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Management of computing: from content analysis to trend study
Management of computing: from content analysis to trend study
The paper discusses major trends and issues in information-technology management on the basis of a two-year newspaper-content analysis and a field survey of IT managers. The trend study contains feedback on factors that are critical to success in strategic IT planning and project implementation, and better understanding of the changing and enlarged roles and responsibilities of todayS IT executives. A list of desired personal qualities and characteristics of IT executives is developed. The study also deals with the roles of, and the limitations and ,4e,2 Cl,/.,-0C.C fnrtrav,- IIS ;n &r&c; till” c1atz *rnn “J, ,-.r 1 TT ,.r\,.n*.ltn-tn ;1. 11 TT , UIILCCOU ,WL‘“fr) 1 L”ICJr(CLUIIW CIC planning and project implementation.
well as the roles and limitations of IT consultants. To establish such trends, a series of newspaper-content analyses and field surveys were conducted over a twoyear period in two countries. The content analysis was based on the advertisement pages for IT executives in major London, UK, newspapers. The field survey was conducted in Singapore, using questionnaires based on trends developed from the newspaper-content analysis, and the study of a wide range of IT literature. The survey, concluded in 1990, was directed at senior IT executives, who were mainly from the manufacturing industries, banking and finance, and government organizations.
Keywords: information technology, trends, surveys
CONTENT The notion of achieving competitive edge through the strategic application of information technology (IT) is now well documented and recognized. It has become an indispensable eiement in many firms’ business strategies. Increasingly, it creates new strategic choices for these firms. To date, IT applications have contributed to improved operating efficiency, created new business opportunities through IT-based products and services, and sometimes even fundamentally altered the rules of the game in competition. The role of IT, whether as an efficiency-enhancing tool or a strategic decision-support system: is indeed pervasive and recognizable in today’s business world. It is, therefore, important for companies to keep abreast with the latest IT development trends, not just with technology, but also with the managerial aspects of IT applications. The objective of this paper is to present findings about certain aspects of the trends and issues in ITplanning, project implementation, and the leadership roles and personal characteristics of IT executives, as School of Mechanical and Production Engineering, Nanyang Technological University, Singapore
Vol 10 No 4 November
1992
ANALYSIS
The content-analysis technique has its origin in the Second World War, when intelligence experts sought to find a method for obtaining information on enemy nations by analysing public opinions and major events reported ;n the local-newspapers’. For trend analysis, this is a relatively simple, inexpensive and yet potentially effective methodology that helps to make sense of what is happening and what is likely to happen in the near future. This can be achieved by closely and systematically monitoring current events around the world, especially the nartc nf the t..., trpnri-cettino .._=.u “1 I.... ~~..‘..“V. L.1” wnrlri V.U..... Nakhitt 1 ~...““.I. f s2nnhlich4 r --*au**--
two sets of best-selling megatrends for the 1980s and for the 1990s. These megatrends are identified and formulated mainly on the basis of content analysis of newspapers, particularly those published in the trendsetting parts of the USA and the world. Most of these trends are perceived to be reasonably accurate and credible. For the purpose of this study, London, UK, was rhnwn I--VUI.-
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through the more serious London &wspapers, noticed that interesting trends could be found appointments sections of the Times and Sunday newspapers. The number, frequency and salary
0263-7863/92/040231-X% @ 1992 Butterworth-Heinemann
Ltd
it was in the Times
levels 231
Management of computing: from content analysis to trend study
of the IT-related appointments advertised are indicative of the demands for, and increasing importance of, IT _^_^_^_^ ___rl_--_..,*.._r_ ‘PL_ ___A__* __,1.._:_ _I rl-. l‘lallagcls a11uLwlIsuIlilllLs. 1IlC
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IT executive appointments is particularly useful in establishing the changing job requirements and desired personal qualities of today’s IT managers, as well as their responsibilities in strategic planning and project implementation. For instance, the established initial trend quickly shows a clear shift in the roles of IT executives from those of the traditional data-processing (DP) managers. The changing roles and personal characteristics of IT executives identified from the content analysis were compared with those described in the IT literature published in the major US and UK journals. The comparison shows a close resemblance in the findings from these two separate sources, those of the newspapers and academic literature. The findings on trends were incorporated into the survey questionnaire. To clarify some of the findings, several pilot interviews with IT managers were conducted prior to the questionnaire being finalized. FIELD SURVEY The objectives of the survey conducted in Singapore, a newly industrializing economy (NIE) with a relatively mature IT industry, were to establish the Singaporebased IT managers’ perceptions of the following trends: key success factors in strategic IT planning, key success factors in IT project implementation, roles and responsibilities of IT executives, personal characteristics of IT executives, perceived roles and limitations of IT consultants, key success factors in using IT consultants. A 13-page questionnaire was organized into subsections according to the above listed objectives or scope of study. 60 usable returns were received from 275 questionnaires mailed out to major corporations, ranging from multinational corporations to banks and government organizations who were known major IT users. The returns represented a modest response rate of 22%. The sample size of the respondents was not very large, but it was more than compensated for by the quality of the respondents. The majority of the respondents were from major US, European and Japanese multinational corporations (MN&) in the electronics manufacturing industries (60%)) a number
Table 1. Job titles of respondents rob tit!!2
Prqxxtio!? cf respondents, %
IT/IS vice presidents/directors/senior
managers
20
MIS/IS/DP managers
65
Senior systems analysts/finance and administration managers
15
Total
100
had higher levels of IT expenditure were those that were currently investing in large factory-automation or computer-integrated manufacturing (CIM) projects. The estimates were only indicative. The actual figures couid be much higher, as not all IT expenditures are incurred through IT departments. The rapid increase in end-user computing in recent years could also inflate the total IT expenditure further. IT budgets in the banks and government organizations were considerably higher in absolute terms. However, no clear pattern could be established, owing to incomplete information from the survey. IT PLANNING The IT-planning survey had two parts. The first part consisted in making general assessments of the IT planning methodologies used, the planning horizons, the current IT applications, the expected benefits, and the perceived IT investment-strategy positioning. The second part focused on establishing the IT managers’ response on the relative importance of a list of success factors in strategic IT planning. Planning methodologies The majority of the companies surveyed (90%) said that their IT planning approach was basically that of management by objectives (MBO), and the use of some forms of cost-benefit analysis. Companies who used critical success factors (CSF) analysis were in the minority (20%). The MB0 approach usually requires the managers to define clear project objectives, systems requirements, and the formulation of viable alternatives. This is basically a hard systems thinking approach
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which PANS tvnp nf “~“““‘” cvrtpmc ..______ ha< ___- itc __- nricrin -__b___ in ___the .___ _.‘.l.Y ‘~=” -.
related organizations (22%), including the publicutilities boards and universities. The annual revenues of the responding manufacturing firms were US$lOOMUS$lOOOM. The distribution of the job titles of the respondents fell into three categories (see Table 1). All the companies surveyed had IT, managementinformation-systems (MIS), information-systems (IS) or DP departments. The level of IT budget handled by these &nartmPntc ci7p r-A _---__.-_ vnriwi . _a.__ wi&!y dp_=pndi~g 0~ the . ..v YlYI of the company and the nature of the business. As a rough estimate, the majority of the manufacturing firms surveyed allocated just under 1% of their annual sales to the IT budget, which included hardware and software purchases, applications development, operations and maintenance. A handful of companies that
and systems engineering3y4. In most cases, IT implementation is often treated as a one-off project. For instance, the implementation of a manufacturing resource-planning (MRP II) system is usually treated as a stand-alone project. The MB0 mentality in IT planning tends to place emphasis on end-item accomplishment, and to take a short-term and narrower view of a project. A common criticism of the traditional DP/MIS &nnrtmPnt the MB0 nnnrnnrh r -__._____. whir-h ..__. _._ nrlnntc “-‘r” -rr- ----is that it tends to be preoccupied with technology issues and system tools. It is common to see a DP/MIS manager who is mainly concerned with the problems of system architecture, the evaluation and selection of hardware platforms, software, operating and applications systems during the IT planning stage. Conse-
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quently, he/she neglects some of the soft and ill structured problems, and other broader strategic issues. The CSF analysis is now a well recognized IT planning methodology. It was first used by Rockart’ to identify chief executives’ data needs. It was further developed to cover different levels of management, and subsequent!y lused as a Slr&gic-nlnnnino tnn16. _A_t the r-----‘---b planning level, CSFs are simply defined as those few important things that an organization must do well to ensure success for the organization. At the operational level, CSFs are those key issues that help to define what an organization or manager must do to meet the specified goals. The process of CSF analysis encourages a broader participation of tiie -user gro.ups and the
some simple forms of materials-planning and inventorycontrol systems developed with spreadsheet packages. The application of computer-aided design (CAD) tools was still not widespread, with only 27% of the manufacturing firms using it. This is interestingly indicative of the low level of product-design activities in these Singapore-based MNC’s, and notably in the Japanese firms, whose product design and development are performed at their head offices in Japan. A minority (15%) of the companies also used projectmanagement packages for planning product development, and the installation and transfer of production facilities. Al+L-..-L thhADD TT o.z-4 cA= ~nnl;rc,t;nna car,= ay&lII~.u~.“I.LI UIV ‘-uul”ugu L,,G 1”IL\I II (11.u
involvement of the senior corporate management to help in identifying and evaluating critical systems applications as a basis for formulating long-term IT implementation plans. The emphasis is on the process of the continual reviewing and rethinking of the company’s long-term goals and rapidly changing business needs. The responsibility of IT management is to ensure that appropriate systems applications are l_..-l---J I_ ~____L_.._L ..>~ .___I uc;velupeu ~0 meet sucn neeus m a timely and COSLeffective manner.
