TRƯỜNG ĐẠI HỌC NGÂN HÀNG TP.
HCM KHOA CÔNG NGHỆ THÔNG TIN
MÔN HỆ THỐNG THÔNG TIN QUẢN TRỊ
BÀI TẬP TÌNH HUỐNG
HỆ ĐẠI HỌC CHÍNH QUY
TP.HCM - 2010
BÀI T P TÌNH HU NG - MÔN H TH NG THÔNG TIN QU N TR - H Đ i h c chính quy
CASE STUDY 1.1
LETTERS TO THE DEAD AND OTHER TALES OF DATA DERELICTION
A retailer once launched a targeted customer marketing campaign that had but one tiny flaw: a fifth of the intended recipients were dead. The letters for them – addressed, with impeccable accuracy, to ‘Dear Mr Deceased’ – urged them to ‘wake up’ to what the company had to offer. This mailshot mishap is part of a nightmarish list of corporate data blunders drawn up for the Financial Times by Detica, a business and information technology consultancy. It includes the tale of the insurance company that was intrigued to discover the majority of its customers were astronauts – until further investigations showed that lazy sales staff eager to close deals had simply chosen the first option available on the pull-down menu of jobs. Whether grotesque or hilarious, the bloopers have a unifying theme that any business ought to note. As companies develop ever more sophisticated ways of using data to help win new business and cut costs, the risk is that they pay too little attention to the quality and organization of the underlying raw information. At best, this damages efficiency; at worst it can destroy relationships and hamper efforts in crucial areas such as fighting fraud. ‘Firms have always seen the data as the water that flows around the system’, says Philip Powell, professor of information management at the University of Bath’s School of Management. ‘They have invested a lot in the system – the water pipes – without really recognizing the value of the water’. It is a problem that has come increasingly into focus as technological advances have opened up new methods of collecting, combining and storing data. Managers have greater quantities of information than ever before, but are in some ways less well-informed because they do not order it well. Bill gates, Microsoft chairman, claimed last year that almost a third of information workers’ time was spent searching for data, costing $18,000 per person per year lost productivity. Those hundreds of forgone hours are in part a consequence of the explosive growth of the space available for information storage. While a bulging filing cabinet is a daily reminder of the need for data discipline, electronic file dumps can grow to gargantuan proportions unseen. They are monitored and cleansed only by computer experts, rather than by information management professionals applying a librarian’s discriminating eye. Information is sometimes duplicated or out of data. A common fault is that companies lack a single docket on each customer, supplier or employee, instead spreading information across files held in numerous places by many departments. In the absence of a master copy, updating is done piecemeal, generating horrors such as the ‘Dear Mr. Deceased’ letters.
Trang 1 / 40
BÀI T P TÌNH HU NG - MÔN H TH NG THÔNG TIN QU N TR - H Đ i h c chính quy
Bridget Treacy , partner at Hunton & Williams, the law firm, says companies are sometimes ignorant of basic facts about information they hold, who has access to it, and what it is being used for. ‘If people are not paying attention to it, of course there are going to be blunders’, she says. A more suitable snare facing companies is their failure to consider the various possible meanings of the information they gather. The classic example is the sales spike that causes marketing people to sniff an opportunity, when a risk manager would scent danger. For instance, a customer starting a credit card splurge might receive an offer for an upgraded deal, when a better response would be to launch an investigation into card theft and fraud. In other cases, companies embarrass themselves because their data storage systems have not kept pace with the complexity of the information they hold. One Detica story concerns an insurer that was unable to store separate addresses for a couple holding a joint account. When the wife left her violent husband, she sent her new address to the company, which promptly wrote a confirmation note to her old home, where her ex-husband was living. The company had to pay to rehouse the ex-wife in a new, undisclosed location. The need for companies to improve their data management is becoming increasingly urgent as the flow of information quickens and the uses to which it is put become more complex. Businesses must manage an increasing amount of ‘unstructured data’, such as voice recordings and pictures. Above all, the challenge for the companies is to make sure they – and their employees – use information in ways that make them look clever rather than ignorant, or event heartless. Death, says David Porter, Detica’s head of security and risk, is the great test of a company’s data deftness. After all, no one wants to emulate the company personnel department that punctiliously sent out a slew of cheques for £0.00 to its ‘pension leavers’, causing distress to the relatives of all those ‘ who had ‘ left’. (Michael Peel, FT.com site, published 3 September 2007)
Questions: 1. The case study identifies a number of problems with the way companies store and mange information. Using your own words, identify and describe these problems. 2. According to the case study, Bill gates has claimed that almost a third of information workers’ time is spent searching for data. Why do you think this is ? 3. What are some of the consequences of relying on inaccurate information ? Refer to the case study in your answer.
Trang 2 / 40
BÀI T P TÌNH HU NG - MÔN H TH NG THÔNG TIN QU N TR - H Đ i h c chính quy
CASE STUDY 1.2
SUPPLY CHAIN: DEMAND FOR MORE DATA HAS WIDE IMPACT
For US electronics retailer BestBuy, having the right data really matters. Research carried out by the company found that if a product’s height was wrong by as little as half an inch, customer returns increased by 3.4 per cent. For a company such as BestBuy, the trend towards flat-screen TVs – which customers often want to mount on a wall – has turned product descriptions that most shoppers once ignored into a dealbreaker. It is part of a wider trend for consumers to want to know much more about the products they are buying. From food to electronic goods, pharmaceuticals to cars, consumers are demanding far more information on a product’s origins, its ingredients or materials, how it was shipped and even its impact on the environment. But this information is absent from many companies’ supply chain management systems- or worse, it is information they simply do not have. The problem is all the more acute because regulators are asking companies to retain more information about the products they sell, in some cases for six years or more. But extended supply chains and a growing use of contract manufacturing are making it hard for companies to say, with certainly, what is in their wares. ‘Senior executives are trying to understand the risks to their business, for example ingredients that can cause an allergic reaction but are not correctly identified’, says Bryan Larkin, director of strategy for retail and CPG industries at data synchronization company GXS. ‘Bad data can result in brand damage’. Improving data quality, on the other hand, can bring immediate benefits to profits. Mr. Larkin, for example, cites research showing that suppliers to US retailers lost the equivalent of 2 per cent of gross sales to compliance-related penalties. Typically, data errors cause companies to ship the wrong product or quantity, or to charge the wrong price. Reducing penalties by half of 1 percentage point in a business with 10 per cent margins means a 5 per cent boost to the bottom line. Then there is the time taken up resolving both supply disputes and product recalls.’ Handling disputes takes up a lot of money,’ says Jon Chorley, vice-president for supply chain execution and product lifecycle management strategy at software vendor Oracle. ‘You also have to be able to track the genealogy of the products, which means getting that information out of the supply chain’. Businesses that want to improve data quality face two hurdles, however. The first is how an item is described and measured. A household chemical could be delivered to a factory in a tanker measured in gallons, bottled in containers measured in centiliters, packed in cartons by the dozen, transported in 50 cases on a pallet and then sold in a store as a single bottle. Each organization in the supply chain could hold the correct data for their part of the process, but still be unable to share it with the others. The second problem is ensuring that the right parties hold the right level of information. ‘There is a cost to every piece of information, so you have to understand the value of that information, its granular quality
Trang 3 / 40
published 19 September 2007)
Questions: 1.com site.’ You need sophistication to ensure that the information adds value to the decisions being made’. Manufacturers might not want to share an entire recipe or bill of materials with a retailer. as has largely been the case with electronic data interchange and more recently. ‘Retailers will only do something if they have to’. 2. 3. RFID. (Stephen Pritchard. futurist at system integrators EDS. but retailers are most likely to act if it improves product availability on shelves’. for example if there is a product recall or a health scare. suggests John Davison. ‘You could improve the operational efficiency of your company. The case study discusses a number of problems caused by poor quality information. Identify and describe these problems with reference to the attributes of information quality. a vice-president at analysts Gartner. says Jeff Wacker. Explain this statement with reference to the case study. Retailers are also under pressure from consumers to provide more data.H Đ i h c chính quy
and frequency’.MÔN H TH NG THÔNG TIN QU N TR . but the retailer will want to know that the manufacturer can call up that information on a batch-by – batch basic. either at the point of sale. FT. But there is a strong chance that the financial and technical burden for gathering and storing such data will fail mostly on producers and manufacturers. online or in catalogues. Why do you think customers are starting to want know more about the products they buy ?
