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Effective IT Management Product Image

Effective IT Management

  • Published: December 2010
  • 149 pages
  • Ovum

Introduction

IT management must focus on activities and solutions that facilitate flexibility and increased business service availability, such as service-management activity, portfolio-management tools and techniques, and the effective management of the wider environment. While the economic climate remains difficult, IT management should not focus purely on short-term survival strategies.

Features and benefits

- Business understanding is the catalyst for achieving IT management effectiveness.- IT organizations cannot continue to ignore the need for better IT financial management.- Organizations need to create a flexible IT function that enables the delivery of services that meet the objectives of the enterprise.- The CIO should provide leadership despite the challenges presented by a federal IT organization.

Highlights

The role of IT needs to change to take into account new challenges and emerging technologies. One of the areas that needs to change to meet the current and future business needs is the siloed hierarchical IT organizational structure. IT management must start to talk the language of business IT functions need to put in place or enhance READ MORE >

Executive Summary
1.1 Executive summary
Catalyst
Key findings
Ovum view
The role of IT needs to change to take into account new challenges and emerging technologies
It is imperative that an effective and quantifiable IT strategy is developed
IT management must start to talk the language of business
Stakeholder relationships should be proactively maintained
Optimizing IT services to meet the demands of the organization is an important focus for IT management
The availability of IT management capabilities as a service offers a serious alternative to on-premise solutions
1.2 Report objectives and structure
Chapter 2 – Trends and issues
Chapter 3 – Developing a successful IT strategy
Chapter 4 – Making the most of IT investment
Chapter 5 – Improving IT financial management
Chapter 6 – Structuring the IT function to meet new challenges
Chapter 7 – Optimizing vendor relationships
Chapter 8 – Exploiting IT management as a service
TRENDS AND ISSUES
2.1 Summary
Catalyst
Ovum view
Key messages
2.2 Supporting cost efficiencies remains important
IT needs to be central to the formulation of budgets
Run-the-organization spending still accounts for 70% or more of most IT budgets
Crucial to think about the long-term implications of cost savings
End-to-end monitoring and measuring should be deployed to improve IT management visibility
2.3 Keeping pace with stakeholder expectations
User choice should start to be factored into IT strategy
IT management needs to start taking account of the increasingly connected world
Improving operational effectiveness and flexibility
2.4 Prioritizing IT deliverables to meet business objectives
Strong portfolio, program, and project management will be essential
Effective IT governance with a clear framework for IT decision-making remains important
The extended and virtual enterprise will have implications for IT
Support for the agile organization is becoming a necessity
Security concerns can dissuade enterprises from making investment in remote working
Management is a critical capability in the extended environment
2.5 IT management should focus on strategic competencies
Strategy and planning
IT capability
IT services
2.6 Customer satisfaction remains an important objective
The vendor marketing message should include aspects of customer satisfaction
Vendors must be innovative with financing options and address virtualization issues
An opportunity exists to be a provider of shared services
DEVELOPING A SUCCESSFUL IT STRATEGY
3.1 Summary
Catalyst
Ovum view
Key messages
3.2 Defining the role of an IT strategy is the first step
There needs to be a clear understanding of the enterprise goals and the role that the business expects IT to play
Many organizations have very little visibility into how successful an IT strategy has been
IT flexibility is a fundamental strategic goal to support an effective and agile organization
3.3 IT strategy creation and execution is not an isolated exercise
IT strategy requires the linking of IT policy, enterprise architecture, and business strategy
When translating planning into execution do not neglect people and process
Execution of a strategy is different from development of a strategy
3.4 IT strategy execution relies on good communication
IT staff must understand their role in delivering the strategy and why it is important
Communicating the strategy is an ongoing process
A checklist can highlight all the pertinent tasks needed when planning and executing an IT strategy
Enterprise architecture is an important enabler of IT strategy
3.5 Organizations need to measure the effectiveness of IT strategy
A successful IT strategy must produce capabilities that enable the organization to create value.
Measurements related solely to IT expenditure, or to a notional return on IT investment, are of limited value.
An IT balanced scorecard is a more objective approach to measuring success
IMPROVING IT FINANCIAL MANAGEMENT
4.1 Summary
Catalyst
Ovum view
Key messages
4.2 IT organizations often struggle with basic IT financial management
IT organizations cannot continue to ignore the need for getter IT financial management
IT organizations need to get the IT financial management basics right
Service costing is mandatory for effective IT delivery
Most organizations would benefit from the introduction of IT chargeback
4.3 IT financial management capabilities need to mature
IT funding models need to change in line with the shift in IT delivery models
Financial instruments and techniques can facilitate the move to a capital-light and service-centric budget model
