IT risks present in Corporate America today

Corporate America has a wide range of IT risks today because most of business models have a dependency on IT. Depends on two strategic dimensions of how much the company relies on cost-effective, uninterrupted, secure, smoothly operating technology systems (referred as "defensive" IT), and how much the company relies on the IT for its competitive edge through systems that provide new value-added services and products or high responsiveness to customers ("offensive" IT), and also on the role of IT, and IT governance in the company, following risk factors can be identified.


• Proper security of IT networks within and outside the company.

• Service outage because of the power failure or natural disaster.

• Inadequate disaster recovery or business continuity measures.

• IT-related surprises coming from lax or ineffective project management. The larger IT projects - the higher the risk.

• Problems with IT-related activities outsourced to 3rd party vendors.

• Legacy systems can present surprises of incompatibility with newer systems or the way of the processing the information.

• Legal problems can arise around the intellectual property issues related to IT.

• Missing the fresh threads and opportunity of using leading-edge technology applications that competitors switch to.

• Risk that IT investments don't create a business value for the organization.

• Aligning of IT assets with the concurrent needs of multiple regulations. Example: data retention, information protection.

• Insufficient number of IT staff.

• IT staff with inadequate skills.

• Lack of agility/development problems.

• Problems with document content and knowledge management.

• Electronic archiving or storage problems.

• Privacy incidents.

• IT infrastructure is inadequate to meet the current and future needs of business in a cost-effective and timely manner.

The Global business faces probably the majority of all possible IT risks. Establishing the adequate IT governance can help to mitigate or eliminate most of risks.

Resource:

Applegate, L.M., Austin, R.D., Soule, D.L. (2009). Corporate information strategy and management: McGraw-Hill.

IT Impact on Organizations

Many organizations are struggling to understand the reality of an economic transition from the industrial economy to a global network economy. In this new reality organizations must become much more agile, innovative, and entrepreneurial and not loosing the efficiency, power, and reach. Choosing the right business model become very challenging. How to build the capabilities that would align the organization with the environment and the chosen strategy to quickly and effectively respond to opportunities and threads. Most executives confront problems that they do not wish to sacrifice efficiency for speed; neither can they abandon authority and control as they empower others. It can be characterized by wish: "we want to be global and local, big and small, and radically decentralized with centralized reporting and control."

Many researches suggests that IT was seen as a key enabler of controlling operations while also providing real-time information analytical tools. In 1950s and 1960s some of the hybrid organizational solution model, matrix,emerged. Companies that adopted these approach had the same drive as we have now days: need to be adoptive, information-intensive, team-based, collaborative, and empowered.  But companies that adopted the hybrid design of the 1960s through 1980s soon learned that the new structures and systems bred conflict, confusion, information overload, and costly duplication of resources. Over past decades, strategic thinking has outdistances organizational capabilities. One of the "lessons learned" why matrix organizations didn't succeed in the past was understating about organization's inability to provide and manage timely information. All pressure of handling complexity was put on managers directly. They would have dazzling array of conflicting information. 
Only the now days IT can provide the capabilities of meeting the information challenge and making the matrix organizational structure successful.
Some other important "lessons learned" from the past:

• Speed counts, but not at the expense of control.The faster the pace, the greater the need to monitor business operations and clearly define and enforce the rules of the road.
• Empowerment is not anarchy. The isolated efforts to empower employees can lead to disaster when not accompanied by more comprehensive redefinition of authority and control through organization.
• Transforming an organization requires more than just changing the structure.

For the success there should be a comprehensive approach to organization design that includes analysis and realignment of capabilities within four key areas of business model design: processes and infrastructure, people and partners, organization and culture, and leadership and governance. Improved access to information and high-capacity networked communication systems are core elements of redesign in all four areas.

Resource: Applegate, L. Corporate Information Strategy and Management. 2009.