integral parts of an overall CIM effort, only a handful of the companies surveyed had a long-term plan towards CIM. Given the current level of knowhow and the experience curve, most of the CIM projects were not well defined. The management of these CIM projects will be user-management-oriented, with IT management providing the necessary technology support. Projects of the low-structure-high-technology type will also need rl__ ,.E d,,” ,_,l C”,,,I,,IClllr;,,I ,,.,,;+,,_+ FIfi_ LILt:L1___1__ u,c;s>,,rg “1 II”,,, ,h1‘1b ,__ L”P _““__P_ ,11411Ll~Lment to succeed. The hard systems thinking and management-by-objective approach may not be able to cope with the many ill defined problematic variables. A soft systemic approach’ that emphasizes continual and relentless learning, both at the organizational and the individual levels, will be more appropriate. The soft systems thinking would take into consideration human attitudes and human perception in a problem situation.
Planning horizon The survey showed that slightly over half (57%) of the respondents had a planning horizon of less than two years, of which 19% planned only on an annual basis. The latter were the smaller manufacturing firms. The remaining 43% of the respondents had a longer horizon of 3-5 years. These figures probably reflect the generally shorter-term orientation of the Singapore-based companies as far as IT planning is concerned. For the smaller manufacturing firms, the IT planning focus is more operational than strategic. The larger banks and manufacturing firms and government organizations are 1:1 -9~ I- *mm_ 1more nKely LO nave a longer pianning span and iarger IT budgets.
Current IT applications A clearer applications trend could be established for the manufacturing firms, as they represented nearly two-thirds of the respondents. The survey showed, however, that all the responding firms had installed the business systems for finance and accounting and other administrative purposes. The systems covered the basic functions, such as accounts payable, accounts receivable, general ledgers, payroll and personnel records. The finance and accounting systems usually represented the first computerization efforts of these companies. The majority of the banks surveyed also used IT to provide customer online services. Most of these systems were typically ‘low-or-medium-technology-high-structure’ type projects according to Cash’s technology-structure matrix. Cash’ used the matrix to define the various project types as a contingency approach to IT project management. About 82% of the manufacturing firms had installed some aspects of MRP II systems which included order entry, materials-requirements planning, inventory control, costing, product data, production scheduling and sales analysis. The remaining 12% of the firms used Vol 10 No 4 November
1992
IT investment
positioning
In formulating long-term IT investment strategy, senior corporate management and IT executives must critically review the company’s current strengths (S) and weaknesses (W) against perceived opportunities (0) for growths and profits as weii as potentiai externai threats (T). The IT investment positioning that is indicative of a firm’s future IT intention can be mapped on a SWOT matrix’. The survey showed broadly the IT investment positioning of the manufacturing firms and the banks (see Table 2): The survey showed that the banks were more positive than the manufacturing firms that IT applica-
Table 2. IT investment
positioning
Proportion of manufacturingfirms Investment
respondents,
positioning
Use of IT to exploit for growth
Proportion of
bank % respondents,
%
opportunities 53
88
50
33
16
22
0
0
Use of IT to rectify internal weaknesses
Use of IT to overcome from new entrants Not interested investment
in further
threats
IT
[Some firms take more than one strategic
position.]
233
Management
of computing: from content analysis to trend study
tions could help the business to achieve further growth. IT impacts different industries and the firms within Al___ AlAX___-Cl_.11 T’p :_ --._. ~mtJeuutxl _-l-__l>_?l :_r_ A?:-_-_:_, lIIlT:IIIu111ere1111y. 1s now lIllU Illlallc;lill services and products as the embedding technology, while the application of IT in manufacturing, such as CAD/CAM or MRP II, is more enabling than embedding. The banking business may now collapse without IT, while manufacturing may still survive without CAD/ CAM. The survey showed that more manufacturing firms intended to use IT to rectify internal weaknesses. Two-thirds of the respondents from manufacturing considered reduction in inventory and work in process (WIP) to be the main goals and expected benefits of IT applications. These considerations are more operational than strategic. KEY SUCCESS FACTORS The main part of the questionnaire survey concentrated solely on establishing key success factors related to IT planning and project implementation, the roles and desired personal qualities of IT executives, the roles and limitations of IT consultants, and factors to ensure success in using consultants. IT strategic planning The respondents were asked to rank a list of factors that must be considered when formulating long-term IT plans on a scale of 1-5. The mean scores of the various factors were then computed. Factors with a mean score of less than 3 were dropped from the list. The result was a shorter list of success factors (see Table 3), which Table 3. Success factors in IT planning Success factors
Issues
Mean score
Style
4.80
Style
4.24
Incorporation of IT into corporate business strategy
Strategy
4.11
Availability
Strategy
4.06
Staff
4.02
Staff
3.88
Style/ Structure
3.83
Structure
3.82
Use of a high-level committee of senior managers to formulate IT strategies and policies
Structure
3.76
General computer company
literacy
Stafi
5./3
Operations (user) IT knowledge
management
Skills/Staff
3.64
Top-management Support
commitment
from an in-house
of funding,
Availability of in-house and manpower Continuing
‘champion’
budgeting IT expertise
staff education
and training
Involvement of IT executives business decisions Coherent
corporate
in
organization
of staff in
I _?
having
[The mean scores are arbitrarily defined as follows: > 4.5: critically important, 4.0-45: very important, 3.5-4.0: important, 3.0-3.5: good-to-have, < 3.0: not important.]
234
were then arranged in order of importance. To help in the better appreciation of the nature of the issues :__.-,.._A ^_._^^__ l?__r_-_ -_ _-r____:-__I ac-IIIVUIV~U,rl..__ LIIGS~:~UC;GGSS I~CLUIS._.^ wcrE: ca~egu’~~~u cording to Mckinsey’s seven-S framework’. The framework is divided into three hard Ss (systems, structure and strategy) and four soft Ss (style, skills, staff and shared values). The survey showed that the emphasis of the key success factors was on strategic considerations of IT, and on issues which are soft-S, such as those concerning leadership, management style, and human-resource management. By definition, key success factors are those few important areas that managers must pay attention to and do well to ensure success in their endeavours. In the study, the key success factors were those that were unanimously perceived as being the most important, and they were arbitrarily defined as those with a mean score exceeding 4.0, with the maximum of the scale being 5.0. These key success factors that must be considered in IT planning are 0 top-management commitment, l support from an in-house ‘champion’, l the incorporation of IT into corporate business strategy, l the availability of funding and adequate budget allocations, l the availability of in-house IT .expertise and manpower. The survey results were consistent with those described in the IT literature and field interviews, i.e. topmanagement commitment is the single most critical factor that ensures success in any major IT implementation. The chief executive officer (CEO) must have a supportive leadership style in giving his/her blessing to major IT initiatives, and in setting aside adequate funding and manpower to support the projects. The top management’s involvement also ensures coordinated efforts between the user management and the IT management. Many respondents also agreed that, ideally, there should be an in-house ‘champion’ from the senior management who believes in the potential benefits of IT applications, lends his/her support, and follows through the planning and critical implementation phases. The other key factor concerns human-resource or staff issues. It is the responsibility of the IT management to ensure the availability of qualified IT staff to provide the necessary technical support to the I\tr\;p,-+ +n-m FL”JtitiL LClo.lll. Project implementation It is unlikely that there is a single best way of managing IT projects. The appropriate project-management approach is contingent on the project type, which is characterized by the level of technology and project structure involved. Cash’ defined four broad project tllnpr armrrlino tn 2 tPrhnnlnov_ctnlrtllrp m&$x. The ‘,F’” U’W”‘..“‘b L” U “““““.“e,, “.1..1.--differences in project-management approach are reflected in the roles and relative dominance of the IT management in relation to the user groups. The level of technology and project definition, on the other hand, influences the level of formal planning and control used. For instance, low-structure or ill-defined projects International
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with unclear objectives and ambiguous user requirements certainly need a high degree of integration with the user groups. Tlne seiection of a user as the project manager and the creation of a user-led steering committee could be critical in ensuring the success of such projects. For high-technology projects, the selection of an experienced IT professional to lead the project team is necessary. The large ‘low-structurehigh-technology’ projects are likely to be the most complex and risky. In this case, close coordination between the user and the IT management is required, ideally with strong top corporate-management support and commitment. The use of forma1 planning and baseline control systems is likely to be more effective with large and highly structured projects than illdefined projects. The survey did not use the technology-structure matrix to study the various in-house IT projects in the responding companies. However, on the basis of their current applications, the majority of the IT projects undertaken to date by the responding companies are of a relatively well structured type using lower- and medium-level technology. The respondents were only asked to give their general assessment of the key factors that contribute to project-implementation success. Table 4 gives a list of success factors arranged in order of relative importance according to the mean scores based on the five-point scale.
