IT Units Research Articles

Understanding and Evaluating IT Budgets and Funding

The average firm spends over two-thirds of the IT budget on maintaining the present infrastructure and architecture. The IT budget in turn makes up between thirty to fifty percent of the capital expenditure of a firm annually. An appreciation of the models would enhance an understanding of funding for new IT initiatives and/or making improved decisions on IT investments and operations. In an era where IT infrastructure is essential, a sound IT portfolio is important. This paper explores the necessities of maintaining a firm’s current IT health, investing in future capacity and improving the competitive position of the firm. This paper tries to suggest how an organization can shift from barely maintaining the current IT infrastructure, much to the chagrin of everyone involved, to an industry leading, value generating and sound IT infrastructure. This paper first examines four models for Budgeting and Funding for Information Technology in a firm (Charge Based, Lord and Master, Revenue Percentage, Absolute Outsourcing). Then it proceeds to develop a speculative framework to assist IT budget and funding. There is evidence that the first four models (Charge-based, Lord and Master, Revenue Percentage and Absolute Outsourcing). Charge-based is a model where the IT unit is treated outright as a service provider and paid for services implemented. In Lord and Master, a firm’s IT unit has absolute control over implementation and execution of IT services. Revenue Percentage is where the IT unit compete for budgets in the form of a percentage of the organization overall revenue/profits. Absolute Outsourcing is also a service-charge based system; the only difference being that there is no defined IT unit within firm. IT needs are outsourced to an IT firm outside of the organization and services rendered, charged back to the organization.The impact an IT department has, whatever model it uses to exist, on organizational activities is un-questionable. The study of these models will help firms gather knowledge as to where they stand and also analyze if they need a change in their IT related financial environment. The proposed models are evaluated on: how each model works, how much is allocated as an IT budget, how the financial relationship of IT with other departments and stake holders functions, and implications on organizational learning. Using the funding and budgeting models as building blocks future research is welcomed on governance, change management as well as operational, day to day practical decision making which has relevance to both academic and practitioners.

ENTERPRISE ARCHITECTURE STRATEGIC FRAMEWORK

The alignment between business and IT is critical for formulating optimal organisational strategies, and obtaining a competitive advantage. Conversely, alignment between the business and IT units is often challenged in many organisations. Some occurrence of deficiencies in the organisation is due to lack of formal approach such as Enterprise Architecture (EA). The deficiencies sometimes threaten activities such as standardisation, implementation and support for ICT infrastructures. Analysis revealed that the deficiencies manifest into complexities and inconsistencies, affecting organisational goals. Also, without EA, some organisations are challenged with a holistic view, to monitor and manage its business processes, information flow, technology selection and deployment. Other factors that pose challenges to the competitive advantage of organisation are adaptive-ness, uniformity and scalability, which EA is intended to address from strategic perspective. Unfortunately, many organisations do not have strategic framework for the implementation of EA. This has significant impact on the organisation’s processes and activities. This study made use of empirical evidences, from qualitative case study to develop a strategic framework, which could be employed in addressing non-technical factors that affect EA.

IT service climate, antecedents and IT service quality outcomes: Some initial evidence

Although many IT service management frameworks exist, we still have limited theoretical understanding of IT service quality within a broader nomological network. Building on recent conceptual work on the IT service climate construct, this study empirically establishes it as a predictor of IT service quality using survey data from both IT units and their clients. Also examined was a set of antecedents which provide a foundation upon which a favorable service climate can be built. The IT service climate instrument, when incorporated into employee feedback initiatives, can provide guidance to IT executives about practices to improve service quality.

Building Consumer Loyalty – Challenge for Global E-healthcare Organizations

In this study authors provide a conceptual investigation regarding the role of consumer loyalty for e-healthcare organisations. The main aim of the article is to identify the level of consumer loyalty and factors which determine this phenomenon. Further the paper suggests a consumer loyalty model on e-healthcare market. The survey was conducted using structured questionnaire. Scale to measure each of factors in the model were developed based on previous literature and using existing scales where possible. A total of 1000 questionnaires were distributed by the Internet to the patients. The results demonstrated that level of consumer loyalty towards e-healthcare organizations is relatively low – lower than what it is, towards traditional healthcare institutions. The most important factors determining consumer loyalty in this market are: trust on ehealthcare institutions, satisfaction from e-medical services and technological factors, like security and privacy. Results of research can be applied by managers of e-healthcare organizations, particularly by departments responsible for establishing relationship with patients and IT units that are involved in the process of developing new electronic marketing channels. The target audience can be characterized as all researchers and practitioners interested in health care services and marketing issues.