Lean Six Sigma: a foundation for innovation

Lean approaches focus on reducing cost through process optimization. Six Sigma is about meeting customer requirements and stakeholder expectations, and improving quality by measuring and eliminating defects.

However, Lean Six Sigma’s goal is growth, not just cost-cutting. Its aim is effectiveness, not just efficiency. In this way, a Lean Six Sigma approach drives organizations not just to do things better but to do better things.
Here are several questions:

• Do you have a clear vision of where you want your company to be in two years? In
five years? In ten years?
• How closely tied is this vision to the needs of your current and target customers? And is your understanding of these needs based on actual assessments or assumed information?
• Will this vision require innovations in your business model? In your products or services? In your markets?
• What will you need to do at the operational level to enable and drive these innovations?
• To support innovation, what changes will be required to your management approach, organizational structures, metrics and skills?
• How are you making innovation happen more systematically? Are you establishing
the right environment?

Resources: http://www-935.ibm.com/services/at/bcs/pdf/br-stragchan-driving-inno.pdf

Project Management: Implementation and Best Practices at Sitecore.net - Dreamcore Europe 2011, London

I made a presentation at Sitecore developer's and customer's conference "Dreamcore Europe 2011" in June 2011, in London, about project management experience on sitecore.net. Link to the presentation video

Changes in Human Resource Management

I am reading about a history of business processes' development. Some business processes are hundred years old and some have emerged as a result of new technologies and IT in particularly. Below is a process view and the resulting organizational structure.

Organizational Focus Employees are the problem  Employee  Doing my job Understanding my job Measuring individuals Change the person Can always find the better employees Motivate people Don't trust anyone Who made the error? Correct errors Bottom-line driven

Process Focus The process is the problem   People  Help to do things done Knowing how my job fits into the process Measuring the process Change the process Can always improve the process Remove barriers We are all in this together Why did the error occur? Reduce variations and special cases Customer driven

I think it is fascinating and quite different from  traditional approaches for human resources treatment.

Free SEO Toolkit

Pretty cool SEO tollkit can be downloded from Misrosoft site: http://www.microsoft.com/web/seo

LEVERAGE IT TO CREATE BUSINESS ADVANTAGE

Part IV
Analyzing Value

Company business value evaluation can be done by looking at its financial statements. Financial ratios that involves comparison with other companies and historical performance are used to provide answers to questions regarding the economics of the business model. These ratios can help to understand the impact of the strategic decisions. Example of the financial metric is using the DuPont Formula to determine return on equity (ROE):

ROE = (Profit margin)*(Asset turnover)*(Equity multiplier) = (Net profit/Sales)*(Sales/Assets)*(Assets/Equity)= (Net Profit/Equity)


ROE is important to understand business model performance.

If company is growing rapidly the financial return is not enough to understand its value. Drivers for value creation needs to be understood. The ability to offer value-added services to customers can be a key driver to revenue growth.

In business model value audit there are 3 ares which are listed below.

Identify internal and external stakeholders:  assess the internal and external stakeholders interests and expectations. Question to answer:

• What do stakeholders require and what they are willing or able to provide?
• Can company attract, retain, and motivate key customers?
• Are these customers willing and able to pay?
• How do the interests of other stakeholder groups (e.g. employees, partners,
• government, society)
• What are the objective and subjective benefits that every key stakeholder receives while doing business with the company?

Identify business model drivers and alignments: assess the insights gained. Questions to answer:

• What are the key opportunities and threads identified during the strategy audit?
• What are the key strength and weaknesses during capability audit?

The SWOT analysis can help to identify key revenue, cost, and asset efficiency drivers.  If you develop a business model dashboard, you can show the linkage and alignments between different components. You can identify how IT can help to enable every key driver of economic value.

Develop the financial model and determine financial needs: - after the business model drivers and value delivered to key stakeholders is identified, you can develop the financial model for the company.

