Information Systems Planning 1 Information Systems Planning 2

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Information Systems Planning

Information Systems Planning

1 Information Systems Planning 2 Distributed Systems Architecture

1 Information Systems Planning 2 Distributed Systems Architecture

Paradox of IS Planning n Most organization's survival now depends on IT q n

Paradox of IS Planning n Most organization's survival now depends on IT q n IT is changing so fast q n Planning of its effective use is a matter of organizational life and death Is it useless to do IS planning? A variety of approaches, tools and mechanisms available for IS planning q No best way to do it.

Mindset for Planning n Traditional view q n A better view q n Determining

Mindset for Planning n Traditional view q n A better view q n Determining what decisions to make in the future Developing a view of the future that guides decision making today Difference : strategy making instead of planning q Strategy: stating the direction in which you want to go and how you intend to get there

Types of Planning Horizon Focus Issues Primary Responsibility 3 -5 years Strategic Vision, architecture,

Types of Planning Horizon Focus Issues Primary Responsibility 3 -5 years Strategic Vision, architecture, business goals Senior management, CIO 1 -2 years Tactical Resource allocation, project selection Middle management, IS line partners, Steering committees 6 month -1 year Operational Project management, meeting time and budget targets IS professionals, Line managers, partners

Why Planning Is So Difficult? (1) n Business goals and systems plans need to

Why Planning Is So Difficult? (1) n Business goals and systems plans need to align q q n Strategic systems plans need to align with business goals and support those objectives Will be difficult if CIO is not part of senior management Technologies are rapidly changing q q Continuous planning based on monitoring and experimenting new technologies Advanced technology groups

Why Planning Is So Difficult? (2) n Companies need portfolios rather than projects q

Why Planning Is So Difficult? (2) n Companies need portfolios rather than projects q q n Evaluation on more than their individual merit How they fit into other projects and how they balance the portfolio of projects Infrastructure development is difficult to fund q q Often done under the auspices of a large application project Challenge: develop improved applications and improve infrastructure over time n Mainframe C/S ERP Web application Web Services

Why Planning Is So Difficult? (3) n Responsibility Needs to be Joint q q

Why Planning Is So Difficult? (3) n Responsibility Needs to be Joint q q n Systems planning has become business planning, not just a technology issue It is better done by a full partnership of C-level officers Other planning issues q Top-down Vs. bottom-up n q Radical change Vs. continuous Planning culture in which the systems planning must fit

Tradition Strategy Making Step 1 Business Strategy Where is the • Business decision business

Tradition Strategy Making Step 1 Business Strategy Where is the • Business decision business • Objectives and direction going and • Change why? Supports business Step 2 What is required? Direction For IS System Strategy • Business-based • Demand-oriented • Application-focused Infrastructure and services Step 3 How can it be delivered? n Assumptions: q q Needs and priorities IT Strategy • Activity-based • Supply-oriented • Technology-focused q The future can be predicted Time is available to do these 3 parts IS supports and follows the business Top management knows best (broadest view of firm) Company: like an "Army"

A World of Rapid Change (1) n Today, due to the Internet and other

A World of Rapid Change (1) n Today, due to the Internet and other technological advances, these assumptions no longer hold true: q The future cannot be predicted n Discontinuous change q q Who predicted Internet, Amazon, e. Bay etc. ? Time is not available for the sequence n n Never enough time in Internet Age IT implementation planning needs to go ahead of business strategizing

A World of Rapid Change (2) n IS does not JUST support the business

A World of Rapid Change (2) n IS does not JUST support the business anymore n Top management may not know best q Inside out Vs. outside in approach Customer n Industrial era metaphor no longer always applies p u S t Lin e on r F Core s er q rs and e pli rtn Pa An organization is not like an army

Today's Sense-and-Response Approach (1) Old-era strategy n Let strategies unfold rather than plan them:

Today's Sense-and-Response Approach (1) Old-era strategy n Let strategies unfold rather than plan them: q A sense-and-respond approach when predictions are risky n n Sense a new opportunity and immediately respond by testing it Myriad of small experiments One big choice, long commitment Time New-era strategy Many small choices, short commitments Time Strategic envelop