The Norwegian Sequencing Centre (NSC)

The Norwegian Sequencing Centre (NSC) was established in 2009 to provide the Norwegian research community with access to high-throughput sequencing services. Currently, 16 people work at the NSC. Funding has been provided from a number of sources, including Health South-East, the University of Oslo, and the Norwegian Research Council. Two main activities of the NSC will contribute to the aims of the SEQAHEAD project. 1. Experience providing a very broad range of sequencing applications based on a range of technology platforms. 2. The development of a national storage and analysis platform for human genetic data. 1. The NSC has 454 (GS FLX+), Illumina (GAIIx, HiSeq) and Pacific Biosciences (RS) platforms. In addition Illumina MiSeq and Ion Torrent (PGM) machines have been ordered. This enables us to support a broad range of projects and sequencing applications. This includes large scale de novo projects, such as the cod genome (doi:10.1038/nature10342), transcriptomics (mRNA, miRNA), epigenetics (RRBS, ChIP), and resequencing (exomeSeq). 2. The medical genetics department at the Oslo University Hospital has initiated and received funding for the development of a national storage and analysis platform for DNA sequence data to be used by the Norwegian health service. Partners in the project are the University High Performance Computing unit, the Informatics Department, and the hospital IT and Data Protection units. The system should enable the secure transfer of sequence data and meta-data from production sites to the system, strict access control functionality, secure communication between users of the system, and interfaces for power users (e.g. bioinformaticians and medical genetics clinicians) and expert computer systems (e.g. pharmaco-genetics expert system). In addition, the system needs to be highly scalable to accomodate what is anticipated to be the explosive use of genetic information in the treatment of a broad range of pathologies. The above requirements will require the design and development of a secure high performance computing infrastructure that not only satisfies the technical requirements, but also complies with the strict data security laws that apply to sequence data in Norway. In addition, secure data software services will need to be developed and run on top of this infrastructure. The goal is to have a working pilot of the system installed by the spring of 2015.

Credit Suisse: Engineering a Global Financial Services Business

In 2010, Credit Suisse was attempting to leverage its global scale by integrating key business processes across geographies and business units. The IT unit, under Global CIO Karl Landert, assumed a pivotal role in enabling business integration. But the IT unit had developed distinctive cultures and capabilities reflecting two very different business units — private banking and investment banking — and different geographies. To help understand and develop the skills needed to support business integration, Credit Suisse’s IT unit developed clearly defined job families and career paths for its 8,000 IT professionals and 4,000 contractors. This case examines the transformation of the IT unit as it implemented its job families and defined IT roles that would help Credit Suisse become a global financial services business.

USAA: Organizing for Innovation and Superior Customer Service

USAA, a diversified financial services firm serving the U.S. military, had long been recognized for outstanding customer service. The company had never operated branches, instead providing services through remote channels, such as the telephone, Internet (USAA.com), mail, fax, and any bank’s ATM machines. USAA wanted customers to be able to access their services any way they liked. By 2010, however, USAA recognized that serving customers remotely meant responding to the rapid introduction of mobile consumer devices. To ensure constant innovation and integrated customer services, USAA was transforming its operating model and promoting innovation across the enterprise. The IT unit was focused on providing technology platforms and solutions to support both an integrated business model and rapid innovations. This case describes how USAA was transforming itself and, specifically, how the IT unit was addressing changing demands from customers and business partners.

Exploring the Role of Knowledge Networks in Perceived e-Government

What are the knowledge network configurations associated with effective e-government? To answer this question, a social network perspective is applied to explore the connection between e-government actors’ social networks and their perception of e-government effectiveness. Specifically, this study closely looks at both intraorganizational networks between program and IT units and interorganizational relationships with IT vendors in the context of local e-government. Two Korean local governments who provide online parking services through the same IT vendor were selected as comparative cases. Through the network analysis of two local governments, the study suggests preliminary findings for the knowledge network conditions for effective e-government: e-government effectiveness is likely to be enhanced (1) members of IT and program units are linked through a greater number of strong cross-unit ties; (2) they maintain strong ties with IT vendors; (3) CUBS take central positions in knowledge networks in a program unit; and (4) they are embedded in high density of intra-unit networks within their units.