Trang 4 / 40
. ‘Bad data can result in brand damage’.BÀI T P TÌNH HU NG .
says Micke Rydbeck.BÀI T P TÌNH HU NG . and quite possibly very rare. perhaps as few as two vehicles might be identical. But an efficient warranty system can cut these costs and more. a manual process. which created a new quality and warranty analysis tool (QWAT) a year ago. The standard European warranty on these vehicles is one year.MÔN H TH NG THÔNG TIN QU N TR . 200. says Rydbeck.000 trucks could produce a warranty claim or produce a problem that ends up in the analytics system’. if the warranty system can feed data into both the manufacturing process and suppliers. But the earlier the company identifies a problem. These are some of the benefits identified by Volvo Trucks. The warranty tool acts as a valuable early warning system. with some vehicles covered by a 300. Improved trend analysis is a valuable feature of the new system: previously. the heavy goods vehicle manufacturer. project manager for warranty systems at Volvo Truck Corporation.000 trucks – mostly tractor units for semi-trailers or rigs – each year. administering the process and. in North America. quality control staff had to use three main tools and three data sources in what was still. The product itself can even be improved. The system is based around SAS Institute’s Warranty Analytics software and an Oracle relational database. one of 350 sites. better reporting and improved recovery of warranty costs from suppliers. The manufacturer ties up fewer resources handling the repair. ‘With current production levels. The business case for Volvo’s project was based on achieving more efficient warranty claims.000 to 300. combination of components.000 km warranty.H Đ i h c chính quy
CASE STUDY 2. and goods are turned round more quickly. An in-warranty failure might be the result of a particular. Added to this. There is the cost of the repair or replacement itself. commodity items. The scale of warranty operations at Volvo’s trucks division is significant. The company currently builds about 100. often. Within the annual production total. in-warranty failures represent a significant expense. reduced fraud. in Europe the vehicle could be taken to any one of 1000 service points or. And a good reputation for handling inwarranty repairs will even justify a price premium in some marketplaces. such is the range of variants and configuration options available to customers. Customer satisfaction is higher if any warranty issues are handled efficiently and quickly. helping to pick up any potential faults before they occur in a truck. the cheaper it is to fix. but only when two parts are used in combination’. ’It might not show up as a battery problem on each and every truck. Advanced warning allows more vehicles to be examined and
Trang 5 / 40
. To add to the complexity. the vehicles Volvo produces are simple. largely. The new system is much more effective at narrowing down the list of vehicles fitted with a particular part to those that are most likely to have problems. and some good will campaigns. a loss of customer good will.1
VOLVO TRUCKS’ VALUABLE EARLY WARNING SYSTEM
For any manufacturing company.
Rather than send a team of auditors to look at a dealer’s books. The system also helps Volvo to give customers a wider range of configuration options without compromising on the manufacturer’s standards or increasing support costs. we can have better conversation with suppliers’. He believes that the new warranty management system.’ If we can reduce our warranty costs. Rydbeck explains. says Mr. five or 10 claims that we are really interested in. but were higher’. he says. Dealers are getting the message. ‘We are opening up the system and showing suppliers information relating to them. These are all important benefits for Volvo customers. says Mr. Previously we reported to suppliers twice a year. a process it started in June this year. Our warranty costs are now about the industry average. will allow Volvo Trucks to deliver above. and in particular its analytical capabilities. The project has had a significant impact on Volvo’s after-market costs : cutting them plays a key part in keeping the manufacturer competitive. 19 September 2007)
Questions: 1. ‘ We need to have a situation where we can produce trucks built to customers’ specifications that still nurture our core values of quality and safety’. What are the benefits of Volvo’s warranty management system ? 2.average service to vehicle owners while cutting its prices and increasing per. ‘But it becomes progressively harder to lower these costs and harder to find the problems that cause them. and we are at much less risk of fraud now’.BÀI T P TÌNH HU NG . ‘Because we can share our information.H Đ i h c chính quy
repaired during regular servicing. (Stephen Pritchard. keeps customers’ trucks on the road for longer. how does the warranty management system help Volvo to be more competitive ?
Trang 6 / 40
. The next step for Volvo is to extend the warranty analytics system to key suppliers.MÔN H TH NG THÔNG TIN QU N TR .vehicle margins. it gives us room to increase our margins while also being competitive on price’. This reduces Volvo’s costs but critically. Rydbeck.Rydbeck. rather than picking 20 at random. Mr. Financial Times. ‘During an audit we can focus on three. Another important part of the analytics-based approach to warranty management is that it helps Volvo’s design and manufacturing teams react to after-market problems with the trucks. The system is also being implemented at US truck maker Mack and at Volvo’s bus operations. it can focus on claims that arouse specific suspicions. ‘Our warranty costs have fallen by 40 to 50 per cent in the past couple of years’. In general. says Mr. Rydbeck. picking random samples. but now we can show quality information to them and they can improve products immediately’. and prioritise design or production changes. The analytics tool can go through historical claims data and identify claims that need to be checked. Volvo is also using its system to detect unusual or potentially fraudulent warranty claims.
MÔN H TH NG THÔNG TIN QU N TR . and is now comparable in popularity. A passenger survey at the end of last year by the International air Transport Association (lata) found only 2 per cent of respondents had checked in via an SMS (text message) on their mobile phones. reflecting the fact that the airline takes a proactive approach – it sends a text message and the customer needs only to reply. JAL’s vice-president for domestic marketing planning.2
AIRPORT CHECK-IN: BOARD YOUR FLIGHT BY MOBILE PHONE
Ubiquitous and well entrenched as mobile phones may be. The number of Touch and Go users has been steadily increasing since the system was introduced. ’To have your boarding pass on your mobile should be something that really excites the customer’.BÀI T P TÌNH HU NG . along with internet and kiosk check-in. All relevant data for the booking are recorded automatically on the IC card. says Ko Yoshida. in which 2D barcodes would be sent directly to mobile devices of customers checking in at Montreal for domestic flights. Such is the case with mobile check-in at airports. and introduced in February 2005. about 75 per cent of customers that receive a message go ahead with the SMS check-in. The system has become the third self-service channel. mobile check-in has inevitably established a foothold in countries where mobile users have been keen to try innovative or experimental services. On average. In the next few weeks. In Japan. But that number looks certain to rise as more airlines introduce mobile check-in – those that already have are as enthusiastic about the service as are their passengers. Finland and Japan are two good examples. with sage falling only when there is less business travelling. From three days before departure and up to one hour before the flight.H Đ i h c chính quy
CASE STUDY 2. Users tend to be individual business travellers. The customers participating in the pilot would scan their device at airport security and proceed to the gate. Customer feedback has been extremely positive. In October 2004 Finnair claimed a first in international air travel when it launched SMS check-in for frequent fliers. passengers can enter basic details about themselves and their flight into their mobile phones. says Finnair. Last June the airline launched mobile check-in for customers on domestic flights without baggage. Air Canada plans to start pilot testing an ‘E-Boarding passes’ service. which was developed in-house for use on domestic routes. Elsewhere. some potential uses have yet to catch on in a big way. mobile phones can be used as part of Japan Airlines’ ‘Touch and Go’ system. Air Canada’s director of customer service platform. Between one and 24 hours before departure. The system allows IC (integrated circuit) cardholders to board domestic flights without a physical ticket or boarding pass.
Trang 7 / 40
. and has already run into millions. says Patrice Quellette. it says. pushing the devices beyond simple calling and texting. then print out their boarding pass from a self-service kiosk at the airport. e-commerce. passengers can make or change a seat selection and check in via their computer or mobile phone. which can then be touched or swiped at machines in front of the airport security check points and then at the boarding gate.
FT. How does being one of the first companies to adopt technologies such as mobile check-in confer competitive advantage? Refer to the concepts covered in BIS and Strategic Advantage in your answer. It says roaming pricing. ‘At most of the airports in the world that is not the case. and the challenge will be to agree one global standard. in particular. removing the need for customers to install software.com site. and if the phone has an RF (radio frequency) chip it can used to pick up a boarding pass from a self-service kiosk at the airport. Secondly. is the airport authorities’ requirements for paper boarding passes at the airport service points.000 – 15. says the airline. credit card. Skip is used by 10. Air Canada. too. says Finnair. Last August. multimedia message service (MMS) provides a method to deliver a 2D barcode to a customer but mobile operators need to read – just their pricing policy. What are the advantages and disadvantages of mobile check-in ? 2. lata says this is a major activity for its barcoded boarding pass (BCBP) team this year – currently North America.MÔN H TH NG THÔNG TIN QU N TR . ANA Mileage Club or 2D barcode to a sensor at security prints a receipt with the customers on board and a boarding pass is then printed for final seat number verification. check-in via computer or mobile phone has been possible for two years for domestic flights. the airline introduced an enhancement known as Skip. mobile phone or at a travel agent – to skip check-in.H Đ i h c chính quy
At rival airline ANA. allowing passengers who have paid for their tickets and reserved their seats – using their computer. (Andrew Baxter. 3. the airport authorities and customs have accepted our text message confirmation as proof of travel’. published 14 May 2007)
Questions: 1.000 customers a day. ’In Finland.BÀI T P TÌNH HU NG . can be ‘a real killer’. meanwhile. One touch of their RF chip-enabled mobile phone. Talks with authorities about starting the pilot on a limited basis in June were successful. says the airline. Individual airlines have taken the initiative on these developments and are pushing for an industry standard that would help widen the usage of mobile check-in. Mobile devices must contain the required features by default. The biggest challenge. There are other obstacles. Finnair notes other provisos. What barriers are there to the widespread adoption of mobile check-in ?
Trang 8 / 40
. is working with Canadian authorities on its Montreal “E-Boarding passes” pilot. and then further implementation would be subject to the results of the test and continued working with authorities. the European Union and Japan each have a preferred 2D barcode to use on mobile phones for ticketing and other applications.