Case Example: Microsoft n n n Abandoned proprietary network despite big investment when it

Case Example: Microsoft n n n Abandoned proprietary network despite big investment when it did not capture enough customers Moved on to buying Internet companies as well as aligning with Sun to promote Java Over time, they moved into a variety of technologies: q n Not all strategies came from top management q n Web, Cable news, Digital movies, Cable modems, Handheld OS, Video server, Music, Xbox, . Net, Search engines. . . e. g. first server came from a rebel's unofficial project Getting its fingers into every pie that might become important

Today's Sense-and-Response Approach (2) n Formulate strategy closest to the action: q Close contact

Today's Sense-and-Response Approach (2) n Formulate strategy closest to the action: q Close contact with the market n q Employees who interact daily with customers, suppliers and partners (organizational edges) Employees who are closest to the future should become prime strategists. n In the Internet Age, this means younger employees

Today's Sense-and-Response Approach (3) n Guide strategy-making with a “strategic envelope": q q Having

Today's Sense-and-Response Approach (3) n Guide strategy-making with a “strategic envelope": q q Having a myriad of potential corporate strategies being tested in parallel could lead to anarchy without a central guiding mechanism Top management set the parameters for the experiments, and then continually manage that context n n n Experiment by territory (as Microsoft did) Strategic conversation Meet regularly with the experimenters

Today's Sense-and-Response Approach (4) n Be at the Table q q q n IS

Today's Sense-and-Response Approach (4) n Be at the Table q q q n IS executives should be actively involved in business strategizing The IS function needs to be strategy-oriented CIO need to make their departments credible and outsource most operational work Test the Future q Need to test potential futures before the business is ready for them (thinking ahead of the business) n n n Provide funding for experiments Work with research organizations Have an emerging technologies group

Today's Sense-and-Response Approach (5) n Put the Infrastructure in Place: q q Moving quickly

Today's Sense-and-Response Approach (5) n Put the Infrastructure in Place: q q Moving quickly in Internet commerce means having the right IT infrastructure in place. IT experiments are recommended to include those that test painful infrastructure issues n n Create and maintain common, consistent data definitions Create and instill mobile commercial standards among handheld devices Implement e-commerce security and privacy measures Determine operational platforms (ERP, Supply Chain Management …)

Stages of Growth (1) n Richard Nolan et al observed four stages in the

Stages of Growth (1) n Richard Nolan et al observed four stages in the introduction and assimilations of a new technology q Early Successes n q Contagion n q Interest grows rapidly; growth is uncontrolled; learning period for the field Control n q Increased interest and experimentation Efforts begun toward cost reduction and standardization Integration n Dominant design mastered; setting the stage for newer technology

Stages of Growth (2) Organizational Learning Technological discontinuity Network Era Micro Era DP Era

Stages of Growth (2) Organizational Learning Technological discontinuity Network Era Micro Era DP Era Stage 2: Stage 4: Integration Contagion and Stage 1 Stage 3: of Micro Era Control Stage 1: Initiation Stage 3: Control Stage 2: Contagion 1960 1980 Time Stage 2: Contagion Stage 3: Control Stage 4: Integration and Stage 1 of Network Era 1995 2010

Stages of Growth (3) n The importance of theory is understanding where a technology

Stages of Growth (3) n The importance of theory is understanding where a technology or company resides on the organizational learning curve q n n e. g. Web Service is currently in Stage 2, too much control at the learning and experimentation stage can kill off new uses of technology Management principles differ from stage to stage Different technologies are in different stages at any point in time

Competitive Forces Model (1) n Michael Porter's Five Forces Model q n A model

Competitive Forces Model (1) n Michael Porter's Five Forces Model q n A model that determines the relative attractiveness (competition) of an industry. Five forces q Bargaining power of customers and buyers n q High when buyers have many choices of whom to buy from, and low when the choices are few. Bargaining power of suppliers n High when buyers have few choices of whom to buy from, and low when there are many choices.