Success factors
identified 4.0, i.e.
clear project objectives and requirements, 0 a concise project plan, 0 active user participation, l an understanding of the company’s operations, l the appointment of a user as the leader of the steering committee.
l
These key success factors are indicative of the responding IT managers’ genera1 emphasis on a forma1 and systematic approach towards project implementation, and their recognition of the importance of user participation and the awareness of business needs. The survey shows some interesting variations from the mean trend. The IT managers from the banks seemed to place less importance on end-user participation than did their counterparts from the manufacturing and government sectors. This variation probably reflects the relative dominance of IT departments in the banking sector, where projects are generally larger, involve a higher level of technology and sophistication, and have relatively well defined user requirements. The government organizations, on the other hand, placed great emphasis on the use of user steering committees, which is probably typical of the civil-service mentality.
Roles of IT executives
Mean
score
Table 5. Roles and responsibilities
of IT executives Mean score
4.51 Roles Concise
project
plan
‘Require to work closely with the senior management team to understand and evaluate their requirements, recommend and create solutions . . .’ (Nicholas Hanley)
4.15
3.90
‘Working with department managers to ensure that the systems are introduced in a timely and cost effective manner . .’ (PA Personnel Services)
3.95
3.87
‘Initiate and lead the development (Touche Ross)
(3.80 banks)
4.05 as leader
of 4.04
competence
of project
4.00 leader
Use of a project-implementation steering committee Use of phased or structured development approach Education and training systems applications
modular-
of software-vendor
support
Formal system to measure systems performance
Vol 10 No 4 November
_’ 3.86
3:75
‘Ensure sufficient supply of professional talent to carry out these responsibilities lanonvmousl \.~~~_~~,~~~.~_,
x77
3.74
‘Responsible for system (Leading Edge)
testing
quality
human
. .’
and quality
assurance
. .’ 3.68
3.70
3.50
1992
solution
3.82
to
enthusiasm
of creative
3.82
of end users in
of end-user
(3.66 banks, 4.38 government)
‘Responsible for entire IT function and particular concentration on design and enhancement of MIS functions, as well as close cooperation in the development of new products .’ (Samual Pearce Recruitment)
3.86
Formal administrative mechanism enforce application after systems handover
Quality
4.27
4.12
End-user feedback and continual enhancement of systems
Maintenance
‘Ensure the IT strategy is continually reviewed to take account of changing business needs and computer development which provide improved benefits .’ (S & P Recruitment)
in design
of company’s
Appointment of end-user steering committee
Technical
and responsibilities
4.23
End-user active participation and development Clear understanding business operations
from
In the survey, the respondents were asked to respond to a list of roles and responsibilities that had originally
in IT implementation
Table 4. Success factors
Five key success factors have been those with a mean score that exceeded
‘To make technical technical minds . (Hoskyns)
information
crystal
clear to non-
. .’ 3.40
235
Management of computing: from content analysis to trend study been extracted from the newspaper-content analysis. Exact wording from advertisements from the various ____-.:r-__c _____:-_ __.__^ ~~~rul~tI~~llL agrnc1tZs WCIE:..__?I u5&Xl1_ 111*I__ LUG,:,.c i*sL,T-1-1,. la”LG Jc ,:_r,. 11&C> those roles and responsibilities that were accorded a score that was significantly above 3.0. The survey showed a significant shift in the perception of the roles and responsibilities of today’s IT executives. The IT managers surveyed were generally in agreement that their most important responsibilities were to ensure that the IT strategy and long-term IT investment were meeting the changing corporate business needs. They acknowledged the need to work closely with the user management team, to understand and assess their most critical requirements, and to recommend and create effective solutions that would bring tangible benefits to the users. They also had to continue to keep abreast of the latest technological trends. Within the IT departments, the IT managers would continue to provide leadership with respect to all the organizational aspects of the IT functions, manage internal IT manpower resources, and maintain an overall view on all on-going and new project developments. At the corporate level, they would help to organize continuing user education and training at various levels.
Personal characteristics of IT executives Table 6 is a partial list of the desired personal characteristics of IT executives as advertised in the Table 6. Personal characteristics
of IT executives
Mean score
Persona! characteristics ‘Proven track record of developing and implementing IT (PA Personnel Services)
Roles and limitations of IT consultants
‘High independence, ability to operate effectively under pressure . . .’ (PA Personnel Services)
4.11
‘Innovative, conceptual thinking, able to adapt to, and promote change throughout the organisation . . .’ (Myriad)
4.10
‘Far-sighted professional who shares the same sense of purpose and courage of conviction of the organisation . (Nolan, Norton & Co.)
IT consultants, like any other management consultants, 4.04
3.95
‘A gift of turning IT knowledge and commercial acumen into business strategy . .’ (Arthur Andersen)
3.94
‘First class written and oral communication personal skills . . .* (Michael Page)
3.86
235
The increased specialization of the IT function and the rise of user computing have encouraged the growth of IT consulting services. IT consuItants are now likely to market their services directly to the user groups, who tend to be more willing customers than IT departments. The following discusses the survey of IT managers in Singapore of their experience and perception of external IT consulting services. Areas of IT consultang
‘You have a flair for planning, organising, and directing the effort of others in a lively progressive environment . (Touche Ross)
‘Comfortable in dealing with ambiguity .
The survey showed that a proven track record and experience top the list. It is quite understandable that an IT executive’s total personal qualities should be manifested in his/her experience and performance to date. This is particularly so when he/she is expected to fill a senior executive position. The list is by no means exhaustive, but it does represent some of the essential qualities that are required by the recruitment agencies and their clients, and concurred on by the IT managers surveyed. In addition to the above five characteristics with mean scores exceeding 4.0, there are several others worth mentioning. These include innovative and conceptual skills, adaptability and responsiveness to change, first-class written and oral communication skills, and, preferably, a university degree or equivalent professional qualification.
4.23
4.20
(DMR)
a proven track record, o being mature and well balanced, l being a strategic thinker with business acumen, l having an ability to work under pressure, l being technically competent. l
. .’
‘Mature, well balanced manager, committed to keep abreast of IT trends. . .’ (PE Inbucon)
and inter-
‘A degree or equivalent professional qualification . . .’ (Touche Ross)
London newspapers, arranged in order of relative importance as perceived by the IT managers surveyed. T&_ ^.._..^.. S1I”WGU ‘.I._._.^A +&,+ CL, Illt: 3u,vt;y 111Cl1 LIIC,,,_,,~,,+, IG;s~“‘I”GIILS,~,___ WG‘G:, ‘11 strong agreement with respect to what were considered to be the desired personal characteristics of IT executives; this was shown by the high scores. This, interestingly, was in contrast to their assessment of the roles and responsibilities of IT executives discussed earlier, in which they were less unanimous and less certain, as reflected in the lower mean scores. The five most important personal qualities with high mean scores are
3.42
.’ 3.30
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problems, introducing new ideas or techniques to a client, and acting as an agent of change. IT consultants fit into a client’s organization by working closely with the client’s staff, and obtaining their cooperation and involvement in identifying areas of concern and areas for improvement. The consultant’s task is then to create effective solutions that will bring about the required change and benefits. From the content ~nalwzic V. nf TT nnnnintmcvttc arivm+wvl in W...Y w-..,. ..--. . . the -..v L,nn&n U‘BU’JY’U . I ..yj.,‘v*...... newspapers during 1989-90, almost half of them are looking for IT consultants. Most of these consultants were to be engaged in strategic IT planning and applications. The survey elicited views from the IT managers on their current and intended areas of consultancy, the International
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reasons for using consultants in their companies, and the limitations and success factors of the use of consultants. The survey showed that just over 40% ol the responding companies had experience in using Pnl7Clllt2l7tC ..“~~uu~ru.,ru) and U‘BU thc=w L&a-, 11rc4 U.,“U them L,,“...
