The Cisco as a New CIO - Assignment Example

The Cisco as a New CIO Introduction Peter Solvik joined the Cisco as a new CIO and decided to bring a lot of innovations to his corporation. Thus, he changed the overall structure of the organization. These changes primarily transformed the role of IT in the organization. The organizational finance group was transformed into a customer advocacy group. The next main step taken Peter Solvik was regarding the reallocation of the majority of the IT budget to the departmental level. In this way each department will have a direct control over the departmental money. In this new structure the concept of the cartelized management has minimized. The next main transformation he made was the formation of a central IT steering committee. He made a new structure through which IT investment decisions on application projects will be taken by the line management. In addition, the execution of these projects will be done by the centralized IT organization. Furthermore, before Cisco’s business was running through legacy system and a UNIX based software package that was used to maintain its operations of manufacturing, financial, and order entry. This system was crashed on January 1994 and because of this problem organization’s systems were not able to process requests for two days. At that time Cisco administration realized that they should implement an enterprise resource (ERP) system quickly. Thus, Cisco successfully executed an ERP system from Oracle only within one year (McAfee, McFarlan, & Wagonfeld, 2004). This paper presents a detailed analysis of the some aspects of new technology based transformation with respect to Cisco. In this scenario the main transformation in ERP system implementation at Cisco will be discussed. This paper will also outline main aspects regarding new technology implementation at Cisco. 1- Peter Solvik's approach to IT governance Peter Solvik changed the overall structure of organization. The organizational finance group was transformed into a customer advocacy group. The next main step he took was regarding the reallocation of the majority of the IT budget to the departmental level. In this way each department had a direct control over departmental money. In this new structure the concept of the cartelized management has minimized. The next main transformation he made was regarding the separation of the central IT steering committee. He established a new structure through which IT investment decisions on application projects were taken by the line organizations. Thus, the execution of these projects was done by the centralized IT organization. These main decisions were carried out to jointly, transform the view that is IT as an “overhead.” (McAfee, McFarlan, & Wagonfeld, 2004). The main governance styles we will discuss are given below: (McAfee, McFarlan, & Wagonfeld, 2004; Antolovic, 2007; Clark, 2004) Business Monarchy: governance style in which we have a group of business executives or individuals. This governess style encompasses committees of senior business executives. In this type of management we eliminate IT executives who are performing separately. The next main governess style is IT Monarchy is which we have individuals or groups of IT executives that are performing in collective manner. Federal governess style is next one that involves a business unit leader. In this scenario we have key procedure owners or their delegates. In Federal governess style C-level business groups and executives are operational in business organizations. In Federal governess style we may as well incorporate IT executives as additional participants. This governess style is corresponding of the central as well as state governments operational jointly. Next governess style is IT Duopoly that involves IT executives as well as one other group business unit or process leaders. The governess style of Anarchy involves every individual user. As I have assessed the main and primary style in use at the network level was Federal. 2- Problems Cisco have with its internal IT by 2001 After the comprehensive transformations made by the Peter Solvik, the business had gained a lot of advantages, however, there were still some problems. The main difficulties after period of 2001 are given below (McAfee, McFarlan, & Wagonfeld, 2004): Business leaders found that their latest technology are taking lots of investment Cisco was throwing money and engineers at customized tools Desired output can’t be attained Different definitions for key terms Multiple databases and fuzzy definitions Current system does not meet all of the specialized needs of other functions such as sales, marketing, and human resources Lack of centralized planning More time spent in getting the information needed regarding projects Central planning has created lot of problems Data handling becomes difficult Need to upgrade to a newer version of the ERP system pervious system was not offers planned services The implementation of ERP system at CISCO has faced some problems. In this scenario ERP system did not help more, the main reason is that ERP system was having lack of centralized planning, that has created many problems. It had turned out to be tremendously hard for the business to upgrade its majority of significant enterprise-wide ERP linked systems. As every utility planned as well as funded its own developments, a lot of groups had established customized plans that interfaced by the enterprise software. A lot of groups as well built specialized tools to facilitate the raw data in diverse methods. When Cisco has upgraded to a latest version of its corporate ERP system, the majority of these custom interfaces were disabled. In this scenario a lot of corporate operations have been disturbed and made the overall management and handling harder (McAfee, McFarlan, & Wagonfeld, 2004). 