Technology has played a part in this change and if you look for examples. CRM is a business problem which technology cannot solve. Richard Boardman of Mareeba CRM Consulting emphasizes the dichotomy: ‘The brutal reality is that the majority of CRM projects produce. Epson. Ed Thompson.driven ones. feedback and how organisations deal with these issues. has more than doubled the number of customers switching their current accounts in its favour and achieved operational cost savings of 66 per cent. electronics aficionados and British bank customers can perhaps testify. worked with a data capture specialist. according to Aki Ratner. many of them involving little technology and little cost.125 per cent increase in online inquiries after installing Talisma customer relationship management systems in its European call centres. ‘Woody Diggs. Which isn’t to say’. ‘Another example is Southwest
Trang 9 / 40
. integrated view of their customers and maintain a mutually beneficial dialogue with them – has a patchy record of success.driven activities. chief executive of the enterprise software group Attunity. It is people.MÔN H TH NG THÔNG TIN QU N TR . that’s where it begins. a senior analyst with the Gartner consultancy argues that it is a matter of expectation setting. you will find plenty. but it does not address the fact that the knowledge that gives a company competitive edge is not held in structured databases or processes but within the people who actually run the business. As Spanish football fans. that define the real success of an organisation. at best. an intranet that can control remotely not only the turnstiles and lighting but also the loudspeakers and security cameras. Digital Vision. ‘that CRM technology doesn’t produce the results. there are also plenty of organizations enjoying very high returns’. the UK-based financial services group. which. marginal benefits to the purchaser. the Japanese electronics group. Here are three: The Santiago Bernabeu football stadium in Madrid has installed. where the introduction of a simple measuring stick meant an end to the disappointment felt by children who had queued for a particular ride only to find they were too small to be allowed on board. And customer relationship management (CMR) technology – systems designed to give companies a single.1
IT NEAR ITS LIMITS IN SATISFYING CUSTOMERS
The customer experience used to end at the cash register. it says. he adds. the failures are conveniently kept out of sight. He points to the example of Disneyworld. Alliance 7 Leicester.’ And there are thousands of ways to improve the customer experience. quotes this remark to illustrate how customer expectations have changed in recent years.BÀI T P TÌNH HU NG .H Đ i h c chính quy
CASE STUDY 6. Today. not process. He says: ‘It may change the way businesses run. to create a fully automated account switching system. a 38 per cent reduction in the cost of handling inquiries and a 1. claims a 30 per cent increase in efficiency. in collaboration with Cisco Systems. leader of the global customer relationship management practice for the consultancy Accenture. The catch is that it is always easy to find the ones that work.
Thompson concludes: ‘Employees often have the biggest impact on the customer experience. that define the real success of an organization. It put in place a smiles programme and found a positive correlation with its customer satisfaction scores.’ IT only goes so far in helping with that. It discovered that the best way was for its staff to smile. a no-frills. Financial Times. Customer satisfaction scores are driven most by delivering on the basics that customers expect – like stock on the shelves.driven ones.’
Trang 10 / 40
. Ask customers what they want and they will often say employees that have the power to “step outside the process”.MÔN H TH NG THÔNG TIN QU N TR . not process . 13 June 2007 (abridged version )
Question: Explain the quotation in the case study: ‘it is people-driven activities.H Đ i h c chính quy
airlines in the US.’ Mr. low-cost airline that was looking for ways to improve customer satisfaction.BÀI T P TÌNH HU NG . clear transparent pricing. Alan Cane. good build quality and innovative design.
H Đ i h c chính quy
CASE STUDY 6. lower prices.2
RETAIL APPLICATIONS OF TPS BY SAINSBURY’S
This case study of UK retailer Sainsbury’s considers the different ways in which a retailer may make use of TPS. Improved operational efficiency by automatic links to suppliers and better information on product demand and availability. Assessment of the effectiveness of product promotions through availability of better information. How is Sainsbury’s helped by TPS technology ? Improved customer service through more choice. How does Sainsbury’s use technologies ? At the till – EPOS and EFTPOS On shelves – auto-price-changing LCDs On trolleys – ‘ self-scanning systems’ At home – direct wine sales from the Internet Barclay Square site For banking – TPS are vital to providing customer statements and cash withdrawals In the marketing department – the effectiveness of marketing campaigns and loyalty card schemes can be assessed using information on transactions stored in data warehouses. Marketing through customer loyalty schemes. The company and its customer service objectives: 17.000 commodities aim is for no more than five commodities to be unavailable at any one time order lead time 24-48 hours distribution centres mange deliveries of 11 million cases to 335 stores.BÀI T P TÌNH HU NG .MÔN H TH NG THÔNG TIN QU N TR . better quality of produce and full shelves. This type of system is covered in more detail in Chapter 4
Trang 11 / 40
Can you think of any problems with using TPS so extensively? What can be done to counter these problems ?
Trang 12 / 40
.BÀI T P TÌNH HU NG . Draw a diagram summarizing the links between all the parties who access Sainsbury’s TPS.H Đ i h c chính quy
Questions: 1. 2. What benefits will Sainsbury’s gain compared to the time before the introduction of TPS ? 3.MÔN H TH NG THÔNG TIN QU N TR .
The focus should be to negotiate the best possible terms and then to concentrate on fulfilling their part of the deal. If you want to use a particular product. ‘The major disadvantage of a subscription licence is that you never own it.
Trang 13 / 40
.must pick their way through with care. ‘Using the “H-bomb” is not a palatable remedy. designed specifically for the police and criminal justice sectors.1
LICENSING: HOW BUYERS CAN FLEX THEIR MUSCLES
Software licensing remains a minefield that all users . you do not have to build in other remedies’.H Đ i h c chính quy
CASE STUDY 7. While IT suppliers like to trumpet the virtues of software asset management. ‘The worst mistake is to think that just because you have the right of termination. just renewal at regular intervals. ‘We buy perpetual licences’. Support needs to be measured and prompted by service level agreement in the same way as an outsourcing contract. Within subscription licences. You need to incentisive suppliers properly to get it right the first time. One caution from independent advisers is to beware the new trend for subscription licences.whether battle-weary or greenhorns .’ Case study: Banking on change Burden recently negotiated a software licence for an investment bank that was procuring an online trading application.BÀI T P TÌNH HU NG . As a result. The rate card price of the standard licence . says Russell Fowler. Subscription licences. partner with law firm DLA Piper Rudnick Gray Cary. Traditionally. by contrast. says Kit Burden. support is often packaged with a ‘right to use’ aspect.MÔN H TH NG THÔNG TIN QU N TR . you have to continue to subscribe – you cannot take a break from the agreement. which has just moved from a Microsoft Office of Government Commerce Enterprise Agreement to the Home Office Master Agreement. you are never able to step out of the agreement. suppliers can pretty much dictate the terms of the next licence. it can be user fast track to under licensing. ICT technical support manager. And all users need to be mindful of support clauses.£8. And once users are on the back foot. offer no ownership. licences were bought in perpetuity with a one-off payment. Seasoned negotiators encourage users first of all to get to grips with the terms and conditions of the software licence.3m – was just the basis for the negotiation. This advice is reiterated by the Surrey Police Force.
because of the way that software licences need to be procured. A warning signal for Burden was that the supplier was offering a five-year licence while his client envisaged using the software for eight to 12 years. ‘For the right application. you may have to pay a substantial sum to get the licence you want’. and it agreed to pay a further £2m for this extension. Case study: The capacity model The pattern of server deployment in Trafford NHS Trust is different to that in the private sector and it follows that the trust prefers a different model of software licensing. but the supplier is able to pull the rug out from under their feet because the licence is due to terminate at that point. IT resources are assigned throughout the NHS on a project basis. rather than by central provision. has been with the trust. If the bank ever wants to exercise this option. In the 15 years that Roger Fenton. Burden renegotiated the standard licence to gain two options. An ‘uplift’ in price. not looking at future scenarios is nothing short of criminally negligent’. This option requires access to source code rather than object code. would take care of this. He is responsible for renegotiating and introducing the most recent model for licensing back-up. he says.BÀI T P TÌNH HU NG . for example – and to create an exclusive licence for this part of the code. ‘You might have a situation where the user is happily bedded in with the software after five years. it will have to stump up an extra £6. ‘We have upwards of 40 servers running various applications that all need to be licensed and maintained’. Fenton says. it has gone through three licensing regimes for back-up software. whether to safeguard the application’s future or to ensure commercial confidentiality. ‘For users contemplating bespoke systems where millions of pounds will be spent on modifying a core product. The danger is that a supplier can lock the user in and then rack up the licensing costs. to be negotiable according to the size of the modification. deputy IT manager at Trafford.H Đ i h c chính quy
An important consideration was how long the user envisaged using the application.8m. ‘It is vital to get a licence long enough to get the full return on your investment’. says Burden although the business benefit and peace of mind may make it worthwhile.
Trang 14 / 40
. The other concern was to provide the bank with options to own the code or modifications. should it later prove commercially expedient to control these. The first option was for his client to identify functionality that it wanted developed from the core application – spot trading. rather than by central provision. because of the way budget.MÔN H TH NG THÔNG TIN QU N TR . he says.’ Burden advised the bank to pay extra t secure a ‘perpetual’ licence. The second option would be where the bank needed to take over development of the application as a strategic move.
who states he saved ‘thousands’ on the previous licensing bill of £40. ‘They were turnkey systems’. serverbased licensing incurred a financial penalty. This licensing overhead had accumulated over time. says Fenton. It is a big improvement on the previous regime. all expiring on different dates’. says Fenton. rather than individual servers. making licence costs proportionately greater. we had loads of different licences to maintain. and the licence can be scaled up incrementally. This was compounded by the fact that in the per server model. and for ‘agents’ that run on the application servers that are backed up. When the trust moved to Windows it initially repeated its approach with the Unix boxes. creeping up on the health trust. which. Computer Associates.MÔN H TH NG THÔNG TIN QU N TR . At the same time.’ There are some disadvantages to the new approach. It was a logical extension of what we did with the Unix boxes. Trafford had used Unix boxes. the overall cost of the model had become unpalatable. Every additional back-up agent that ran on the application servers had to be licensed. and applications were accompanied by a script for the back-up. CA charges both for the software running on the central back-up server. each time we bought a new server. had no previous experience of licensing back-up.