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Table 7. The survey showed that the main areas of IT consultancy services were the provision of in-house training, strategic planning, and the management of projects. Most of the companies in Singapore used outside consultants to raise awareness and gain experience of specific IT applications. Training and skills development were normally given high priority in these firms. Reasons for using IT consultants When asked what would be the reasons for using IT consultants, about two-thirds of the respondents cited lack of in-house expertise, and one-third said that they would use them to obtain independent opinions and fresh ideas (see Table 8). Perceived pitfalls of using consultants In the earlier survey on IT project implementation, the use of external IT consultants was not considered as being an important success factor. The managers surveyed generally had reservations about the use of outside consultants. Questions about the competency and integrity of the consultants were high on the list (see Table 9). it is naturai for a company to be concerned about the prospect of engaging a consultant who then fails to deliver a workable and effective solution. The integrity of a consultant was seen as relating to his/her ability to give value for money for the services provided, to give objective and unbiased views and recommendations, and to maintain confidentiality to protect the clients’
Table 7. Areas of IT consultancy Areas
Proportion respondents,
Training
Systems Feasibility Systems
of %
IT planning
design
45
management
studies
45
and software
Proportion respondents,
pitfalls
TnrnmnPtPnt
~“.,.,“.LU,II11
Irresponsible
characters
Overcharged
by consultants
Overdependence Disclosure Misuse
of %
58
rnncllltlntc
.,.~Y”‘y~,‘.mL
50
of consultants
42 38
on consultants
of company’s
23
secrets
of consultants
8
interests. A consultant’s impartiality and judgment in his/her advice to the clients may be in question if he/she has links with certain hardware or software products. Overdependence on outside consultants was another ‘.l_,, al _A pirran mar most companies wanted to avoid. ideaiiy, companies should develop their own in-house IT capability, and use consultants mainly for knowhow and technology transfer. The smaller manufacturing firms were also more wary of being overcharged by consultants. The larger firms were less concerned with cost, as long as the consultants could deliver solutions. Very few respondents said that misuse of outside consultants, say for political reasons, was a real -1 I promem.
Success factors in use of IT consultants Table 10 shows the rating of a list of success factors that need to be considered to avoid unfruitful consultancy. From the survey and field interviews, a number of 1____~._1__~_.2 * _1..~.. lessons were learneo. A cnent company, before engaging an outside consultant, must satisfy itself that the
evaluation
and prototyping
Table 10. Success factors in use of IT consultants
Success
5.5
project
Perceived
pitfalls of using consultants
services used
of consultancy
Strategic
Table 9. Perceived
27
Consultants
have good track
Consultants
have tested
Consultants
can work
Clients
18
Mean score
factors
have clear
Close monitoring
4.28
and proven
closely
objectives
Close user involvement
records
4.27
with clients
4.25
in what they want
4.15
in systems
of progress
methodology
definition
and design
by client
4.03 4.01
Table 8. Reasons for using IT consultants Consultants Reasons
Proportion respondents,
Lack of in-house
IT expertise
of %
have intimate
Consultants provide implementation
knowledge
follow-up
of clients’ businesses
support
4.00
after systems 3.94
67 33
Consultants give clear and specific recommendations instead of many alternative solutions
3.92
For fresh ideas and new methods
33
Cnnrllltnnts --..__.__.._l
3.87
For their tested
27
Client’s
16
Client
To obtain
independent
opinions
and proven
More cost-effective
methodologies
than in-house
Vol 10 No 4 November
efforts
1992
ran --..
company
nmvidr r._ ..__
ctrnno -~'-..D
nrnitvt r'-,--.
must be internally
must have in-house
expertise
&&rc&ip
organized
3.78 3.35
237
Management of computing: from content analysis to trend study
prospective consultant can demonstrate characteristics:
the following
having a good track record with similar assignments, hca.r;nn
“CA..,‘6
tertd
CULIICUanrl cl,,” n,-c\.,~n y’““ti”
v-.r-nhl~m_rnl,r;nn yL”V’U&n’~““‘.*a’~
mpthnrlnIXIVLLIVU”
logies, being able to work closely with client’s staff, having a clear idea of the client’s objectives and requirements, encouraging user involvement in systems definition and design, having a system for regularly reporting to the client on the project-progress status, having an intimate knowledge of the client’s business operations and environment. Before engaging a consultant, it is advisable for the company to check the resume of the assigned consultants, particularly with regard to their track record in previous projects. To ensure success, the client must be intemaiiy organized in defining its own objectives and requirements, setting up an internal team to supervise and monitor progress, and developing relevant inhouse training. On engaging the consultant, clear terms of reference must be defined and documented which specify the client’s systems objectives and requirements, scope of work and deliverables, as well as key milestones and delivery dates. The importance of IT consultants to the industry is weii recognized, particuiariy for the smaiier firms, who do not usually have their own in-house expertise and manpower to implement relatively sophisticated projects. However, to many of these smaller companies, the costs of engaging a reputable consulting firm are prohibitively high. To this end, the Singapore government has, over the past decade, introduced many technical and financial schemes to help these companies to computerize and automate. The government has successfully implemented its first national IT plan, through which a large pool of IT personnel have been trained, and a strong proIT culture nurtured. Singapore has committed itself to develop a strong IT industry as an integral part of the national economic strategy. A new IT-2000 national plan has recently been announced, ‘with a multibillion-dollar budget to fund IT research and development for the 1990s up to 2000. CONCLUSIONS The trend survey, although conducted in Singapore, took into account the trends in London, a major IT trendsetting city in the world. For the content analysis, the trends took more than two years to observe. The research questionnaire was developed on the basis of the content analysis, an extensive IT literature search, and field interviews of many senior IT managers. The author hopes that the result of this trend study has
238
provided a reasonably comprehensive list of key success factors for IT planning and project management, leadership qualities, and issues concerning the use of IT consultants. A survey of this nature has its inherent limitatinnc . . . . ..CY.-v..”
that ST-P WVEII...V.. mmmm~ .I...& Y.”
tn .v
mnct ..I”“.
CII~VPV ctlldiec .,..I ..,, YL....._“,
and it was time-consuming. However, it has been a useful exercise which looks into issues of the project management of computing, a nontraditional projectmanagement field, and goes beyond the conventional engineering and construction project-management experience. REFERENCES J Megatrends Warner, USA (1984) J and Aburdene, P Megatrends
Naisbitt, Naisbitt,
2000
Morrow, USA (1990) Checkland,
P B Systems Thinking,
John Wiley, UK (1981) Checkland, P B ‘Information thinking: time to unite?’ Int. (1988) pp 239-248 Rockart, J F ‘Chief executives needs’ Harvard Business Rev.
Systems Practice
systems and systems .I. Inf. Manage. Voi 8
define their own data (Mar/Apr 1979) Boynton, A C and Zmud, R W ‘An assessment of critical success factors’ Sloan Manage. Rev. Vol 25 No 4 (1984) pp 17-27 Cash, J, Corporate
McFarlan, F W and McKenney, Information Systems Management
Ed.j Dow Jones-Irwin,
,a ^^^\ USA (1988)
J L
(2nd
Checkland, P B and Scholes, J Soft Systems Methodology in Action John Wiley, UK (1990) Yeo, K T ‘Systemic CSF analysis for strategic IT planning’ Int. I. Project Manage. Vol 8 No 4 (1991)
Khim-Teck Yeo is an associate professor at the School of Mechanical and Production Engineering, Nanyang Technological University, Singapore. His current interests are in the management of technology, systems thinking and practice, information systems, and project management in new fields. He currently holds a joint appointment with the GINTIC Institute of CIM. and as a fellow with the Centre for Advanced Construction Studies at NTU. 1 He received his PhD from the University of Manchester Institute of Science and Technology, UK. He gained his industrial experience from the utilities, offshore oil and gas, and aerospace industries. He worked at Foster Wheeler, BNOC and Britoil during 1975-83. and was attached to Grumman Aerospace in 1987188. Litely, he has been a visiting scholar at the Sloan School of Management, Massachusetts Institute of Technology, USA. He has been active in consulting in systems-related work for major corporations.
