Risk and Value Management in IT Company - Report Example

The Case Scenario TechWatt Corporation is a small but fast growing IT company producing both computer hardware and software systems. The company is considering investing in a new regional HQ as part of an ambitious expansion plan, and are about to commission a major project for this. Funds of approximately 5M have been allocated for this purpose. No major decisions have been made yet regarding a possible site or the specific facilities to be provided. However, TechWatt expect the proposed scheme to include the following: The Changes Some of the changes in the infrastructure of TechWatt Corporation include the following -Office accommodation for management and administrative employees (12 staff) -A workshop for hi-tech light manufacturing processes (15 staff) -The ability to receive visits from clients and potential clients for meetings and to tour facilities The Study TechWatt has approached as an independent VRM consultant for expert advice on the project and have commissioned 2 studies [1] A Value Management study To be carried out during project briefing stage. The aim is to help develop the brief and confirm the decision to build. TechWatt see VM as a means of ensuring the project is properly scoped and clearly defined before proceeding further. [2] A Risk Management study To be carried out following contract award and immediately prior to site set-up Report I - Value Management Study The two reports bring out the pros, cons and processes of value management related to the development of TechWatt and its expansion plans. Some of the expansions plans of TechWatt involve office accommodation for management and administrative employees employing 12 staff members, a workshop for hi-tech light manufacturing processes with 15 staff members. Expansion also includes the ability for TechWatt to receive visits from clients and potential clients for meetings and tour facilities. Value management relates to using management principles to motivate employees and developing their skills and also maximizes their potential for improved company performance. Value management helps in developing an awareness for value in an organization and also focuses on targets and objectives seeking solutions to function on practical innovative outcomes. In this case, value management would relate to development of value based systems, of aims and methods in the company TechWatt and developing skills and competencies in the staff members. Maximizing potential of a company by developing structures and functions appropriate to the value management principles would also be recommended. The concept of value is dependent on resources and needs of a company and satisfaction of these needs and resources would be dependent on management style, human dynamics and interaction, external and internal environment and effective methods and tools of achieving outcomes. The value management focus on management style highlights the importance of teamwork and communication, creativity, innovation, with focus on functional and customer approach and requirements. Considering the need for teamwork and cooperation, cooperative operating principles with enhanced meeting facilities and office space for many members of staff would be an important aspect of value management. Enhancing facilities for interaction and communication among members is very important and could be emphasized. Teamwork, communication as well as external and internal conditions and managers can consider value management perspectives to influence these conditions. However means of achieving this outcome would relate to better business decision making with improved services and products, better competitiveness, value culture and common knowledge, with development of multitask and multidisciplinary teamwork. The benefits of value management with the technological sector as relates to TechWatt would be associated with provision of services in public and private sectors. The people who could remain involved in this aspect of management would be the team members of the company, the members working within the IT section and the management and administrators. The specific issues in IT management and value management at TechWatt would thus include principles of teamwork and enhancing communication and IT facilities as also improving internal and external conditions of working and these could be applied with the applications of the principles of value management involving staff, IT people and the management although the final task and services facilities would also depend on the market, distributors and customers ultimately who matter for the success of company performance. Workshops arranged on value management would require the presence of staff, IT staff and management so TechWatt will have to inform its staff members on the subject of the workshop, on the aims and objectives of the workshop and the general structure, functions and purpose of the company. Emphasizing on teamwork and communication, internal and external conditions, competitiveness, innovation and focusing on customer requirements are some of the objectives that will be highlighted in the workshop suggesting the importance of value management involving different aspects of company decision making. In the context of TechWatt value management would thus involve having a workshop related to improving performance in all aspects of decision making and management and involving all staff especially IT. Services of TechWatt would be improved competitiveness when compared with other similar companies that sell hardware and software products and also improving its infrastructure as it has been trying to do in recent times with expansion and better facilities. The specific facilities to be provided at a site could thus be highly recommended and emphasis should be drawn to not just infrastructure and management but also to general ambience and facilities that all add to value management through increasing competitiveness and skills and enhance company performance. Training and improving skills of staff would thus be an important part of the workshop and emphasize on the need of work power and human resource for better output of the company. This forms the value management study and project for TechWatt. The value management study is thus built during the project briefing and development phase where the aim is to develop and confirm the decision to build the infrastructure at the