Competitive Forces Model (2) q Threat of substitute products or services n n Low

Competitive Forces Model (2) q Threat of substitute products or services n n Low if there are very few alternatives to replace the product or service. Switching costs q q Threat of new entrants n q Costs that can make customers reluctant to switch to another product or service. High when it is easy for competitors to enter the market The intensity of rivalry among competitors n High when the industry is less attractive.

Competitive Forces Model (3) How will the business react to threats (and opportunities)? Potential

Competitive Forces Model (3) How will the business react to threats (and opportunities)? Potential Entrants Threat of new entrants Industry Competitors Bargaining power of suppliers Customers and Buyers Suppliers Rivalry among existing firms Substitutes Bargaining power of buyers Threat of substitute products or services

Competitive Forces Model (4) Potential Entrants Threat of new entrants The strategy and actions.

Competitive Forces Model (4) Potential Entrants Threat of new entrants The strategy and actions. Industry an organization adopts depend upon its Bargaining power of buyers perceptions of itself and Competitors these threats. suppliers Customers and Buyers Suppliers Porter’s strategies: • Product differentiation (non-duplicable product or service) Rivalry among • Low-cost producer existing firms • Market niche (market segment or geographical market) Substitutes Threat of substitute products or services

Five Forces Analysis of the Internet n The Internet tends to dampen the profitability

Five Forces Analysis of the Internet n The Internet tends to dampen the profitability of industries q q q n Increases the bargaining power of buyers Decreases barriers to entry Increases the bargaining power of suppliers Increases the threat of substitute products and services Intensifies rivalry among competitors Success depends on offering distinct value q Firms should focus on their strategic position in an industry and how they will maintain profitability

1 Information Systems Planning 2 Distributed Systems Architecture

1 Information Systems Planning 2 Distributed Systems Architecture

Definition: IT Architecture VS. IT Infrastructure n An IT architecture is a blueprint showing

Definition: IT Architecture VS. IT Infrastructure n An IT architecture is a blueprint showing how the parts will interact and interrelate. q q n System, information, departments. . . Multiplicity of structures and views An IT infrastructure is the implementation of an architecture. q q processors, software, databases, electronic links, data centers, standards, skills, electronic processes. . . We now tend to divide computing into applications and infrastructures

The Evolution of Distributed Systems n n Mainframes: with dumb terminals Minicomputers moved computing

The Evolution of Distributed Systems n n Mainframes: with dumb terminals Minicomputers moved computing into departments q n Microcomputer moved processing power into desktop, briefcase and handhelds q n The master-slave computing model persisted and processing was mainly centralized Client/server computing Internet: a globally distributed system q Interesting twist: power returning to a type of centralized processing with networks of servers

Four Attributes of Distributed Systems n The degree to which a system is distributed

Four Attributes of Distributed Systems n The degree to which a system is distributed can be determined by answering four questions: 1. 2. 3. 4. Where is the processing done? How are the processors and other devices interconnected? Where is the information stored? What rules or standards are used?

Distributed Processing n Limited processing power of a single node VS. increasing application demands

Distributed Processing n Limited processing power of a single node VS. increasing application demands q q n Balance the load and improve overall performance Let machines handle the work they do best Interoperability: information exchange between heterogeneous computing platforms q q Protocols Two-way message passing between user applications

Connectivity Among Processors n Data exchanges through electronic communication links q q n TCP/IP

Connectivity Among Processors n Data exchanges through electronic communication links q q n TCP/IP Ethernet, ATM, FDDI, Frame relay. . . Planned Redundancy for reliability q q Two or more independent paths between two nodes to provide automatic alternate routing Topology and reliability of the Internet

Distributed Databases n Two distributed database schemes q Divide a database and distribute its

Distributed Databases n Two distributed database schemes q Divide a database and distribute its portions throughout a system without duplicating the data n q Transparent user access Store the same data at several different locations, with one site containing the master file n n Synchronization issue E. g. edge servers