Cloud computing places a heavy reliance on IT financial management
The Ovum IT financial management maturity model
4.4 Financially astute IT functions target delivered value over cost
Reactive cost management is no longer enough for IT organizations
An IT organization needs to be able to demonstrate the value it creates for the business
MAKING THE MOST OF IT INVESTMENT
5.1 Summary
Catalyst
Ovum view
Key messages
5.2 The effectiveness of IT investments is constantly under scrutiny
A background to IT investment effectiveness
IT investment effectiveness continues to be a problem for business
5.3 Business understanding is the catalyst to achieving effectiveness
Business questions with their origins in finance and equivalent IT questions
The language of business is the language of IT
5.4 IT finance is more than a budget
Introduction to the financial architecture
5.5 IT investments have vastly different returns, risks, and options
IT investments are different
Types of IT investment
5.6 Effective IT investment is more about communication
Communicating IT value
STRUCTURING THE IT FUNCTION TO MEET NEW CHALLENGES
6.1 Summary
Catalyst
Ovum view
Key messages
6.2 A hierarchical IT organization is no longer appropriate
The IT structure needs to cater for the changing market landscape
Improving the effectiveness and flexibility of IT provision is a priority
Blending localized effectiveness with centralized efficiencies
6.3 Organizations need to create a flexible IT function
People remain the true differentiator of any organization
Metrics are an important gauge of IT structure effectiveness
A federated structure can help integration of IT with the business
The ability to embed IT within business services is a growing requirement
Blend localized effectiveness with centralized efficiencies for a flexible IT function
6.4 The CIO function must provide leadership
The federal IT organization is a challenging environment for CIOs
The CIO should look to harness the benefits of both centralization and decentralization of the IT organization
The CIO maturity model provides a useful tool to assess the current situation and engage in a dialogue regarding how to improve remit, range, and reach
OPTIMIZING VENDOR RELATIONSHIPS
7.1 Summary
Catalyst
Ovum view
Key messages
7.2 Outsourcing relationships must be managed over their lifecycle
Organizations need to take a strategic approach to outsourcing
Success can only be based on selecting the right work to outsource, and an effective approach to enable the required value to be realized
Managing the quality of service delivery is a key foundation for effective outsourcing relationships
Suppliers and customers must agree how value is to be measured in order to optimize the benefit of the outsourcing relationship
7.3 Rationalizing the number of IT supplier relationships is long overdue
Sustaining relationships with too many vendors can incur significant overheads
Selecting which vendors to terminate relationships with is a complex process
Reducing supplier numbers excessively could incur risk
7.4 Organizations that manage software licensing poorly incur significant risk
Over-provisioning or under-licensing both cause problems and incur risk
Licensing complexity makes optimization a serious challenge
An automated approach to licensing compliance and optimization can deliver appreciable benefits
EXPLOITING IT MANAGEMENT AS A SERVICE
8.1 Summary
Catalyst
Ovum view
Key messages
8.2 The SaaS-delivery model is gaining traction
Ovum’s definition of IT management-as-a-service
The case for SaaS-delivered IT management capabilities
The CIO’s view of SaaS-delivered capabilities
8.3 SaaS adoption is more than changing the technology
SaaS will change relationships
Service integration might be needed to manage multiple IT service suppliers
SaaS-related people issues need to be addressed
8.4 There are a growing number of SaaS offerings available
IT management software-as-a-service
IT service management software-as-a-service
Traditional on-premise vendors – the “big four” vendors
Traditional on-premise vendors – the IT service management specialists
SaaS-only players
New “dual play” vendors
Project and portfolio management software-as-a-service
Vendors targeting major enterprises with complex PPM needs
Vendors targeting organizations with “less complex” PPM needs
SaaS-only PPM vendors.
GLOSSARY
Glossary
Agile development
ALM (application lifecycle management)
APPM (application project and portfolio management)
Asset lifecycle management
B2B (business-to-business)
B2C (business-to-consumer)
BAM
BI (business intelligence)
BPM (business process management)
BSM (business service management)
Business as a service
Business Services
Business service catalog
Change
Change impact analysis
Change management
Cloud computing
CMDB (configuration management database)
CMM (Capability Maturity Model)
COBIT
Compliance
Configuration management
Demand management
Enterprise architecture
Governance
IaaS (infrastructure-as-a-service)
ISV (independent software vendor)
ITAM (IT asset management)
ITFM (IT financial management)
ITG (IT governance)
ITIL (formerly IT infrastructure library)
IT infrastructure
IT service
ITSM (IT service management)
LOB (line of business)
Metric
Open source
PaaS (platform-as-a-service)
PPM (project portfolio management)
QA (quality assurance)
Risk
ROI (return on investment)
SaaS (software-as-a-service)
SAM (software asset management)
Service catalog
Service consumer
Service contract
Service desk
Service level
Service-level management
Service policy
Service registry
Service request
SOA (service-oriented architecture)
Software appliance
SPM (service portfolio management)
TCO (total cost of ownership)
Web
APPENDIX
Methodology
Author(s)
Ovum consulting
Disclaimer

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