Editorial Board

Prof. Sunil Kr. Pandey

Professor & Director (IT & UG), I.T.S, Ghaziabad
Dr. S.C. Yadav
Professor and Head of Department, Department of Computer Science,
Central University of Jharkhand, Ranchi

Content Writers
Anshika Singh, Ms. Ishita Verma,
Dr. Geetika Vashishta, Ms. Juhi Gupta
Academic Coordinator
Mr. Deekshant Awasthi

© Department of Distance and Continuing Education

ISBN: 978-81-19417-17-9
1st Edition: 2023
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© Department of Distance & Continuing Education, Campus of Open Learning,

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© Department of Distance Learning,
Continuing UniversityCampus
Education, of Delhiof Open Learning,
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 Contents

PAGE

Lesson 1 : Technology Trends and Models for Management of Information Technology

hi
1.1 Learning Objectives 1

el
1.2 Introduction 2
1.3
D
Technology Trends and Models for Management of Information Technology 3

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1.4 Information Systems Strategy Formulation 13

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1.5 CSF/KPI Theory 16
1.6 Information System Management Issues

s i 22
1.7 Summary
e r 24

v
ni
1.8 Answers to In-Text Questions 26
1.9 Self-Assessment Questions 26
1.10 References
, U 27

O L
Lesson 2 : IT Architecture Planning
2.1
/ S
Learning Objectives 28
2.2 Introduction

O L 29

C
2.3 IT Architecture Planning 29
2.4
E /
Open System Architecture 32
2.5

D C
Leadership in IT
National Information Infrastructure
36
39

©D
2.6
2.7 Digital Signature 43
2.8 'LJLWDO &HUWL¿FDWH 
2.9 Summary 52
2.10 Answers to In-Text Questions 53
2.11 Self-Assessment Questions 53
2.12 References 54

PAGE i
© Department of Distance & Continuing Education, Campus of Open Learning,
School of Open Learning, University of Delhi
 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

PAGE

Lesson 3 : Strategic Management of Information Technology

3.1 Learning Objectives 55
3.2 Strategic Information Systems Planning 56
3.3 Learning Organizations 64
3.4 Outsourcing IT Functions 67

i
3.5 IT for Strategic Alliances 73
3.6 Summary
l h 77

De
3.7 Answers to In-Text Questions 78

of
3.8 Self-Assessment Questions 78
3.9 References 79

ity
3.10 Suggested Readings 80

r s
e
Lesson 4 : Organizational Transformation Through IT

iv
4.1 Learning Objectives 81

Un
4.2 Introduction 82

,
4.3 Organizational Transformation Through IT 84
4.4

O L
Customer Relationship Management (CRM) 86

S
4.5 Supply Chain Management (SCM) 88
4.6 Industry 4.0
L / 90
4.7 Data Warehousing

C O 93
4.8
/
Knowledge Management 96

CE
4.9 Business Intelligence and Data Analytics 99

D
4.10 Summary 107
4.11
4.12
© D
Answers to In-Text Questions
Self-Assessment Questions
109
109
4.13 References 110
4.14 Suggested Readings 110

Lesson 5 : Strategic IT Management Success and failure in Indian Industry

5.1 Learning Objectives 111
5.2 Introduction to Strategic IT Management 112

ii PAGE
© Department of Distance & Continuing Education, Campus of Open Learning,
School of Open Learning, University of Delhi
 CONTENTS

PAGE

5.3 Key Factors in Deciding Success and Failure of Strategic IT Management 113
5.4 Success Stories of Indian Companies in Strategic IT Management 116
5.5 Failure Stories of Indian Companies in Strategic IT Management 126
5.6 Critical Analysis of Strategic IT Management Successes and Failures in
Indian Companies 136

hi
5.7 Summary 139

l
5.8 Answers to In-Text Questions 140
5.9 Self-Assessment Questions

D e 140

of
5.10 References 140
5.11 Suggested Readings 142

ity
Glossary 143

r s
v e
n i
, U
O L
/ S
O L
/ C
C E
D
©D

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© Department of Distance & Continuing Education, Campus of Open Learning,
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L E S S O N

1
Technology Trends and
Models for Management of
Information Technology
i
Anshika Singh

l h
Assistant Professor

D e
Shaheed Rajguru College of Applied
Sciences for Women

of
University of Delhi
Email-Id: [email protected]

i ty
STRUCTURE
r s
v e
i
1.1 Learning Objectives
1.2 Introduction
U n
,
1.3 Technology Trends and Models for Management of Information Technology

L
1.4 Information Systems Strategy Formulation
O
1.5 CSF/KPI Theory
/ S
L
1.6 Information System Management

OQuestions
Issues

C
1.7 Summary

E / Questions
1.8 Answers to In-Text

C
1.9 Self-Assessment
D
D
1.10 References

1.1©Learning Objectives
‹ Understand different technology trends and models for management of Information
Technology.
‹ Understand Information system strategy formulation.

PAGE 1
© Department of Distance & Continuing Education, Campus of Open Learning,
School of Open Learning, University of Delhi
 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes ‹ Understand different CSF and KPI factors and their role.
‹ Describe Information Systems Management Issues.

1.2 Introduction
Information Technology (IT) is an extensive professional category covering
functions such as building communications networks, safeguarding data

i
and information, and troubleshooting computer problems. It is generally

h
accepted as a booster of economic and technological growth. Technologists

e l
implement new technology to modify things like organization, the nature

D
of work, relationships with other organizations, or some other facet

of
of the business. IT is now a force and driver of modern technological
development and globalization and makes management of information

ty
more efficient and effective.

s i
r
Information Technology is currently the enabler of most services.

e
Advancements in technology have affected society’s way of living both

i v
positively and negatively. Today, new technologies have affected various

U n
strata of human beings including education, industries, healthcare, business,
government, communication, and our day-to-day tasks. Information

L ,
Technology helps us to gather, communicate, manage, and interconnect

O
large volumes of data and information. The advancement of technologies

/ S
has brought about various Technological trends and models including

O L
Cloud Computing, AI/ML, Mobile Computing, social media, Ubiquitous
computing, data analytics, data science, and the Internet of Things (IoT),

/ C
a network of large amount of objects, computing devices embedded with

C Emicrochips, sensors, actuators making this world a smart place to live.

D
Various technologies in IT are growing very fast like cloud computing,

©D
mobile computing, social media, etc. which is changing the way of doing
jobs. We can get hardware and software resources virtually on pay per
demand basis with the help of cloud computing. This helps individuals and
organizations avoid installing heavy and costly software on their systems
and rather use a shared area known as the cloud to store information.
Cloud computing provides us with various services like platform and
software services. Mobile computing enables us to access and process
data on mobile devices with the speed of personal computers. It is an
exhaustively used field that has always had a bright future. Social media

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© Department of Distance & Continuing Education, Campus of Open Learning,
School of Open Learning, University of Delhi
 TECHNOLOGY TRENDS AND MODELS FOR MANAGEMENT OF IT

in no time allows us to interact with people all over the globe in a very Notes
user-friendly manner. Wireless devices are becoming very popular these
days. Ubiquitous computing or the Internet of Things (IoT) is making
almost every IT-enabled object that can sense, process, and transmit data
among different objects in real time over the existing networks. This
helps us to control the objects remotely and thus save time.

1.3 Technology Trends and Models for Management of

h i
l
Information Technology
Technology trends and models for the management of information
D e
of
technology (IT) are evolving continuously as new innovations and practices
emerge. Here are some key technology trends and models relevant to IT

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management:

s i
1.3.1 Cloud Computing
e r
i v
n
Cloud computing is the distribution of Computing services, including

, U
servers, databases, networking, storage, software, analytics, and intelligence
over the Internet (“the Cloud”). That offers faster revolution, flexible and

L
easily accessible resources and economies of scale. Cloud Computing serves
O
S
different factors including Mobility, Accessibility, Flexibility, Services,

L /
and much more. The cloud model affords a high degree of flexibility in

O
terms of management of resources: “scaling out,” which refers to adding

C
more nodes or resources; “scaling up,” which refers to adding more

E /
resources to a node in the system; or even downgrading is easily handled

C
almost instantaneously. It allows individuals and organizations to access

D
and utilize these resources without the need for local infrastructure or

©D
physical hardware.
It is one of the latest advancements in information technology that has
impacted an organization’s growth daily as data is increasing and more
and more storage area is required to store such big data. Cloud Computing
is a pool of shared resources, which includes servers, storage, networks,
services, and applications that can be shared with multiple individuals as
well as with organizations on pay per use basis in a cost-efficient manner.
Cloud computing services are usually owned and managed by third-party
providers who deliver the services to the user on a pay-per-use basis.

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School of Open Learning, University of Delhi
 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes It has various computing services that are very key to clients, the services
include:
‹ Software as a Service (SaaS): SaaS is a very familiar type of cloud
service to customers. Software as a Service is the topmost layer of
cloud computing architecture that offers complete applications to
the customer over the Internet. Among the most familiar software
as a Service (SaaS) application currently used for businesses are

i
CRM applications like Sales force, storage solutions like Google

l h
Drive, and Dropbox, and productivity applications suit as Google

e
apps.
‹
D
Platform as a Service (PaaS) is the middle layer of cloud computing

of
architecture that offers an execution environment as a service for the
software without any need for downloading software or installation

i ty
of software for the developers or end users. Examples of Platform

r s
as a Service (PaaS) are Microsoft Azure and Google App Engine.
‹

v e
Infrastructure as a Service (IaaS): Infrastructure as a Service is the

i
bottom layer of cloud computing architecture that offers sharing of
n
U
the hardware resources through virtualization for executing services.

L ,
The benefits of using Cloud Computing is that it reduces the IT
infrastructure cost of the company, Cloud computing promotes the concept

S O
of virtualization, which enables server and storage device to be utilized

/
across the organization, Cloud computing makes maintenance of software
L
O
and hardware easier as the installation is not. It provides a platform that

C
contains shared data that is generally accessible to all.

E /
Some prominent implementations: The most popular Cloud Computing

D C products include AWS Elastic Compute, Google Cloud Engine, and AWS
Lambda. The utmost famous cloud computing services are including

©D
Amazon Web Services, Google Cloud Platform, and Microsoft Azure. Cloud
Computing is flexible. Cloud-based services are models for businesses
with increasing or changeable bandwidth demands.

1.3.2 Artificial Intelligence and Machine Learning

Artificial intelligence (AI) is a branch of computer science concerned
with the study and development of intelligent computer systems, which

4 PAGE
© Department of Distance & Continuing Education, Campus of Open Learning,
School of Open Learning, University of Delhi
 TECHNOLOGY TRENDS AND MODELS FOR MANAGEMENT OF IT

can think, learns, and decides like human brain while solving a problem. Notes
Generative AI refers to the sub-field of machine learning that generates
new data or content by using an existing data set or earlier models. Its
goal is to produce something very close to the original, real-world input
data. This AI type uses deep learning algorithms to learn patterns and
features in that data set, which usually consists of code, text, images,
audio, video, or other data types. Generative AI already has a wide range
of applications. Today most of devices are embedded with AI technology.
Be it smart phones, Security purpose devices, banking systems, and daily
h i
day-to-day life.
e l
Many large businesses and organizations have begun to introduce AI
D
of
and ML solutions into their operations, gaining tangible benefits such as
improved customer experience, streamlined processes, reduced production

ty
issues, and higher revenues.

s i
r
AI is required to enhance data analytics and automated scripts. However,

e
AI itself is not immune to cyber attacks. With the advancement in virtual

v
n i
reality, cyber attacks do come in bundles. To manage and control these
challenges affecting the two technologies, there is a need to make Artificial

U
Intelligence/Deep Learning (AI/DL) techniques more robust and secure
,
L
in the presence of adversarial traffic in any application area.
Implementations of AI in today’s world:

S O
‹

L /
Various applications in Supply Chain Management, Chatbots, Robotic

O
Process Automation, Analytics etc.
‹

/ C
Generative Pre-trained Transformer 3 (GPT-3)
‹ Chat GPT

C E
D
‹ DALL – E

©D
With Human AI collaborations: Cobots will be more widespread in these
fields:
‹ Automotive manufacturing: AI is extensively used in car assembly,
spray painting, surface polishing, systems checking, and retrofitting
or reconstructing car production lines to accommodate electric
models. Companies with palletizing and welding activities expect to
adopt more cobots with higher payloads and a longer reach. Also,
3D printers have been used in manufacturing.

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© Department of Distance & Continuing Education, Campus of Open Learning,
School of Open Learning, University of Delhi
 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes ‹ Agriculture: AI is highly used in the agricultural sector as drones

for seed planting, fertilizer, and pesticide application, trespasser
and invasive species tracking, and LED lighting and hydroponics
for indoor farms.
‹ Healthcare and hospitality: In this field, AI has done tremendous
work like sample collection, hospital supplies restocking, surgery,
injury recovery, and health worker support in residential and nursing

i
care homes for the elderly or disabled.
‹ Food and beverage: AI is also used in various industries in
l h
by big machines that are embedded with AI.
D e
warehousing and food packaging. Systematic work is mostly done

‹
of
Electronics: AI also contributes to quality inspection for phone chips,

ty
phone chip processors, and printed circuit boards.
‹

s i
Emerging technologies: AI is handling torque sensors, proximity

r
detection sensors, end-effectors (end-of-the-arm tooling such as
e
v
vacuum, mechanical, pneumatic, and magnetic grippers).
‹
n i
Defence: AI nowadays is used in the defence sector in clearing roads

, U
of explosive devices, sensors to detect explosives, or setting radars
to detect unusual happenings.

1.3.3 DevOps O
L
/ S
O L
DevOps is a set of methods that combines the concept of software

/ C
development (Dev) and information-technology operations (Ops) that

E
shorten the systems development life cycle while delivering features,

D C fixes, and updates frequently in close alignment with business objectives.

It helps in enhancing collaboration, communication, and efficiency

© D throughout the software development lifecycle. It aims to bridge the

gap between development teams, responsible for creating and updating
software applications, and operations teams, responsible for deploying and
maintaining those applications in production environments. It creates a
cross-functional team that includes members from a variety of fields, such
as developers, system administrators, quality assurance teams, security
professionals, and product owners. That helps to minimize complexity and
improve collaboration. It aims to streamline the process of developing

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© Department of Distance & Continuing Education, Campus of Open Learning,
School of Open Learning, University of Delhi
 TECHNOLOGY TRENDS AND MODELS FOR MANAGEMENT OF IT

applications so they can be released quickly without compromising on Notes

quality or service delivery. This allows organizations to respond faster to
customer demands while saving time and money on resource allocation.
DevOps includes trends:
‹ The rise of Automation: To minimize errors caused by manual
intervention. Automation will increasingly be used in DevOps
to speed up processes and hence avoid manual intervention by

i
automating work. Tools such as Ansible and Chef have already been
instrumental in automating various tasks within an organization’s
l h
IT infrastructure.

D e
of
‹ AI/ML Integration in CI/CD Pipelines: Artificial Intelligence (AI)
and machine learning (ML) technologies are now used in pipelines to

ty
adapt better to quickly changing development needs while improving

i
accuracy levels at every step. This trend will only continue to

s
r
grow as teams seek new ways to optimize their operations through
streamlined automation processes powered by AI/ML.
v e
‹

n i
Cloud Native Platforms: Due to the rise of the need for serverless

U
computing and the increased demand for faster and more resilient

L ,
software delivery pipelines has made cloud-native platforms a must-
have DevOps teams. These solutions offer improved scalability and

S O
accessibility, cost savings benefits, and automated operations to help

/
streamline development workflows.
L
O
‹ Kubernetes: Initially developed by Google, Kubernetes has quickly

/ C
become the de facto standard for running distributed applications

E
in production. Kubernetes is an open-source container orchestration

D C
system that allows users to manage, maintain, and scale applications
easily. It provides powerful features such as automatic resource

©D
allocation, scheduling of workloads, and self-healing capabilities
that make it easier for developers to maintain their applications.
Additionally, Kubernetes supports a wide variety of languages and
frameworks, which makes it possible to integrate existing applications
into the platform. As more companies look towards cloud computing
solutions like Kubernetes, their popularity will only grow in 2023.