International
Journal of Project Management
The paper discusses major trends and issues in information-technology management on the basis of a two-year newspaper-content analysis and a field survey of IT managers. The trend study contains feedback on factors that are critical to success in strategic IT planning and project implementation, and better understanding of the changing and enlarged roles and responsibilities of todayS IT executives. A list of desired personal qualities and characteristics of IT executives is developed. The study also deals with the roles of, and the limitations and ,4e,2 Cl,/.,-0C.C fnrtrav,- IIS ;n &r&c; till” c1atz *rnn “J, ,-.r 1 TT ,.r\,.n*.ltn-tn ;1. 11 TT , UIILCCOU ,WL‘“fr) 1 L”ICJr(CLUIIW CIC planning and project implementation.
well as the roles and limitations of IT consultants. To establish such trends, a series of newspaper-content analyses and field surveys were conducted over a twoyear period in two countries. The content analysis was based on the advertisement pages for IT executives in major London, UK, newspapers. The field survey was conducted in Singapore, using questionnaires based on trends developed from the newspaper-content analysis, and the study of a wide range of IT literature. The survey, concluded in 1990, was directed at senior IT executives, who were mainly from the manufacturing industries, banking and finance, and government organizations.
Keywords: information technology, trends, surveys
CONTENT The notion of achieving competitive edge through the strategic application of information technology (IT) is now well documented and recognized. It has become an indispensable eiement in many firms’ business strategies. Increasingly, it creates new strategic choices for these firms. To date, IT applications have contributed to improved operating efficiency, created new business opportunities through IT-based products and services, and sometimes even fundamentally altered the rules of the game in competition. The role of IT, whether as an efficiency-enhancing tool or a strategic decision-support system: is indeed pervasive and recognizable in today’s business world. It is, therefore, important for companies to keep abreast with the latest IT development trends, not just with technology, but also with the managerial aspects of IT applications. The objective of this paper is to present findings about certain aspects of the trends and issues in ITplanning, project implementation, and the leadership roles and personal characteristics of IT executives, as School of Mechanical and Production Engineering, Nanyang Technological University, Singapore
Vol 10 No 4 November
1992
ANALYSIS
The content-analysis technique has its origin in the Second World War, when intelligence experts sought to find a method for obtaining information on enemy nations by analysing public opinions and major events reported ;n the local-newspapers’. For trend analysis, this is a relatively simple, inexpensive and yet potentially effective methodology that helps to make sense of what is happening and what is likely to happen in the near future. This can be achieved by closely and systematically monitoring current events around the world, especially the nartc nf the t..., trpnri-cettino .._=.u “1 I.... ~~..‘..“V. L.1” wnrlri V.U..... Nakhitt 1 ~...““.I. f s2nnhlich4 r --*au**--
two sets of best-selling megatrends for the 1980s and for the 1990s. These megatrends are identified and formulated mainly on the basis of content analysis of newspapers, particularly those published in the trendsetting parts of the USA and the world. Most of these trends are perceived to be reasonably accurate and credible. For the purpose of this study, London, UK, was rhnwn I--VUI.-
RC . . the . .._
TT .*_*._ ,.,”.-.. * _ trwwLwttino
‘&
citv
ftpr .A__Iy1
hrnwcino -..,.. “..‘_
through the more serious London &wspapers, noticed that interesting trends could be found appointments sections of the Times and Sunday newspapers. The number, frequency and salary
0263-7863/92/040231-X% @ 1992 Butterworth-Heinemann
Ltd
it was in the Times
levels 231
Management of computing: from content analysis to trend study
of the IT-related appointments advertised are indicative of the demands for, and increasing importance of, IT _^_^_^_^ ___rl_--_..,*.._r_ ‘PL_ ___A__* __,1.._:_ _I rl-. l‘lallagcls a11uLwlIsuIlilllLs. 1IlC
CUIILG:IIL
Xldlj’SlS
or
me
IT executive appointments is particularly useful in establishing the changing job requirements and desired personal qualities of today’s IT managers, as well as their responsibilities in strategic planning and project implementation. For instance, the established initial trend quickly shows a clear shift in the roles of IT executives from those of the traditional data-processing (DP) managers. The changing roles and personal characteristics of IT executives identified from the content analysis were compared with those described in the IT literature published in the major US and UK journals. The comparison shows a close resemblance in the findings from these two separate sources, those of the newspapers and academic literature. The findings on trends were incorporated into the survey questionnaire. To clarify some of the findings, several pilot interviews with IT managers were conducted prior to the questionnaire being finalized. FIELD SURVEY The objectives of the survey conducted in Singapore, a newly industrializing economy (NIE) with a relatively mature IT industry, were to establish the Singaporebased IT managers’ perceptions of the following trends: key success factors in strategic IT planning, key success factors in IT project implementation, roles and responsibilities of IT executives, personal characteristics of IT executives, perceived roles and limitations of IT consultants, key success factors in using IT consultants. A 13-page questionnaire was organized into subsections according to the above listed objectives or scope of study. 60 usable returns were received from 275 questionnaires mailed out to major corporations, ranging from multinational corporations to banks and government organizations who were known major IT users. The returns represented a modest response rate of 22%. The sample size of the respondents was not very large, but it was more than compensated for by the quality of the respondents. The majority of the respondents were from major US, European and Japanese multinational corporations (MN&) in the electronics manufacturing industries (60%)) a number
Table 1. Job titles of respondents rob tit!!2
Prqxxtio!? cf respondents, %
IT/IS vice presidents/directors/senior
managers
20
MIS/IS/DP managers
65
Senior systems analysts/finance and administration managers
15
Total
100
had higher levels of IT expenditure were those that were currently investing in large factory-automation or computer-integrated manufacturing (CIM) projects. The estimates were only indicative. The actual figures couid be much higher, as not all IT expenditures are incurred through IT departments. The rapid increase in end-user computing in recent years could also inflate the total IT expenditure further. IT budgets in the banks and government organizations were considerably higher in absolute terms. However, no clear pattern could be established, owing to incomplete information from the survey. IT PLANNING The IT-planning survey had two parts. The first part consisted in making general assessments of the IT planning methodologies used, the planning horizons, the current IT applications, the expected benefits, and the perceived IT investment-strategy positioning. The second part focused on establishing the IT managers’ response on the relative importance of a list of success factors in strategic IT planning. Planning methodologies The majority of the companies surveyed (90%) said that their IT planning approach was basically that of management by objectives (MBO), and the use of some forms of cost-benefit analysis. Companies who used critical success factors (CSF) analysis were in the minority (20%). The MB0 approach usually requires the managers to define clear project objectives, systems requirements, and the formulation of viable alternatives. This is basically a hard systems thinking approach
nfmninrlnral I1 5X0/,\ anrl onv~rnm~~~t---.--J --.VI.......- anrlfnrpion _-.-. e”“”hankr . . . . “\^“,“,,““‘~“.“““‘V”’
which PANS tvnp nf “~“““‘” cvrtpmc ..______ ha< ___- itc __- nricrin -__b___ in ___the .___ _.‘.l.Y ‘~=” -.
related organizations (22%), including the publicutilities boards and universities. The annual revenues of the responding manufacturing firms were US$lOOMUS$lOOOM. The distribution of the job titles of the respondents fell into three categories (see Table 1). All the companies surveyed had IT, managementinformation-systems (MIS), information-systems (IS) or DP departments. The level of IT budget handled by these &nartmPntc ci7p r-A _---__.-_ vnriwi . _a.__ wi&!y dp_=pndi~g 0~ the . ..v YlYI of the company and the nature of the business. As a rough estimate, the majority of the manufacturing firms surveyed allocated just under 1% of their annual sales to the IT budget, which included hardware and software purchases, applications development, operations and maintenance. A handful of companies that
and systems engineering3y4. In most cases, IT implementation is often treated as a one-off project. For instance, the implementation of a manufacturing resource-planning (MRP II) system is usually treated as a stand-alone project. The MB0 mentality in IT planning tends to place emphasis on end-item accomplishment, and to take a short-term and narrower view of a project. A common criticism of the traditional DP/MIS &nnrtmPnt the MB0 nnnrnnrh r -__._____. whir-h ..__. _._ nrlnntc “-‘r” -rr- ----is that it tends to be preoccupied with technology issues and system tools. It is common to see a DP/MIS manager who is mainly concerned with the problems of system architecture, the evaluation and selection of hardware platforms, software, operating and applications systems during the IT planning stage. Conse-
232
International
anal&c u ..-. ~“.’