The Social Antecedents of Business/IT Alignment

Business/IT alignment is a major source of business value generated from IT and social structures at the interface between a firm’s business and IT units are of vital importance to business/IT alignment. Yet, there is a substantial gap in understanding the nature of these social structures. Based on a literature review comprising all related articles published in the AIS Senior Scholars’ Basket journals between January 2000 and August 2011, this paper identifies antecedents of alignment related to social network structure. These are translated into formal SNA concepts. The identification and formalization of social network structures allow IT governance to implement social engineering mechanisms influencing the social network structure, thus improving business/IT alignment and IT value. Examples for such translated arguments are high degree centrality of CIOs vis-à-vis other executives and strong ties in terms of cross-domain knowledge between CIOs and other executives. Finally, important avenues for future research are highlighted.

Risk-Mitigation in Supply Chain Digitization: A Study of System Modularity and IT Governance

Firms face significant risk when they adopt digital supply chain systems to transact and coordinate with their partners. Drawn upon modular systems theory, this study proposes that system modularity mitigates the risk of adopting digital supply chain systems and therefore motivates firms to digitize more of their supply chain operations. The study also theorizes how the risk-mitigating effect of system modularity can be enhanced by the allocation of decision rights to the IT unit. The main logic is that IT managers with more domain IT knowledge can better utilize their knowledge in decision making to achieve effective system modularity. We tested these theoretical propositions using a survey study of Chinese companies and found empirical support. We also found that the allocation of decision rights to the IT unit does not directly mitigate the perceived risk of digital supply chain system, which highlights the role of decision allocation to the IT unit as a key moderator in risk mitigation. The study generates theoretical and practical implications on how IT governance and system modularity may jointly mitigate risk and foster supply chain digitization.

Alignment within the software development unit: Assessing structural and relational dimensions between developers and testers

Just as business-IT alignment has received significant focus as a strategic concern in the IS literature, it is also important to consider internal alignment between the diverse subunits within the IT organization. This study investigates alignment between developers and testers in software development to understand alignment within the IT unit. Prior evidence of tension between these sub-groups (and others as well) suggests that all is not necessarily well within the IT organization. Misalignment within the IT unit can certainly make it difficult for the IT unit to add strategic value to the organization. This study is an important initial step in investigating IT subunit alignment which can inform future research focusing on the alignment of other IT subunits such as architecture, operations, and customer-support. Using theoretical concepts from strategic business-IT alignment, we test a research model through a survey of professional software developers and testers. Results suggest that relational but not structural dimensions influence IT subunit alignment.

An Agile approach to library IT innovations

PurposeThis paper seeks to describe the application of the Agile software development approach to rapidly develop and deploy a variety of innovative IT applications.Design/methodology/approachThe Agile approach is flexible and iterative with continuous feedback and constant communication. It is also marked by frequent and short delivery schedules. An Agile team of staff and students was formed for different projects, and visual tools were used to show process and progress. Team members were also co‐located (situated in the same space), a key element that allowed faster and direct communication. Within the Agile framework, the Crystal Clear methodology was selected, which is based on team size and criticality of the application to develop the workflow and iterative processes.FindingsThe Agile approach is particularly suited to innovation development and creative teams for rapid development of products, services, and technology. However, its acceptance is dependent on organizational culture and nature of application.Research limitations/implicationsAs a next step, it would be useful to test the Agile approach in an innovative application that is on a larger scale than six team members and with a different level of criticality.Practical implicationsFlexibility and adaptability are needed in managing the development of IT innovations and applications as they vary in size and complexity. The flexible and iterative Agile approach provided the framework to develop and implement these projects despite the small staff size.Originality/valueThere is little in the professional literature on software development and project management approaches for small teams. The Agile approach would be of interest to an IT unit or library with limited staff resources and interested in a lightweight framework to develop and deploy innovative projects.

Editorial Board Thoughts

Editorial Board Thoughts

Chevron: Outsourcing Commodity Processes in a Commodity Business

Faced with a large number of impending retirements, Chevron intended to downsize by outsourcing commodity services. In 2004 management recognized that taking advantage of the growing number of services available on the market required new competencies. This case describes how Chevron learned to identify appropriate outsourcing opportunities and how the IT unit - and managers of IT-enabled processes - incrementally built skills around architecture, integration, and vendor management to enable the company to benefit from outsourcing opportunities.