Trang 15 / 40
. ‘We used individual tapes for each SQL server. managing tapes and backup programs for each server became impractical. ‘In such an environment. ‘Potentially. says Fenton. ‘The price we secured was embarrassingly good’.H Đ i h c chính quy
He has just moved to a new licensing regime with his back-up supplier. The first is having to licence back-up in blocks of 1 Tbyte. says Fenton. The health authority now pays on the basis of total raw storage capacity rather than per server. as servers proliferated within its project-led culture. Keeping track of the annual maintenance charges for the separate agent licences was a major headache. better suits Trafford’s pattern of deployment. server costs were falling below the £2. Savings accrue chiefly because licensing on the basis of capacity.000 mark. both financially and in terms of simplifying and reducing administration. In addition. Each Unix server came with its own low-capacity tape drive. However. like other former Unix users. which have back-up built-in.000. as the number of servers and applications mushroomed. we were talking about another £750 or more in licence fees’. and the maintenance fee renewed each year. Before moving to Windows.BÀI T P TÌNH HU NG .
a version update may change the way that the number of users is calculated or the nature of server licensing. This can be invoked for an outsourcing contract. and an approval process for signing it out. Control of media A number of suppliers of shrink-wrapped software have clauses in the agreement that require users to show they control the media on which the software is distributed. For example. Suppliers may also reserve the right to charge an administration fee to transfer the licence to the third party. A further disadvantage is the way that storage capacity is calculated – according to the raw capacity of the backed-up drives. Enterprise licence If you are underlicensed and on the back foot. servers or even processors ? Seemingly low-cost software can easily be installed in a non-compliant way.H Đ i h c chính quy
‘As you tip over into a new increment you are faced with buying a large chunk of extra capacity that may be only partially used’. Seemingly innocuous ‘version updates’ Relatively minor updates of the ‘0.BÀI T P TÌNH HU NG . Above all. if software costs are processor-based. Is it based on the number of users. Obscure charging mechanisms Be very sure of the supplier’s charging model for a licence.MÔN H TH NG THÔNG TIN QU N TR .1’ variety can incur unadvertised changes to terms and conditions that have a significant impact on customers. even when the software and server remain onsite. while redundant array of independent disc (Raid) storage architectures are designed to ensure redundancy. Examples of control might include a single point of contract for receipt of a disc. Such a licence may appear to be all-inclusive and cover every
Trang 16 / 40
. says outsourcing broker Quantum Plus. ‘Nonetheless. licensing capacity is cheaper and a lot less hassle for us’. says Fenton. For example. Beware the chamber of horrors There are certain scenarios that users should avoid at all costs. always remember the golden rule: there is no such thing as a standard contract. its safe storage. rather than the capacity actually utilized. and the server is a quad processor. the result is under licensing and a big bill. the balance of power shifts to the supplier. A supplier could cite a lapse in control as breach of contract. says Fenton. Beware: the transfer fee could run into thousands of pounds. The outsourcing clause Supplier may try to insert into terms and conditions their right to renegotiate the licence should the management of a asset be moved to a third party. The large disc installed in servers may only be used nominally. who may insist you sign up to an enterprise licence.
MÔN H TH NG THÔNG TIN QU N TR . but the reality is that it will likely be accompanied by a hefty three-year or more service and support charge that adds no value.htm
Question: Summaries the main differences between ‘traditional’ software licenses and ‘subscription’ licenses including their respective advantages and disadvantages.BÀI T P TÌNH HU NG .computerweekly.com/Articles/2006/07/25/217102/licensing-how-buyers-can-flex-their-muscles.
Source: www.H Đ i h c chính quy
Trang 17 / 40
Each customer is allocated an account handler who acts as the main liaison point within LFFL.g. specialist store vs supermarket chain).MÔN H TH NG THÔNG TIN QU N TR . Besides receiving orders. Order processing
Trang 18 / 40
. LFFL purchases finished and semi-finished food products from other manufactures which it then finishes before resale. The company has enjoyed steady growth in recent years and is now seeking to capitalize on the current fashion for quality and healthy food products. The sales department LFFL has a diverse customer base. Orders are placed either directly through sales office ‘account handlers’ or through field sales persons (each customer has one sales person). The company has its administrative headquarters in Ashville and manufactures on an adjacent site. volume of business and type of customer (e. Manufacturing. In addition. ranging from small health food shops to major supermarket chains. LFFL’s turnover is £16 million with net profitability of 6. Orders can be one of two types: standard orders placed in advance for delivery in a specific week or priority orders placed for immediate delivery.BÀI T P TÌNH HU NG . the account handler is responsible for cash collection. It is hoping to increase turnover by 10 per cent per year after inflation over the next five years and increase net profitability to 9 per cent of turnover over the same period. Warehousing and distribution. All information recording and internal communication is paper based and relies on range of preprinted documents which are then used as appropriate. The sales director is apt to change his mind about which category a customer is in and which category means what. ensuring satisfactory progress of the order and handing day-to-day queries.3 per cent of turnover/ It is hoping to gain a competitive edge by providing quality food products which meet all present and anticipated quality standards and to this end will be applying for BS5750 accreditation within the next six months. Finance. Customers are also placed into sales categories based on geographic location.H Đ i h c chính quy
CASE STUDY 7. All customer deliveries are from the Ashville-based warehouse. LFFL’s main operations are divided into four main areas: Sales and marketing.2
LASCELLES FINE FOODS
Lascelles Fine Foods (LFFL) is a fictitious example of a long-established company operating in the food industry.
The warehouse in divided into three areas: The general zone.H Đ i h c chính quy
Once an order is taken. bought-in products and raw materials in the warehouse.MÔN H TH NG THÔNG TIN QU N TR . The customer is required to check the delivery against the invoice and note any errors on the consignment note and if any errors are noted a corrected invoice is sent to the customer. Receiving finished products from manufacturing and any unused raw materials. comprising low-level storage at 2 to 4oC. other activities are also performed: Internal warehouse movements from high-rise locations to ground-level areas and vice versa. Recipes are recorded on 7” by 5” cards and include details of the required ingredients as well as the processing which is to take place. When an order is delivered. which has to be searched manually for the appropriate entry when updating is required. it is accompanied by a consignment note and an invoice. LFFL uses a manual purchase ledge to manager these accounts. One copy is retained by the sales department and two copies are sent to warehousing and distribution. Information about quantities of finished goods and raw materials in stock is recorded in a card file. Warehousing and distribution sort all order forms into date order. In addition to their role in the order processing cycle. suppliers will invoice them. The cool zone. The frozen zone. Finance LFFL’s finance department is divided into three areas: Accounts payable – when LFFL makes purchases. products are picked from the warehouse and loaded into the appropriate vehicle. Financial accounting – management of all monies flowing in and out of the company together with compliance with legal accounting requirements. Receiving products and raw materials from suppliers and returned products from customers. Issuing raw materials to manufacturing in response to submitted requisition forms.
Trang 19 / 40
. it is recording on a preprinted order form. Manufacturing Manufacturing ranges in complexity from simple repackaging of bulk-purchased materials to complex mixing and cooking activities. comprising a high-rise bulk storage area with a floor-level picking area. Warehousing and distribution LFFL stores finished products.BÀI T P TÌNH HU NG . When an order is due to be delivered. with temperatures held to -18oC.
orders delivered too late. Finance The sales returns from the account handlers are often incomplete.MÔN H TH NG THÔNG TIN QU N TR . The sales department often accepts priority orders for products which are not in stock. Many customer complaints occur due to delivery of wrong products.BÀI T P TÌNH HU NG .
Trang 20 / 40
. Warehousing and distribution Many items have a limited shelf life – warehousing often fails to rotate the stock properly. The accounts receivable area is handled by the account handlers who use a manual sales ledger
and make a weekly return to the finance department on the state of their customer’s accounts. Orders often cannot be delivered on time because manufacturing produces too late and in insufficient quantity. Warehousing does not deliver the most important orders first – small orders are often given priority over larger orders from major retailers.H Đ i h c chính quy
Management accounting – internal accounting information necessary to manage the business more effectively. There are several bad debts which cannot be recovered – this is attributed to poor credit control procedures. Financial accounts are often published late due to lack of accurate information. Sales The status if an order cannot easily be determined without pestering the warehouse. incomplete orders and faulty products. Specific business issues There are a number of specific issues which relate to the activities of each department. thus necessitating correct procedures being bypassed (especially when the sales department is applying pressure). Actual stock levels are rarely in step with the recorded stock levels – this may be due to pilfering.
Manufacturing Warehousing is slow to respond to requests for raw materials. These are detailed below. poor update of stock records or both. Manufacturing bypasses the normal requisition procedures and simply takes raw materials as required – it also often fails to return unused materials to warehousing. Management accounting is very difficult due to a general lack of accurate information from other departments.