In summary, the power of business model audit comes from linkage between strategy, capability and value drivers of business performance. According to S. Shapiro, when strategy, capabilities and value are aligned with each other and external environment, a business model can create a "virtuous cycle" of innovation, productivity and increasing returns. The contemporary dynamics of business models makes it even more important to understand these linkage to be able to adjust to the environment.

Resources:
L. Applegate, R. Austin, D. Soule. Corporate Information Strategy and Management, 2009

LEVERAGE IT TO CREATE BUSINESS ADVANTAGE

Part III
Analyzing Capabilities

After strategic goals are defined, the next step is to get resources to build capabilities needed to achieve these goals. Capabilities let company fulfill the current strategy and to grow.

 A business model capability audit frames analysis in the four areas:

Analyze processes and infrastructure: includes evaluation of core operating processes to produce products, deliver services, acquire and serve customers, manage relationship with key stakeholders and deliver innovations. It also includes analysis of processes where company involved with suppliers, customers, and partners. Then a question "do end-to-end support processes  (payroll, finance, HR, etc.) enable the efficient and effective strategy execution?' should be answered. "Do participants at all levels have needed information and infrastructure required to support them? Are operations defined as the best in class for speed, quality, cost, and production? Is IT structured to form the foundation for execution? IT should not only enable firms to coordinate activities and share information within the organization and across extended network of suppliers, customers and partners, but also let have an up to day current information for executive to take action which will create value,

Evaluate people and partners:  with all core processes defined company needs to identify if there is needed expertise withing company resources and how easy it it to attract, develop, motivate, and retain the expertise to carry the core processes execution. Some questions to answer:

• Does company have the image to attracts talents?
• Are culture and incentives in place to enable leadership to engage and inspire?
• Are performance targets, measurements systems, rewards, and punishments in place to provide fairness and transparency?

Examples of salesforce quality and productivity  measurements are sales per employee, customer retention per employee, and customer profitability per employee. IT is a tool for increasing business intelligence.

Assess organization and culture: identify if organization design makes it easy or harder fro people to make decisions and get work done. Questions to answer:

• Do people have grouped into right units?
• Do they have accountability authorities to make their  decisions about the work they are doing to meet performance targets?
• Are roles and responsibilities are clear?
• Are mechanisms like formal reporting relationship, steering committees and liaison positions, information and communication systems in place to coordinate work across units?
• Does the informal culture support individuals and groups?
• Do shared visions and values enable employees and partners to work effectively together?
• Does everyone understand boundaries for decision making and actions beyond which they should not cross?

The ability to use IT to supports sharing information related to above challenges and monitor decisions and actions makes company agile and flexible to changes.

Evaluate leadership and governance: assess  the level  of company's leadership strength. Effective leaders use governance structure and system that includes:

• strategic control - observing the environment, determining strategic positions,  setting goals,  prioritizing projects and investments
• operating control - setting clear short-term objectives, and controlling business operations and projects
• effective risk management - identification and management of key risks
• effective development and management of the shared culture and values that helps in decision making

Questions to answer:

• Have leaders communicated compelling and clear vision for the future that unites people and partners around common goals?
• Do leaders at all levels balance creativity and innovation with disciplined execution?
• Can they set goals and deliver results?
• Are leaders well connected and have they demonstrated a track record of success?
• Are there a high-performing board of directors and an executive team that closely monitor strategic and operating performance/
• Do the board and executive team have a systems in place to identify and manage risks while also ensuring that the organization's culture and values guide decisions and behavior levels?

Resources:
L. Applegate, R. Austin, D. Soule. Corporate Information Strategy and Management, 2009

LEVERAGE IT TO CREATE BUSINESS ADVANTAGE

Part II
Analyzing Strategy

Analysis include 4 areas:

Assess business context: helps define company's boundary positioning by analyzing the industry’s trend's and disruptors, by defining what opportunities can be pursued and their associated risks, and sorting out the opportunities that will not be pursued. It provides the high level of industry understanding. It helps framing choices concerning company's boundary’s positioning. It also include analysis and identification of IT trends, disruptors, opportunities and risks.

