Strategic Management of IS/IT Services and IT

Infrastructure

MSSI 2022S
Structure
Corporate & Aligning Organizing
business IS/IT with Managing the strategic
strategy and business the app. managmnt
IS/IT strategy portfolio of IS/IT
implications

Key ideas &

A strategic Business Determine the future of
perspective innovation the IS IS/IT strategy
of IS/IT with IS/IT strategy

Establish Search for Justifying & The strat.

IS/IT strategy competitive managing Managmnt
process opportunit. IS/IT of IT service
to shape investments &
strategy infrstructure
Establishing IS/IT Portfolio & Organizing,
strategic strategy: investment sourcing, and
management tools & management infrastructure 2
framework techniques management
REVIEW

IS/IT Strategy Formulation & Planning Process: The Model

Describes the overall framework for managing To define how technical resources and
both demand and supply across the enterprise. technologies will be acquired, managed, and
It will address the following: developed to deliver applications and services
• Scope and Rationale: it will need to lay out required by the business IS strategy. It will
the business background, scope and normally address the following supply factors:
rationale for the directives it is stating, and • Organization of IS/IT activities and decision making,
preferably describe a vision of the corporate including the management of its people, maintaining
IS/IT environment and its expected impact on and developing capabilities and critical resources;
• Managing the information resources and provision
the business community.
of information, application, and technology services,
• Formal Organization and Resource Structure:
including security;
organization, resourcing and the allocation of • Procurement, contracting, outsourcing, and supplier
responsibility and authority for IS/IT selection policies and practices;
decisions. • Preferred or approved project and application
• Investment and Prioritization Policies development and implementation methods and best
• Vendor Policies practices.
• HR Policies
• IS Accounting Policies

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Session Objectives
• To identify IT services
• To understand the strategies for managing IT services
• To understand the strategies for managing IT
infrastructure
• To understand issues on outsourcing of IT services

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Agenda
• Creating and Sustaining Business Change: Projects and Services
• The Need for the Strategic Management of IS/IT Services and IT Infrastructure
• IS/IT Service Categories
• Managing Operational and Value-enabling Services
• Strategies for Managing IT Infrastructure and Infrastructure Services
• Understanding and Managing IT Risks
• Sourcing of IS/IT Resources and Services
• Business Process Outsourcing
• Innovation and Outsourcing
• Back-sourcing and Switching Suppliers

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Creating and Sustaining Business Change: Projects and Services
Business/
IS/IT Strategy

Governance Principles & Priority Rules

Business
Case
Evaluate Decide

Administer Service Eliminate Evaluate Project Execute

Portfolio Portfolio

Deploy Deliver

Business As Usual Innovation/Change

Transparancy in real cost & business Transparancy in decision making & 6
value of IT products & services business value of IT investments
DevOps

• DevOps (a clipped compound of "software

DEVelopment" and "information technology
OPerationS") is a term used to refer to a set of
practices that emphasize the collaboration and
communication of both software developers
and information technology (IT) professionals
while automating the process of software
delivery and infrastructure changes.
• It aims at establishing a culture and environment
where building, testing, and releasing software
can happen rapidly, frequently, and more
reliably.

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The Need for the Strategic Management of IS/IT Services and IT
Infrastructure
• The drivers:
1.Most businesses now deliver some aspects of their product/service to customers via IS/IT  the quality
and performance of IS/IT services are visible, not only internally but externally, and directly affect the
business performance & customer relationships.
2.As more and more aspects of service delivery are being outsourced, contracts with suppliers are becoming
integral management of IS/IT.
• Managing users’ expectations:
– There is often no competition  quality of service provided
• If the service fails to meet users’ needs, users may look outside for future service provision (‘shadow IT’)
– There is a general expectation of availability and high levels of service quality whenever required
– Users can often be reluctant to pay for IS/IT services
– Users often don’t appreciate what is required in delivering the service
– Those who pay/benefit for/from the service, and those who participate in service delivery process may
have different expectations/requirements
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IS/IT Service Categories
• Application services Business strategy & operations

• Infrastructure services
• Operational services: assembling &
Value-enabling Services
operating the core IT environment
• Value-enabling services: services to
Application
enhance the value of information Operational Services Services
assets (strategy development,
business analysis, enterprise Infrastructure Services
architecture, …)
IS/IT services environment

Internal/external service providers

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Gaps in Service Delivery
1. Not understanding what users expect or value due
to:
– a lack of user needs analysis; ineffective communication by either
or both parties; excessive bureaucracy in the IS function.
2. Setting the wrong IT Service Standards due to:
– lack of commitment to IT services by IS management;
perceptions of infeasibility in meeting user demands; inadequate
task definition and standardization or inadequate esourcing to
standards set; absence of objectives for the service to achieve
and/or inappropriate performance measurements.
3. Underperformance of the service due to:
– role ambiguity, including the user’s role in service delivery; lack
of resource availability; lack of actual or perceived controls; lack
of teamwork and inappropriate resource use, or inappropriate
use of the service.
4. Poor communication of what the service is and can
deliver due to:
– a propensity to overpromise and/or overreact to ‘complaints’;
– inconsistent communication across the user communities; lack of
visibility of the service process.
5. Expectation versus perception gap due to:
– not understanding user requirements and reasons for them;
users not understanding the service process and the implications
of their demands; user expectations actually being impossible to
satisfy!