In addition. Which method(s) of business systems software acquisition would you recommend to LFFL ? Explain and justify your answer. Assuming that LFFL decides to go down the route of purchasing off-the-shelf packages. together with a desire to minimize the risk of damage or exposure within their own departments. However. while another will be to purchase off-the-shelf packages.MÔN H TH NG THÔNG TIN QU N TR . since there is very little IT expertise among the end-users.
Questions: 1. There is a perceived lack of management and technical support which has resulted in a general lowering of morale. 2. due mainly to inadequate provision of lifting equipment. One option will be to hire relevant IT staff and build bespoke applications.
General There is a rapid turnover of staff. Mr. these directors have varying degrees of enthusiasm for the project.H Đ i h c chính quy
Lack of accurate forecasting makes it difficult for production to be planned ahead and adequate suppliers of raw materials to be secured. he is hoping to improve on the communication of information at all levels in the organization. especially in the sales area where the pressure from customers can be intense. In order to proceed with the computerisation programme. Yet another option will be for end-users to develop their own applications. field sales personnel are apt to make promises which cannot be kept and new sales personnel are often thrown in at the deep end with little formal training for their jobs. This last option may prove awkward.BÀI T P TÌNH HU NG . There is a high level of sickness in the warehousing and distribution area. has indicated that he would like to replace the existing paperbased systems with ‘computers of some kind’. Mr Moor has asked the following senior managers to produce a plan: Paula Barlow – Finance director Terry Watson – Sales and marketing director Peter Jackson – Manufacturing operations director Frances Clarke – Warehousing and distribution director However. Moor knows little about computer hardware or applications software except that it seems to cost rather a lot. One of the key decisions which must be made will be how LFFL acquires the necessary applications software. Clive Moor. Future plans The managing director. what steps do you recommend it takes to ensure that the applications which are selected meet their requirements ?
Trang 21 / 40
. With such a move.
50 per £100 of cover (i. LBIS. where advisors take an enquirer’s details and ring LBID for a quote. and that fulfil the expectations of users. and a fast-track approach called RAD (Rapid Application Development). available at the bank branches. Reason for the urgency at the LBIS headquarters in Haywards Health.3
LLOYDS BANK INSURANCE SERVICES APPLIES RAD
When marketing people spot a business opportunity. That was the situation facing the computer team at Lloyds Bank Insurance Services when a new product called MUDI (Mortgage Unemployment Disability Insurance) required a telesales quotation system that had to be fully operational by October 2nd.e. ‘I faced the classic dilemma of no available resource within my team and an immovable deadline’. a subsidiary of Lloyds Bank and Abbey Life. This is essentially a telemarketing organization based in Bournemouth. a development environment toolset. is a firm of independent brokers dealing in life assurance. the race against time was won. West Sussex was a government decision to amend the rules relating to the payment of mortgage cover out of social security in the event of a house-owner being made redundant. IT Development Manager. Otherwise the opportunity could be lost forever. Systems have to be put in place that meet the stipulated deadline. pensions and general insurance. However. A simple version of MUDI was.MÔN H TH NG THÔNG TIN QU N TR .50).H Đ i h c chính quy
CASE STUDY 7. About 70 per cent of its business comes via branches of Lloyds Bank. In fact. A significant proportion of the company’s business is generated through a business unit called Lloyds Bank Insurance Direct. It was a moment he remembers well. LBIS. in fact. The new system would incorporate a
Trang 22 / 40
. The remaining 30 per cent is from people responding to direct mail of advertisement and telephoning in direct. But there were no facilities for accurate underwriting and anyone talking up the policy paid a straight £6. he recalls. This opened a new insurance window which the company was determined to exploit. if the monthly mortgage payment was £300. Annual turnover is £100 million and 800 people are employed at Haywards Health and six regional offices.BÀI T P TÌNH HU NG . in spite of that initial reaction and against some unexpected odds. that work first time. it is often IT people who have to think and act the faster. The insurance broker’s objective was achieved with help of a hard-working software house. Yet it was already mid-August when David Jacklin. was informed of the need for new application. the premium was £19. the entire development took just five weeks.
and this was precisely what the LBIS team sought. MDA’s first task was systems analysis.1 and GUI based. ‘The demo convinced us.40 to £9. The system would be in Windows 3. about mouse-driven systems.’ Following that demo and an agreement of project scope. and has already met the Croydon-based soft-ware house at the end of July. At the early stage. and recommended Enterprise Developer. essentially a classic PC LAN application. Such systems are repository-based and scaleable. testing that is integrated within the development cycle. We had looked at other development tools but they did not seem meaty enough for our needs. and spent three days at LBID in Bournemouth prototyping the forms on screen using Enterprise Developer. ‘We had no hesitation going back to MDA. providing the flexibility to quote premiums appropriate to the enquirer ranging from £4.BÀI T P TÌNH HU NG .
Trang 23 / 40
. Jacklin and his colleagues had agreed with MDA the RAD methods to be used. and user involvement throughout the whole process. work began on August 24th. They had been particularly attracted by a RAD specialist. It would run a Compaq server using Novell. Next step was a demonstration of the Symantec toolset at MDA. Suddenly. But first the new system had to be built. with the new business-critical requirement looming.40 per £100 of cover. MDA evaluates every tool that comes on to the client/server market and felt that Enterprise Developer offered the best set of second generation facilities. and – specially important according to Jacklin – are driven by business rules so that future changes are easily made as business needs change. LBIS had not formulated all their needs – not even the design of the ‘forms’ that would appear on the screen. The key requirement was for a front-end system that would enable telesales staff at 30 screens to capture a caller’s details and generate an immediate MUDI quotation. The software house also had to allay fears. Some of the main attractions of RAD included the delivery of a workable first version within a very short time-scale. Jacklin and his team had been looking at development toolsets and the RAD concept earlier in the summer. says Jacklin. However. So MDA used RAD techniques to work out what the requirements would be. This versatile toolset from Symantec had all the advanced features of a second generation client/server development system. so what would almost certainly be a Windows system could not merely be tagged on. flexibility of the specification. They obviously knew what they were talking about and we were in urgent need of a system’. And although MDA had never built anything with Enterprise Developer they were clearly keen to do so. the need for RAD became urgent.H Đ i h c chính quy
complex screen replacing the existing simple paper form. MDA Computing. The software house underlined the need for an appropriate development environment. Within days. There already existing another application at Bournemouth – BIQS (Building Insurance Quotations Service) – but this ran under DOS.MÔN H TH NG THÔNG TIN QU N TR . among a user-team with little experience of Windows.
(In fact. A business need had demanded IT support. and we have sold more than we would have done. They were always confident they could do something with Enterprise Developer and within time.’ He adds. Do you think that Lloyds can be confident that future RAD projects will be successful ?
Trang 24 / 40
. we always have a need to react to business changes quickly. comments.5 at the beginning of November. ‘We like RAD and we shall use it again. Why and how did the company choose the RAD approach used for this project ? 2. On ‘live’ day. A happy Jacklin concludes.) The system was delivered in the last week of September for final testing in readiness to go live the following Monday. In a market-oriented organization like LBIS. Jacklin.BÀI T P TÌNH HU NG . All this. with a simple keyboard Alt/Tab depression. MDA had to accommodate a new database in already tight development cycle. Now the end-users. MDA and Symantec had every right to feel pleased with themselves. letter print. There are five other. I think that says something for Enterprise Developer too. and I suspect that within 18 months we could need a system to handle all six of our insurance products.dsdm. such as sex. The quotation then appears on the same screen. and the system will pay for itself before Christmas!’
Source: www. It had to be in at the right time or we would have missed the boat. equipped with telephone headsets. By then. ‘The system had allowed LBIS to launch a more competitive product than would otherwise have been possible. rating and search for existing customer. The ability to adapt to the fresh circumstances and still deliver the system on time was a big tribute to the software house’s RAD methods and the Symantec toolset. the use of a Watcom database was assumed. ‘Here was a software house that gave us what we need. supporting screens labeled status. on to a GUI screen.H Đ i h c chính quy
In order to get the project started. And we went live on the big day. What disadvantages of the RAD method can you identify from the study ? 3. LBIS’s own technical team had adjusted the BIQS system so that the telesales people could flip to it from MUDI. enter personal details which affect ratings. From a technical point of view. there were minor compatibility problems which disappeared when LBIS upgraded to Enterprise Developer 2. depending on the caller’s needs. the telesales team processed 200 customer quotations with scarcely a hitch. However. post code and occupation. it forced us to go to Windows which was always our eventual intention. it was decided that f or strategic and operational support reasons the use of Oracle was preferred. following discussions within LBIS. There was no slippage despite it being their first real use of the Symantec product and despite the change in database midway through.org Questions: 1.MÔN H TH NG THÔNG TIN QU N TR . and that support was implemented on time.
he says. Agile methods encourage developers to do their own testing. Chapman concedes. agile development is based on iterative development – developing software in small. ‘For the hedge funds particularly.MÔN H TH NG THÔNG TIN QU N TR .’ Agile development had three levels: developer. project and enterprise. Chapman says. for example. For a one-year project. ‘But I think there are parts of agile you can use on every project to improve it. often code and to develop automated testing routines for the programs they deliver. then the actual program finally is written.
