innovation: A strategic

approach (Revised/Expanded ed.). Mason, OH: South-Western Cengage Learning.

Zimmer, Ben. (January 14, 2013). Remembering Aaron Swartz (and Infogami). Language Log.

Retrieved from http://languagelog.ldc.upenn.edu/nll/?p=4417


Recommended