PAGE 7
© Department of Distance & Continuing Education, Campus of Open Learning,
School of Open Learning, University of Delhi
 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes
1.3.4 Blockchain Evolution
A blockchain is a decentralized, distributed and public digital ledger that
is used to record transactions across many computers so that the record
cannot be altered retroactively without the alteration of all subsequent
blocks and the consensus of the network. Its initial application is noted as
Bitcoin – The Cryptocurrency. For Bitcoin, transactions are permanently

i
recorded and viewable to anyone. Blockchain is a decentralized and

h
distributed digital ledger technology that allows multiple parties to record
and verify transactions securely and transparently.
e l
D
A blockchain consists of programs called scripts that conduct the tasks

of
you usually would in a database: Entering and accessing information
and saving and storing it somewhere. It is distributed, which means

i ty
several copies are saved on many different machines, and they must all

s
match for it to be valid. There should be no ambiguity. The blockchain
r
e
collects transaction information and enters it into a block, like a cell in

i v
a spreadsheet containing information. Once it is full, the information is

U n
run through an encryption algorithm, which creates a hexadecimal number
called the hash. The hash is then entered into the following block header

L ,
and encrypted with the other information in the block. This creates a

O
series of blocks that are chained together widely known as Blockchain.

/ S
Blockchain technology should undoubtedly be in tech trends since it

O L
has been rapidly expanding for the last few years and still has huge
potential. Though most people associate blockchain with cryptocurrencies

/ C
only, the technology can be successfully incorporated into many other

C Ecrypto-unrelated fields. In the coming time, we will positively witness

blockchain convergence with other technologies such as IoT, machine
D
©D
learning, and fog computing.
Top Implementations of Blockchain:
‹ Healthcare: This technology is being used to track and trace
prescription medications throughout supply networks. Using this tool,
we can easily prevent and regulate the distribution of counterfeit
pharmaceuticals and recall ineffective and unsafe drugs. Customer
data security is a primary goal in healthcare, as is data exchange
and dissemination, which aids in improving healthcare services
among hospitals, governments, and research institutes.

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School of Open Learning, University of Delhi
 TECHNOLOGY TRENDS AND MODELS FOR MANAGEMENT OF IT

‹ Transfer contracts and wills: Nowadays there is a shift in the Notes

pattern to store wills and testaments. Now the traditional way is
being replaced with digitalization. Smart contracts are another name
for these. Smart contracts bind all parties to the document legally.
This data is kept on the blockchain network and may be retrieved
when needed, binding all participants to the terms established in
the smart contract.

i
‹ Cryptocurrency: It is one of the prominent applications of blockchain.
Bitcoins are one of the most trended and hot topics. The major
l h
e
reason for adopting blockchain for crypto is that it has no territorial
boundaries. As a result, it serves as a global transaction.
D
of
‹ Management of supply chain: Blockchain supports activities like
real-time tracking of commodities as they travel and change hands

i
across the supply chain due to the unchangeable ledger of the
ty
blockchain.
r s
v e
1.3.5 Mobile Computing Technologies
n i
U
Mobile computing technologies refer to the various technologies and
,
L
hardware components that enable the use of computing devices while

O
on the move. These technologies have revolutionized the way we access

/ S
information, communicate, and perform tasks, providing flexibility and

O L
mobility. Mobile computing technology allows the transmission of data, and
audio-video through the wireless medium without having actual physical

/ C
connections. It has led to an increase in portable devices that can be easily

C E
connected to the internet and thus is very popular. The use of mobile
computing has increased tremendously due to current advances in mobile

D
computing that include GPS, GPRS, Long Term Evolution (LTE), 3G, 4G,

©D
and Wi-Max.5G devices are the newly emerging sector. The networks of
the new generation have been tested and the first 5G- ready smartphones
are available. 5th Generation has set new standards to bring broadband
download speeds over mobile networks and to provide 10x faster internet
services than the previous 4G. It is more evolved than the previous one
as it focuses on the further development of the Internet of Things, self-
driving cars, virtual and augmented reality, robotic surgery, drone delivery,
and much more. Mobile computing devices include smartphones, tablets,

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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes Personal Digital Assistants (PDAs), Laptops, and wearable devices like
Apple smartwatches, Google Glass, and head-mounted displays.
It has several Pros:
‹ Increase in productivity due to the effectiveness and efficiency of
the system
‹ Lower Latency: The time it takes for an event to occur after giving
a particular task. This Latency is 5G is ten times lower than 4G
‹ Improved broadband
h i
‹ Security
e l
D
Speed: It can provide speed up to 20Gbps, 5G offers data rates that

of
‹
are an order of magnitude greater than 4G and 4G LTE. Hence
providing seamless data communication
‹
i ty
Network Slicing: An optimized network for every requirement.

r s
Enhanced Mobile Broadband (eMBB) for the fastest possible
connections.
v e
n i
U
1.3.6 Data Analytics

L ,
Analytics is a process, which helps in discovering informational patterns

O
with data. It is the combination of Computer Programming, statistics,

S
L /
and operations research. Data Analytics is a tool used to support the
decision-making process by converting raw data into useful information.

O
Data analytics refers to the process of extracting meaningful insights,
C
E /
patterns, and trends from large volumes of structured or unstructured
data. It involves applying various techniques, tools, and methodologies

D C to analyze data and uncover valuable information that can drive informed

©D
decision-making and provide a competitive advantage. Predictive
analytics is the tool used to predict future events based on current and
historical information means predicting events that may occur based on
the previously collected information. Social media analytics is the tool
used by companies to understand and accommodate customer needs. In
today’s times, data analytics is the most important factor for any business.
It helps them gather insights into market trends and make data-driven
decisions thereby maximizing profits. Prescriptive analytics goes beyond
predictions and suggests actions or decisions to optimize outcomes. It

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 TECHNOLOGY TRENDS AND MODELS FOR MANAGEMENT OF IT

combines historical data, predictive models, optimization techniques, and Notes

business rules to provide recommendations on the best course of action
to achieve desired goals.
It has various applications:
‹ Finance, E-Commerce, Logistics, Banking, and supply chain.
‹ Healthcare: The healthcare industry has evolved for the past decade as
the technology continues to evolve in itself. Big data has optimized
medical care quality, predicted the strength of the epidermis, and
h i
identified ways to combat them. It also contributes to science that
e l
D
could result in the identification and removal of inefficient overheads.

of
‹ It has major applications in the HR domain, HR analytics is the
data-driven approach that helps recruiters leverage the potential of

ty
this technology for sourcing deserving talent.
‹

s i
Big data in entertainment: It is one of the major concerns as

e r
entertainment content is consumed through multiple electronic

i v
devices such as mobile phones laptops and tablets as the variety of

U n
channels grows. It results in an excessive overflow of incoming data
that needs to be stood and stored before it is utilized in strategies.
‹

L ,
Big data in government: The government sector is highly overpowered

O
by data emerging from countless technology sources from satellites

/ S
to CCTV cameras, sensors, and social media. Some tools help to

O L
process these data so that government can quickly take decisions
which is very effective for the people. The government utilizes

/ C
efficient data mining methods that can make well predictions and

C E
maintain extensive databases that replaced the traditional way of
storing records the changes promote better emergency responses in
D
critical situations.

©D
1.3.7 Virtual Reality (VR) and Augmented Reality (AR)
Virtual Reality refers to a computer-generated simulation that immerses
users in a completely artificial environment, typically experienced through
specialized headsets or devices. VR aims to create a sense of presence,
transporting users to a different reality, separate from the physical world.
While Augmented Reality overlays digital content onto the real world,

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School of Open Learning, University of Delhi
 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes enhancing the user’s perception and interaction with the environment. AR
technology blends computer-generated elements with real-world views,
typically viewed through smartphones, tablets, or smart glasses. Virtual
reality (VR) and augmented reality (AR) have significant potential in the
future of marketing, gaming, education, e-commerce, and several other
fields. Both technologies provide an immersive 3-D visual experience by
combining the virtual and real worlds. Although both VR and AR tend
to feel the same, both have significant differences.

h i
l
Augmented reality (AR) adds digital elements to an existing live view by

e
often using the camera on a smartphone. It does not replace the real-world

D
entity. While Virtual reality (VR) is an experience that replaces a real-

of
life environment with a simulated environment. VR and AR technologies
are used mainly in the gaming sector and entertainment purpose industry.

ty
Nevertheless, now the applications of augmented and virtual reality go

s i
beyond games. Virtual reality gaming has already become popular due

e r
to new technology, which improves how the industry can grow.

i v
Both VR and AR technologies are developing at a pretty rapid pace

U n
due to advancements in other technologies. Experts predict that these
technologies tend to build more soon. With the dynamic industry of

L ,
Information Technology, it is not long before AR and VR will be applied

O
to both business and everyday life.

/ S
Several benefits include:
‹

O L
No distractions while the study hence increasing knowledge area
‹

/ CActive experience rather than just passive information

C E ‹ Helps to understand complex concepts, subjects, or theories

D
‹ Boosts creativity and Expands learner’s efficiency to gain knowledge

©D
‹ Memory Retention
‹ Promotes tourism and travel

1.3.8 Internet of Things (IoT)

The Internet of Things (IoT) refers to the network of interconnected
physical devices, vehicles, buildings, and other objects embedded with
sensors, software, and connectivity that enable them to collect and exchange
data. These devices, often referred to as “smart” devices, communicate

12 PAGE
© Department of Distance & Continuing Education, Campus of Open Learning,
School of Open Learning, University of Delhi
 TECHNOLOGY TRENDS AND MODELS FOR MANAGEMENT OF IT

with each other and with humans through the internet, creating a vast Notes
ecosystem of interconnected systems. It offers possibilities for real-time
monitoring, automation, and data-driven insights in IT infrastructure
management. IoT offers several benefits, including improved efficiency,
cost savings, enhanced productivity, better decision-making, and enhanced
safety and security. It enables organizations to optimize processes, provide
personalized services, and create new business models. Though IoT also
presents challenges such as security and privacy risks, interoperability issues,
data management complexities, and ethical considerations. Safeguarding
h i
data privacy and ensuring secure communication and authentication are
e l
D
crucial concerns.

of
IoT has a wide range of applications across industries. It is used in
smart homes, healthcare monitoring, industrial automation, agriculture,

ty
transportation, energy management, and smart cities, among others.

s i
It has the potential to revolutionize various aspects of our lives and

e r
industries. IoT sensors and devices can be used to track and manage IT

i v
assets, such as servers, networking equipment, and mobile devices. Real-

U n
time monitoring and tracking help optimize asset utilization, improve
maintenance scheduling, and reduce losses or theft. IoT-based security

,
systems can enhance physical access control and surveillance in IT
L
O
facilities. Smart locks, biometric authentication, and video surveillance

S
systems connected to the IoT provide real-time monitoring and remote

L /
access management. IoT devices can streamline IT service management

O
processes by automatically generating service tickets when equipment

/ C
malfunctions or requires maintenance. This enables faster response times

E
and predictive maintenance. IoT devices are often integrated with cloud

D C
and edge computing platforms, enabling data processing, analytics, and
decision-making closer to the data source. This reduces latency, enhances

D
scalability, and enables real-time insights for IT management.

©
1.4 Information Systems Strategy Formulation
Information Technology (IT) is recognized today as a major factor that
influences business performance. Consequently, there has been increasing
concern in most organizations regarding its management. Information
systems strategies can be defined as application strategies that aim to align
Information system developments with business needs and seek competitive

PAGE 13
© Department of Distance & Continuing Education, Campus of Open Learning,
School of Open Learning, University of Delhi
 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes advantage from IT. It has been noted in the literature that the importance
of Information system strategy varies considerably among organizations and
various sectors. Information system strategy formulation is the process of
developing a plan that aligns an organization’s information systems with
its overall business strategy. It involves defining the direction, goals, and
initiatives for leveraging technology and information systems to support
the organization’s objectives.

i
There are some important steps in formulating an information system
strategy:
l h
‹

D e
Understanding of the organization’s objectives, priorities, and overall
business strategy- identifying how it is structured and functions,

of
and how technology and information systems can contribute to
achieving those objectives.
‹
i ty
Evaluating the current state of the existing information system within

r s
the organization, including infrastructure, applications, data, and

e
processes. Comparing with the technology used by competitors,
v
i
identifying stakeholders, gaps, and areas for improvement. One of
n
U
the most popular methods to assess the organization’s current state

,
and potential strategic options is SWOT analysis which identifies the

L
strengths, weaknesses, opportunities, and threats of an organization.

O
S
‹ Envision the desired future state of the organization’s information

/
systems based on the business strategy and assessment of the
L
O
current state. Determine the organization’s constraints, priorities,

C
resources, and gap between the current state and the desired state

/
CE
(future state).
‹ Determine what strategic initiatives are required to bridge this gap.

D D These initiatives could involve implementing new technologies,

enhancing existing systems, improving data management, or optimizing
© ‹
processes.
Evaluate and prioritize the strategic initiatives based on their cost and
benefits, potential impact, feasibility, and alignment with business
goals.
‹ A roadmap with milestones and activities is established that outlines
the sequencing and timelines for executing the strategic initiatives.
Identify dependencies, key milestones, resource requirements, and

14 PAGE
© Department of Distance & Continuing Education, Campus of Open Learning,
School of Open Learning, University of Delhi
 TECHNOLOGY TRENDS AND MODELS FOR MANAGEMENT OF IT

risks associated with each initiative. Ensure the necessary resources, Notes
including budget, skilled personnel, and technology infrastructure,
are allocated to support the implementation of the information
system strategy. Secure buy-in and support from key stakeholders
within the organization.
‹ Establish mechanisms for monitoring the progress and effectiveness
of the information system strategy. Regularly assess the outcomes

i
and make adjustments as needed to address changing business needs,
technology advancements, and market dynamics.
l h
‹ Encourage collaboration and communication between IT and business
stakeholders throughout the strategy formulation and implementation
D e
of
process. This helps ensure that the information system strategy is
closely aligned with business requirements and priorities. Regularly

i ty
review and update the information system strategy to stay relevant

r s
and responsive to evolving organizational needs and emerging
technologies.

v e
i
Information system strategy formulation is a continuous process and
n
U
typically involves multiple levels of planning and decision-making within

,
an organization to ensure the effective utilization of information systems

O L
to achieve organizational success. These levels help ensure alignment
between the information systems strategy and the overall business strategy.