Trang 25 / 40
. But I think every project could gain some benefit from trying to break down the project into more manageable chunks that can be delivered in a more iterative and agile way. Chapman explains. where some of the system is delivered in two weeks. integration becomes very difficult and all the risky software development happens at the end of the development effort’.’ Agile software development is designed to delivery software more quickly yet maintain high quality. ‘Imagine a hedge fund where traditionally a new credit derivatives trading system would take a year to build using the waterfall approach. every two or four weeks. Chapman says. says Sungard’s Chapman.BÀI T P TÌNH HU NG . ‘People get stuck in this analysis paralysis – they spend months and months trying to define what they want. yet using a disciplined software delivery mechanism. which calls for strict. ‘Every investment bank and hedge fund I’ve spoken to is looking at agile’. ‘A lot of education needs to take place within the banks – it’s going to take some time. Historically.’ Agile methods even improve software quality. ‘The waterfall approach has a horrible track record of delivery. AGILE METHODS AT MELLON FINANCIAL
Mellon Financial’s shift to agile software development is part of an emerging trend.’ Another three to six months can be devoted to software design. lengthy analysis and documentation of requirements. A relatively new term.H Đ i h c chính quy
CASE STUDY 7. agile is an extraordinarily good fit because the portfolio managers want to get things done quickly. In agile methods. ‘The business people are expected to define 100 percent of their requirements up front before the project even starts’.’ But you every project lends itself to short iterations. the software development approach used throughout Wall Street has been the ‘waterfall’ method. and it’s OK if you change your mind’. ‘On Wall Street it’s not so easy because there are a lot of other systems you need to integrate with’. Agile methods encourage developers to do their own testing. because they emphasize testing. businesspeople get a small amount of code to review and the opportunity to change the requirements. ‘Inevitably what happens is requirements change. Chapman says. Chapman contends.4
USE OF WATERFALL V. three to six months might be spent on needs analysis. ‘Nobody on Wall Street is using agile at the enterprise level’. manageable chunks that can be modified as requirements change. with businesspeople writing six months’ worth of documentation versus using an agile approach.
Questions: 1. What does the observation that ‘requirements change.H Đ i h c chính quy
‘Agile development approaches and CMMI are compliant with each other – you can use CMM and CMMI to make agile software development better’.BÀI T P TÌNH HU NG . he asserts.jhtml?articleID=199601961&cid=RSSfeed_TechWeb accessed via www.
Source: www. integration becomes very difficult and all the risky software development happens at the end of the development effort’ suggest about the traditional waterfall approach to software development with respect to system design? 2. trying to use CMM and CMMI on top of waterfall development approaches will just weigh projects down with bureaucracy and paperwork.MÔN H TH NG THÔNG TIN QU N TR .com/advancedtrading/showArticle. Chapman adds. On the other hand.wallstreetandtech. Do you think there are any dangers in trying to take short cuts around the traditional approach to systems design ?
Trang 26 / 40
H Đ i h c chính quy
ACTIVITY 8.5 . The grand total shows that Supplier 3 is the clear winner.MÔN H TH NG THÔNG TIN QU N TR .
DETAILED WEIGHTED ANALYSIS OF AN ERP SOFTWARE DECISION
Table 8.5 shows an analysis for three products from different suppliers that were compared across many factors to establish which was most suitable. This type of detailed analysis is usually conducted when a new system costs tens or hundreds of thousands of pounds. Subtotal B.Detailed weighted analysis for ERP software Decision criteria A.BÀI T P TÌNH HU NG . General functionality Receive information Verify cut quantity Schedule operations Monitor schedule execution Verify shop data input Verify parts loss reporting Detect labor variances ? Provide real-time status Provide capacity planning ? Calculate incentive pay Provide needed flexibility Verify inventory data entry Provide operation history Provide security A. Technical considerations System reliability Compatibility with other systems Cross-module integration 100 100 100 56 56 45 56 56 70 56 56 65 70 70 80 80 80 70 60 60 70 70 80 60 60 90 1000 60 30 56 40 64 28 30 24 56 30 65 42 32 30 587 60 40 56 40 64 56 36 19 40 25 50 42 40 36 604 60 80 56 68 64 56 42 43 50 35 55 42 42 36 729 Weighting factor Supplier 1 score Supplier 2 score Supplier 3 score
Trang 27 / 40
comment on the suitability of this technique for making a decision.BÀI T P TÌNH HU NG . Comment on the basis for deciding on individual scores.MÔN H TH NG THÔNG TIN QU N TR . 3.H Đ i h c chính quy
Implementation time Ease of customisation B. Subtotal C. Subtotal Grand total
100 100 500
45 60 262
70 48 300
65 56 298
60 90 70 80 300 1800
36 45 25 35 141 990
48 50 25 45 168 1072
54 57 40 65 216 1243
Questions: 1. Other considerations Cost Service and support Vendor vision Confidence in supplier C. Would you use it and why? What would you do differently ?
Trang 28 / 40
. Do you think that the weighting factors are valid? Are there other factors that might apply for ERP software ? 2. Review the different categories and the criteria within them. Given possible deficiencies in 1 and 2 above. Look in detail at the values for each product.
BÀI T P TÌNH HU NG . reducing storage costs.’ The aim is to replace paper-based systems and integrate all systems with the EDRM software to centralise the storage and management of all documents. Craig Wilkins.5 million documents.H Đ i h c chính quy
CASE STUDY 8. he says. We have a variety of systems covering 14 different business areas and EDRM will underpin them all to attain availability of information accurately’. Trim Context from Tower Software. ‘We are scanning documents into the EDRM system and populating the back-office systems with metadata. ‘It was in a proprietary DMS but it has been migrated to our EDRM system and been made available to the public online’. says Wilkins. and to remove legacy DMS applications. We can scan documents into EDRM and recycle paper documents. The council is now in a position to remove its planning department’s legacy data management system (DMS). We also aim to specify retention policies for data to improve information lifecycle management. Making planning documents available online has also reduced the number of phone calls to the council.1
SEDGEMOOR DISTRICT COUNCIL
Quick availability or information increases efficiency and reduces costs
Sedgemoor District Council is improving the availability of information online to enhance customer service. perhaps through a barcode system. although there is a question over how much metadata a barcode can contain’. ‘Dropping the DMS means we can improve efficiency and save about £7. ‘New documents go into the repository as well as archived data being migrated. part of the Government Connect programme to provide a common infrastructure for secure electronic transactions between local
Trang 29 / 40
.000 annually on maintenance and server hardware. as it had complete migrating information to its electronic document and records management (EDRM) system.’ The council had started to fully integrate its Goss iCM content management system with its EDRM software to assist in making data available via its web site. As volumes of data multiply. increase the efficiency of accessing information and reduce data management costs. Recently the council received confirmation that it is likely to be one of the first local authorities to comply with the Code of Connection requirements for connecting onto GCSx. the council has also installed a storage area network to support EDRM. says Wilkins. We are having to key in metadata manually but the aim is to automate this process. information system manager at Sedgemoor District Council. ‘We now have a million records in the EDRM system out of 7.MÔN H TH NG THÔNG TIN QU N TR . says archived material for planning stretches from 1974 to 1995.
face to face and by telephone.
Trang 30 / 40
. Computing.MÔN H TH NG THÔNG TIN QU N TR . Given the intangible nature of some of the benefits from the new information systems.BÀI T P TÌNH HU NG . 11 Oct 2007. says Wilkins.co.computing. www.H Đ i h c chính quy
and central government.
1. The ultimate goal is for the EDRM system to make information readily available to support customer services through all access channels – the internet. Other benefits include making council reports. agendas and minutes available online – and using Goss software in conjunction with EDRM to ensure the correct document versions are published online in each service area. how
might the council have gone about making the investment decision ?
2. Analyse the initiation part of the project in terms of the internal and external factors driving the
systems acquisition process.
The first place to look is the application of the Return on Investment (ROI) tool as the arbiter for benefits delivery and the subsequent plans for implementing the systems. costs are grossly underestimated (often 40 per cent or more) by failing to consider precisely those factors that are needed to deliver the return. It may. An ROI is required by most organizations. aligning the people with the processes the business is changing to. stop some projects from getting off the ground and avoid some of the overspending we have seen in the past. ensuring that behaviours are commensurate with the required new ways of working. The underestimates are generally in: ensuring compliance with the business strategy. By including these costs some projects start to appear unprofitable. of course. Realising the benefits forecast is where the hard work arises. is that the ROI calculation is no more than a forecast. IT projects tend to focus on dealing with the technical issues. The key word is ‘expected’. there is often a drastic underestimate of the efforts required to ‘make it happen’. but the tool is often applied without fully understanding all of the cost components (full disclosure) By definition. Yet organizations still fail to recognize or accept why this occurs and generally do little to address the root cause in any meaningful way. of course. ROI is a technical measure talking expected returns and expected costs to determine the worth of the investment. It is these that get measured as the cost side of the change – usually the cost of hardware and software with some allowance for training. is generally not in the interests of any systems suppliers. It is the need to ensure and facilitate this change that generates a high proportion of the total project costs.1
PUTTING AN ALL-INCLUSIVE PRICE TAG ON SUCCESSFUL IT
Failure to derive the expected benefits from IT systems is legendary. There is a range of implementation approaches taken by companies including: simple ROI and the ‘stuff it at ‘em’ approach that follows the principles of ‘if we tell them what to do and give them a bit of training then they’ll make it work’.BÀI T P TÌNH HU NG . This. based upon someone’s view of the costs and benefits. This assumes processes are being changed – otherwise where are the benefits coming from? Which means there is an implicit assumption that people somewhere will be doing something differently. Typically. The reality. If the way things are done in the business is being changed the there is a need to understand what that change means. however.