Analyze customers: includes analysis of current and future customers by identifying pressing customer's problems and determination how existing and future products and services can resolve these problems. It is done by talking and observing customers, involve them in designing the products. The goal is to help framing the choices regarding a company's market positioning. IT solutions for collection the a real time data and interact with future and current customers is an important foundation for market positioning decisions.

Analyze competitors and substitutes: helps understand what alternatives customers have, which firms offers different solution, how different this solutions are, how much customers are willing to pay. The goal is to help framing the choices regarding a company's product positioning. IT can serve as a source of differentiation and proprietary advantage.

Assess the business network: analyzes the network of suppliers, distributors and other partners who will be included to implement the strategy. It helps frame more choices regarding the role a company plays and its positioning within business network.

Resources:
L. Applegate, R. Austin, D. Soule. Corporate Information Strategy and Management, 2009

LEVERAGE IT TO CREATE BUSINESS ADVANTAGE

PART 1
A good business model is essential to every successful business.

During the previous century the well-established business model was used by most executives to drive their companies. Dot-com era destroyed this model. In today's global network economy new business models are emerging. Radical changes how companies create value within industry requires a new management tools to define strategy and its execution - framework of a business model. IT has great impacts on the three components of a business model - strategy, capabilities, and value. It plays bigger roles in transforming business models.

Business Model definition:

A business model defines how an organization interacts with its environment to define a unique strategy, attract the resources and build the capabilities required to execute the strategy, and create value for all stakeholders.

There are fundamental principles how to run a sustainable business. Using these fundamentals is very important during the turbulent time. An enterprise's business model frames these fundamentals. It can be used for strategic analysis and decision making. It also used to assess the IT impact on the business.

Strategy:

According to Michael Porter, strategy is a set of choices that determine the opportunities you pursue and the market potential of these choices.

These choices define strategic positioning along four key dimensions:
• Market positioning - customers to serve and channels to reach the customers
• Product positioning - products and services to offer and the price to be charged
• Business network positioning - role within extended network of suppliers, producers, distributors, and partners
• Boundary positioning - markets, products, and businesses that will NOT be pursued.

A successful positioning attracts many copy cats. Sustainable advantage happens when barrier for entrance is high and it is difficult for competitors to imitate.

Business model audit can by done by analyzing strategy, capabilities, and value created for all stakeholders.

Resources:

L. Applegate, R. Austin, D. Soule. Corporate Information Strategy and Management, 2009

New aspect of looking at innovation - say no to 1000 different things and concentrate on the essence.

Steve Jobs: Get rid of the crappy stuff, Article by Carmine Gallo, Forbes

Main thoughts that I liked in this article are:
- Get rid of the crappy stuff and focus on the good stuff.
- While anyone can learn the principles that drive Apple’s innovation, few businesses have the courage to do so.
- A designer knows he has achieved perfection not when there is nothing more to add, but when there is nothing left to take away.
- Your customers demand simplicity and simplicity requires that you eliminate anything that clutters the user experience — whether it be in product design, website navigation, marketing and advertising materials and presentation slides.
- Innovation is saying ‘no’ to 1,000 things.

Microsoft Project 2010 and Team Foundation Server 2010

Resource: TecEd

Tech Ed provides the most comprehensive technical education across Microsoft's current and soon-to-release suite of products, solutions and services.

Cool Image Zoomig Resizing Service

While browsing I have bumped to this site that provides a chip and interesing cloud service to host your high resolution images with Acamai. You can embed the code to your website to see, resize or zoom your images. I have signed up for the free account. The plans start from  $9 per month for 100 images for zoom.