/ S
The number of levels may vary depending on the organization’s size,

O L
structure, and industry. In some cases, additional levels or variations
of these levels may exist. Here are some levels of Information system
strategy formulation:
/ C
C E
1. Corporate-Level Strategy: This level describes the organization’s

D
overall mission, vision, and strategic goals, such as its growth,

©D
stability, acquisitions, or layoffs including its information system.
It focuses on the type of business you plan to launch.
2. Business-Level Strategy: This level of strategy provides an answer
to the question of how you will compete. It plays a relevant role in
organizations with smaller business units, each of which is referred
to as a strategic business unit (SBU). It considers the unique
requirements and opportunities within each unit and determines how
information systems can contribute to their success. It aligns the

PAGE 15
© Department of Distance & Continuing Education, Campus of Open Learning,
School of Open Learning, University of Delhi
 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes goals and objectives of the business units with the overall corporate
strategy.
3. Functional-Level Strategy: This level focuses on how an organization
will grow. It outlines everyday operations, such as resource allocation
for the implementation of corporate and business-level strategies.
It involves developing strategies that support the specific needs of
each functional area and leveraging information systems to enhance

i
their effectiveness.
IN-TEXT QUESTIONS
l h
D e
1. __________________ is a pool of shared resources, which

of
includes servers, storage, networks, services, and applications
that can be shared with multiple individuals as well as with

ty
organizations on pay per use basis in a cost-efficient manner.

s i
2. __________________ is a branch of computer science concerned

e r
with the study and development of intelligent computer systems,

i v
which can think, learns, and decides like human brain while

n
solving a problem.

U
3. __________________ is a decentralized and distributed digital

,
L
ledger technology that allows multiple parties to record and

O
verify transactions securely and transparently.

/ S
4. __________________ is the tool used to predict future events based

O L
on current and historical information means predicting events
that may occur based on the previously collected information.

/ C
5. __________________ is a continuous process and typically

C E involves multiple levels of planning and decision-making within

D
an organization to ensure the effective utilization of information

©D
systems to achieve organizational success.

1.5 CSF/KPI Theory

CSF stands for Critical Success Factors, while KPI stands for Key
Performance Indicators. These two concepts are often used in conjunction
to measure and manage the success of organizations, projects, or initiatives.

16 PAGE
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School of Open Learning, University of Delhi
 TECHNOLOGY TRENDS AND MODELS FOR MANAGEMENT OF IT

1.5.1 Critical Success Factors (CSF) Notes

Critical Success Factors (CSF) are the essential areas or factors that
must be achieved or addressed in order for an organization, project, or
initiative to be successful. They are the few crucial factors that directly
contribute to achieving the objectives or desired outcomes. They either
have a high level of customer value or offer a significant cost benefit.
They require the manager’s attention constantly and carefully to monitor
their performance continuously. CSFs vary depending on the specific
h i
context and goals of the entity involved. Identifying and focusing on
e l
D
CSF helps organizations prioritize their efforts and resources toward what

of
truly matters for success.
Types of Critical Success Factors:

i
D. Ronald Danial of McKinsey and Company first created the idea of
ty
s
a success factor in the 1960s. However, Jack F. Rockart of the Sloan
r
e
School of Management refined and popularised the concept around the end

i v
of the 1980s. According to Rockart, there are four main types of CSFs:

n
1. Industry factors: These factors are specific to a particular industry
U
,
or sector. These are responsible for remaining competitive in the

L
market. For example, a tech start-up might identify innovation as a

O
CSF. For example, inventory management and customer experience

S
/
may be the CSFs for the retail industry.

L
2. Strategic factors: They depend on the organization’s competitive
O
C
strategy. They involve the way an organization positions itself in

/
the market and competes. These are necessary for the business to
E
C
accomplish its long-term or permanent strategic goals. For example,

D
the development of new products, mergers or market expansion etc.

©D
3. Environmental factors: They consider the external environment in
which the organization operates. They include economic conditions,
market trends, technological advancements, or regulatory changes.
Understanding and adapting to these factors is crucial for the
organization’s success. You can better understand your environmental
influences by doing a PEST analysis.
4. Temporal factors: Most of the CSFs are tied to the long-term or
permanent strategic goals of an organization. But sometimes short-

PAGE 17
© Department of Distance & Continuing Education, Campus of Open Learning,
School of Open Learning, University of Delhi
 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes term management is needed whenever some temporary situation

arises. That’s why managers need to be proactive to find effective
solutions to the problems. They include internal changes in the
organization. For example, due to the COVID-19 pandemic, a number
of businesses had to temporarily increase their online orders and
speed up their shipping and delivery processes.
How to Identify Critical Success Factors?

i
1. Examine the main components of your long-term strategic objectives:

l h
Initially, start with determining the mission of the organization,

D e
its present targets, and challenges. Determine external factors that
impact the organization using PEST analysis and identify strengths,

of
weaknesses, opportunities, and threats of an organization.

ty
2. Review and discuss with key stakeholders the overarching strategic

i
goals of an organization: Formalize CSFs only when data is gathered.

s
r
This can be done by interviewing employees and customers, holding

e
focus groups, and reviewing recent trends. To prepare for the future,
v
i
try to quantify how your organization is performing right now rather
n
U
than how it was performing in the past.

L ,
3. Discuss prospective CSFs with senior executives to see which will
help the long-term strategic goals succeed the most. Take opinions

S O
and feedback from the team leaders, and senior leaders to evaluate

/
a list of CSFs and identify the CSFs we need to focus on in order
L
O
to achieve the organization’s goals.

/ C
4. Identify the potential CSFs to attain organization goals by combining

E
the information from group brainstorming and feedback from

D C employees. Opinions from throughout the organization help in

pinpointing the priority CSFs that we should concentrate on. Then

©D
implementing those CSFs into the organization-wide strategic plan
and ensuring everyone is aware of what contribution they need to
give to the CSF.
5. Find a way for monitoring and reassess the progress. One of the
best methods is to use Key Performance Indicators (KPIs) to do
the same. For example, if our aim is to lessen the harmful effects
on the environment, one can set a KPI of “100% changing non-
recyclable packing to recyclable within in next five years”. Also,
dedicate a team or employee to monitor the same.
18 PAGE
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 TECHNOLOGY TRENDS AND MODELS FOR MANAGEMENT OF IT

1.5.2 Key Performance Indicators (KPI) Notes

Key Performance Indicators (KPI) are measurable values or metrics that

indicate how effectively an organization, project, or initiative is performing
in relation to its objectives and CSFs. KPIs provide quantifiable data
that can be tracked over time to assess progress and performance. KPIs
should be specific, measurable, achievable, relevant, and time-bound
(SMART). They enable organizations to monitor performance, identify
areas of improvement, and make data-driven decisions. CSFs and KPIs
h i
are closely connected. CSFs define the critical areas that are vital for
e l
D
success, while KPIs measure and quantify the performance within those

of
areas. CSFs are the high-level strategic factors that guide the selection of
appropriate KPIs. KPIs are then used to track progress toward achieving

ty
the CSFs.

s i
KPIs offer a strategy and operational improvement, establishes an analytical

r
foundation for decision-making, and help in focusing attention on what
e
v
is more important. It can be used to monitor how well departments,

n i
projects, or individuals are performing operationally against objectives

, U
or targets. It helps to reduce the complexity involved with performance
tracking by reducing a huge number of measures into a manageable

L
number of ‘key’ indicators. Choosing the right KPIs depends upon a
O
S
good understanding of what is important to the organization as it solely

L /
depends on the department measuring the performance. For example, KPIs

O
for the Finance department will not be the same and relevant for the

C
Sales department. Hence, selecting KPIs involves accessing the current

E /
state of the business as well as its core activities to grasp what matters

C
the most. These assessments often lead to the identification of potential

D
improvements, so performance indicators are routinely associated with

©D
performance improvement initiatives. The importance of such performance
indicators is evident in the typical decision-making process (for example,
in the management of organizations). Hence, it is crucial to use the correct
performance indicators to prevent mistakes and reduce the risk.
KPIs define the raw set of values that can be fed to systems aggregating the
data, also known as indicators. Measurements for KPIs have two categories:
Quantitative and Qualitative. Quantitative measures are represented by
numeric values (continuous or discrete) measured against a standard. For
example, time spent per call for the help desk is a continuous quantitative

PAGE 19
© Department of Distance & Continuing Education, Campus of Open Learning,
School of Open Learning, University of Delhi
 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes measure while whole numbers representing customer acquisition numbers

are discrete quantitative measures. They do not represent any personal
feelings or interpretations. Some of the examples of Quantitative measures
are: Monthly Recurring Revenue, Customer Acquisition Cost, Number of
Resolved Tickets, Service Response Time, Customer Lifetime Value, Sales
growth etc. Qualitative measures are non-numeric measures against the
standard and represent personal feelings, interpretations, opinions, ideas or
experiences, etc. They includes customer stories, feedback, comments or

h
responses to open ended questions etc. When combined with quantitative
i
data, we get a overall picture of the organisation.
e l
Steps to create KPIs:
D
of
A properly constructed KPI aids organizations in turning their visions
into strategies and monitors the effect of initiatives. Each KPI developer

i ty
needs to address a specific business objective and provide timely, accurate

r
information to assess progress toward goals:
s
e
1. Establish a clear objective: If the goal of a business is to be the
v
i
‘market leader’ then the objective may be to increase revenue by
n
U
10% this financial year. The objective of a KPI is to state clearly

,
and in simple terms the purpose of the KPI. The purpose of this

O L
is to provide guidance for anyone viewing the KPI to interpret the
data in the correct context.

/ S
2. Outline the criteria for success: Targets should be realistic, and

O L
changes to business processes take time to implement. It is advisable

C
to concentrate on long-term goals with mid-term monitoring in the

/
CE
early phases of KPI monitoring.
3. Collect data: Investigate the availability and accuracy of the data.

D D Data may be available automatically from existing systems or hidden

in reports and databases.
© 4. Build the KPI formula: Some KPIs contain but a single metric or
measure. But the majority relies on a combination that is brought
together under a single calculated formula.
5. Present your KPI: You must convert the data into easily understood
visualizations, like graphs and charts, in order to effectively explain
your KPI.

20 PAGE
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 TECHNOLOGY TRENDS AND MODELS FOR MANAGEMENT OF IT

There are two types of Key Performance Indicators, based on the different Notes
levels of organization they apply to:
1. Lagging KPI: These are used to determine the result of past
performance such as production, volume, or a result. They are easy
to measure as they are simple values that are used to understand how
well a process is performing. For example, no units are produced
in a manufacturing process in a business.

i
2. Leading KPI: These are key indicators to predict or influence future
performance. They are more difficult to set up as they rely more
l h
on external actions to impact outcomes, such as changes in process
or investments in infrastructure.
D e
KPI typically falls into two categories:
of
ty
Operational KPI: These key indicators clearly articulate detailed and

s i
timely information that is used to make day-to-day decisions, or take

r
corrective actions on performance or a process. They are complex in
e
v
nature due to the usage of formulas and data from several sources.

n i
Strategic KPI: These key indicators focused on long-term objectives

, U
derived from an organization’s goals. They help in identifying if a strategy
is working and if it is on a target. They are sometimes referred to as
high-level KPIs.
O L
/ S
There are five different categories of key performance indicators (KPIs)

O L
depending on their contribution to the organization:
1. Input KPIs; measure the type, quality, and amount of resource

/ C
attributes required to generate particular outputs.

C E
2. Output KPIs; measure the output of Input KPIs indicating the amount

D
of work done and defining what has to be produced.

©D
3. Process KPIs; measure the effectiveness and quality of the processes
and equipment used in the generation of particular outputs.
4. Project KPIs; measure and keep monitoring the status of deliverables
and progress in achieving the project’s milestones.
5. Outcome KPIs; measure the achievements resulting from your efforts
while progressing towards the objective. There are two sub-types
of Outcome KPIs: Intermediate outcome KPIs (For example,
establishing better awareness about the brand) and End outcome

PAGE 21
© Department of Distance & Continuing Education, Campus of Open Learning,
School of Open Learning, University of Delhi
 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes KPIs (For example, establishing a high customer satisfaction and

retention as a result of the better awareness about the brand).
IN-TEXT QUESTIONS
6. Which of the following measure refers to a quantifiable measure
used to evaluate the success of an organization, projects,
employee etc., in meeting objectives for performance?
(a) Key Performance Indicator
(b) Key Process Indicator
h i
(c) Key Procedure Indicator
e l
(d) Key project Indicator
D
of
7. The study which involves advantages and disadvantages of a

ty
business with respect to others:
(a) SWOT
s i
(b) PEST
e r
8. CSF stands for:
i v
U n
(a) Critical Success Factor

,
(b) Crucial Success Factor
L
O
(c) Central Success factor

/ S
(d) None of these

O L
C
1.6 Information System Management Issues

E /
Information system management encompasses various challenges and issues

D C that organizations face in effectively managing their information systems.

©D
There occurs a huge gap when Information system is not aligned with the
business objectives. Hence, aligning information systems with the overall
business strategy is crucial for success. It can be a very complex task to
ensure that IT initiatives and investments are strategically aligned and
deliver value to the organization. It involves identifying the technology
capabilities required to support the organization’s objectives, assessing
current IT infrastructure, and developing plans for technology acquisition,
development, and deployment. The IT strategy ensures that technology
investments and initiatives are aligned with the overall business strategy.

22 PAGE
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School of Open Learning, University of Delhi
 TECHNOLOGY TRENDS AND MODELS FOR MANAGEMENT OF IT

Effective governance mechanisms are necessary to ensure strategic Notes

alignment. This includes establishing decision-making structures, such as
IT steering committees or executive sponsorship, to oversee and prioritize
IT initiatives. Governance helps ensure that IT investments and projects
align with business priorities and are evaluated based on their strategic
value.
Organizations often have multiple systems and applications that need to

i
work together seamlessly. Ensuring the integration and interoperability
of different systems can be complex, requiring effective data exchange,
l h
e
compatibility, and synchronization. Legacy systems, which are outdated
or unsupported software or hardware, can pose challenges in terms of
D
of
maintenance, compatibility, and security. Organizations may struggle with
managing and modernizing these systems while ensuring they continue

ty
to meet business requirements. Information technology is constantly

s i
evolving, and organizations need to keep pace with new technologies,

e r
trends, and innovations. Keeping up with advancements such as cloud

i v
computing, artificial intelligence, or blockchain, while evaluating their

U n
potential benefits and risks, can be a challenge.
As organizations grow and their information systems expand, ensuring

L ,
scalability and optimal performance becomes crucial. Challenges may

O
arise in managing system performance, handling increasing data volumes,

/ S
and ensuring efficient resource allocation. Maintaining high-quality

O L
data is essential for effective decision-making and business operations.
Organizations face challenges related to data accuracy, consistency,

/ C
completeness, and governance, including data privacy and compliance

E
with regulations such as GDPR or CCPA.

C
D
Managing IT projects, including system implementations, upgrades, or

©D
migrations, can be complex. Organizations need to address challenges
related to project planning, resource allocation, stakeholder management,
and ensuring projects are delivered on time and within budget. Introducing
new information systems or making significant changes to existing systems
requires effective change management. Organizations need to address
employee resistance, provide training and support, and communicate
the benefits of system changes to ensure successful adoption. Many
organizations rely on external vendors for their information systems,
such as software providers or cloud service providers. Managing vendor

PAGE 23
© Department of Distance & Continuing Education, Campus of Open Learning,
School of Open Learning, University of Delhi
 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes relationships, contracts, service-level agreements, and ensuring vendor

accountability can be a challenge.
Another critical challenge is to ensure the security of information systems
and protecting sensitive data, Organizations need to implement robust
cyber security measures, such as firewalls, encryption, access controls, and
employee training, to mitigate the risk of data breaches and unauthorized
access.

i
To address these information system management issues we require a

l h
combination of strategic planning, robust policies and processes, skilled

D e
personnel, and ongoing monitoring and improvement. Organizations
need to adopt a proactive approach to mitigate risks, enhance system

of
performance, and ensure the effective and secure management of their
information systems.

i ty
1.7 Summary
r s
v e
i
The advancement of technologies has brought about various Technological

U n
trends and models including Cloud Computing, AI/ML, Mobile Computing,
social media, Ubiquitous computing, data analytics, data science, and the

L ,
Internet of Things (IoT), devices embedded with microchips, large amount

O
of objects, actuators, sensors, intended to make a smart place for living.