Trang 31 / 40
.MÔN H TH NG THÔNG TIN QU N TR .H Đ i h c chính quy
CASE STUDY 9.
and identify the best options. Over and above this. Often these technically focused people are poorly qualified to understand and business nuances and may not have the required communications skills. from ownership and visions through stakeholder buy-in. in business benefit terms. prior to getting the technologists involved. Quite often. Context is the first parameter to get right.MÔN H TH NG THÔNG TIN QU N TR .
Ron Barker. so that we know what is to be delivered and why? After thinking through the application needs and functions. technology and people readiness. but is not properly aligned to the organisation’s strategy and owned by specific. This should include all of the people costs for effective change. technology projects are devolved to the IT
department who are then responsible for overseeing through delivery and implementation. This may include some scenario planning work fully to appreciate the different ways that the system may work. This will give positive adoption of systems that are pulled through by users who expect what they get and get what they expect. The business’s responsible project owner will now have a budget that allows them to plan from concept to execution with holistic consideration of all PPTE elements. Costs can then be assessed in outline for the whole PPTE model. once the decision to invest is made. accountable people in the business. perhaps with the ‘go’ decision requiring people readiness to be assured. They will ‘pull’ the system through rather than having it shoved at them. user-led adoption. who looks at the changes required in human behavior? Who is addressing the motivational issues that will get the right people doing the right things? A framework can be proposed to improve chances of success. to positive. the next useful question is how is it to be delivered? This should be viewed as problem that the business deals with rather than abdicating it to the IT group. How does the development proposed relate to the business strategy? What is the desired outcome for the development. Financial Times.
development of a system that involves some users early and is well communicated to staff.BÀI T P TÌNH HU NG .H Đ i h c chính quy
a considered approach that defines real business need and vision but then fails to communicate this through to the ‘what’s in it for me’ messages and thereby does not connect with the users. This is based around the simple model of People. Process and Technology (PPT) with the added element of environment or context (PPTE). A full disclosure ROI can then be calculated that takes all benefits and PPTE costs into account.
Trang 32 / 40
. Decisions to proceed are now likely to be better informed and can be done on all fronts of process. Truer costs will be understood and the full implications of benefits will emerge. 30 May 2007 Question: Discuss the difficulties in estimating the costs and benefits of an IT project.
It is true that successful public sector projects rarely attract standing ovations. No major problems encountered. It can
Trang 33 / 40
. now Baron Turnbull. that have come in on time and to budget. however. The agency is in the process of being abolished. Of course. Successes. The CSA story is chilling. executive director. the former UK cabinet secretary. Public sector failures. He says public sector projects are on a scale rarely seen in the commercial sector and that scrutiny tends to highlight failure. Here is Sir Andrew Turnbull.000 a month. Mr George says the most important lesson the commercial world could learn from the public sector concerned the benefits of sharing pool of knowledge of what makes projects work and what does not. There is no real difference between public and private sector projects in this respect. such as EDS’s Oyster card payment scheme with London Transport rarely attract plaudits.’ This view resonates with Malcom George. the thriller writer. he said.2
LESSONS FOR BUSINESS FROM THE PUBLIC SECTOR
Stephen King. most drivers renew their licences at a post office. talking on the subject before leaving office: ‘There have been plenty of projects. at a cost to date of about £539m is through to have 52 critical faults of which 14 cannot be easily corrected. but it is almost normal for an industry in which. The system. In 2002.H Đ i h c chính quy
CASE STUDY 9. are more visible and attract media attention more easily. government relations. Competition militated against such sharing. That’s an exaggeration. At present. The media inevitably focuses on those projects at the other and of the spectrum. large and small. the more likely it is to fail. The CSA has had to process thousands of cases manually because of system failures. the UK government’s Swansea-based Vehicle and Driver Licencing Agency (DVLA) initiated a project to enable British drivers to license their vehicles either online or by telephone. but only just. charged with tracing absent fathers and forcing them to pay child maintenance. two years after completion on time and budget 3m drivers have used the system successfully and it is attracting users at the rate of 400. the man with ultimate responsibility for government IT.000 cases.MÔN H TH NG THÔNG TIN QU N TR . according to analysts. you don’t tend to get headlines announcing “Government project completed on time and to budget. the consequence of an IT foul-up which meant a government watchdog discovered that costs were eating 70p of each £1 it collected and that it had a backlog of 300. the US group.BÀI T P TÌNH HU NG . Improved services delivered”. At the peak. 80 IBM staff and 20 DVLA IT specialists were involved. Today. might be hard pressed to top some of the horror stories generated by public sector information technology project. Take the UK’s Child Support Agency. developed by EDS. of course. not least because of its human implications. The system was built in collaboration with IBM at a cost of £30m. for EDS in Europe. an IT project is more likely to be unsuccessful than successful and the bigger the project.
‘The proper review mechanisms have to be in place’. 53 per cent were late and/or over budget or with less than optimal functionality and 18 per cent were cancelled or never used. Julie Palmer. Mr Kemp says. A licensing authority has to be sure a vehicle is insured. More recently. More recently. has passed its roadworthiness test and that payment has been made before a licence can be issued. in which independent scrutineers assess high-risk projects at critical stages in planning. A second reason is a lack of ‘ownership’ of a project by senior management. says it was important that DVLA and IBM shared the same vision: ‘To the outside world. Mr Kemp points to the importance of established and proven methods of project management such as Prince2. the Standish Group’s methodology has been queried. but the fact remains that the rate of failure of big projects is unacceptably high. in charge of public sector business for Sun Microsystems in the UK. the Inland Revenue and the Home Office.MÔN H TH NG THÔNG TIN QU N TR . a methodology which takes as its starting point the business case for a project and provides guidance at each stage. He says communication is critical: ‘I think that when projects fail. This comes up time and again in studies: a project needs a champion at senior level who is responsible for bringing the scheme to fruition on time and to budget. Andrew Rhodes. pointed to the efforts made at the beginning to ensure that what was delivered was what customers wanted: ‘The secret in defining a product your customers will want to use.’ Nevertheless.000 IT projects. The DVLA licensing project involved representatives of everybody affected at each stage. And a payment engine with links to the banks had to be created. The Standish Group in the US has been at the forefront in analyzing and classifying these failures: its 1995 report is regarded as a classic. we looked like a single team. it is because the rigour around communications or review and inspection is not what it could be. He also stresses the importance of ‘Gateway’ reviews. does it select for failure?. whose customers include the health service. the Vehicle Programme Manager in charge of the project. some projects are simply too large to be managed effectively. The DVLA database had to be linked to the motor industry insurance and roadworthiness database. rating them red. planning and performance manager. it is fundamental that all stakeholders are excellent communicators.’ Not engaging all the stakeholders in the aims and objectives of a project is frequently quoted as a cause of failure. there are significant numbers of projects that have lost their way. Third. Why do IT projects founder? And what can the business world learn? Among the most important is a failure to align project objectives and the organisation’s strategic priorities. the most critical issue in any big project.’ ‘For those engaged in the project. suggests that 29 per cent were successful. linking successful projects together to create a seamless whole as a final stage. procurement and implementation. ‘The projects led by governments are sometimes just too
Trang 34 / 40
.H Đ i h c chính quy
be counted as an unqualified success. an example being a US insurance group that took three years to finish a one year marketing project. more than half of them in the US. only to find the product in question was being sold.BÀI T P TÌNH HU NG . there has been a trend to tackle automation in small steps. We could simply have mirrored the existing paper process but we redefined it in a way that not only met our needs but also out customers’ expectations of ease of use. Its lasted survey of 9. amber or green. These issues are underlined by Graham Kemp.’ The ground rules were agreed at the start: these included the degree to which risks were shared and the rules covering change management. But it was not a simple project.
FT. Is the private sector taking the same medicine? And would we kmow? ‘The private sector keeps its mistakes to itself’.H Đ i h c chính quy
big. If they were segmented.BÀI T P TÌNH HU NG .MÔN H TH NG THÔNG TIN QU N TR .com site. What steps can be taken to reduce the risk of project failure ?
Trang 35 / 40
. then some risks could be mitigated by people with appropriate competences. if not yet out of intensive care. Mr Kemp notes. What reasons does the case study indicate are responsible for project failure ? 2. Projects and subprojects would be more manageable. Alan Cane.’ So the public sector patient is responding to treatment. published 4 October 2006 (abridged)
says Hilson. based on a monolithic specification. independently of other parts of the development. coding and testing stages linearly. Hastie. could mean throwing away much more. with major impact on the project schedule. agile techniques can at least ‘deliver enough to keep the business moving forward’. Fellow presenter Stephen Hilson. This is important in resource-constrained New Zealand. Superficially. says both general and ICT managers are nervous about the less structured nature of agile methods. In an agile environment. but requirements’ churn’ is actually a fact of applications development life. This results in iterative redesign and re-coding.