Zoom:


Resize:
1. Size 1024x768


2 . Size 500x375



3. Size 100x75

Spectacular Chihuly show at the Boston Fine Art Museum

During my visit to Boston prior to Dreamcore 2011 conference we spent a fantastic weekend in Boston and New Hampshire. The wide gamma of colors and unstoppable imagination of Chihuly show was a great beginning.  I sent this picture from my phone to the blog. Now after I have setup my iPhone I will be able to blog from my phone and post directly. Diving in sitecore products and projects took most of my time for the last 10 month. Looking at blogger and switching to other Google items amazed me with the "mushrooming" of different new staff on Google "more" staff.

Now I am really interested in exploring the latest Google projects and utilization of possible gadgets. For example: Google Code Playground: http://code.google.com/apis/ajax/playground/ I also found an interesting book:

Project Professionals on the Job Hunt

According to Michelle Bowles (1), on the current job market a solid experience is not enough to earn a candidate an interview. To secure the competitive edge, project professionals need to blend their experience with formal education and certifications. Especially it is a proven practice if a project manager is moving beyond implementation roles into director roles. Experienced project mangers without formal education or educated project managers without experience can find themselves unable to advance.

Professional certification like, for example, Project Manager Professional(PMP)credential is an evidence that captures experience, skills and competence of the job candidate. Admission to the rigorous exam for this certification requires on-the-job experience and formal education. The exam itself as a process is a high barrier for the non-experienced candidates. It also validates a high level of knowledge.

The human component of the experience, especially interpersonal skills and emotional intelligence are of the utmost importance. There's no better chance for "negative learning" of the best management lessons than watching horrible managers and learning how not to do things. Being agile and react quickly to problems can be acquired only in the workplace along with the ability to quickly adopt to the critical situation, not overreact, and stay calm and collected.

Being formally educated in project management makes a project manager to go through the process of problem-solving by using collection and observation of facts, reflection and critical enquiry.

The whole package of careful balance of job experience, professional certification, and recent, relevant formal education provides the best chance for happy landing on the great job for a project manager seeking employment.








Resources:
1. Michelle Bowles, The battle of the resumes, PM Network, March 2011

Effective Virtual Teams

The trend of software development companies to outsource their development oversees and create global teams causes many additional challenges for virtual teams.

To work effectively virtual teams need to overcome different types of barriers: technical and non-technical. Key technology barriers include underdeveloped IT infrastructure and telecommunications services. A number of technical problems range from unreliable systems, traffic congestion on the network during certain time of the day. Virtual team would benefit from the adopting of a full range of real-time multimedia communications and collaborations: voice, data, text, shared whiteboards, etc.

For decades most of equipment and software was design for use in the conventional office. More and more office software providers started to provide collaborative features, but adoption of these versions requires a significant organizational changes and dedicated resources. Additionally, these tools are evolving too and add complication in their adoption. An example is a beta version of Microsoft Office Live Workspace now is becoming Windows Live SkyDrive. A productivity booster can come from the adoption of another Microsoft product - Team Foundation Server (commonly abbreviated to TFS). This product offering source control, data collection, reporting, and project tracking, and is intended for collaborative software development projects. But again, switching from previously used tools requires good planning of the organization change. To increase the virtual team's effectiveness the adequate technological support is a must to have.

Working in virtual teams poses problems not usually encountered when groups of people work in the same building. Compared with the technological barriers, organizational and cultural barriers are probably more serious impediments to effectiveness of the virtual teams. The successful management of the virtual teams requires trust. Developing trust, a shared team culture, and agreed procedures for effective communication - the essential "common ground". Other examples of barriers include constrains and advantages of the time zones, lack of non-verbal cues during communications, and problems of identity. Physical meetings of the team members can provide a better image of identity between people and sometimes help to understand and accept some other differences.

The emergent electronic space significantly increases the complexity of the business environment and the geographical flexibility of organization and individuals. Understanding the challenges and aligning the efforts to help the virtual teams to increase their effectiveness is an essential way of moving an organizational maturity to the higher level.

Resources: Chris Kimble Research paper: Effective Virtual Teams through Community of Practice.