SOLUTION: University of Missouri – Kansas City Hefty Hardware Case Study
MINI CASE IT Planning at ModMeters4 Brian Smith, CIO of ModMeters, groaned inwardly as he scheduleened to CEO John Johnson wrapping up his remarks. “So our ruler team reflects there are veritcogent profession opportunities for us in unraveling these two new strategic shoves. But antecedently I go to the consideration for terminal acclaim proximate month, I scarcity to perceive that our IT, marketing, and sales plans terminate mediums-of-patronage us all the way,” Johnson concluded. Brian mentally adapted the contact these new initiatives would accept on his structure. He had heard rumors from his boss, the COO, that star big was coming down. He had courteous-mannered-balanced been asked his view environing whether these strategies were technically doable, theoretically. But twain at unintermittently? Resources—people, space, and capital—were tight, as regular. ModMeters was making a moderate use, but the CFO, Stan Abrams, had regularly kept the lid screwed down tightly on IT expending. Brian had to combat for perfect dime. How he was going to confront the wherewithal to mediums-of-patronage not one but two new strategic initiatives, he didn’t perceive. global from a North American agency seemed to be a argumentative proximate stride for the gang. Its fruits, metering components of all types, were bulkyly specialized and in bulky ole-for from such distinct customers as advantageousness companies, manufacturers, and a calculate of other industries. Originally seted as Modern Meters, the steadfast had grown steadily as ole-for for its metering expertise and components had grown aggravate the spent century or so. Today ModMeters was the capaciousst motive of metering components in the globe after a period a ample appoint of twain habitual and, now, digital fruits. Expanding into meter constellation after a period cunningts in Asia and Eastern Europe was a amicogent cunning, purpose Brian, but he wasn’t correspondently safe how he was going to get the infrastructure in place to mediums-of-patronage it. “Many of these countries simply don’t accept the telecommunications and equipment we are going to scarcity, and the grafting and new systems we accept to put in place are going to be bulky,” he said. But it was the succor strategic shove that was going to exhibit him nightmares, he predicted. How on sphere did they look-for him to put direct-to-customer sales in place so they could vend “green” electric meters to specific users? His notice was jerked tail to the exhibit by a bespangled new logo on an easel that the CEO had directeous unveiled. “In guardianship after a period our updated diplomacy, may I exhibit our new name—MM!” Johnson announced portentously. “Oh, this is directeous bulky,” purpose Brian. “Now I accept to go into perfect separate impression and perfect separate muniment this gang produces and substitute our name!” Because of its age and or-laws orientation, ModMeters (as he stagnant preferred to ole it) had been in the IT profession a hanker space. Starting tail in the bulky 1960s, the 4 September 2005. Reproduced by endurance of Queen’s University, School of Business, Kingston, Ontario, Canada. 82 IT Planning at ModMeters gang had fragmentarily automated closely perfect submit-toing of its profession from finance and accounting to minister fetter treatment. Environing the scantly fiction it didn’t accept was a conceit Web predicament for consumers, although courteous-mannered-balanced that was environing to substitute. ModMeters currently had systems reflecting directeous environing perfect era of computers from pierce cards to PCs. Unfortunately, the gang never seemed to accept the media to endue in reengineering its bulky systems. It directeous layered spent systems on top of the others. A diagram of all the interactions incompact systems looked love a extract of spaghetti. There was no way they were going to be cogent to mediums-of-patronage two new strategic shoves after a period their prevalent budget razes, he purpose as he applauded the new artfulness ahanker after a period the others. “Next week’s IT budget discourse is going to be a doozy!” Sure plenty, the forthcoming week set them all, save for the CEO, tail in the had exhibited their indispenscogent IT initiatives. In specification to what scarcityed to be executed to means-of-patronage the new profession strategies, each dissolution had a ample laundry schedule of indispensables for maintaining the prevalent profession of the steadfast. Well-balanced Abrams had gotten into the act this year owing of new comp that gave the steadfast’s delayout auditors immense scope to fellow into the vital fruitings of perfect financial and governance system the structure had. After scheduleening carefully to each orator in transform, Brian appointly up. “As multifarious of you know, we accept regularly been timid environing how we expend our IT budget. We accept been attached a budget that is similar to 2 percent of revenues, which seriously limits what we in IT accept been cogent to do for the gang. Perfect year we expend a lot of space ras our project schedule down to scant bones, and perfect year we produce do after a period a composition of infrastructure enduements. We are now at the apex where 80 percent of our budget in IT is fixed. Here’s how we expend our capital.” Brian clicked on a PowerPoint exhibitation showing a multicolored pie chart. “This capacious chunk in bluish is directeous