TechWatt as proposed. Report II - Risk Management Study Following contractual agreement and prior to having the site set up it would be important to undergo a risk management study to identify and prioritize the risks involved and to develop a plan for tackling such risks. TechWatt has asked for a risk management study that would examine the risks involved in infrastructural changes and the people involved in such risks and risk management. Changes include office accommodation and management as well as training and development of skills of staff. Receiving clients and arranging tour facilities as well as holding a workshop on light manufacturing in the context of hardware and software would be some of the features that could account for potential risks. Risk management is about identifying and preventing risks at the company and in this case risks could be related to IT, management or even changed infrastructure. IT related risks would be viruses or other technical faults of the systems or technical issues related to the hardware or software such as a failure of the systems, or problems with the hardware parts or simply software snags and technical issues. In the context of assessing and identifying risks in business acquisitions, Harris (2007) suggests that business acquisitions would involve important strategic investments decisions and could utilize organisational learning reflecting on experience. The managers' perception of risk as also the entire staff perception of risks would be important an this could bring out the learning process in building expertise of an organization with emphasis on acquisitions strategy. The risk constructs and assessments would include drawing out a profile for risks in business acquisitions so the first exercise would be to create a risk profile identifying the types of risks possible, at what frequency and how these could be tackled. The knowledge of risks could aid in future decision making (Harris, 2007). Risk assessment should also be related to insuring the company systems against the risks identified. So in case of development of the infrastructure and workshops related to development of light manufacturing processes of software and hardware systems, it is important to recognize the risks which could be technical problems, systems breakdown, security threats with data transfer and incompatible operating systems and software features. The risk management team could involve the general management as well as the IT staff. Security related risks could be best handled by separate security staff who would deal not just with general security but IT related security as well. Data transfer threats and divulging personal information from data storage facilities and data theft would also be identifiable with security threats that will have to be prevented with insurance that will ensure that all data have back-up facilities so even in case of data theft, adequate precautions can be taken to retrieve the correct information and data promptly so that any further adverse consequences could be avoided. For facilities and infrastructure, disaster planning would be involved and the role of the insurance company in terms of financial help could help overcome any drawbacks related to infrastructure. Other potential risks related to data management would be fraud, forgery, theft and terrorism and it is important for companies including TechWatt that they protect all data and information on new products and software otherwise there may be copyright issues or simply issues related to data theft that can bring about problems for the company in many ways. Risk management in non profits would involve liability issues and for business organizations risk management would focus on environmental safety issues, business insurance etc. Natural disaster, fires, legal suits etc are some of the risks, as are security concerns, information and data theft (McFadzean et al, 2007), as well as environmental risks or risks on trading of financial institutions and markets. In some cases, risks may be organisational and could involve service, value, quality, management and environment or simply relationship issues among the staff. Identification, planning, analysis, mapping and mitigation of the risks are some of the steps to risk management (also in Ahmed et al, 2007) and in case of TechWatt, the workshop and study on risk management should include these processes as some of the risks during identification would relate to security and technical issues as well as financial problems. The next phase of planning against these risks would be to take adequate measures so that data security is maintained or there is proper insurance or financial back-up or support in case of financial risks for a company due to any market fluctuations. Risk management could b done by several means of risk avoidance, risk transfer, and risk elimination or risk reduction. Risk avoidance is identifying the risks beforehand and taking measures against its appearance. Risk elimination is completely getting rid of the risks and risk reduction is about minimizing risks and all these methods of risk management could be applied simultaneously depending on the risks involved. Outsourcing or sending information elsewhere for management of data could be a method that TechWatt can adopt with some of its data management jobs being given to third parties who specialize in data storage and this could minimize the risks of data management. Thus the risk management exercise for TechWatt relates to identification and assessment of risks and then risk minimization or reduction through involvement of IT security staff and management (also on McFadzean, 2007). Bibliography Ahmed, Ammar;Kayis, Berman;Amornsawadwatana, Sataporn (2007) A review of techniques for risk management in projects Benchmarking: An International Journal, Volume 14,Number 1, pp. 22-36(15) Al-Mudimigh, Abdullah S. (2007) The role and impact of business process management in enterprise systems implementation Business Process Management Journal, Volume 13,Number 6, pp. 866-874(9) Harris, Elaine P. (2007) How managers construe risk in business acquisitions International Journal of Risk Assessment and Management, Volume 7,Number 8, pp. 1057-1073(17) McFadzean, Elspeth;Ezingeard, Jean-Noel;Birchall, David (2007) Perception of risk and the strategic impact of existing IT on information security strategy at board level Online Information Review, Volume 31,Number 5, pp. 622-660(39) Read More