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Gaps in Service Delivery:
IT Cost/Service Trade-Off

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Managing Operational & Value-enabling
Services
Degree of customization of service
• Service factory: ‘back-office’ services
such as security, capacity and network
Service factory Service shop
maintenance, software release/upgrades
and installation of basic desktop facilities
• Service shop: software acquisition,
Degree
of user infrastructure design, technical product
involvement
Service mall Service evaluation and vendor assessment
boutique
• Service mall: help desks and essential
IS/IT skills training
• Service boutique: strategy development,
consultancy, business analysis and
systems, and process design
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The Dimensions of IS/IT Services
Overall Framework for Managing IS/IT Services

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IT Service Management (ITSM) Framework

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ITSM Frameworks & Others
• The ISO 9000 family of quality management systems (QMS) is a set of
standards that helps organizations ensure they meet customer and
other stakeholder needs within statutory and regulatory requirements related to
a product or service.
• ISO/IEC 27000 is an information security management systems standard.
• ISO/IEC 20000 is an international standard for managing and delivering IT
services. Its process model bears many similarities to that of ITIL version 2, ….
• ITIL (Information Technology Infrastructure Library) is a set of detailed practices
for IT activities such as IT service management (ITSM) and IT asset
management (ITAM) that focus on aligning IT services with the needs of
business.[7][2]
• FitSM[8] is a standard for lightweight service management.
• COBIT (Control Objectives for Information and Related Technologies) is an IT
Governance framework that specifies control objectives, metrics and maturity
models. Recent versions have aligned the naming of select control objectives to
established ITSM process names.
• CMMI (Capability Maturity Model Integration) is a process and behavioral model
that helps organizations streamline process improvement and encourage
productive, efficient behaviors that decrease risks in software, product,
and service development.
• ISO 15504 is a set of technical standards documents for the computer software
development process and related business management functions.
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Process Chain and Framework/Best Practices

ITIL

It is very useful to know how TOGAF relates to other frameworks like COBIT, ITIL and
PMBOK to define IS/IT Management Strategies

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IT INFRASTRUCTURE MANAGEMENT

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Strategies for Managing the IT Infrastructure &
Infrastructure Services: The SCOPE
• Physical infrastructure
– consists of a range of network, hardware and base software products and services,
deployed to enable applications
• Architectures
– describe the physical infrastructure
• Policies and standards
– cover technology aspects to determine how the infrastructure, its acquisition,
deployment and support are managed
• Management processes
– to ensure investments in infrastructure are coherently planned and justified, and
relationships with technology suppliers and outsourcing providers are appropriate
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Strategies for Managing the IT Infrastructure:
Business Basis for Technology Management
• Main purpose:
– The purpose behind the overall management of the technology infrastructure is to provide an appropriate set of
technology, resources, processes and services to meet the evolving needs of the business and the organizational
ability to apply them effectively
• Some of the issues to be faced:
– Linking technology investments to business needs – how to describe requirements for technology
investment in terms of business implications
– Identifying technical opportunities – how IT capabilities can improve or radically change the
products/services
– IT investments by others – how competitors/customers/suppliers use technology to improve their
competitive positions
– Technical implications and ‘hype’ – separate real business opportunity from irresistible offerings from the
vendors/consultants
– Business and technical awareness – CIO needs to instill business judgement in his/here technology
experts and also create a sound understanding of technology issues in general management
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 TOGAF Foundation Architecture:
Technical Reference Model (TRM)
“an architecture of generic services and
functions that provides a foundation on
which more specific architectures and
architectural components can be built”

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Sourcing of IS/IT Resources & Services:
Classifying Sourcing Options & Strategies
• Contract out – the supplier is responsible for delivering
the results of IT activity
• Buy-in – the organization buys in resources from the
external market, usually to meet temporary requirement
• Preferred contractor – the organization contracts long-
term with a vendor to reduce risk
• Preferred supplier – this takes buy-in approach further,
with an organization seeking to develop long-term close
relationship with a vendor
• Multi-sourcing option (prime contractor, best of breed,
panel) is increasingly popular strategy to minimize risks,
maximize benefits, and reduce costs.
• Vital competences that need to be maintained:
– track, assess, and interpret changing IS/IT capabilities and
relate them to org. needs;
– work with business management to define the IS/IT
requirements over time;
– identify appropriate ways to use the market, specify, and
manage IS/IT sourcing;
– monitor and manage contractual relations. 26
Outsourcing Strategies: Guidelines for Decision
• Organizations should choose to outsource carefully selected, non-core activities
that can be accomplished quicker, cheaper and better by vendors.
– Earl argues that companies should first ask why they should not insource IT services.
Indeed, actual outsourcing or, … is often the symptom of the problem of demonstrating the
value of IS
• Strategic Intents driving outsourcing:
– IS Improvement; Business Impact; Commercial Exploitation
• Sourcing strategy should be based on a combined assessment of financial &
economic, business, and technical factors, the relative importance of each being
determined by the strategic intent.
– Financial & Economic Reasons
• Cost savings; Shifting expenditure from capex to opex, providing budget flexibility
– Business Reasons
• Competitive Positioning (commodity/differentiator) & Business Operations (useful/critical)
– Technical Reasons
• Level of Maturity & Level of Integration

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 NEW

International and National Standards

• IT Governance: Seri SNI ISO/IEC 38500

• IT Services Management: Seri SNI ISO/IEC 20000
• Information Security: Seri SNI ISO/IEC 27000
• Data Center: SNI 8799
• Software Testing: SNI ISO/IEC/IEEE 29119

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End of Presentation
TUGAS: BAHAN DISKUSI MINGGU DEPAN

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