/ S
Information Technology (IT) is recognized today as a major factor that

O L
influences business performance. Consequently, there has been increasing
concern in most organizations regarding its management. Information

/ C
systems strategies can be defined as application strategies that aim to

C Ealign Information system developments with business needs and seek

D
competitive advantage from IT. Information system strategy formulation is

©D
the process of developing a plan that aligns an organization’s information
systems with its overall business strategy. It involves defining the direction,
goals, and initiatives for leveraging technology and information systems
to support the organization’s objectives.
Critical Success Factors (CSF) are the essential areas or factors that must
be achieved or addressed in order for an organization, project, or initiative
to be successful. They are the few crucial factors that directly contribute
to achieving the objectives or desired outcomes. CSFs vary depending
on the specific context and goals of the entity involved. Identifying and

24 PAGE
© Department of Distance & Continuing Education, Campus of Open Learning,
School of Open Learning, University of Delhi
 TECHNOLOGY TRENDS AND MODELS FOR MANAGEMENT OF IT

focusing on CSF helps organizations prioritize their efforts and resources Notes
toward what truly matters for success. According to Rockart, there are
four main types of CSFs- Industry factors, Strategic, Environmental and
temporal factors.
Key Performance Indicators (KPI) are measurable values or metrics that
indicate how effectively an organization, project, or initiative is performing
in relation to its objectives and CSFs. KPIs provide quantifiable data

i
that can be tracked over time to assess progress and performance. KPIs

h
should be specific, measurable, achievable, relevant, and time-bound
(SMART). They enable organizations to monitor performance, identify
e l
areas of improvement, and make data-driven decisions. CSFs and KPIs
D
of
are closely connected. CSFs define the critical areas that are vital for
success, while KPIs measure and quantify the performance within those

ty
areas. CSFs are the high-level strategic factors that guide the selection of

s i
appropriate KPIs. KPIs are then used to track progress toward achieving

e r
the CSFs. There are two types of Key Performance Indicators, based on

i v
the different levels of organization they apply to- Lagging KPI, Leading

n
KPI. There are five different categories of key performance indicators

Process, Project and Outcome KPIs.

, U
(KPIs) depending on their contribution to the organization- Input, Output,

O L
Information system management encompasses various challenges and

/ S
issues that organizations face in effectively managing their information

L
systems. One of the biggest challenge is strategic planning, i.e., aligning

O
information systems with the overall business strategy. It is very complex

C
/
to ensure that IT initiatives and investments are strategically aligned

C E
and deliver value to the organization. Organizations often have multiple
systems and applications that need to work together seamlessly. Ensuring

D
the integration and interoperability of different systems can be complex,

©D
requiring effective data exchange, compatibility, and synchronization.
Information technology is constantly evolving, and organizations need
to keep pace with new technologies, trends, and innovations. Keeping
up with advancements such as cloud computing, artificial intelligence, or
blockchain, while evaluating their potential benefits and risks, can be a
challenge. As organizations grow and their information systems expand,
ensuring scalability and optimal performance becomes crucial. Challenges
may arise in managing system performance, handling increasing data
volumes, and ensuring efficient resource allocation. Maintaining high-quality

PAGE 25
© Department of Distance & Continuing Education, Campus of Open Learning,
School of Open Learning, University of Delhi
 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes data is essential for effective decision-making and business operations.

Introducing new information systems or making significant changes
to existing systems requires effective change management. Managing
vendor relationships, contracts, service-level agreements, and ensuring
vendor accountability can be a challenge. Another critical challenge is to
ensure the security of information systems and protecting sensitive data,
Organizations need to implement robust cybersecurity measures, such as
firewalls, encryption, access controls, and employee training, to mitigate
the risk of data breaches and unauthorized access.
h i
e l
1.8 Answers to In-Text Questions
D
1. Cloud Computing
of
ty
2. Artificial Intelligence

s i
r
3. Blockchain
4. Predictive Analytics
v e
n i
5. Information system strategy formulation

U
6. (a) Key Performance Indicator

,
L
7. (a) SWOT

O
8. (a) Critical success factor

S
L /
1.9 Self-Assessment Questions

C O
E /
1. What are the different technology trends and models to manage
information technology?

D C 2. Describe the role of Information System Strategy formulation? What

©D
are the different levels in formulating Information System Strategy?
3. Differentiate between CSFs and KPIs. How can we identify the CSFs?
4. Describe the role of KPIs. What are the different types of KPIs?
5. What are the issues faced in Information System Management?

26 PAGE
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School of Open Learning, University of Delhi
 TECHNOLOGY TRENDS AND MODELS FOR MANAGEMENT OF IT

Notes
1.10 References
‹ M. J. Earl. 1987. Information systems strategy formulation. Critical
issues in information systems research. John Wiley & Sons, Inc.,
USA, 157–178.
‹ Gupta, Satish & Ambashtha, Dr. Kanahaiya & Kumar, Dr. (2022).
CHALLENGES AND OPPORTUNITIES OF MANAGEMENT

i
INFORMATION SYSTEMS IN BUSINESS. 9. 22-28.
‹ Din, Z., Jambari, D. I., Yusof, M. M., & Yahaya, J. (2019). Challenges
l h
in Managing Information Systems Security for Internet of Things-
D e
of
enabled Smart Cities. 2019 6th International Conference on Research
and Innovation in Information Systems (ICRIIS). doi:10.1109/

ty
icriis48246.2019.9073661.
 ‹

s i
https://www.institutedata.com/blog/big-data-analytics-the-digital-
impact-on-modern-technology/

e r
 ‹

i v
https://www.researchgate.net/publication/342988285_Current_Trends_

n
In_Information_Technology_Which_Way_For_Modern_It_Experts
 ‹

, U
https://www.econstor.eu/bitstream/10419/217873/1/sajbm-v15i4-1128.

L
pdf
 ‹

S O
https://harappa.education/harappa-diaries/critical-success-factors-

/
meaning-and-examples/
 ‹

O L
https://cmoe.com/glossary/critical-success-factors/

/ C
 ‹ https://sendpulse.com/support/glossary/critical-success-factors
 ‹

C E
https://www.kpi.org/kpi-basics/

D
 ‹ https://www.12manage.com/methods_rockart_csfs_kpis.html

©D
 ‹ https://libres.uncg.edu/ir/uncg/f/P_Palvia_Information_1999.pdf

PAGE 27
© Department of Distance & Continuing Education, Campus of Open Learning,
School of Open Learning, University of Delhi
L E S S O N

2
IT Architecture
Planning
Ishita Verma
Assistant Professor

i
USME-DTU

l h
Email-Id: [email protected]

STRUCTURE
D e
2.1 Learning Objectives
of
2.2 Introduction
i ty
2.3 IT Architecture Planning
r s
2.4 Open System Architecture
v e
2.5 Leadership in IT
n i
U
2.6 National Information Infrastructure
2.7 Digital Signature,

O L
2.8 'LJLWDO &HUWL¿FDWH
S
/ to In-Text Questions
L
2.9 Summary

O
2.10 Answers

C
E /
2.11 Self-Assessment Questions

C
2.12 References

D D 2.1 Learning Objectives

© ‹ Developing an understanding of how IT Architecture planning is
done.
‹ Developing an understanding of what open source architecture is and
its benefits and challenges.
‹ Understanding how leadership is critical in field of Information
technology.

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 IT ARCHITECTURE PLANNING

‹ Developing an understanding of National Information Infrastructure Notes

and how its useful.
‹ Understanding what are digital certificates and digital signatures and
how they differ.

2.2 Introduction

i
Architecture planning refers to the process of designing the structure

h
of a system, whether it’s a physical system or a software application.
It involves making decisions and creating a blueprint that outlines how
e l
different components will work together to achieve a specific goal.
D
of
In the context of physical system, architecture planning involves considering
factors such as the purpose of the building, its functionality, aesthetics,

i ty
and the needs of the people who will use it. Architects take into account

r s
various elements like the layout, materials, and infrastructure to create a

e
design that is practical, visually appealing, and meets the requirements
of the end users.
i v
U n
In the context of IT, architecture focuses on defining the structure,

,
components, and interactions of a software system. This includes determining

O L
the overall system architecture, such as the choice of programming
languages, frameworks, and databases, as well as the organization of

/ S
different modules and how they communicate with each other. The goal

O L
is to create a robust, scalable, and maintainable software solution that
addresses the desired functionality and performance requirements.

/ C
E
In both cases, architecture planning is a crucial step that lays the foundation

C
for successful implementation. It helps ensure that the final product meets

D
the intended purpose, functions effectively, and is well-aligned with the

D
needs of the users or stakeholders.

©
2.3 IT Architecture Planning
Information Technology Architecture planning is like building a strong
foundation for a house. Just as a house needs a solid base to ensure
stability and support, organizations need a well-designed IT architecture
to support their application development systems and processes.

PAGE 29
© Department of Distance & Continuing Education, Campus of Open Learning,
School of Open Learning, University of Delhi
 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes Why is IT architecture planning important? It’s like having a blueprint

that guides the construction of an application. It helps organizations align
their IT systems with their business goals and strategies, ensuring that
technology supports their needs and objectives.
When planning IT architecture, there are a few key things to consider,
which are as follows:
1. Understanding the organization’s requirements is the most crucial

i
step. This involves figuring out what the organization requires

l
from its technology systems and how they can be used to improve
h
operations, collaboration, and decision-making.

D e
2. Choice of right technologies is also important. It’s like picking the

of
right tools for the job. Organizations need to select technology

ty
solutions that fit their needs, are scalable, and can work well with

i
the already existing systems.

r s
3. Integration and interoperability are other important aspects. It’s like

e
making sure all the parts of the house fit in together. In terms of
v
i
IT, it is the ability of different systems, device and applications to
n
U
connect and communicate in a coordinated way to ensure that they

,
can communicate and share information effectively, both within the

O L
organization and with external partners.
4. Security is the topmost priority. It’s like having strong locks on the

/ S
doors and windows of a house. Organizations need to implement
L
measures to protect their data and systems from unauthorized access,
O
C
ensuring compliance with regulations and industry standards.

E /
5. Scalability and performance are also considerations. Scalability is

C
the ability to cater to the increased demands. It’s like planning for

D future growth. Organizations need to design their IT architecture

©D
to handle increasing demands, such as more users, more data, and
higher workloads.
6. Another important factor is governance and standards which are
like having rules and guidelines for the house. Organizations need
to establish policies and processes to manage their IT resources,
ensure changes are handled properly, and maintain compliance with
regulations.

30 PAGE
© Department of Distance & Continuing Education, Campus of Open Learning,
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 IT ARCHITECTURE PLANNING

2.3.1 Key Components of IT Architecture Plan Notes

‹ Business Objectives: Clearly defined goals and objectives that the

IT architecture plan aims to support and align with the overall
business strategy.
‹ Stakeholder Requirements: Identification and understanding of the
needs, expectations, and requirements of stakeholders such as users,
management, customers, and partners.

h i
l
‹ System Requirements: Detailed specifications and functional
requirements of the IT systems and components that will be part
of the architecture.
D e
of
‹ Application Architecture: Design and structure of the software

ty
applications that will be used, including the selection of appropriate

i
platforms, frameworks, and technologies.
‹
r s
Infrastructure Architecture: Design and layout of the physical and

v e
virtual infrastructure, including servers, networks, storage, and cloud

n
resources, required to support the IT systems.
i
‹

, U
Data Architecture: Management and organization of data assets,
including databases, data models, data storage, data integration,
and data security measures.
O L
‹

/ S
Integration Architecture: Approaches for connecting and integrating

L
various systems, components, and external services to ensure seamless

O
communication and data exchange.

C
‹

E /
Security Architecture: Planning for the implementation of security
measures and controls to protect information assets, mitigate risks,

C
and comply with regulatory requirements.
D
©D
‹ Migration and Implementation Strategy: Plan and roadmap for
transitioning from the current state to the desired future state of the
IT architecture, including considerations for phased implementation,
testing, training, and support.
Finally, IT architecture planning is an ongoing process. It’s like maintaining
a house. Organizations need to continuously evaluate their IT architecture,
identify areas for improvement, and make necessary adjustments to keep
up with ever changing needs and technological advancements.

PAGE 31
© Department of Distance & Continuing Education, Campus of Open Learning,
School of Open Learning, University of Delhi
 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes To conclude, IT architecture planning is about building a solid foundation

for an organization’s technology systems. It involves understanding the
requirements, choosing the right technologies, ensuring integration and
security, planning for growth, and establishing standards. It’s like creating
a blueprint that guides the construction and maintenance of different
applications, ensuring that technology supports the organization’s goals
and objectives.

2.4 Open System Architecture

h i
e l
D
Open system architecture, refers to a design approach that promotes

of
interoperability, flexibility, and collaboration among different components
or systems.

ty
An open system architecture is like a puzzle where various pieces can

s i
fit together regardless of their origin or manufacturer. It allows different

e r
components or systems to communicate and work together seamlessly,

i v
even if they were developed independently. This is possible because open

n
systems adhere to standardized protocols, interfaces, and data formats

U
that enable smooth integration and interaction.

,
L
Open system architecture is like building a house with interchangeable

O
parts. Just as modular kitchen has interchangeable parts which allow

/ S
you to rearrange and customize your kitchen, open system architecture

O L
enables organizations to build and integrate technology systems using
interchangeable components and interfaces which can also be reused thus

/ C
avoiding duplication of effort in developing the same component again

C Eand again.

D
The idea behind open system architecture is to avoid dependency on

©D
vendors and promote competition among vendors, leading to innovation,
and end users have a wide variety of options to choose from. It allows
users or organizations to select components or systems from different
providers based on their specific needs, without being limited to a single
proprietary solution. This flexibility not only encourages competition
among vendors but also gives users the freedom to customize and enhance
their systems as required.
What is open system architecture? It’s a flexible and modular approach
to designing and developing technology systems. It allows different

32 PAGE
© Department of Distance & Continuing Education, Campus of Open Learning,
School of Open Learning, University of Delhi
 IT ARCHITECTURE PLANNING

software and hardware components from various vendors to integrate Notes

and work together seamlessly, promoting interoperability and enabling
organizations to adapt and evolve their technology infrastructure to the
changing requirements.
In open system architecture, components are designed to communicate with
each other using standard interfaces. It’s like having a common language
that allows different parts of the system to understand and interact with

i
one another. This standardized communication enables organizations to
mix and match components from different vendors, creating a customized
l h
e
technology environment where they can customise the applications
depending on the needs.
D
of
Additionally, an open system architecture encourages collaboration and
knowledge sharing. It allows developers and users to contribute to the

i ty
improvement and evolution of the system by providing feedback, suggesting

r s
enhancements, and even creating new components or extensions. This

e
collective effort helps to drive innovation and ensure that the system

v
i
remains adaptable to changing requirements and advancements in technology.

n
, U
2.4.1 Benefits of Open System Architecture

O L
The benefits of open system architecture are numerous which are as
follows:
/ S
O L
1. First and foremost, it promotes flexibility and scalability. It’s like
being able to add or remove furniture pieces as per your needs. With

/ C
open system architecture, organizations can easily add or replace

E
components without disrupting the entire system. Each component
C
D
is an independent module which can be used in developing any

©D
system. This also promotes reuseability of modules. This flexibility
allows for efficient technology upgrades and expansions, enabling
organizations to keep up with evolving requirements and advancements
in technology.
2. Open system architecture also promotes innovation and competition.
It’s like having a market with many furniture vendors offering
different options. With open system architecture, multiple vendors
can develop and offer compatible components, increasing competition
and driving innovation. This competitive landscape encourages

PAGE 33
© Department of Distance & Continuing Education, Campus of Open Learning,
School of Open Learning, University of Delhi
 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes vendors to continually improve their products and services in order

to become the best, leading to a wider range of options and better
solutions for organizations.
3. Interoperability is another key advantage of open system architecture.
It is the ability of different systems or devices to communicate in a
coordinated way. With standardized interfaces, different components
can seamlessly exchange data and information, enabling efficient

i
collaboration and integration. This interoperability eliminates the

l h
need for custom integration efforts, reduces complexity, and promotes

e
seamless communication across the organization’s technology system.