Trang 36 / 40
. was one of two developers who addressed a well-attended NXCS’ birds of a feather’ session on agile development.1
AGILE DEVELOPMENT CAN MAKE BUSINESS QUICK AND LIGHT
But ICT must communicate its benefits if managers are to accept it
Agile software development can prevent organizations becoming locked into yesterday’s ideas and business strategies. says Hastie.MÔN H TH NG THÔNG TIN QU N TR . And. such as telecommunications. he says. experts told New Zealand Computer Society members at a recent NZCS meeting. a process that can sometimes lead to a realization that the original design of that part of the program either won’t work or should be revised. Telecom fits agile practices around a skeleton of more conventional waterfall-style development – starting with a complete specification and working through design. held in Wellington earlier this month. realizing work is off-track often means that only a little work has to be thrown away. the speakers say. Management can appreciate the benefits of agile development techniques – but only if these benefits are communicated properly.H Đ i h c chính quy
CASE STUDY 13. who currently works for Telecom.BÀI T P TÌNH HU NG . but it makes some managers nervous. if the completion target is hard to see at times. especially when it comes to mission-critical disciplines. he says. Agile software development is one way IT can guard against becoming an anchor weighing down changing businesses. Rigid specifications and inflexible development techniques can lock organizations into yesterday’s ideas and also inhibit commercial evolution. The essence of agile development is the creation of small pieces of a program. In contrast. this process looks unstructured. who is chief knowledge engineer at Software Education Associates. according to developer Shane Hastie. a misconceived design.
Hastie says. and recognised as good practice. where developers report on the work they have accomplished since the last meeting. Agile methods – branded as such around 2001 – ‘pull all these good practices together’.H Đ i h c chính quy
The speakers acknowledge that. says Hastie. which may now be outdated.
Adapted from an article by Stephen Bell. If management and users are involved. close contact with customers. they will understand the logic of the way the ICT team chooses to develop. But it tends to be more aligned with the business’ needs at the time of completion – rather than its needs at the start. as well as what they plan to do next and any obstacles they have encountered. and a daily ‘stand-up’.nsf/devt/943AA253F4D6EADFCC257333000EAF06
Question: What do the differences between the traditional waterfall model and agile development methods suggest about their respective applicability to the strategic alignment of business and IS/IT strategies ?
Trang 37 / 40
. 13 August 2007. quick turnaround of small modules. you will succeed no matter what technique you’re using’. If you have those. ‘Two of the most important factors are a high level of customer involvement and chief executive support. The essentials are programming with teams of peers. http:// computerworld. the final product can be quite different from that originally planned.co.MÔN H TH NG THÔNG TIN QU N TR . with agile development.BÀI T P TÌNH HU NG .nz/news. The essence of agile development has been known for 10 to 15 years.
MÔN H TH NG THÔNG TIN QU N TR . Astonishingly research suggests that one in five doctors have even considered suicide. The problem with many of these initiatives is that the parameters of the project and contract provisions are tightly defined and the contracts are not managed effectively by the same team through the project lifecycle. Just look at the CSA – the situation deteriorated to such an extent that the entire organization was scrapped.1
WHY DO PUBLIC-SECTOR PROJECTS FAIL ?
Back in the spring of 2007 a doctor application system which was supposed to match junior doctors to specialist training posts was shelved by ministers.BÀI T P TÌNH HU NG . Public sector projects are so tainted by their poor track record. But in the world of public sector technology initiatives. despite the CSA and its supplier being aware that there were 52 defects within the system. expectations are set very low and they now have little to live up to. So why do these failures keep happening? There needs to ne an element of realism when looking at major technology projects. These and other examples of outsourcing have been very damaging to public sector organizations for a range of reasons. which caused the opposition to call for the resignation of the then-health secretary. When a problem is encountered often the first reaction of the public sector is to seek to avoid any blame. The NAO branded the project. The sheer scale of the larger projects means that inevitably there will be problems along the way. An investigation by the National Audit Office (NAO) found that ‘go live’ of the system had been authorized. The reorganization of training and the application process meant that 30. The fact that public sector technology and outsourcing projects go wrong so regularly means we aren’t surprised by these failures anymore.000 posts in a system poorly thought through.000 doctors were chasing just 32. Doctors complained that the system – the medical training application service (MTAS) – was profoundly flawed and that many juniors had been unfairly treated.H Đ i h c chính quy
CASE STUDY 14. this story was the most recent in a long line of blunders. And the story didn’t end there. Public sector organizations are effectively answerable to taxpayers – wanton waste of public funds does not bode well for good relations. Patricia Hewitt. ‘one of the worst public administration scandals of modern times’. such is the depth of the fiasco. The MTAS site has also allegedly been the subject of two security breaches. These public sector technology catastrophes also attract a good deal of negative publicity – this can do serious amounts of damage to the organisation’s reputation and dent stakeholder and taxpayer confidence in the ability of the organization to do a good job. One of the most troubled technology outsourcing cases was that of the now defunct Child Support Agency.
Trang 38 / 40
. There is of course the waste of money and other resources. The outsourced IT system was at the root of the agency’s problems.
However. This understandably begs the question. Adjudication is a particularly useful dispute – resolution process for obtaining swift results which has yet to find favour on large-scale technology projects. it does not deal with the constant reorganization that takes place at central and local government level or the constant churn of ministers and officials on projects. A blame culture often comes to the fore when things go wrong. organizations really are limited when picking a
Trang 39 / 40
. Cost is often cited as a major driver in technology and outsourcing projects. Problems in technology and outsourcing deals can often arise when there are unclear lines of responsibility both within the public sector and between the public sector and the supplier.BÀI T P TÌNH HU NG . End users need to realize that any mentality of ‘the cheapest wins’ means that the more realistic suppliers will be missing out on contracts. with the end user blaming the supplier as operations were not executed to their satisfaction and the supplier blaming the end user because they were negotiated right down on costs. Since differences or disputes are inevitable in relation to large-scale technology projects. A shift away from the blame culture to an environment where successful delivery is valued above all else is required in order to increase the probability of problems being detected at an early enough stage for them to be dealt with appropriately in a way that works for the supplier and the public sector. public sector organizations have to be wary they are not blinded in the quest for squeezing as much value for money as possible out of the supplier. it would seem that they invariably involve the same circle of suppliers. Problems often arise around the cost issue. is it any wonder that there is not a great track record of successful delivery of major technology projects? Failures are often attributed to the supplier but as in any relationship it takes two to tango. mediation and adjudication – which exist as legal mechanisms for resolving disputes – should be more widely utilized.MÔN H TH NG THÔNG TIN QU N TR . Drafting a contract with clear responsibilities and then managing it appropriately deals with the responsibility between the public sector and the supplier. The principle reason behind this is the protracted and complex tendering process that suppliers have to go through. From all the press reports that circulate about these problematic projects. With this sort of fundamental change. Far from these being an alleged ‘inner circle’. Problems worsen as the two parties are more concerned with absolving themselves of wrongdoing than they are with rectifying the issues. Whilst it is undoubtedly important. Of course as a spender of public funds those in the public sector feel an obligation to get the best deal but nailing the supplier to the wall financially can often backfire. What appears to be the cheapest deal is often the worst as frequently the service will be compromised or the final cost will spiral because it was unrealistic in the first place.H Đ i h c chính quy
History has taught us that errors and mistakes should be expected and factored in to the way that contracts and projects are managed. why on earth do public sector organizations keep selecting them? One of the major problems in the public sector today is the lack of competition amongst suppliers. This procurement – led approach to technology and outsourcing cab be problematic as it leaves very little scope for innovation in the project and makes it much more difficult to cope with problems when they arise.
Paul Bentham. Unfortunately the need for an ‘intelligent client’ is often overlooked – with the very expertise the public sector needs to manage its IT suppliers being outsourced to those suppliers. Instead of using a ‘one-stop shop’ supplier the public sector should look to use specialist suppliers for different aspects of a project.BÀI T P TÌNH HU NG . a sensible. The public sector boom of technology outsourcing definitely set to continue but public sector bodies need to learn lessons from their private peers. What are the likely benefits and risks associated with this approach ? 3. Could the COBIT methodology be applied in this context ?
Trang 40 / 40
. This gives smaller companies a chance of a contract but also gives the end user access to.00. July 2007. constantly reviewing existing contracts and looking for improvements and innovations. More choice would be likely to mean better service.silicon. and the retention of an ‘intelligent client’ on the public sector side.3800010403.H Đ i h c chính quy
vendor for projects of this size.MÔN H TH NG THÔNG TIN QU N TR . If they spread the work and therefore knowledge between a range of suppliers or keep some knowledge in-house then this won’t happen. Public organizations shouldn’t be held to ransom by a private organization. The national programme for IT involves a substancial increase in outsourcing. Successful delivery needs to be valued within the public sector more than simply not being to blame for problems.htm
Questions: 1. effective dispute resolution. Public-sector information systems projects have had a chequered history. Is the national programme for IT proving to be any different from some of the flascos that have preceded it ? 2. www. quality suppliers compete in the public sector market? And how can end users avoid the obvious choice? Public sector organizations need to take a more strategic approach to outsourcing.39167934. The key to successful delivery is to have continuity of personnel throughout the project lifecycle. balanced contract managed appropriately.com/publicsector/0. They need to ensure they have a dedicated team that manages the process full time. But with such hurdles to overcome how can smaller.