3- What is BPOC's role BPOC was established in 2002 and its main role was to reinforce the significance of a higher degree of centralized IT planning. The development of the BPOC was intended for a cross-functional decision making group. BPOC was aimed to drive and set corporate priorities intended for the business (McAfee, McFarlan, & Wagonfeld, 2004). The authority of the BPOC was focused on driving the business wide productivity by making operational strategy decisions, implementing corporate business procedure structure, aligning comparable initiatives all through the corporation and implementing decisions through consideration to accountability and execution. BPOC makes suggestions that influence how Cisco applied its IT spending (McAfee, McFarlan, & Wagonfeld, 2004). Three enterprise projects were selected by the Boston for upgrading the Oracle ERP system. The main solutions were based on other huge software packages like that PeopleSoft for human resource management and Siebel for sales force automation (McAfee, McFarlan, & Wagonfeld, 2004). 4- Why Boston selected the three big projects At Cisco, Boston discovered the need for centralized planning. Thus, he realized that the central planning had created a lot of problems. At that state they realized that it has turned out to be extremely hard for an organization to upgrade its most important enterprise-wide systems. The customary planning and development was done through the interfaced system. In this period the trough the rapid development the different parts of the organization had interfaced by means of the ERP system to attain dissimilar kinds of data. A lot of groups as well built specialized application that employed the raw data in diverse means. To effectively handle the organizational data it was necessary for Cisco to upgrade its system to a newer version of the ERP system. They thought new ERP will be able to manage the data in an enhanced way and offer the business better solutions. Then after a detailed analysis and requirements analysis it was found that Oracle ERP system will be the best solution for the overall organizational processing and operational structure (McAfee, McFarlan, & Wagonfeld, 2004). 5- 3 big projects to BPOC Three big projects were intended to enhance the overall organization’s operational performance and effective decision making. PeopleSoft is intended to enhance the performance by offering the enhanced human resource management functionalities. This project will offer better performance for the management of overall organizational process and working structure. The next main project is Siebel that is intended to enhance the sales or business and manage them in an effective way. However, these systems were mainly aimed to automate the organizational processes and operational structure. In scenario of Cisco’s ERP system upgrade that was intended to impact these other systems also as they were mission critical for the corporation. Boston predicted that the project would need three years as well as cost at least $200 million. The corporate reporting and business intelligence program signified an attempt to standardize implementation that everyone in the corporation could utilize to get information regarding main metrics like that bookings, sales, shipments etc. (McAfee, McFarlan, & Wagonfeld, 2004). 6- Issues related to "Shadow IT" at Cisco The implementation of the “shadow IT” projects was done to IT headcount for the centralization and optimization. Shadow IT was intended using contractors to carry on building functional tools, however this turned out to be difficult because of number of minute, “underground” IT projects were deserted or started being paid too big. Boston hired senior leaders from all through the corporation who standardized the significance of central governance (McAfee, McFarlan, & Wagonfeld, 2004). The main issues regarding the Shadow IT at Cisco were the privacy of business. In department of Shadow IT all workers were contractors, so they were not offering more solid privy to Cisco’s worldwide strategic schemes. Another main issue Cisco was having in case of Shadow IT was about the non-centralized working structure of employees. The contractors were divided in to four to five employees groups; however, they would have been managed in a more enhanced way in central fashion (McAfee, McFarlan, & Wagonfeld, 2004). Conclusion There were a lot of benefits of the ERP system and the web-centric supply chain since they offered the greater facilities such as email, and server operating systems, voicemail, desktop, meeting schedule software and office productivity suites were all standardized. Through this transformation the whole business operational structure became centralized. Through the web-enabled services Cisco’s operations were standardized and Cisco was capable to carry out business activities with enhanced efficiency and more effectively. Additionally, through the implementation of new technology based system and large IT projects Cisco was able to standardize the overall business structure. In addition, these implementations offered Cisco to uphold and maintain an efficient supply chain via business networked applications and also facilitated to join and integrate suppliers into its production systems. It allowed Cisco to establish a single enterprise system. This large IT projects implementation also helped Cisco and its business suppliers and associates to control, manage, respond on time to the customers’ demand. Thus, it has augmented the customers’ confidence on the business and its ongoing working structure. Cisco is good at pursuing the new idea because it will offer its business to add more value and enhanced overall market share in the business market place. This also enhances the user performance that leads toward the better user dependence on Cisco services. The new ideas allow Cisco to remain profitable in the marketplace because they help enhance the portability and market value of the Cisco products and overall global demand. Bibliography Antolovic, L. G. (2007). IT Governance Propelled IT Revolution. Retrieved 04 02, 2010, from http://74.125.153.132/search?q=cache:oIZVioxxKfoJ:net.educause.edu/section_params/conf/ITGS07/IU%20ITG%20Antolovic%27.ppt+Monarchy,+Feudal,+Federal,+Duopoly,+Anarchy&cd=2&hl=en&ct=clnk&gl=pk&client=firefox-a Clark, A. J. (2004). IT Governance: Establishing Who Decides. Retrieved 04 01, 2010, from http://74.125.153.132/search?q=cache:8eQ9LzPxfzUJ:net.educause.edu/ir/library/powerpoint/LIVE0714.ppt+Monarchy,+Feudal,+Federal,+Duopoly,+Anarchy&cd=3&hl=en&ct=clnk&gl=pk&client=firefox-a McAfee, A., McFarlan, F. W., & Wagonfeld, A. B. (2004). Enterprise IT at Cisco. Harvard Business Review , pp. 605-615. Read More