environing half our budget,” he methodic. “This is simply the absorb of guardianship the lights on—floating our systems and replacing a scant minimum of equipment. The red chunk is environing 30 percent of the pie. This is the subject we accept to do—fixing blunders, traffic after a period substitutes mandated by legislation and our own activity, and providing indispenscogent services love the succor desk. How we segregate up the leavings of the pie is what this discourse is all environing.” Brian clicked to a succor slide showing a succor pie chart. “As you perceive, we accept typically segregated up the retaining IT budget relatively, according to who has the biggest aggravateall detached budget. This capacious pink chunk is you, Fred.” Brian gestured at Fred Tompkins, guide of manufacturing and the most ruley ruler in the extent. It was his dissolution that made the steadfast’s use. The pink chunk largely took up spent than half of the pie. Tompkins smiled. Brian went on, apexing out the hunch that each bisect of the steadfast had been allotted in the anterior year. “Finally, we after to Harriet human media and marketing, respectively. Their microscopic slivers were scantly visible— righteous a few percent of the completion budget. “This similarity to divvying up our IT budget may accept promoted us courteous-mannered-mannered aggravate the years”—Brian didn’t reflect it had, but he wasn’t going to combat spent battles—“however, we all heard what John said conclusive week, and this similarity to budgeting doesn’t exhibit us any extent to unravel our new strategies or caggravate our new infrastructure or staffing needs. Although we rule get a short spent capital to gain some new impressions 83 84 and buy some spent computers”—Abrams nodded slightly—“it won’t get us where we scarcity to go in the coming.” A third graph went up on the shelter, showing the proximate five years. “If we don’t do star now to harangue our IT investigates, after a periodin five years our perfect IT budget terminate be eaten up by directeous agencys and mediums-of-support. In the spent we accept paid minimal notice to our infrastructure or our knowledge and technology structure or to reengineering our bulky systems and systemes.” A diagram of the “spaghetti” flashed on. “This is what you’re question me to train in a absorb-conducive habit. It isn’t pretty. We scarcity a amend cunning for making our systems spent sturdy and lithe. If we are going to be tender in new submit-toings after a period this steadfast, the setation directeous isn’t there. Stan, you should be worried that we won’t be cogent to exhibit our auditors what they ask for. But you should too be worried environing our cause exposafe if one of these systems fails and environing how we are going to blend two new profession ventures into this cobble.” Tompkins looked up from his papers. It was plain he wasn’t affable after a period where this exhibitation was guideed. “Well, I, for one, scarcity perfectfiction I’ve asked for on my list,” he methodic flatly. “You can’t look-for me to be the currency cow of the structure and not encogent me to produce the capital we scarcity to endue elsewhere.” Brian was inquerulous. “I’m not dictum that you don’t, Fred. I’m directeous dictum that we’ve been exhibitn a new strategic submit-toing from the top and that some fictions are going to accept to substitute to encogent IT to mediums-of-patronage the healthy achievement amend. For sample, until now, we accept regularly prioritized dissolutional IT projects on the premise of ROI. How should we prioritize these new strategic initiatives? Furthermore, these new ventures terminate require a lot of specificational infrastructure, so we scarcity to illustration out a way to bestow this. And direct now our systems don’t ‘talk’ to the ones floating in other dissolutions owing they don’t use the corresponding terminology. But in the coming, if we’re going to accept systems that won’t absorb increasing sums of our budget, we are going to accept to disencumber and blend them amend.” Tompkins clbulky hadn’t deliberateed the achievement’s scarcitys at all. He scowled but said molehill. Brian remaind, “We are substance asked to do some new fictions in the gang. Obviously, John hopes there’s going to be a payback, but it may admit a period. New strategies don’t regularly submit-to fruition direct detached.” Now looking at Abrams, he said apexedly, “There’s spent to IT esteem than short-term use. Bisect of our profession diplomacy is to produce new markets for our gang. That requires enduement, not scantly in equipment and fruit but too in the underlying systemes and knowledge we scarcity to train and mentor that enduement.” Harriet Simpson spoke for the earliest space. “It’s love when we engage someone new in R&D. We engage for property owing we deficiency their ideas and alteration, not directeous a warm body. I reflect we scarcity to amend perceive how we are going to render our five key municipal objectives into IT projects. Yes, we scarcity to produce a use, but Stan scarcitys to satisfy regulators and Brenda’s going to be on the hot perpetuate when we set-on-foot marketing to Kwok was undertakinged after a period guardianship one or spent strides aguide of the emulation. New types of fruits and customer scarcitys would medium disquisition in his area as courteous-mannered. Abrams plained his throat. “All of you are direct. As I see it, we are going to accept to obpromote the currency eloquent from Fred’s area period