D
4. Open system architecture also enhances future-proofing. The different

of
components can easily adapt to changing technical needs. By using
open standards, organizations can future-proof their technology

i ty
investments. They can ensure that their systems can integrate with

r s
emerging technologies or adapt to changes in business requirements.

e
However, open system architecture also comes with its challenges. Ensuring
v
i
compatibility and interoperability among different components requires
n
U
careful planning, coordination, and adherence to standards. Organizations

,
need to invest in proper integration and testing processes to ensure the

L
smooth functioning of their technology systems.

O
S
In conclusion, open system architecture is a modular and flexible

/
approach to building and integrating technology systems. It promotes
L
O
interoperability, flexibility, scalability, innovation, and future-proofing.

C
By using standardized interfaces and components from different vendors,

E /
organizations can create a customized technology systems that meet

C
their specific needs and allows for easy upgrades and expansions. While

D
challenges exist, open system architecture offers numerous benefits for

©D
organizations seeking adaptable and interoperable technology solutions.
CASE STUDY
Case Overview: A healthcare organization is facing challenges with
interoperability and data exchange between different departments
and systems. To address these issues, they decide to implement an
open system architecture approach. They aim to improve patient care
coordination, data sharing, and system scalability while ensuring data
security and privacy.

34 PAGE
© Department of Distance & Continuing Education, Campus of Open Learning,
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 IT ARCHITECTURE PLANNING

Implementation Steps: Notes

‹ Assessing System Requirements: The organization evaluates the
existing healthcare systems, identifies the interoperability challenges,
and defines the requirements for data exchange, security, and system
scalability.
‹ Selecting Open Standards and Protocols: Open standards and
protocols, such as HL7 (Health Level Seven) for healthcare data

i
exchange, are chosen to enable seamless integration between systems.
This ensures compatibility and interoperability across different
l h
healthcare applications.

D e
of
‹ Developing APIs and Interfaces: APIs (Application Programming
Interfaces) and well-defined interfaces are developed to facilitate

ty
the exchange of data and functionalities between various healthcare

i
systems. This allows different systems to communicate effectively

s
r
and share information securely.

v e
Implementing Modular Architecture: The organization adopts a
i
‹

n
modular architecture approach, where individual components or

U
modules can be developed and updated independently. This allows

L ,
for flexibility in integrating new systems, upgrading existing ones,
and replacing components without disrupting the entire system.

S O
Collaborating with Vendors: The healthcare organization works
/
‹

L
closely with vendors and system providers to ensure compliance

O
with open system architecture principles. They encourage vendors to

/ C
adopt open standards and support interoperability, giving preference

E
to systems that can seamlessly integrate into their open architecture

D C
environment.
Enhancing Security Measures: Robust security measures, including

©D
‹
encryption, access controls, and authentication mechanisms, are
implemented to protect patient data and maintain privacy during
data exchange within the open system architecture.
‹ Monitoring and Continuous Improvement: The organization establishes
a monitoring system to track system performance, interoperability,
and adherence to open system architecture principles. Regular
assessments and feedback loops are implemented to address any
challenges or shortcomings and drive continuous improvement.

PAGE 35
© Department of Distance & Continuing Education, Campus of Open Learning,
School of Open Learning, University of Delhi
 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes Results and Benefits: By implementing an open system architecture, the

healthcare organization achieves several benefits:
‹ Improved data exchange and interoperability between different
healthcare systems and departments, facilitating seamless information
flow and care coordination.
‹ Enhanced scalability and flexibility, allowing the organization to
integrate new systems and technologies as needed.
‹ Increased vendor choice and competition, as the organization is
h i
l
not locked into proprietary solutions, leading to cost savings and
e
D
innovation.

of
‹ Strengthened data security and privacy measures, ensuring compliance
with regulations and safeguarding patient information during system

ty
interactions.

s i
Overall, the adoption of open system architecture in the healthcare

e r
organization promotes efficient and collaborative healthcare delivery,

i v
enabling better patient outcomes and streamlining operations across the
healthcare ecosystem.

U n
2.5 Leadership in IT
L ,
S O
Leadership plays a crucial role in the field of Information Technology

L /
(IT) as it guides teams, drives innovation, and ensures the successful

O
implementation of technology initiatives. We will study the key aspects

/ C
of leadership in IT, including its significance, qualities of effective IT

E
leaders, challenges faced, strategies for success, and the impact of IT

D C leadership on organizational outcomes.

©D
2.5.1 Importance of Leadership in IT
Leadership in IT holds immense importance due to the following reasons:
(a) Alignment of technology with the goals and objectives: IT leaders
align technology initiatives with the organization’s overall strategic
objectives. They ensure that IT investments and projects are in line
with the organization’s vision and contribute to achievement of
organization’s overall goals and objectives.

36 PAGE
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 IT ARCHITECTURE PLANNING

(b) Team Management: IT leaders are responsible for managing and Notes
guiding teams of IT professionals. They provide support, direction
and guidance to foster a productive and motivated workforce.
(c) Innovation and Adaptation: IT leaders drive innovation by exploring
emerging technologies, identifying opportunities for growth and
improvement, and inculcating a culture of creativity. They encourage
their teams to embrace change and adapt to technological advancements.

i
(d) Collaboration and Communication: Effective IT leaders promote
collaboration and communication between IT teams and other
l h
departments. They bridge the gap between technical expertise and
non-technical stakeholders, ensuring effective understanding and
D e
of
cooperation among all the departments.

ty
(e) Risk Management and Security: IT leaders play a critical role in

i
managing risks associated with technology systems and ensuring

s
r
the security of organizational data. They establish robust security

e
measures, implement risk management strategies, and comply with
v
all the guidelines and regulations.
n i
, U
2.5.2 Qualities of Effective IT Leaders

O L
Few qualities possessed by effective IT leaders which help them in staying
effective are as follows:
/ S
L
(a) Vision: They have a clear vision for the future of IT within the
O
C
organization and develop strategic plans to achieve it. They align

E /
IT initiatives with business objectives and strategic goals so that

C
organizational goals can be achieved.

D
(b) Technical Expertise: Good IT leaders have a detailed understanding

©D
of technology and stay updated with the latest technological
advancements. They possess a broad knowledge base that enables
them to make informed decisions and effectively communicate with
technical professionals.
(c) Interpersonal Skills: Strong communication and interpersonal skills
are crucial for IT leaders. They can explain complex technical
concepts in simple terms, actively listen to their team members,
and build strong relationships with stakeholders.

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© Department of Distance & Continuing Education, Campus of Open Learning,
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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes (d) Emotional Intelligence: IT leaders also possess emotional intelligence

by understanding and empathizing with their team members. They
create a positive work environment, manage conflicts effectively,
create an environment of healthy competition among the team
members and motivate their teams.
(e) Strategic Decision-Making: IT leaders take strategic decisions by
considering various factors such as business objectives, technological

i
feasibility, and resource constraints. They analyze all the data, take

l h
input from stakeholders, and evaluate all the risks and benefits for

e
the achievement of strategic goals and objectives.

D
(f) Continuous Learning and Adaptability: Good IT leaders have a

of
mindset of lifelong learning and continuously update their knowledge
and skills. They encourage their team members to learn and continually

i ty
upgrade their skills, adapt to new technologies, and stay updated
with industry trends.
r s
v e
i
2.5.3 Challenges Faced by IT Leaders
n
U
IT leadership comes with its own set of challenges which are as follows:
,
O L
(a) Technological Advancements: The rapid pace of technological
advancements poses a challenge for IT leaders. They need to stay

/ S
updated with emerging technologies, evaluate their relevance to the

L
organization, and be familiar with the latest technological practices.

O
C
(b) Balancing Innovation and Stability: IT leaders must strike a balance

E / between driving innovation and maintaining system stability. They

C
need to ensure that technology systems are reliable, secure, and

D
scalable and follow the best technological practices.

©D
(c) Resource Constraints: Limited resources, including budget and staff,
present challenges for IT leaders. They must allocate resources
effectively, prioritize projects, and find creative solutions to maximize
the utilisation of all the available resources.
(d) Managing Change: IT leaders need to manage organizational change
effectively, especially during technology implementations or digital
transformations. They must communicate the benefits of change,
address resistance, and ensure a smooth transition.

38 PAGE
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 IT ARCHITECTURE PLANNING

2.6 National Information Infrastructure Notes

The National Information Infrastructure (NII) refers to the underlying

framework of interconnected networks, information systems and technologies
that facilitate the flow of information across a nation. It encompasses
various components, including telecommunications networks, internet
infrastructure, data centers, and government systems. We will study about
the concept of National Information Infrastructure, its significance, key
components, and its impact on the society.
h i
The primary goal of a national information infrastructure is to facilitate
e l
D
efficient and secure communication, promote access to information, and

of
fulfil the digital requirements of a country’s citizens, organizations, and
government. It enables the sharing of information and resources, such as

ty
websites, databases, and digital services, which can enhance productivity,
innovation, and collaboration across different sectors.
s i
e r
The NII also plays a vital role in connecting individuals and communities,

i v
bridging the digital gap and promoting inclusion, and ensuring that everyone

U n
has access to essential digital services, such as internet connectivity,
online education, e-commerce, and government services.

L ,
Governments and policymakers often focus on developing and maintaining

O
a robust national information infrastructure to promote economic growth,

S
/
improve public services, enhance cyber security, and promote digital

O L
inclusion. Investments in infrastructure development, cyber security
measures, and digital literacy programs are crucial for the successful

/ C
establishment and maintenance of a resilient and accessible NII.

C E
D
2.6.1 Significance of the National Information Infrastructure

©D
The NII is of great importance for several reasons:
(a) Communication and Connectivity: It enables people and organizations
to connect, communicate, and share information across geographical
boundaries. It facilitates the exchange of ideas, supports economic
activities, and enhances social interactions among people from
different parts of the globe.
(b) Access to Information: The NII provides widespread access to
information resources, including educational materials, healthcare

PAGE 39
© Department of Distance & Continuing Education, Campus of Open Learning,
School of Open Learning, University of Delhi
 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes information, government schemes and services and other business

data. It promotes knowledge-sharing and empowers individuals with
valuable information.
(c) Economic Growth: A robust NII promotes economic growth by
supporting digital industries, enabling e-commerce, and attracting
investments. It provides a platform for innovation, entrepreneurship,
and job opportunities.

i
(d) Government Services: The NII facilitates the access of government

l h
services and information to the citizens of the nation. It enables online

D e
transactions, electronic voting, and access to public information like
Aadhaar information, government schemes etc. making governance

of
more efficient and transparent.

ty
(e) Emergency Management: The NII plays a crucial role in disaster

i
management and emergency response. It enables the quick dissemination

s
r
of critical information, coordination among responsible agencies

e
providing relief and communication with affected communities.
v
n i
U
2.6.2 Components of the National Information Infrastructure

L ,
The NII comprises various components, including:

O
(a) Telecommunications Networks: These networks form the backbone of
S
L /
the NII, providing the infrastructure for voice and data transmission.
They include wired networks (fiber-optic, coaxial cable, twisted pair

C O
cable) and wireless networks (cellular, satellite).

E /
(b) Internet Infrastructure: The internet is a key component of the

D C NII, connecting networks across the globe and facilitating global

information exchange. It includes internet service providers (ISPs),

©D
network infrastructure, and protocols which govern the exchange
of information over the internet.
(c) Data Centers: Data centers are centers that host servers, storage
systems, and network equipment. They store and process vast
amounts of data, supporting online services, cloud computing, and
information storage.
(d) Government Systems: Government systems form an essential part of
the NII, encompassing databases, portals, and online platforms that

40 PAGE
© Department of Distance & Continuing Education, Campus of Open Learning,
School of Open Learning, University of Delhi
 IT ARCHITECTURE PLANNING

provide public services, manage records, and facilitate government Notes

operations.
(e) Cyber security Measures: Protecting the NII from cyber threats
is crucial. Cyber security measures include firewalls, encryption,
authentication mechanisms, and incident response systems to safeguard
information and networks.

i
2.6.3 Impact of the National Information Infrastructure

l h
e
The NII has the following effects on the society:
(a) Communication and Connectivity: The NII enables instant
D
of
communication across people living in different parts of the world
thus promoting global connections and cultural exchange. It brings

i ty
people closer, facilitating collaboration and breaking down barriers.

r s
(b) Access to Information and Education: The NII provides access to

e
vast pool of information and educational resources. It empowers
v
i
individuals to learn, acquire new skills, and participate in the
n
U
exchange of knowledge.

L ,
(c) Economic Development: The NII drives economic development by
promoting digital industries, enabling e-commerce, and expanding

O
market reach. It creates opportunities for entrepreneurship, job
S
creation, and innovation.
L /
O
(d) Digital Governance: The NII transforms governance by offering all

/ C
the government services online, increasing transparency, providing all

E
the information online and improving efficiency. It enhances public

D C
participation and enables citizens to know about all the government
services and policies and take maximum benefit.

©D
IN-TEXT QUESTIONS
1. What is the primary purpose of architecture planning?
(a) To select the most expensive materials for a building
(b) To create a visually appealing design
(c) To ensure the functionality and practicality of a system
(d) To increase the construction timeline

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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes 2. In software architecture planning, what does scalability refer to?

(a) The ability of the system to handle increased workload
(b) The use of cloud-based technologies
(c) The aesthetic design of the user interface
(d) The choice of programming language
3. What is the benefit of an open system architecture?
(a) It limits competition and innovation among vendors
h i
(b) It promotes interoperability and flexibility
e l
D
(c) It restricts customization and enhancements

of
(d) It results in a higher cost of implementation

ty
4. What does a National Information Infrastructure (NII) support?

s i
(a) The flow of information and communication within a
country
e r
i v
(b) International trade and commerce

n
(c) Transportation and logistics systems
U
,
(d) Energy and power generation

L
5. What is the main objective of IT architecture planning?
O
/ S
(a) To increase the complexity of the IT infrastructure

L
(b) To ensure data security and privacy

CO
(c) To prioritize cost reduction over system performance

E/
(d) To implement the latest technology trends without considering

C
business needs

D D 6. What is the primary characteristic of an open system architecture?

©
(a) It restricts interoperability with other systems
(b) It relies on proprietary protocols and interfaces
(c) It promotes collaboration and interoperability
(d) It limits the choice of components and vendors
7. How does an open system architecture encourage competition?
(a) By enforcing strict regulations on vendors
(b) By standardizing protocols and interfaces

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 IT ARCHITECTURE PLANNING

(c) By providing exclusive contracts to a single vendor Notes

(d) By restricting access to system documentation

8. What is a key advantage of an open system architecture?
(a) It limits the ability to customize and extend the system
(b) It increases the complexity of integrating different components
(c) It allows users to choose components from multiple vendors
(d) It results in higher implementation and maintenance costs
h i
9. What is the role of open standards in an open system architecture?
e l
(a) They hinder interoperability with other systems
D
of
(b) They limit the options for customization

ty
(c) They provide a common framework for compatibility and
interoperability
s i
e r
(d) They promote vendor lock-in and restrict competition

i v
2.7 Digital Signature
U n
L ,
A digital signature is the digital equivalent of the regular ink signature.
This technique makes us of encryption and is used to authenticate the

S O
integrity and origin of electronic documents or messages in the digital

L /
world. It provides a way to ensure that a digital document has not been

O
tampered with and that it was sent by the claimed sender. We will

/ C
learn about digital signatures, how they work, their benefits, and their

E
applications in various fields.