Get it in writing: MOUs and library/IT partnerships

PurposeIncreasingly academic libraries are partnering with other campus units to improve efficiency and to better serve students and faculty. This paper aims to focus on the importance of developing a memorandum of understanding (MOU) to foster a relationship between an academic library and IT unit. It seeks to identify what the MOU should include, pitfalls to be avoided, and lessons learned. It also proposes demonstrating how the MOU has been used as a model for other alliances and how, because of the MOU, a partnership has flourished.Design/methodology/approachThis paper will outline the steps taken that led to the successful MOU created by the Indiana University Bloomington (IUB) Libraries and University Information Technology Services (UITS.)FindingsThe paper finds that a well‐crafted MOU that allows for flexibility in ongoing decision making by service stakeholders permits partnerships to evolve and mature and creates the avenue for continued success and innovation.Practical implicationsThis paper describes the execution and ongoing evolution of a successful partnership based on a MOU and commitment by the IUB Libraries and the central technology organization, UITS.Originality/valueLibraries interested in entering into or strengthening partnerships with IT or other campus organizations can use the Indiana University experience and MOU as a model.

Towards an IT production function

PurposeThe goal of this paper is to identify core IT value drivers in firms and to model them as an IT production function to help disclose and measure the IT value creation process and to guide managers in seeking adequate ways of employing the IT resource.Design/methodology/approachBased on a critical review of the literature on the resource‐based view, an IT value framework based on the constructs IT capability, resource, and routine is developed and then formalized as an IT production function.FindingsOrganizational routines are decisive for turning firm resources into an IT capability and in turn into better business process performance. Shows how the IT value creation process in general and routines in particular can be measured and formalized.Practical implicationsAs the interaction between IT and business units is crucial for IT value generation, organizational routines provide for important knowledge flows that turn firm resources into value generating capabilities. Proposes a concrete method to measure and evaluate these routines and thereby contribute to making the IT resource controllable.Originality/valueThe main contribution is the identification and analytical formalization of the role of routines for IT value creation. Shows how insights from the resource‐based view, microeconomic theory (Cobb‐Douglas/CES production function), and Granovetter's strength of ties argument can be used to describe, measure, and guide IT value creation and to develop an IT production function.

Change Management

Change management is a core IT general control required to support the business functions of the enterprise. Although change control is conceptually simple, the mechanics of implementation and monitoring require attention to detail as well as support from IT, users, and business unit management.

The evolution of the corporate IT function and the role of the CIO at Texaco

While senior management's confidence in the IT function and the CIO appears to be at an all time low, the field's understanding of why this condition exists is still confused. This paper suggests that the problem lies in how perceptions about IT are formed. To this end, the paper briefly looks at the growth and evolution of the corporate IT department at the oil giant Texaco, Inc. The analysis paints a somewhat disturbing picture of a top performing IT organization, intimately responsible for the success of the corporation, yet being perceived by much of senior management as an overhead that was costly and ineffective. The paper suggests some reasons as to why such perceptions might have come about, and what lessons the field can learn from what happened at Texaco. It is our belief that through such historical analyses, like the one performed at Texaco, a richer and broader understanding of the nature of organizational IT units is possible. These analyses shed light on the root causes for why IT is often perceived negatively. We suggest that IT organizations might change these perceptions by partnering with business units to share the credit for successful implementations and managing the perceptions about IT's contribution.

Improving Information Quality Through it Alignment Planning: A Case Study

This article describes how a medium-sized, Midwestern power company implemented an IT alignment planning process. the IT alignment planning process was a successful four-year activity that involved, first, a pilot implementation and then a companywide implementation of the IT alignment planning process. Designed to be flexible and to dovetail with corporate strategic planning processes, IT alignment planning achieved acknowledgment and approval in all divisions of the company. the IT alignment planning process improved and facilitated communication on IT and IT projects throughout the company, from the executive level to the operational level, and brought the IT and client units closer together.

Is it Time for an it Ethics Program?

Once thought of as a value-neutral service function, IT is being recognized as a department that is involved in a variety of ethical questions. These ethical questions can be recognized and dealt with on an explicit basis, but most often the decisions are unrecognized or decided by a small group of people who may lack the training and authority to deal with the issues properly. We suggest that IT units pay attention to ethical issues and create a structure for identifying and dealing with them.