Journal of Project Management
KTYEO
quently, he/she neglects some of the soft and ill structured problems, and other broader strategic issues. The CSF analysis is now a well recognized IT planning methodology. It was first used by Rockart’ to identify chief executives’ data needs. It was further developed to cover different levels of management, and subsequent!y lused as a Slr&gic-nlnnnino tnn16. _A_t the r-----‘---b planning level, CSFs are simply defined as those few important things that an organization must do well to ensure success for the organization. At the operational level, CSFs are those key issues that help to define what an organization or manager must do to meet the specified goals. The process of CSF analysis encourages a broader participation of tiie -user gro.ups and the
some simple forms of materials-planning and inventorycontrol systems developed with spreadsheet packages. The application of computer-aided design (CAD) tools was still not widespread, with only 27% of the manufacturing firms using it. This is interestingly indicative of the low level of product-design activities in these Singapore-based MNC’s, and notably in the Japanese firms, whose product design and development are performed at their head offices in Japan. A minority (15%) of the companies also used projectmanagement packages for planning product development, and the installation and transfer of production facilities. Al+L-..-L thhADD TT o.z-4 cA= ~nnl;rc,t;nna car,= ay&lII~.u~.“I.LI UIV ‘-uul”ugu L,,G 1”IL\I II (11.u
involvement of the senior corporate management to help in identifying and evaluating critical systems applications as a basis for formulating long-term IT implementation plans. The emphasis is on the process of the continual reviewing and rethinking of the company’s long-term goals and rapidly changing business needs. The responsibility of IT management is to ensure that appropriate systems applications are l_..-l---J I_ ~____L_.._L ..>~ .___I uc;velupeu ~0 meet sucn neeus m a timely and COSLeffective manner.
integral parts of an overall CIM effort, only a handful of the companies surveyed had a long-term plan towards CIM. Given the current level of knowhow and the experience curve, most of the CIM projects were not well defined. The management of these CIM projects will be user-management-oriented, with IT management providing the necessary technology support. Projects of the low-structure-high-technology type will also need rl__ ,.E d,,” ,_,l C”,,,I,,IClllr;,,I ,,.,,;+,,_+ FIfi_ LILt:L1___1__ u,c;s>,,rg “1 II”,,, ,h1‘1b ,__ L”P _““__P_ ,11411Ll~Lment to succeed. The hard systems thinking and management-by-objective approach may not be able to cope with the many ill defined problematic variables. A soft systemic approach’ that emphasizes continual and relentless learning, both at the organizational and the individual levels, will be more appropriate. The soft systems thinking would take into consideration human attitudes and human perception in a problem situation.
Planning horizon The survey showed that slightly over half (57%) of the respondents had a planning horizon of less than two years, of which 19% planned only on an annual basis. The latter were the smaller manufacturing firms. The remaining 43% of the respondents had a longer horizon of 3-5 years. These figures probably reflect the generally shorter-term orientation of the Singapore-based companies as far as IT planning is concerned. For the smaller manufacturing firms, the IT planning focus is more operational than strategic. The larger banks and manufacturing firms and government organizations are 1:1 -9~ I- *mm_ 1more nKely LO nave a longer pianning span and iarger IT budgets.
Current IT applications A clearer applications trend could be established for the manufacturing firms, as they represented nearly two-thirds of the respondents. The survey showed, however, that all the responding firms had installed the business systems for finance and accounting and other administrative purposes. The systems covered the basic functions, such as accounts payable, accounts receivable, general ledgers, payroll and personnel records. The finance and accounting systems usually represented the first computerization efforts of these companies. The majority of the banks surveyed also used IT to provide customer online services. Most of these systems were typically ‘low-or-medium-technology-high-structure’ type projects according to Cash’s technology-structure matrix. Cash’ used the matrix to define the various project types as a contingency approach to IT project management. About 82% of the manufacturing firms had installed some aspects of MRP II systems which included order entry, materials-requirements planning, inventory control, costing, product data, production scheduling and sales analysis. The remaining 12% of the firms used Vol 10 No 4 November
1992
IT investment
positioning
In formulating long-term IT investment strategy, senior corporate management and IT executives must critically review the company’s current strengths (S) and weaknesses (W) against perceived opportunities (0) for growths and profits as weii as potentiai externai threats (T). The IT investment positioning that is indicative of a firm’s future IT intention can be mapped on a SWOT matrix’. The survey showed broadly the IT investment positioning of the manufacturing firms and the banks (see Table 2): The survey showed that the banks were more positive than the manufacturing firms that IT applica-
Table 2. IT investment
positioning
Proportion of manufacturingfirms Investment
respondents,
positioning
Use of IT to exploit for growth
Proportion of
bank % respondents,
%
opportunities 53
88
50
33
16
22
0
0
Use of IT to rectify internal weaknesses
Use of IT to overcome from new entrants Not interested investment
in further
threats
IT
[Some firms take more than one strategic
position.]
233
Management
of computing: from content analysis to trend study
tions could help the business to achieve further growth. IT impacts different industries and the firms within Al___ AlAX___-Cl_.11 T’p :_ --._. ~mtJeuutxl _-l-__l>_?l :_r_ A?:-_-_:_, lIIlT:IIIu111ere1111y. 1s now lIllU Illlallc;lill services and products as the embedding technology, while the application of IT in manufacturing, such as CAD/CAM or MRP II, is more enabling than embedding. The banking business may now collapse without IT, while manufacturing may still survive without CAD/ CAM. The survey showed that more manufacturing firms intended to use IT to rectify internal weaknesses. Two-thirds of the respondents from manufacturing considered reduction in inventory and work in process (WIP) to be the main goals and expected benefits of IT applications. These considerations are more operational than strategic. KEY SUCCESS FACTORS The main part of the questionnaire survey concentrated solely on establishing key success factors related to IT planning and project implementation, the roles and desired personal qualities of IT executives, the roles and limitations of IT consultants, and factors to ensure success in using consultants. IT strategic planning The respondents were asked to rank a list of factors that must be considered when formulating long-term IT plans on a scale of 1-5. The mean scores of the various factors were then computed. Factors with a mean score of less than 3 were dropped from the list. The result was a shorter list of success factors (see Table 3), which Table 3. Success factors in IT planning Success factors
Issues
Mean score
Style
4.80
Style
4.24
Incorporation of IT into corporate business strategy
Strategy
4.11
Availability
Strategy
4.06
Staff
4.02
Staff
3.88
Style/ Structure
3.83
Structure
3.82
Use of a high-level committee of senior managers to formulate IT strategies and policies
Structure
3.76
General computer company
literacy
Stafi
5./3
Operations (user) IT knowledge
management
Skills/Staff
3.64
Top-management Support
commitment
from an in-house
of funding,
Availability of in-house and manpower Continuing
‘champion’
budgeting IT expertise
staff education
and training
Involvement of IT executives business decisions Coherent
corporate
in
organization
of staff in
I _?
having
[The mean scores are arbitrarily defined as follows: > 4.5: critically important, 4.0-45: very important, 3.5-4.0: important, 3.0-3.5: good-to-have, < 3.0: not important.]
234
were then arranged in order of importance. To help in the better appreciation of the nature of the issues :__.-,.._A ^_._^^__ l?__r_-_ -_ _-r____:-__I ac-IIIVUIV~U,rl..__ LIIGS~:~UC;GGSS I~CLUIS._.^ wcrE: ca~egu’~~~u cording to Mckinsey’s seven-S framework’. The framework is divided into three hard Ss (systems, structure and strategy) and four soft Ss (style, skills, staff and shared values). The survey showed that the emphasis of the key success factors was on strategic considerations of IT, and on issues which are soft-S, such as those concerning leadership, management style, and human-resource management. By definition, key success factors are those few important areas that managers must pay attention to and do well to ensure success in their endeavours. In the study, the key success factors were those that were unanimously perceived as being the most important, and they were arbitrarily defined as those with a mean score exceeding 4.0, with the maximum of the scale being 5.0. These key success factors that must be considered in IT planning are 0 top-management commitment, l support from an in-house ‘champion’, l the incorporation of IT into corporate business strategy, l the availability of funding and adequate budget allocations, l the availability of in-house IT .expertise and manpower. The survey results were consistent with those described in the IT literature and field interviews, i.e. topmanagement commitment is the single most critical factor that ensures success in any major IT implementation. The chief executive officer (CEO) must have a supportive leadership style in giving his/her blessing to major IT initiatives, and in setting aside adequate funding and manpower to support the projects. The top management’s involvement also ensures coordinated efforts between the user management and the IT management. Many respondents also agreed that, ideally, there should be an in-house ‘champion’ from the senior management who believes in the potential benefits of IT applications, lends his/her support, and follows through the planning and critical implementation phases. The other key factor concerns human-resource or staff issues. It is the responsibility of the IT management to ensure the availability of qualified IT staff to provide the necessary technical support to the I\tr\;p,-+ +n-m FL”JtitiL LClo.lll. Project implementation It is unlikely that there is a single best way of managing IT projects. The appropriate project-management approach is contingent on the project type, which is characterized by the level of technology and project structure involved. Cash’ defined four broad project tllnpr armrrlino tn 2 tPrhnnlnov_ctnlrtllrp m&$x. The ‘,F’” U’W”‘..“‘b L” U “““““.“e,, “.1..1.--differences in project-management approach are reflected in the roles and relative dominance of the IT management in relation to the user groups. The level of technology and project definition, on the other hand, influences the level of formal planning and control used. For instance, low-structure or ill-defined projects International
Journal of Project Management
KTYEO
with unclear objectives and ambiguous user requirements certainly need a high degree of integration with the user groups. Tlne seiection of a user as the project manager and the creation of a user-led steering committee could be critical in ensuring the success of such projects. For high-technology projects, the selection of an experienced IT professional to lead the project team is necessary. The large ‘low-structurehigh-technology’ projects are likely to be the most complex and risky. In this case, close coordination between the user and the IT management is required, ideally with strong top corporate-management support and commitment. The use of forma1 planning and baseline control systems is likely to be more effective with large and highly structured projects than illdefined projects. The survey did not use the technology-structure matrix to study the various in-house IT projects in the responding companies. However, on the basis of their current applications, the majority of the IT projects undertaken to date by the responding companies are of a relatively well structured type using lower- and medium-level technology. The respondents were only asked to give their general assessment of the key factors that contribute to project-implementation success. Table 4 gives a list of success factors arranged in order of relative importance according to the mean scores based on the five-point scale.