D C
2.7.1 Understanding Digital Signatures

©D
A digital signature is like a digital seal that is attached to an electronic
document to verify its authenticity and integrity. It is created using a
mathematical algorithm that generates a unique digital code. This code is
based on the content of the document and the private key of the sender,
which is a secret key known only to the sender.

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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes 2.7.2 How Digital Signatures Work

The process of creating and verifying a digital signature involves the
following steps:
(a) Creation:
‹ The sender uses a digital signature software to apply the
digital signature to the document.
‹ The software generates a hash value, which is a unique

h i
numerical representation of the document’s content.

e l
D
‹ The sender’s private key is then used to encrypt the hash

of
value, creating the digital signature.
(b) Verification:
‹

i ty
The recipient of the digitally signed document uses the same

s
digital signature software or tool to verify the signature.
r
‹

v e
The software decrypts the digital signature using the sender’s

i
public key, which is freely available.

n
U
‹ The software then generates a hash value from the received

,
document and compares it with the decrypted hash value.
‹

O L
If the two hash values match, it means that the document has

S
not been tampered with and that it was signed by the claimed

L /
signer.

C O
/
2.7.3 Benefits of Digital Signatures

CE
(a) Authentication: Digital signatures provide strong proof of the identity

D D of the sender. They ensure that the document originated from the
claimed sender and has not been altered during transmission.

© (b) Integrity: Digital signatures guarantee the integrity of the document.

Any change or tampering with the document after the signature
invalidates the signature, indicating that the document is no longer
trustworthy.
(c) Non-Repudiation: Digital signatures prevent the sender from denying
their involvement in signing the document. Once a document is
digitally signed, it becomes legally binding and difficult to repudiate.

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 IT ARCHITECTURE PLANNING

(d) Efficiency: Digital signatures streamline processes by eliminating Notes

the need for physical signatures and paperwork. They enable secure
and efficient electronic transactions, saving time and resources.
(e) Security: Digital signatures use advanced encryption techniques,
making it extremely difficult for unauthorized parties to forge or
tamper with the signature. This enhances the overall security of
electronic communication and transactions.

2.7.4 Applications of Digital Signatures

h i
e l
D
Digital signatures find applications in various fields, including:

of
(a) Business and Contracts: Digital signatures are used to sign and
authenticate contracts, agreements, and other legal documents. They

ty
provide a secure and efficient way to conduct business transactions
electronically.
s i
r
(b) Government and E-Government: Digital signatures are employed in
e
v
government processes such as online filing of tax returns, e-voting,

n i
digital permits, and digital identity verification. They ensure the

U
integrity and authenticity of government documents and transactions.

L ,
(c) Financial Transactions: Digital signatures are used in online banking,
e-commerce, and electronic fund transfers. They provide secure

O
authentication and authorization for financial transactions.
S
L /
(d) Intellectual Property Protection: Digital signatures are utilized to

O
protect intellectual property rights. They can be used to sign digital

C
copyrights, patents, and trademarks, ensuring the authenticity and

E /
integrity of such assets.

C
(e) Healthcare and Medical Records: Digital signatures play a crucial

D
role in securing electronic medical records, prescriptions, and

©D
healthcare-related documents. They protect the privacy and integrity
of sensitive patient information.

2.7.5 Comparison of Digital Signature with Regular Ink

Signature
The main difference between a digital signature and a regular ink signature
lies in the underlying technology and the level of security and verifiability
they provide. Here are the key distinctions:

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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes 1. Technique:
‹ Regular Ink Signature: A regular ink signature is a handwritten
signature created using a pen or similar writing instrument
on a physical document.
‹ Digital Signature: A digital signature is an encrypted code
generated using mathematical algorithms and applied to an
electronic document.
2. Authentication:
h i
‹

e l
Regular Ink Signature: A regular ink signature serves as a

D
visual representation of an individual’s identity but can be

of
easily forged or copied.
‹ Digital Signature: A digital signature provides a higher level

ty
of authentication and identity verification. It uses public key

s i
cryptography to ensure that the document is signed by the

e r
claimed sender and has not been tampered with.
3. Integrity:
i v
‹

U n
Regular Ink Signature: A regular ink signature does not

,
provide any protection against tampering done to the signed

O L
document. It can be easily altered or manipulated and thus
the integrity of the document will not be preserved.

/ S
Digital Signature: A digital signature guarantees the integrity
L
‹

O
of the document. Any change or tampering with the document

C
after the signature has been attached to the document, invalidates

E / the signature, ensuring the recipient knows that the document

C
has been altered.

D 4. Non-Repudiation:

©D
‹ Regular Ink Signature: A regular ink signature can be denied
by the signer since it may lack concrete evidence to prove its
authenticity.
‹ Digital Signature: A digital signature provides non-repudiation,
meaning the signer cannot deny signing of the document.
5. Efficiency and Document Management:
‹ Regular Ink Signature: Regular ink signatures require physical
documents, printing, signing, and scanning or mailing. This

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 IT ARCHITECTURE PLANNING

process can be time-consuming and less efficient for digital Notes

transactions.
‹ Digital Signature: Digital signatures streamline document
management and transactions by eliminating the need for
physical paperwork. They enable secure electronic transactions,
saving time and resources.
6. Security:
‹ Regular Ink Signature: Regular ink signatures lack built-in
h i
security features and can be easily forged, copied, or stolen.
e l
D
‹ Digital Signature: Digital signatures make use of advanced

of
encryption techniques, making it extremely difficult for
unauthorized parties to tamper with the signature. They offer

ty
a higher level of security and authenticity.

s i
In summary, while a regular ink signature serves as a visual representation

e r
of identity, a digital signature provides a higher level of authentication,

i v
integrity, non-repudiation, and security for electronic documents. Digital

U n
signatures are particularly advantageous for online transactions, legal
documents, and instances where secure verification and tamper detection
are crucial.
L ,
S O
/
2.8 Digital Certificate

O L
Digital certification, also known as digital certificates or digital IDs, is a

/ C
technology that provides a secure and trusted way to verify the identity of

E
individuals, organizations, or devices in the world of digital transactions.

D C
It serves as a digital equivalent of a physical identification document,
such as a passport or driver’s license. We will study the concept of

©D
digital certification, its purpose, how it works, and its applications in
various fields.
Understanding Digital Certification: Digital certification is a method
used to establish the authenticity and integrity of digital entities, such as
individuals, websites, or software. It involves the use of Encryption and
Decryption techniques to create a unique digital certificate that contains
information about the entity’s identity, public key, and other relevant
details. This certificate is issued by a trusted third party known as a
certification authority (CA).
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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes 2.8.1 Purpose and Benefits of Digital Certification

The main purpose of digital certification is to ensure authenticity of the
sending entity. Some key benefits of using Digital certificates are as
follows:
(a) Identity Verification: Digital certificates provide a reliable way to
verify the identity of individuals or entities in online interactions.
They help establish trust and confidence in the digital environment.

h i
l
(b) Authentication: Digital certificates enable the authentication of

D e
digital entities, such as websites. Individuals or organization. This
helps users ensure they are interacting with genuine and authorized

of
entities.

ty
(c) Secure Communication: Digital certificates facilitate secure com-

i
munication by enabling the establishment of encrypted connections.

r s
They play a vital role in protocols like Transport Layer Security

e
(TLS) and Secure Sockets Layer (SSL) to ensure data confidentiality

v
i
and protection against eavesdropping.

n
U
(d) Trustworthiness: Digital certificates are issued by trusted certification

,
authorities, which helps establish trust in online transactions and

O L
interactions. They provide assurance that the entity being certified
is genuine and can be relied upon.

/ S
L
2.8.2 How Digital Certification Works
O
/ C
The process of digital certification involves the following steps:

CE
(a) Certificate Request: The entity seeking a digital certificate generates a

D D key pair consisting of a private key (kept secret) and a corresponding

public key. The entity then submits a certificate request to a

© certification authority (CA) along with relevant identification and

verification information.
(b) Certificate Issuance: The CA verifies the identity of the entity
requesting the certificate. Once the verification is complete, the CA
creates a digital certificate by digitally signing the entity’s public
key and other relevant information using the CA’s private key.

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 IT ARCHITECTURE PLANNING

(c) Certificate Distribution: The CA distributes the digital certificate to Notes

the entity or makes it available for download. The entity can then
use the digital certificate to prove its identity, sign documents, or
establish secure communication.
(d) Certificate Validation: When a digital certificate is presented for
verification, the recipient uses the CA’s public key (previously
trusted) to verify the digital signature on the certificate. If the

i
signature is valid, the recipient can trust the identity and integrity
of the certified entity.
l h
2.8.3 Applications of Digital Certification
D e
Digital certification finds applications in various fields, including:
of
i
(a) Secure Website Communication: Digital certificates are used in
ty
r s
SSL/TLS protocols to secure website communication, enabling

e
encrypted connections and protecting sensitive information, such
as passwords and credit card details.
i v
U n
(b) Email Encryption: Digital certificates enable the encryption and

,
signing of emails, ensuring confidentiality and authenticity of email
communication.

O L
(c) Software and Code Signing: Digital certificates are used to sign

/ S
software programs and code to verify their authenticity and ensure
L
they have not been tampered with. This helps prevent the distribution
O
C
of malicious or unauthorized software.

E /
The following figure shows how digital signature and digital certificate

C
are used to protect the authenticity of the sender and the data being sent.

D
©D

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© Department of Distance & Continuing Education, Campus of Open Learning,
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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes

h i
e l
D
of
i ty
r s
v e
n i
, U
Figure 2.1 Digital signature and digital certificate

L
(Source: www.lifewire.com)

S O
/
2.8.4 How Digital Signature and Digital Certificate Differ
‹
O L
Digital signature verifies the authenticity of the electronic document

/ Cwhereas the Digital certificate verifies the authenticity of the sender.

CE
‹ One entity will have one digital ceritificate but digital signatures can

D
be many depending on the number of electronic documents being

D
sent. Each document will have different digital signature depending

©
on the content.
CASE STUDY
Background: An e-commerce platform wants to enhance the security
and trustworthiness of online transactions. They decide to implement
digital signature and digital certificate technologies to ensure the
integrity, authenticity, and non-repudiation of their digital documents
and transactions.

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 IT ARCHITECTURE PLANNING

Case Overview: The e-commerce platform integrates digital signature Notes

and digital certificate technologies into their system to provide secure
and reliable transactions for their customers. They aim to establish
trust, prevent fraud, and protect sensitive information during online
interactions.
Implementation Steps:
‹ Obtaining Digital Certificates: The e-commerce platform collaborates
with a trusted Certificate Authority (CA) to obtain digital certificates.
h i
These certificates validate the platform’s identity, ensuring that
e l
D
customers can verify the authenticity of the platform and establish

of
trust.
‹ Implementing Digital Signature Mechanism: The platform integrates

ty
a digital signature mechanism into their system to sign important

s i
documents such as purchase orders, invoices, and contracts. This

e r
mechanism uses the platform’s private key to create a unique digital

i v
signature that verifies the integrity and authenticity of the document.
‹

U n
Verifying Digital Signatures: Customers and other stakeholders can
verify the digital signatures using the platform’s corresponding public

L ,
key. This enables them to confirm that the documents have not been

O
tampered with and have originated from the trusted e-commerce
platform.
/ S
‹

O L
Educating Customers: The e-commerce platform provides information
and instructions to customers on how to verify digital signatures

/ C
and the importance of doing so. This educates customers about the

E
benefits of digital signatures and promotes trust in the platform’s
C
D
transactions.

©D
‹ Ensuring Data Privacy and Encryption: The platform employs
encryption techniques to protect sensitive customer information
during transmission. This ensures that data remains confidential and
secure, further enhancing the overall security of the e-commerce
platform.
Benefits: By implementing digital signature and digital certificate
technologies, the e-commerce platform achieves the following benefits:

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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes ‹ Enhanced Trust and Customer Confidence: The presence of digital

signatures and digital certificates assures customers of the platform’s
identity and authenticity, fostering trust and confidence in their
transactions.
‹ Protection Against Fraud and Tampering: Digital signatures verify
the integrity of documents and prevent unauthorized modifications
or tampering. This helps protect the platform and customers from

i
fraudulent activities.
‹

l h
Non-Repudiation and Legal Validity: Digital signatures provide non-

D e
repudiation, ensuring that the platform cannot deny their involvement
in transactions. This strengthens legal validity and supports dispute

of
resolution.

ty
‹ Compliance with Security Standards: Implementing digital signatures

i
and digital certificates helps the platform meet security and privacy

s
r
compliance requirements, protecting both the platform and its
customers’ data.
v e
n i
U
2.9 Summary

L ,
To conclude, architecture planning is a crucial process in both physical

O
and IT realms. It involves designing and organizing the structure of

S
L /
systems to ensure functionality, efficiency, and alignment with specific
goals. Open system architecture promotes interoperability, flexibility,

O
and collaboration by allowing different components or systems to work
C
E /
together seamlessly. The National Information Infrastructure (NII) plays
a crucial role in promoting efficient communication, enabling access to

D C digital services, and fostering economic growth and digital inclusion.

©D
Digital signatures provide a way to ensure the integrity, authenticity, and
non-repudiation of digital messages or documents. They use techniques
of encryption and decryption. Digital certificates, on the other hand,
serve as electronic credentials that verify the identity of entities in online
transactions. They are issued by trusted Certificate Authorities and contain
information about the entity, its public key, and the CA’s digital signature.

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2.10 Answers to In-Text Questions Notes

1. (c) To ensure the functionality and practicality of a system

2. (a) The ability of the system to handle increased workload
3. (b) It promotes interoperability and flexibility
4. (a) The flow of information and communication within a country
5. (b) To ensure data security and privacy
6. (c) It promotes collaboration and interoperability
h i
7. (b) By standardizing protocols and interfaces
e l
D
of
8. (c) It allows users to choose components from multiple vendors
9. (c) They provide a common framework for compatibility and

ty
interoperability

s i
2.11 Self-Assessment Questions
e r
i v
n
1. How does IT architecture planning contribute to the success of an

U
organization?

,
2. What are the key components of an IT architecture plan?
L
O
3. What is the difference between a monolithic architecture and a
modular architecture?
/ S
collaboration?
O L
4. How does open system architecture promote interoperability and

/ C
5. What are the benefits of adopting an open system architecture?

C E
6. What are the key benefits of a robust National Information Infrastructure

D
(NII) for a country’s economy and society?

©D
7. What are the main challenges in establishing and maintaining an
effective National Information Infrastructure (NII) that supports
digital inclusion and accessibility for all citizens?
8. How does a digital signature ensure the integrity and authenticity of
a digital document or message?
9. What is the role of a Certificate Authority (CA) in issuing and
verifying digital certificates?

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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes 10. What are the key differences between a digital signature and a
digital certificate in terms of their purpose and functionality?

