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New Demands on Information Management Processes

New Demands on Information Management Processes

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Published by Scott
Awash with data, organizations are facing new demands on their information management processes. Security, corporate governance compliance, and real-time asset management, are among the set of information driven activities that today’s executive must address. Rather than be intimidated with these new demands, leading companies can deploy information management systems that can further competitive advantage.

Today’s information systems are mature, add shareholder value, and are the backbone of high performing organization. Overcoming the Information Paradox will further separate those firms that “get it” from those that do not. To be certain, there are many new demands on firms and the information systems that enable organizations, but none that cannot be overcome.
Awash with data, organizations are facing new demands on their information management processes. Security, corporate governance compliance, and real-time asset management, are among the set of information driven activities that today’s executive must address. Rather than be intimidated with these new demands, leading companies can deploy information management systems that can further competitive advantage.

Today’s information systems are mature, add shareholder value, and are the backbone of high performing organization. Overcoming the Information Paradox will further separate those firms that “get it” from those that do not. To be certain, there are many new demands on firms and the information systems that enable organizations, but none that cannot be overcome.

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Published by: Scott on Jun 13, 2010
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06/17/2010

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New Demands on Information ManagementProcesses
Scott M. Shemwell, D.B.AMarch 2003
CIOs told Gartner they now rank "providing guidance for the board and executives" astheir leading management priority, up from sixth on the 2002 list. Their top technology  priorities are securing systems from internal and external threats, followed by better integrating applications to provide greater data availability throughout the enterprise.
Bernadette HearneEditor, e-business Chemicals NewsletterMarch 26, 2003
1
 
Abstract
Awash with data, organizations are facing new demands on their informationmanagement processes. Security, corporate governance compliance, and
real-time
 asset management, are among the set of information driven activities that todaysexecutive must address. Rather than be intimidated with these new demands, leadingcompanies can deploy information management systems that can further competitiveadvantage.Todays information systems are mature, add shareholder value, and are the backbone ofhigh performing organization. Overcoming the Information Paradox will further separatethose firms that get it from those that do not. To be certain, there are many newdemands on firms and the information systems that enable organizations, but none thatcannot be overcome.
Introduction
Corporate officers and their auditors are under increased scrutiny to insure that publiclytraded firms report a true picture of the financial performance of the organization.Moreover, the very ethics policies and enforcement processes of the firm must also bedivulged. The Sarbanes-Oxley Act of 2002
2
, places new and specific demands onDirectors, certain corporate officers, and financial service professionals that is potentiallyonerous. Specific record keeping policies must be adhered to and failure to comply canlead to prison sentences up to 20 years on criminal charges of
obstruction of justice
.
3
 Timely information regarding the status of dispersed assets has always been aprerequisite for optimizing revenue and cash flow, but never more than today. Thedouble edge information sword that has been unsheathed is the demand to have a betterunderstanding of the exposure the global energy firm has to potential terrorism. Theinfrastructure that fuels the worlds hunger for petroleum is very exposed to the mischiefof malcontents or downright destruction by those so inclined.
4
Critical, real-timeinformation about the status of revenue producing assets, especially unmanned facilities
 
New Demands on Information Management ProcessesMarch 2003 - 2 of 6 - S. Shemwellwill enable rapid response regardless of whether an outage is the result of a naturaldisaster such as a hurricane or otherwise.Finally, the petroleum industry faces increased pressure from stakeholders to increaseasset performance. Not only investors, but local communities, government agencies, andenvironmental groups expect specific organizational behavior and appropriatedocumentation of conduct.Recessions are cathartic events. While the mettle of the strong is tested, the weak oftendemise. As part of this renewal process, mergers and acquisitions change thecompetitive landscape. Smart acquisitions may lead to enhanced shareholder value,however, most mergers are dilutive
5
.Good and timely information clearly enables the modern organization. However, there isan
Information Paradox 
. Management is expecting Information Technology (IT)organizations to reduce costs, while at the same time expecting greater informationsecurity. Conversely, for many of the reasons articulated in this paper, managementmust have more information quicker.
The Information Paradox
As the demand for information increases as articulated in this article
6
, IT budgets are heldin abeyance.
7
Organizations expect more from work processes, individual contributors,technology resources, and supply chain partners. With recessionary pressures andglobal uncertainty, companies must do more with less.Can management expect IT to provide more timely, even
real-time
information toexecutive dashboards, substantially reduce the budget, and insure corporate informationsystems are secure? Seemingly a paradox, the answer is yes!Critical information systems are robust and secure when architected properly andappropriate data management, applications software, and communications protocols areused. Modern software is built for the Internet economy and enables firms to generateInternet Economies ahead of their competitors. Attributed to John Malone, CEO of TCI,well end up with a much lower marginal cost structure and that will allow us to underprice our competitors.
8
 