Success factors
identified 4.0, i.e.
clear project objectives and requirements, 0 a concise project plan, 0 active user participation, l an understanding of the company’s operations, l the appointment of a user as the leader of the steering committee.
l
These key success factors are indicative of the responding IT managers’ genera1 emphasis on a forma1 and systematic approach towards project implementation, and their recognition of the importance of user participation and the awareness of business needs. The survey shows some interesting variations from the mean trend. The IT managers from the banks seemed to place less importance on end-user participation than did their counterparts from the manufacturing and government sectors. This variation probably reflects the relative dominance of IT departments in the banking sector, where projects are generally larger, involve a higher level of technology and sophistication, and have relatively well defined user requirements. The government organizations, on the other hand, placed great emphasis on the use of user steering committees, which is probably typical of the civil-service mentality.
Roles of IT executives
Mean
score
Table 5. Roles and responsibilities
of IT executives Mean score
4.51 Roles Concise
project
plan
‘Require to work closely with the senior management team to understand and evaluate their requirements, recommend and create solutions . . .’ (Nicholas Hanley)
4.15
3.90
‘Working with department managers to ensure that the systems are introduced in a timely and cost effective manner . .’ (PA Personnel Services)
3.95
3.87
‘Initiate and lead the development (Touche Ross)
(3.80 banks)
4.05 as leader
of 4.04
competence
of project
4.00 leader
Use of a project-implementation steering committee Use of phased or structured development approach Education and training systems applications
modular-
of software-vendor
support
Formal system to measure systems performance
Vol 10 No 4 November
_’ 3.86
3:75
‘Ensure sufficient supply of professional talent to carry out these responsibilities lanonvmousl \.~~~_~~,~~~.~_,
x77
3.74
‘Responsible for system (Leading Edge)
testing
quality
human
. .’
and quality
assurance
. .’ 3.68
3.70
3.50
1992
solution
3.82
to
enthusiasm
of creative
3.82
of end users in
of end-user
(3.66 banks, 4.38 government)
‘Responsible for entire IT function and particular concentration on design and enhancement of MIS functions, as well as close cooperation in the development of new products .’ (Samual Pearce Recruitment)
3.86
Formal administrative mechanism enforce application after systems handover
Quality
4.27
4.12
End-user feedback and continual enhancement of systems
Maintenance
‘Ensure the IT strategy is continually reviewed to take account of changing business needs and computer development which provide improved benefits .’ (S & P Recruitment)
in design
of company’s
Appointment of end-user steering committee
Technical
and responsibilities
4.23
End-user active participation and development Clear understanding business operations
from
In the survey, the respondents were asked to respond to a list of roles and responsibilities that had originally
in IT implementation
Table 4. Success factors
Five key success factors have been those with a mean score that exceeded
‘To make technical technical minds . (Hoskyns)
information
crystal
clear to non-
. .’ 3.40
235
Management of computing: from content analysis to trend study been extracted from the newspaper-content analysis. Exact wording from advertisements from the various ____-.:r-__c _____:-_ __.__^ ~~~rul~tI~~llL agrnc1tZs WCIE:..__?I u5&Xl1_ 111*I__ LUG,:,.c i*sL,T-1-1,. la”LG Jc ,:_r,. 11&C> those roles and responsibilities that were accorded a score that was significantly above 3.0. The survey showed a significant shift in the perception of the roles and responsibilities of today’s IT executives. The IT managers surveyed were generally in agreement that their most important responsibilities were to ensure that the IT strategy and long-term IT investment were meeting the changing corporate business needs. They acknowledged the need to work closely with the user management team, to understand and assess their most critical requirements, and to recommend and create effective solutions that would bring tangible benefits to the users. They also had to continue to keep abreast of the latest technological trends. Within the IT departments, the IT managers would continue to provide leadership with respect to all the organizational aspects of the IT functions, manage internal IT manpower resources, and maintain an overall view on all on-going and new project developments. At the corporate level, they would help to organize continuing user education and training at various levels.
Personal characteristics of IT executives Table 6 is a partial list of the desired personal characteristics of IT executives as advertised in the Table 6. Personal characteristics
of IT executives
Mean score
Persona! characteristics ‘Proven track record of developing and implementing IT (PA Personnel Services)
Roles and limitations of IT consultants
‘High independence, ability to operate effectively under pressure . . .’ (PA Personnel Services)
4.11
‘Innovative, conceptual thinking, able to adapt to, and promote change throughout the organisation . . .’ (Myriad)
4.10
‘Far-sighted professional who shares the same sense of purpose and courage of conviction of the organisation . (Nolan, Norton & Co.)
IT consultants, like any other management consultants, 4.04
3.95
‘A gift of turning IT knowledge and commercial acumen into business strategy . .’ (Arthur Andersen)
3.94
‘First class written and oral communication personal skills . . .* (Michael Page)
3.86
235
The increased specialization of the IT function and the rise of user computing have encouraged the growth of IT consulting services. IT consuItants are now likely to market their services directly to the user groups, who tend to be more willing customers than IT departments. The following discusses the survey of IT managers in Singapore of their experience and perception of external IT consulting services. Areas of IT consultang
‘You have a flair for planning, organising, and directing the effort of others in a lively progressive environment . (Touche Ross)
‘Comfortable in dealing with ambiguity .
The survey showed that a proven track record and experience top the list. It is quite understandable that an IT executive’s total personal qualities should be manifested in his/her experience and performance to date. This is particularly so when he/she is expected to fill a senior executive position. The list is by no means exhaustive, but it does represent some of the essential qualities that are required by the recruitment agencies and their clients, and concurred on by the IT managers surveyed. In addition to the above five characteristics with mean scores exceeding 4.0, there are several others worth mentioning. These include innovative and conceptual skills, adaptability and responsiveness to change, first-class written and oral communication skills, and, preferably, a university degree or equivalent professional qualification.
4.23
4.20
(DMR)
a proven track record, o being mature and well balanced, l being a strategic thinker with business acumen, l having an ability to work under pressure, l being technically competent. l
. .’
‘Mature, well balanced manager, committed to keep abreast of IT trends. . .’ (PE Inbucon)
and inter-
‘A degree or equivalent professional qualification . . .’ (Touche Ross)
London newspapers, arranged in order of relative importance as perceived by the IT managers surveyed. T&_ ^.._..^.. S1I”WGU ‘.I._._.^A +&,+ CL, Illt: 3u,vt;y 111Cl1 LIIC,,,_,,~,,+, IG;s~“‘I”GIILS,~,___ WG‘G:, ‘11 strong agreement with respect to what were considered to be the desired personal characteristics of IT executives; this was shown by the high scores. This, interestingly, was in contrast to their assessment of the roles and responsibilities of IT executives discussed earlier, in which they were less unanimous and less certain, as reflected in the lower mean scores. The five most important personal qualities with high mean scores are
3.42
.’ 3.30
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problems, introducing new ideas or techniques to a client, and acting as an agent of change. IT consultants fit into a client’s organization by working closely with the client’s staff, and obtaining their cooperation and involvement in identifying areas of concern and areas for improvement. The consultant’s task is then to create effective solutions that will bring about the required change and benefits. From the content ~nalwzic V. nf TT nnnnintmcvttc arivm+wvl in W...Y w-..,. ..--. . . the -..v L,nn&n U‘BU’JY’U . I ..yj.,‘v*...... newspapers during 1989-90, almost half of them are looking for IT consultants. Most of these consultants were to be engaged in strategic IT planning and applications. The survey elicited views from the IT managers on their current and intended areas of consultancy, the International
Journai of Project Management
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reasons for using consultants in their companies, and the limitations and success factors of the use of consultants. The survey showed that just over 40% ol the responding companies had experience in using Pnl7Clllt2l7tC ..“~~uu~ru.,ru) and U‘BU thc=w L&a-, 11rc4 U.,“U them L,,“...