we amplify. But Brian’s got a apex. We may be substance gentleman intelligent and triturate silly if we don’t reflect fictions through spent IT Planning at ModMeters carefully. We’ve put a lot of trial into unraveling this new diplomacy, and there terminate be some extra capital for IT but not plenty to do that plus perfectfiction all of you deficiency. We scarcity to lessen and regroup and propel self-assertive at the corresponding space.” There was stifle in the extent. Abrams had an tiresome way of stating the obvious after a periodout veritablely succoring to propel the globe self-assertive. Brian spoke frequently. “The way I see it, we accept to perceive two fictions antecedently we can veritablely produce a new budget. First, we scarcity to illustration out how each of the IT projects we’ve got on the tcogent contributes to one of our key municipal objectives. Second, we scarcity to illustration out a way to determine the esteem of each to ModMeters so that we can prioritize it. Then I scarcity to inmunicipal a moderate sum of IT resuscitation so that we can remain to do new projects at all.” Everyone was faltering now. Brian breathed a inferior faint of aid. That was stride one courtly. But stride two was going to be harder. “We accept a month to get tail to the deliberateation after a period our assurances that the IT cunning can inmunicipal the new strategies and what we’re going to scarcity in conditions of extra funds to do this. As I said antecedent, this is not directeous a subject of throwing capital at the tenor. What we scarcity is a system for IT planning and budgeting that terminate promote us courteous-mannered-mannered aggravate the proximate few years. This system terminate scarcity to terminate a calculate of fictions: It terminate scarcity to admit an achievement perspective on IT. We’re all in these new strategies coincidently. It terminate accept to inmunicipal all types of IT initiatives—our new strategies, the scarcitys of Fred and others for the new IT to act and meliorate our bulky profession, Stan’s new auditing scarcitys, and our agencys and mediums-of-patronage scarcitys. In specification, we must confront some way of allocating some of the budget to fixing the cobble we accept in IT direct now. It must stipulate a amend way to converge new IT fruit after a period our municipal objectives. It must succor us prioritize projects after a period contrariant types of esteem. Finally, it must ensafe we accept the profession and IT media in place to entrust that esteem.” Looking at each of his colleagues in transform, he asked, “Now how are we going to do this?” Discussion Question 1. Unravel an IT cunningning system for ModMeters to terminate the ole-fors as set out overhead. 85 Hefty Hardware Instance Study Assignment Synopsis This instance highlights a vend steadfast struggling to produce recognition of the increasing criticality of knowledge technology (IT) to the profession and the esteem IT is prevalently entrusting. Torn between “guardianship the lights on” and “delivering new fruits and services to customers”, successive CIOs accept failed to converge conducively after a period their profession bisectners despite seemingly conducive relationships at the mid-treatment raze. How to collaborate conducively after a period the profession at all razes sweepings the key IT investigate. Key Issues • • • There is increasing pressafe on profession to be spent lithe and to entrust fruits and services to customers straightly. IT practices repeatedly prevent these profession goals. “Techno speak” is confusing and frustrating for profession. This can fruit frequentlyst IT cunnings and strategies owing profession leaders don’t perceive how these cunnings/strategies relate to their own scarcitys, issues, and strategies. Business look-fors IT despatch to be in profession articulation. Key Points The Scene The investigate is “knowing where to set-on-foot” – directeous as it is in veritcogent structures – and this requires detective fruit. Therefore, the earliest undertaking is to highlight the issues. To do this, you terminate accept to identify all the issues exhibited after a periodin the instance. The Analysis Once the issues are authorized, digest the condition at Hefty naturalized on the authorized issues. As you accept already authorized, there are calculate of issues in the instance. Your undertaking is to hone down to two key investigates, which are highlighted in the instance. Here is a insinuate, the earliest investigate is one of collaboration and the succor is one of communication. There are a lot of contrariant feasible solutions to harangue twain the short-term scarcitys and the long-term scarcitys at Hefty. In appoint to deliberate what is most relevant, you terminate accept to produce safe that your solutions harangue twain the despatchs and collaborations investigates. Questions 1. Explain how IT and the profession can fruit collaboratively to entrust the Savvy Store program successfully. (Appendix A stipulates an structulegitimate chart to succor after a period the planning) Attribute - Pearson Education, Inc. Publishing as Prentice Hall 1 Appendix A Organization Chart COO Glen Vogel VP Marketing CFO CIO Cheryl O’Shea Michelle Wright Farzad Mohammed IT Account Mgr Marketing IT Relationship Manager Jenny Henderson Paul Gutierez Chief Architect Sergei Grozny New Intern Joyce Li Attribute - Pearson Education, Inc. Publishing as Prentice Hall 2 ...
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