Economic Transaction Costs
Economically, organizations exist because their internal transaction costs are lessexpensive than if they acquired goods and services externally. The networked economyallows organizations to extend their business model beyond the physical limits of theorganizational boundaries and capitalize on a global supply chain. Network economiesreduce transaction costs and value is realized when the marginal cost of new informationexceeds the costs of acquiring and processing that information.
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 In other words if the economic value of secure, accurate, and timely information is greaterthan the costs of that information, then it adds value to organizational processes. Thus,the Information Paradox can be solved using todays technology intelligently employed tocapitalize on intuitional processes. Cutting this Gordian knot using technology andchange management instead of continuous improvement from the status quo canleapfrog a firm wielding the knife into a higher competitive orbit.
10
 
 
New Demands on Information Management ProcessesMarch 2003 - 3 of 6 - S. Shemwell
Governance and Information
Competitive issues aside, Sarbanes-Oxley demands a greater level of disclosure andprovides for significant personal penalties for non-performance. Regulatory reporting hastaken a new level and one can expect that in order to rebuild public trust, publicly tradedfirms will not only be required to, but will want to increase the level of information madeavailable.According to The Business Roundtable, it is the responsibility of management to operatethe corporation in an effective and ethical manner. The report goes on to state, it is theresponsibility of management, under the oversight of the board and its audit committee,to produce financial statements that fairly present the financial conditions and results ofoperations of the corporation, and to make the timely disclosures investors need to permitthem to assess the financial and business soundness and risks of the corporation.
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 Corporations, particularly asset intensive industries must have access to capital. Capitalmarkets value the management team and subjectively make assessments whether thatteam can deliver value.
12
Continued access to these markets requires that managementbe seen as able to perform, not just report compliance but truly demonstrate that the firmand its supply chain partners are operating effectively and ethically through enhancedvisibility.
13
 Governance is all about the transparency and timeliness of information flow. Firms mustprovide specific financial reporting that must be grounded in a certain understanding ofthe status of revenue producing assets, costs, and capital structure. Firms that enjoy alow cost access to capital are those that convince investors and debt holders that thecorporation is well managed.Moreover, as firms continue to rebalance their asset portfolio, lack of access to capitalcan result in one of several scenarios. First, growth may be constrained, as thecorporation has to dispose of certain assets to generate the liquidity necessary to acquireothers. Second, the firm may be acquired. In either case, information availability iscritical to achieving the maximum price.Strong information management processes deliver information that management needsto provide all stakeholders with good governance. It is the absence of information thatcauses market concern.
Assets and Information
Revenue producing assets increasingly demand operational excellence and strong costmanagement if financial performance targets are to be met. The petroleum industry istasked with effectively operating existing facilities and reservoirs. These challengesdemand that operators rely heavily on the service industry and supply chain partners.Field operations require information flow among participants as well as the processcontrol and data acquisition systems associated with the asset itself. This is another areaof transition as engineers continually reassess what the
Information Profile
looks like.The Information Profile is defined as that architecture, and set of data and informationrequired to realize the demand the firm places on the system to optimize assetperformance. Much like the firms asset portfolio, it provides the organization with a

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