System-wide Rules n Rules governing communication between nodes, security, data accessibility, program and file

System-wide Rules n Rules governing communication between nodes, security, data accessibility, program and file transfers, and common operating procedures q Open standards after 1990 s n n n OSI Reference Model SQL API: standardized interface TCP/IP Open source

Internet---A Scale-free Network (1) n n Internet is not designed, but evolved Internet is

Internet---A Scale-free Network (1) n n Internet is not designed, but evolved Internet is a scale-free network q n Scale-free networks are very common and a very important category of real networks. Scale-free networks are the direct result of selforganized growth q q Growth: networks continuously expand by the addition of new nodes Special type of growth called preferential attachment n n Preferential Attachment : The attachment is NOT uniform A node is linked with higher probability to a node that already has a large number of links

Internet---A Scale-free Network (2) Random/ Five nodes with most links First neighbors of red

Internet---A Scale-free Network (2) Random/ Five nodes with most links First neighbors of red nodes 27% reach 60% reach

Internet---A Scale-free Power-law distribution Poisson distribution Network (3) P(k)~k-γ Exponential Network Scale-free Network

Internet---A Scale-free Power-law distribution Poisson distribution Network (3) P(k)~k-γ Exponential Network Scale-free Network

Internet---Topological Robustness n Topological robustness: the Internet is robust in the presence of random

Internet---Topological Robustness n Topological robustness: the Internet is robust in the presence of random failures. q q n At any given time hundreds of routers are down but the performance is not impacted It will function even if we remove randomly 80% of the nodes. Theoretical and experimental investigations show that scale-free networks are topologically robust

Internet---Vulnerability to Targeted Attacks n Scale-free networks such as Internet are vulnerable to attacks.

Internet---Vulnerability to Targeted Attacks n Scale-free networks such as Internet are vulnerable to attacks. q If a malicious attack could simultaneously remove 5% of hubs (the highly connected nodes) the network would disintegrate

Internet---Virus n Scale-free networks like internet are vulnerable to spreading viruses q n Hubs

Internet---Virus n Scale-free networks like internet are vulnerable to spreading viruses q n Hubs are passing them massively to the connected multiple nodes. This suggests immunizing hubs.

When to Distribute Computing Responsibilities (1) n The decision of distributing computing responsibilities is

When to Distribute Computing Responsibilities (1) n The decision of distributing computing responsibilities is rather managerial than technical q People deciding how their portion of business operates should also decide how they use IT

When to Distribute Computing Responsibilities (2) n Systems responsibilities can be distributed unless the

When to Distribute Computing Responsibilities (2) n Systems responsibilities can be distributed unless the following are true: q Are the operations interdependent? n q Are the businesses really homogenous? n q For interdependent, their planning, development, resources, and operations must be centrally coordinated Processing may be distributed, but planning and hardware selection should be centralized Does the corporate culture support decentralization? n Corporate culture might centralize finance, HR, and systems planning

An Organizational Framework 1 Business Ecosystem 2 Enterprise 3 Country or Region 4 Plant

An Organizational Framework 1 Business Ecosystem 2 Enterprise 3 Country or Region 4 Plant or Site 5 Department or Process n Systems may be needed for all 7 levels Inter-organizational links can occur at all six internal levels n The current hot levels n q 6 Work Group or Team q 7 Individual Level 1: inter-enterprise computing Leve 5: where business processes reside

A Technical Framework (1) n The SUMURU architecture developed in 1982, has stood the

A Technical Framework (1) n The SUMURU architecture developed in 1982, has stood the test of time. q It provides a clear conceptual framework for understanding various components of a distributed architecture.

A Technical Framework (2)

A Technical Framework (2)

A Technical Framework (3) Processors Services Single-user systems (SU) Terminal access Multiple-user systems (MU)

A Technical Framework (3) Processors Services Single-user systems (SU) Terminal access Multiple-user systems (MU) File transfer Remote utility systems (RU) Computer mail Networks Standards Local network (LN) Operating system Remote network (RN) Communications protocols Database systems