2.12 References
‹ www.lifewire.com
‹ www.techtarget.com

i
‹ www.tutorialspoint.com
‹
l h
Sarv, D & Kohli, R (2002), The it payoff: Measuring the business

e
value of information technology investments, New York: Prentice
D
of
Hall
‹ Chew, Eng K & Gottschalk, P (2009), Information technology strategy

ty
and management: Best Practices
‹

s i
HBS (2014), Leading Digital: Turning Technology into Business

e r
Transformation, Boston: Harvard Business School Press

i v
U n
L ,
S O
L /
C O
E /
D C
©D

54 PAGE
© Department of Distance & Continuing Education, Campus of Open Learning,
School of Open Learning, University of Delhi
L E S S O N

3
Strategic Management of
Information Technology
Dr. Geetika Vashishta
Assistant Professor

i
University of Delhi

l h
Email-Id: [email protected]

STRUCTURE
D e
3.1 Learning Objectives
of
3.2 Strategic Information Systems Planning
i ty
3.3 Learning Organizations
r s
3.4 Outsourcing IT Functions
v e
3.5 IT for Strategic Alliances
n i
3.6 Summary
, U
3.7 Answers to In-Text Questions
3.8 Self-Assessment Questions
O L
/ S
3.10 Suggested Readings L
3.9 References

C O
E /
3.1 Learning Objectives

D C
Understand role of Information Technology as a Strategic Tool for organizations to

©D
‹
gain competitive advantage.
‹ Explain the concepts for designing and developing a winning IT architecture and to
introduce the students to the concept of SISP and Learning Organizations.
‹ Explain the relevance of emerging paradigms such as BI and BA as well as their
relevance to businesses together with an understanding of the reasons for success
and failure of IT projects.

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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes 3.2 Strategic Information Systems Planning

In today’s digital age, organizations are increasingly reliant on information
technology (IT) to achieve their strategic goals and remain competitive. IT
has transformed the way businesses operate, from improving operational
efficiency and customer engagement to creating new products and
services. However, as organizations invest more in IT, they face several
challenges, such as aligning their IT investments with their business
strategy, developing a culture of innovation and learning, managing IT
h i
l
costs and risks, and forming strategic alliances with other organizations.
e
D
Strategic information systems (SIS) planning is a critical process that

of
enables organizations to align their IT investments with their business
goals and objectives. It involves identifying the key IT initiatives that

ty
will support the organization’s strategic goals, prioritizing them based

s i
on their importance, and allocating resources and budget to implement

r
them effectively. By aligning their IT investments with their business
e
v
strategy, organizations can ensure that their IT investments deliver

n i
tangible business value and competitive advantage. As shown in Figure

U
3.1, SIS aims at maintaining and creating an organization’s competitive

competitive advantage.
L ,
strategy so as to prevent the organization’s competitors from gaining a

S O
L /
C O
E /
D C
©D

Figure 3.1: Strategic Information Systems

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 STRATEGIC MANAGEMENT OF INFORMATION TECHNOLOGY

Learning organizations are another critical concept that organizations Notes

need to understand to succeed in today’s rapidly changing business
environment. Figure 3.2 beautifully presents the pre-requisites of a
learning organization. A learning organization is one that fosters a culture
of innovation, knowledge sharing, and experimentation. It encourages
employees to continuously learn and develop new skills, and it provides
them with the resources and tools they need to do so. By creating a
culture of learning and innovation, organizations can stay ahead of the
curve and adapt quickly to new challenges and opportunities.
h i
Individual Level Team/Group level Organizational level
e l
‹ Create ‹ Encourage ‹ Create Systems
D
of
Continuous Collaboration to Capture and
Learning and Team Share Learning

ty
Opportunities Learning

i
‹ Empower people

s
‹ Promote inquiry toward a
and dialogue
e r
collective vision

i v
‹ Connect the

n
organization to

U its environment

L,
‹ Provide Strategic

O
Leadership for

S
Learning

L /
Figure 3.2: Pre-requisites for a Learning Organizations

O
Outsourcing IT functions is another strategy that organizations can use

C
E /
to manage IT costs and risks. Outsourcing IT functions can provide cost
savings and access to specialized expertise, but organizations need to

C
carefully select their outsourcing partners and establish clear communication
D
D
channels and service level agreements to mitigate risks.

©
IT can also be used to form strategic alliances between organizations,
enabling them to achieve common goals more effectively. However,
forming strategic alliances also poses several challenges, such as data
security risks, compatibility issues, and cultural differences. By overcoming
these challenges, organizations can leverage their respective strengths and
expertise to create innovative solutions and enter new markets.
In this lesson, we will discuss each of these concepts in detail, providing
examples from Indian industry to illustrate how organizations have

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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes successfully implemented them to achieve their strategic goals and remain
competitive. We will also discuss the benefits and challenges of each
concept and provide practical advice for organizations looking to implement
them. By the end of this lesson, readers will have a comprehensive
understanding of these important concepts and how they can be used to
drive success in today’s digital age.
Strategic Information Systems Planning (SISP) is a critical process that

i
enables organizations to align their IT investments with their business

l h
strategy. The goal of SISP is to identify the key IT initiatives that will

e
support the organization’s strategic goals, prioritize them based on

D
their importance, and allocate resources and budget to implement them

of
effectively. By aligning their IT investments with their business strategy,
organizations can ensure that their IT investments deliver tangible business

ty
value and competitive advantage. The five phases of SISP are presented
in Figure 3.3.
s i
e r
Strategic Business Planning

i v
U n
Information System Assessment

L ,
S O Information Systems Vision

L /
CO
Information Systems Guidelines

E /
D C Strategic Initiatives

D
Figure 3.3: SISP Process Phases

© 3.2.1 Understanding the Organization’s Business Strategy

and Goals
The first step in the SISP process is to understand the organization’s
business strategy and goals. This involves analyzing the organization’s
vision, mission, values, and objectives, as well as its competitive
landscape, industry trends, and customer needs. By understanding the

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 STRATEGIC MANAGEMENT OF INFORMATION TECHNOLOGY

organization’s business strategy and goals, IT leaders can identify the key Notes
IT initiatives that will support the organization’s objectives and deliver
the most business value.
To better understand the organization’s business strategy and goals, IT
leaders may conduct interviews with key stakeholders, review internal and
external reports, and conduct market research. For example, an IT leader
at an e-commerce company may analyze customer data to understand their

i
buying behaviour and preferences, review industry reports to understand

h
market trends and competition, and conduct internal interviews with sales

e
and marketing teams to identify their business objectives and goals.
l
D
of
3.2.2 Assessing the Organization’s Current IT Capabilities
and Infrastructure

i ty
s
The second step in the SISP process is to assess the organization’s

e r
current IT capabilities and infrastructure. This involves reviewing the

i v
organization’s current IT systems, applications, and processes, as well as

U n
its IT governance structure, policies, and procedures. This step helps IT
leaders identify the gaps between the organization’s current IT capabilities

,
and its desired state, and develop a roadmap for achieving the desired state.
L
O
To assess the organization’s current IT capabilities and infrastructure, IT

/ S
leaders may conduct an IT audit, review internal and external reports,

L
and conduct interviews with IT staff and other stakeholders. For example,

O
an IT leader at a manufacturing company may conduct an IT audit to

C
/
identify the organization’s current IT systems and infrastructure, review

C E
industry reports to understand best practices, and conduct interviews with
IT staff to identify areas for improvement.

3.2.3 D
D
©
Identifying Key IT Initiatives
The third step in the SISP process is to identify the key IT initiatives that
will support the organization’s strategic goals. This involves brainstorming
and evaluating potential IT initiatives, such as new applications, systems,
or processes, and assessing their potential business value, feasibility,
and alignment with the organization’s strategic goals. IT leaders should
prioritize the IT initiatives based on their importance and expected business
value, and allocate resources and budget to implement them effectively.

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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes To identify key IT initiatives, IT leaders may conduct brainstorming

sessions, review industry reports and case studies, and conduct interviews
with key stakeholders. For example, an IT leader at a healthcare company
may review industry reports to identify emerging trends in telemedicine,
conduct interviews with medical staff to identify areas for improvement,
and brainstorm potential IT initiatives that could improve patient care
and satisfaction.

3.2.4 Developing an IT Roadmap or Strategic Plan

h i
e l
D
The fourth step in the SISP process is to develop an IT roadmap or

of
strategic plan. This involves outlining the key IT initiatives, their timelines,
budgets, and resource requirements, as well as the metrics and KPIs

ty
used to measure their success. The IT roadmap should also include a

i
governance structure that outlines the roles and responsibilities of different
s
r
stakeholders, and a communication plan that outlines how IT leaders will

e
v
communicate the IT roadmap to other stakeholders.

n i
To develop an IT roadmap or strategic plan, IT leaders may use project

, U
management tools and methodologies, such as agile or waterfall, to plan
and track the progress of the IT initiatives. They may also use IT portfolio
L
management tools to manage their IT investments and align them with
O
S
the organization’s business strategy.

L /
For example, an IT leader at a financial services company may develop an

O
IT roadmap that includes a new mobile banking application, an enhanced

/ C
customer relationship management system, and a cybersecurity training

E
program for employees. The IT roadmap should outline the timelines,

D C budgets, and resource requirements for each initiative, as well as the

metrics used to measure their success. The IT leader may also develop a

©D
governance structure that includes a steering committee and project teams
responsible for overseeing and implementing the IT initiatives.

3.2.5 Aligning IT Investments with Business Strategy

The final step in the SISP process is to align IT investments with the
organization’s business strategy. This involves monitoring and measuring

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 STRATEGIC MANAGEMENT OF INFORMATION TECHNOLOGY

the performance of the IT initiatives against their business value and Notes
strategic goals and adjusting the IT roadmap accordingly. IT leaders should
also communicate the IT roadmap and its progress to other stakeholders,
such as business leaders, investors, and customers, to ensure that the IT
initiatives are aligned with the organization’s overall strategy and deliver
tangible business value. Figure 3.4 presents the interplay between IT
infrastructure and processes and organizational infrastructure and processes.

i
To align IT investments with business strategy, IT leaders may use
performance metrics and KPIs to measure the success of the IT initiatives
l h
e
and their impact on the organization’s business objectives. They may also
conduct regular reviews and assessments of the IT roadmap to identify
D
of
areas for improvement and adjust the IT initiatives as needed. For
example, an IT leader at a retail company may monitor the performance

ty
of a new e-commerce platform by tracking metrics such as website traffic,

s i
conversion rates, and customer satisfaction, and adjust the IT roadmap
based on the results.
e r
i v
U n
L ,
S O
L /
C O
E /
Figure 3.4: Strategic Alignment Model

D C
In summary, SISP is a critical process that enables organizations to
align their IT investments with their business strategy. By understanding

©D
the organization’s business strategy and goals, assessing its current IT
capabilities and infrastructure, identifying key IT initiatives, developing an
IT roadmap or strategic plan, and aligning IT investments with business
strategy, IT leaders can ensure that their IT investments deliver tangible
business value and competitive advantage. The process of SISP can help
organizations achieve their strategic objectives, improve operational
efficiency, and enhance customer satisfaction, leading to long-term success
and growth.

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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes Example from Indian Industry: TATA STEEL

Tata Steel is a leading steel company in India and one of the top steel
producers globally. It is a subsidiary of the Tata Group, one of India’s
largest and most respected business conglomerates. Tata Steel has a long
history of using IT to drive business growth and innovation. In this section,
we will explore how Tata Steel has used SISP to align its IT investments
with its business strategy and achieve its strategic objectives.

i
‹ Understanding Business Strategy and Goals

l h
Tata Steel’s business strategy is focused on delivering sustainable

D e
growth and profitability by optimizing its operations, expanding

of
its customer base, and leveraging technology and innovation. The
company has identified several strategic goals, including improving

ty
operational efficiency, enhancing customer experience, and driving
innovation.

s i
‹

e r
Assessing Current IT Capabilities and Infrastructure

i v
To achieve its strategic goals, Tata Steel recognized the need to

U n
improve its IT capabilities and infrastructure. The company conducted
a comprehensive assessment of its existing IT systems and identified

,
several areas for improvement, such as data management, analytics,
L
O
and cybersecurity.
‹

/ S
Identifying Key IT Initiatives

O L
Based on the assessment of its current IT capabilities and infrastructure,
Tata Steel identified several key IT initiatives that would enable the

/ Ccompany to achieve its strategic goals. These initiatives included:

CE
1. Implementing an advanced analytics platform to improve

D
operational efficiency and drive innovation.

© D 2. Upgrading its ERP system to streamline business processes and

improve data management.
3. Investing in cybersecurity measures to protect its critical assets
and ensure business continuity.
4. Enhancing its digital customer engagement platforms to improve
customer experience and loyalty.

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STRATEGIC MANAGEMENT OF INFORMATION TECHNOLOGY

‹ Developing an IT Roadmap or Strategic Plan Notes

Tata Steel developed a comprehensive IT roadmap that outlined
the timelines, budgets, and resource requirements for each of the
IT initiatives. The company also established a governance structure
that included a steering committee and project teams responsible
for overseeing and implementing the IT initiatives.
Tata Steel used agile methodologies to plan and track the progress

i
of its IT initiatives. The company also used IT portfolio management
tools to manage its IT investments and align them with its business
l h
strategy.

D e
of
‹ Aligning IT Investments with Business Strategy
Tata Steel monitored and measured the performance of its IT initiatives

ty
against their business value and strategic goals. The company used

i
performance metrics and KPIs to measure the success of the IT
s
r
initiatives and their impact on the organization’s business objectives.

e
v
Tata Steel also conducted regular reviews and assessments of its

n i
IT roadmap to identify areas for improvement and adjust the IT

U
initiatives as needed.

L ,
One example of how Tata Steel has successfully aligned its IT
investments with its business strategy is through its use of advanced

S O
analytics. The company implemented an advanced analytics platform

L /
that leverages machine learning and artificial intelligence to optimize

O
its operations and drive innovation. The platform enables Tata Steel

C
to collect and analyze data from its manufacturing processes and

E /
supply chain, identify areas for improvement, and make data-driven

C
decisions to optimize its operations and reduce costs. By aligning

D
its IT investments with its business strategy, Tata Steel has been

©D
able to achieve significant improvements in operational efficiency,
cost reduction, and innovation.
In conclusion, Tata Steel is an excellent example of how SISP can
enable organizations to align their IT investments with their business
strategy and achieve their strategic objectives. By understanding
its business strategy and goals, assessing its current IT capabilities
and infrastructure, identifying key IT initiatives, developing an IT

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School of Open Learning, University of Delhi
 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes roadmap, and aligning its IT investments with business strategy, Tata
Steel has been able to achieve sustainable growth and profitability.
The company’s use of advanced analytics and other IT initiatives has
enabled it to optimize its operations, enhance customer experience,
and drive innovation, leading to long-term success and growth.
IN-TEXT QUESTIONS
1. The first phase of SISP process is___.
(a) Strategic Initiatives
h i
(b) Strategic Business Planning
e l
(c) Information Systems Vision
D
of
(d) None of these

ty
2. The goal of SISP is to identify the key IT initiatives that will
support _______.
s i
r
(a) Organization’s strategic goals
e
i v
(b) Prioritize goals based on their importance

n
(c) Allocate resources and budget to implement the goals
U
,
effectively

L
(d) All of these

O
/ S
L
3.3 Learning Organizations

C O
In today’s rapidly changing business environment, organizations must be

E /
able to learn and adapt continuously to remain competitive. The concept

C
of a learning organization has emerged as a key strategy for achieving

D
sustainable growth and success. A learning organization is one that

©D
fosters a culture of learning and innovation, encourages collaboration and
experimentation, and continuously improves its processes and practices.
In this section, we will explore the concept of learning organizations
in detail. We will start by discussing what a learning organization is
and its benefits. Next, we will look at the steps involved in building a
learning organization, including creating a culture of learning, encouraging
employee development, fostering innovation, and implementing continuous
improvement processes. Finally, we will examine an example from

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 STRATEGIC MANAGEMENT OF INFORMATION TECHNOLOGY

Indian industry, Wipro, which has successfully embraced the concept of Notes
a learning organization.
By the end of this section, you will have a deep understanding of the
importance of learning organizations in today’s business environment and
the key steps involved in building one. You will also have a concrete
example of how an Indian company has successfully implemented the
concept of a learning organization, leading to long-term success and growth.

h i
l
3.3.1 Concept of Learning Organizations

D
The concept of a learning organization is based on the idea that organizations e
of
can be designed and managed in a way that enables them to learn and
adapt continuously. A learning organization is one that fosters a culture

ty
of learning and innovation, encourages collaboration and experimentation,
and continuously improves its processes and practices.
s i
e r
3.3.2 Benefits of Learning Organizations
i v
U n
The benefits of creating a learning organization are numerous. Some of
the key benefits include:
L ,
O
1. Improved Decision-Making: Learning organizations are better

/ S
equipped to make informed decisions based on data and evidence.