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Table 7. The survey showed that the main areas of IT consultancy services were the provision of in-house training, strategic planning, and the management of projects. Most of the companies in Singapore used outside consultants to raise awareness and gain experience of specific IT applications. Training and skills development were normally given high priority in these firms. Reasons for using IT consultants When asked what would be the reasons for using IT consultants, about two-thirds of the respondents cited lack of in-house expertise, and one-third said that they would use them to obtain independent opinions and fresh ideas (see Table 8). Perceived pitfalls of using consultants In the earlier survey on IT project implementation, the use of external IT consultants was not considered as being an important success factor. The managers surveyed generally had reservations about the use of outside consultants. Questions about the competency and integrity of the consultants were high on the list (see Table 9). it is naturai for a company to be concerned about the prospect of engaging a consultant who then fails to deliver a workable and effective solution. The integrity of a consultant was seen as relating to his/her ability to give value for money for the services provided, to give objective and unbiased views and recommendations, and to maintain confidentiality to protect the clients’
Table 7. Areas of IT consultancy Areas
Proportion respondents,
Training
Systems Feasibility Systems
of %
IT planning
design
45
management
studies
45
and software
Proportion respondents,
pitfalls
TnrnmnPtPnt
~“.,.,“.LU,II11
Irresponsible
characters
Overcharged
by consultants
Overdependence Disclosure Misuse
of %
58
rnncllltlntc
.,.~Y”‘y~,‘.mL
50
of consultants
42 38
on consultants
of company’s
23
secrets
of consultants
8
interests. A consultant’s impartiality and judgment in his/her advice to the clients may be in question if he/she has links with certain hardware or software products. Overdependence on outside consultants was another ‘.l_,, al _A pirran mar most companies wanted to avoid. ideaiiy, companies should develop their own in-house IT capability, and use consultants mainly for knowhow and technology transfer. The smaller manufacturing firms were also more wary of being overcharged by consultants. The larger firms were less concerned with cost, as long as the consultants could deliver solutions. Very few respondents said that misuse of outside consultants, say for political reasons, was a real -1 I promem.
Success factors in use of IT consultants Table 10 shows the rating of a list of success factors that need to be considered to avoid unfruitful consultancy. From the survey and field interviews, a number of 1____~._1__~_.2 * _1..~.. lessons were learneo. A cnent company, before engaging an outside consultant, must satisfy itself that the
evaluation
and prototyping
Table 10. Success factors in use of IT consultants
Success
5.5
project
Perceived
pitfalls of using consultants
services used
of consultancy
Strategic
Table 9. Perceived
27
Consultants
have good track
Consultants
have tested
Consultants
can work
Clients
18
Mean score
factors
have clear
Close monitoring
4.28
and proven
closely
objectives
Close user involvement
records
4.27
with clients
4.25
in what they want
4.15
in systems
of progress
methodology
definition
and design
by client
4.03 4.01
Table 8. Reasons for using IT consultants Consultants Reasons
Proportion respondents,
Lack of in-house
IT expertise
of %
have intimate
Consultants provide implementation
knowledge
follow-up
of clients’ businesses
support
4.00
after systems 3.94
67 33
Consultants give clear and specific recommendations instead of many alternative solutions
3.92
For fresh ideas and new methods
33
Cnnrllltnnts --..__.__.._l
3.87
For their tested
27
Client’s
16
Client
To obtain
independent
opinions
and proven
More cost-effective
methodologies
than in-house
Vol 10 No 4 November
efforts
1992
ran --..
company
nmvidr r._ ..__
ctrnno -~'-..D
nrnitvt r'-,--.
must be internally
must have in-house
expertise
&&rc&ip
organized
3.78 3.35
237
Management of computing: from content analysis to trend study
prospective consultant can demonstrate characteristics:
the following
having a good track record with similar assignments, hca.r;nn
“CA..,‘6
tertd
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logies, being able to work closely with client’s staff, having a clear idea of the client’s objectives and requirements, encouraging user involvement in systems definition and design, having a system for regularly reporting to the client on the project-progress status, having an intimate knowledge of the client’s business operations and environment. Before engaging a consultant, it is advisable for the company to check the resume of the assigned consultants, particularly with regard to their track record in previous projects. To ensure success, the client must be intemaiiy organized in defining its own objectives and requirements, setting up an internal team to supervise and monitor progress, and developing relevant inhouse training. On engaging the consultant, clear terms of reference must be defined and documented which specify the client’s systems objectives and requirements, scope of work and deliverables, as well as key milestones and delivery dates. The importance of IT consultants to the industry is weii recognized, particuiariy for the smaiier firms, who do not usually have their own in-house expertise and manpower to implement relatively sophisticated projects. However, to many of these smaller companies, the costs of engaging a reputable consulting firm are prohibitively high. To this end, the Singapore government has, over the past decade, introduced many technical and financial schemes to help these companies to computerize and automate. The government has successfully implemented its first national IT plan, through which a large pool of IT personnel have been trained, and a strong proIT culture nurtured. Singapore has committed itself to develop a strong IT industry as an integral part of the national economic strategy. A new IT-2000 national plan has recently been announced, ‘with a multibillion-dollar budget to fund IT research and development for the 1990s up to 2000. CONCLUSIONS The trend survey, although conducted in Singapore, took into account the trends in London, a major IT trendsetting city in the world. For the content analysis, the trends took more than two years to observe. The research questionnaire was developed on the basis of the content analysis, an extensive IT literature search, and field interviews of many senior IT managers. The author hopes that the result of this trend study has
238
provided a reasonably comprehensive list of key success factors for IT planning and project management, leadership qualities, and issues concerning the use of IT consultants. A survey of this nature has its inherent limitatinnc . . . . ..CY.-v..”
that ST-P WVEII...V.. mmmm~ .I...& Y.”
tn .v
mnct ..I”“.
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and it was time-consuming. However, it has been a useful exercise which looks into issues of the project management of computing, a nontraditional projectmanagement field, and goes beyond the conventional engineering and construction project-management experience. REFERENCES J Megatrends Warner, USA (1984) J and Aburdene, P Megatrends
Naisbitt, Naisbitt,
2000
Morrow, USA (1990) Checkland,
P B Systems Thinking,
John Wiley, UK (1981) Checkland, P B ‘Information thinking: time to unite?’ Int. (1988) pp 239-248 Rockart, J F ‘Chief executives needs’ Harvard Business Rev.
Systems Practice
systems and systems .I. Inf. Manage. Voi 8
define their own data (Mar/Apr 1979) Boynton, A C and Zmud, R W ‘An assessment of critical success factors’ Sloan Manage. Rev. Vol 25 No 4 (1984) pp 17-27 Cash, J, Corporate
McFarlan, F W and McKenney, Information Systems Management
Ed.j Dow Jones-Irwin,
,a ^^^\ USA (1988)
J L
(2nd
Checkland, P B and Scholes, J Soft Systems Methodology in Action John Wiley, UK (1990) Yeo, K T ‘Systemic CSF analysis for strategic IT planning’ Int. I. Project Manage. Vol 8 No 4 (1991)
Khim-Teck Yeo is an associate professor at the School of Mechanical and Production Engineering, Nanyang Technological University, Singapore. His current interests are in the management of technology, systems thinking and practice, information systems, and project management in new fields. He currently holds a joint appointment with the GINTIC Institute of CIM. and as a fellow with the Centre for Advanced Construction Studies at NTU. 1 He received his PhD from the University of Manchester Institute of Science and Technology, UK. He gained his industrial experience from the utilities, offshore oil and gas, and aerospace industries. He worked at Foster Wheeler, BNOC and Britoil during 1975-83. and was attached to Grumman Aerospace in 1987188. Litely, he has been a visiting scholar at the Sloan School of Management, Massachusetts Institute of Technology, USA. He has been active in consulting in systems-related work for major corporations.
International
Journal of Project Management