O L
2. Increased Innovation: By fostering a culture of experimentation
and collaboration, learning organizations can drive innovation and
new ideas.
/ C
C E
3. Better Employee Engagement and Retention: Learning organizations

D
provide opportunities for employee development and growth, leading

©D
to higher engagement and retention rates.
4. Improved Performance and Productivity: Learning organizations
continuously improve their processes and practices, leading to
improved performance and productivity.

3.3.3 Building a Learning Organization

Building a learning organization requires a commitment to continuous

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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes improvement and a willingness to challenge the status quo. Some of the
key steps involved in building a learning organization include:
1. Creating a Culture of Learning: Leaders should promote a culture
of learning by encouraging collaboration, experimentation, and
continuous improvement.
2. Encouraging Employee Development: Organizations should provide
opportunities for employee development and growth, including

i
training, mentoring, and coaching.

l
3. Fostering Innovation: Organizations should encourage and reward
h
innovative ideas and experimentation.
D e
of
4. Implementing Continuous Improvement Processes: Organizations
should implement processes for continuous improvement, such as

ty
Lean Six Sigma or Agile methodologies.
Example from Indian Industry: Wipro
s i
e r
Wipro is a leading IT services company in India that has embraced the

i v
concept of a learning organization. The company has established several

n
initiatives to promote learning and development, including:

U
,
1. Wipro Academy of Software Excellence (WASE): WASE is a unique

O L
program that offers engineering graduates the opportunity to earn a
master’s degree while gaining real-world experience at Wipro. The

/ S
program combines classroom learning with on-the-job training and

L
mentoring.

O
C
2. Mission10X: Mission10X is an initiative aimed at improving the

E / employability of engineering graduates in India. The program

C
provides training and mentoring to engineering students, with a

D
focus on developing their technical and soft skills.

©D
3. Wipro Learning Labs: Wipro Learning Labs is an online platform
that provides employees with access to a wide range of training
and development programs. The platform offers courses on topics
such as technology, leadership, and communication skills.
Wipro’s commitment to creating a learning organization has led to numerous
benefits, including improved employee engagement and retention, increased
innovation, and improved performance and productivity.

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 STRATEGIC MANAGEMENT OF INFORMATION TECHNOLOGY

In conclusion, building a learning organization is essential for organizations Notes

that want to remain competitive in today’s rapidly changing business
environment. By fostering a culture of learning and innovation, encouraging
employee development, and implementing continuous improvement
processes, organizations can achieve sustainable growth and success.
Wipro is an excellent example of how an Indian company has successfully
embraced the concept of a learning organization, leading to long-term
success and growth.

h i
l
IN-TEXT QUESTIONS
3. The concept of a learning organization is based on the idea
that_____.
D e
(a) Organizations can manage things in an organized way
of
ty
(b) Organizations can learn to take decisions about how to do
things
s i
e r
(c) Organizations can be designed in a way that enables them
to learn and adapt continuously.
i v
(d) None of these.
U n
,
4. Building a learning organization comprises of_____.

L
(a) Creating a culture of learning
O
/ S
(b) Encouraging employee development

L
(c) Fostering innovation

O
C
(d) All of these

E / IT Functions
C
3.4 Outsourcing

D
©D
Outsourcing IT functions has become a popular practice among organizations
in recent years. It involves contracting certain IT services to external
service providers to reduce costs, improve efficiency, and provide access
to specialized expertise. However, outsourcing also comes with its own
set of challenges, including the need to manage relationships with external
providers, ensure data security and confidentiality, and maintain control
over critical business processes.
In this section, we will explore the benefits and challenges of outsourcing
IT functions and provide best practices for successful outsourcing. We

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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes will also examine an example from Indian industry, specifically Infosys,
a leading IT services company in India that has successfully implemented
outsourcing of IT functions.
By understanding the benefits and challenges of outsourcing IT functions
and following best practices, organizations can effectively leverage external
service providers to achieve long-term success and growth.

i
3.4.1 Introduction to Outsourcing IT Functions

l h
e
Outsourcing IT functions refers to the practice of contracting out certain

D
IT services to external service providers. This practice has become

of
increasingly popular in recent years due to its potential to reduce costs,
improve efficiency, and provide access to specialized expertise. However,

ty
outsourcing also comes with its own set of challenges, including the need

s i
to manage relationships with external providers, ensure data security and

e r
confidentiality, and maintain control over critical business processes. Figure

i v
3.5 presents the Outsourcing decision-making framework which highlights

n
the possibilities that has be considered before opting for outsourcing.

, U
Besides the strong motivation to outsource, associated risks and valid
reasons to outsource must be identified.

O L
/ S
O L
/ C
C E
D
©D

Figure 3.5: Outsourcing Decision-Making Framework

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 STRATEGIC MANAGEMENT OF INFORMATION TECHNOLOGY

The six phases of Outsourcing Lifecycle are presented in Figure 3.6 and Notes
are discussed briefly next.
Phase 1 - Strategy: A decision to outsource is usually recommended,
reviewed and evaluated. it could be a part of a larger method to move
the organization to a leveraged business model and to gain competitive
advantage. it can be strictly a choice to outsource a particular operation,
application or project. Generally, the strategy is developed at top level

i
management within the company.
Phase 2 - Selection: This important phase involves identifying the work
l h
to be done and finding customers using the Request for Information (RFI)
and/or Request for Proposals (RFP) process, leading to the selection of
D e
of
the desirable vendor. There are three main steps in the selection phase:

ty
‹ Defining the task
‹ Finding a vendor
s i
‹ Selecting one or more vendor
e r
i v
U n
L ,
S O
L /
C O
E /
D C
©D
Figure 3.6: Outsourcing Lifecycle
Phase 3 - Negotiation: This phase has two main tasks:
‹ Negotiation of contracts
‹ Signing of the final contracts

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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes This phase is usually completed after the initial period because both
the company and the seller will go through a legal review process. A
memorandum or letter of understanding can be issued before the final
contract is signed.
Phase 4 - Implementation: This stage includes the preparation of
initiatives for the modification and implementation of the outsourcing
contract, as well as the creation of the necessary management system for

i
its management and production. The four main processes in the inception
phase are:
l h
‹ Planning the change

D e
of
‹ Involving one or more suppliers
‹ Preparing detailed budgets and forecasts

ty
Initiating the process
i
‹

r s
Phase 5 - Management: The management phase includes all ongoing

e
activities necessary to manage the project and achieve the desired results.

v
of the project:
n i
Each of the seven main processes listed below continue during the life

, U
Manage customer (or user) relationships
‹

O L
Perform all financial monitoring tasks

S
monitor project and product performance
/
‹

O L
Manage partner relationships or supplier relationships
Integration of the Support Services
C
‹

E
‹
/ Negotiating changes in the project

D C ‹ Overseeing the transition of vendors (both prepared and unexpected)

©D
Phase 6 - Completion: The final stage includes all close out tasks for
the project.
The two main steps in this phase are:
‹ Contract Completion
‹ Closing the project

3.4.2 Benefits of Outsourcing IT Functions

There are several benefits to outsourcing IT functions, including:

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 STRATEGIC MANAGEMENT OF INFORMATION TECHNOLOGY

1. Reduced Operational Costs: Outsourcing can help organizations Notes

reduce IT costs by providing access to specialized expertise and
reducing the need for in-house IT staff.
2. Improved Efficiency: External service providers can often perform IT
functions more efficiently than in-house staff, allowing organizations
to focus on their core business functions.
3. Access to Specialized Expertise/New Technology/Skills: Outsourcing

i
can provide access to specialized IT expertise that may not be
available in-house.
l h
4. Flexibility and Scalability: Outsourcing allows organizations to
D e
of
scale IT resources up or down as needed, providing flexibility to
respond to changing business needs.

3.4.3 Challenges of Outsourcing IT Functions

i ty
r s
e
While outsourcing IT functions can provide significant benefits, it has
v
i
associated risks viz. Operational risks, Strategical risks, intrinsic risks
n
U
of antropy and location. It also comes with its own set of challenges,

,
including:

O L
1. Managing Relationships with External Providers: Outsourcing
requires effective management of relationships with external service

/ S
providers, including communication, coordination, and monitoring
of performance.
O L
/ C
2. Ensuring Data Security and Confidentiality: Outsourcing can

E
increase the risk of data breaches and loss of confidential information,

D C
requiring strict security measures and protocols.
3. Maintaining Control Over Critical Business Processes: Outsourcing

©D
can result in a loss of control over critical business processes,
requiring careful consideration of which functions are suitable for
outsourcing.

3.4.4 Best Practices for Outsourcing IT Functions

To ensure successful outsourcing of IT functions, organizations should
follow best practices, including:

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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes 1. Clearly Defining Requirements and Expectations: Organizations

should clearly define their requirements and expectations for
outsourced IT services, including performance metrics, service level
agreements (SLAs), and security protocols.
2. Selecting the Right Provider: Organizations should carefully select
an external service provider based on their expertise, track record,
and cultural fit.

i
3. Managing Relationships Effectively: Organizations should establish

l h
effective communication and coordination mechanisms with external

e
providers, including regular meetings and performance reviews.

D
of
4. Maintaining Control Over Critical Processes: Organizations should
maintain control over critical business processes by retaining in-

ty
house staff or implementing effective oversight mechanisms.
Example from Indian Industry: Infosys
s i
e r
Infosys is a leading IT services company in India that has successfully

i v
implemented outsourcing of IT functions. The company has established

U n
strong relationships with external service providers, including IBM and
SAP, to provide specialized IT services to its clients. Infosys has also

,
implemented strict security measures and protocols to ensure data security
L
O
and confidentiality. By outsourcing certain IT functions, Infosys has been

S
able to focus on its core business functions and provide high-quality

L /
services to its clients.

O
In conclusion, outsourcing IT functions can provide significant benefits

C
/
to organizations, including cost savings, improved efficiency, and access

C Eto specialized expertise. However, it also comes with its own set of
challenges, including the need to manage relationships with external
D providers, ensure data security and confidentiality, and maintain control

©D
over critical business processes. By following best practices and learning
from successful examples, organizations can successfully implement
outsourcing of IT functions and achieve long-term success and growth.
IN-TEXT QUESTIONS
5. Benefits to outsourcing IT functions includes___.
(a) Cost savings (b) Scalability
(c) Flexibility (d) All of these

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 STRATEGIC MANAGEMENT OF INFORMATION TECHNOLOGY

6. Outsourcing IT functions refers to ___. Notes

(a) Practice of contracting out certain IT services to external

service providers
(b) Procuring IT enabled software
(c) Gaining knowledge of Information Society
(d) All of these

h i
3.5 IT for Strategic Alliances
e l
Strategic alliances are formed when two or more organizations collaborate
D
of
to achieve mutual benefits such as access to new markets, technologies, and
resources. With the increasing importance of IT in business operations, IT

i ty
has become an essential tool for creating and managing strategic alliances.

s
In this section, we will explore the role of IT in strategic alliances and
r
e
how it can be used to enhance collaboration and achieve mutual benefits.

i v
Strategic alliances have become increasingly important in today’s globalized

n
and interconnected business environment. With the rapid growth of
U
,
technology and the increasing importance of IT in business operations, IT

L
has become a crucial tool for creating and managing strategic alliances.

O
By leveraging IT, organizations can collaborate more effectively and

S
/
efficiently, align their goals and strategies, and achieve mutual benefits

O L
such as access to new markets, technologies, and resources. In this
section, we will explore the role of IT in strategic alliances and provide

/ C
examples from Indian industry to illustrate how IT can be used to enhance

E
collaboration and achieve mutual benefits.

C
D
©D Alliances
3.5.1 IT-Enabled Communication and Coordination in
Strategic
IT plays a critical role in enabling communication and coordination between
partners in a strategic alliance. By providing shared platforms and tools
for communication, IT can facilitate the exchange of information and
collaboration on projects. This enhances transparency, reduces duplication
of effort, and improves decision-making.

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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes One way IT facilitates communication in strategic alliances is through

video conferencing. This technology allows partners to have face-to-face
meetings without physically being in the same location, reducing the time
and cost associated with travel. It can also enable real-time collaboration
on projects, enabling partners to share ideas and make decisions quickly.
Online collaboration tools such as shared project management software and
document repositories can also enhance communication and coordination

i
between partners. These tools provide a central location for partners

l
to access and contribute to project information, reducing the risk of
h
e
miscommunication or missed deadlines.

D
An example of the use of IT-enabled communication and coordination

of
in strategic alliances is the partnership between Indian pharmaceutical
company Dr. Reddy’s Laboratories and the Japanese pharmaceutical

i ty
company Fujifilm. The two companies formed a strategic alliance in 2011

r s
to develop and manufacture generic drugs for the Japanese market. To

e
facilitate communication and coordination between the partners, they set

v
n i
up a joint project management office that used online collaboration tools
to track progress and share information.

, U
L
3.5.2 IT-Enabled Knowledge Sharing in Strategic Alliances

O
/ S
IT can also enable knowledge sharing between partners in a strategic

O L
alliance. By providing a shared repository of knowledge and best practices,
partners can learn from each other and improve their operations. This can

/ C
result in better decision-making and increased efficiency.

C EOne way IT facilitates knowledge sharing is through the creation of a

D
shared knowledge management system. This system can contain information

©D
on industry trends, best practices, and past project experiences. Partners
can use this information to improve their operations and avoid making
the same mistakes.
Another way IT facilitates knowledge sharing is through online communities
of practice. These communities allow partners to connect and share
knowledge and experiences related to specific topics or projects. By sharing
their knowledge, partners can benefit from each other’s experiences and
expertise.

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 STRATEGIC MANAGEMENT OF INFORMATION TECHNOLOGY

An example of the use of IT-enabled knowledge sharing in strategic Notes

alliances is the partnership between Indian automotive company Tata
Motors and the British automotive company Jaguar Land Rover. The two
companies formed a strategic alliance in 2008 to share resources and
expertise. To facilitate knowledge sharing between the partners, they set
up a joint engineering team that used a shared knowledge management
system to share information on engineering best practices and past project
experiences.

h i
3.5.3 IT-Enabled Value Creation in Strategic Alliances
e l
D
of
IT can also enable value creation in strategic alliances by providing access
to new markets, technologies, and resources. By collaborating on research

ty
and development projects or leveraging partner networks and expertise,

i
partners can create new products or services that leverage their strengths.
s
e r
One way IT facilitates value creation is through collaborative research

i v
and development projects. By pooling their resources and expertise,

n
partners can develop new technologies or products that they could not

increased revenue.
, U
have developed alone. This can lead to new market opportunities and

O L
Another way IT facilitates value creation is through the leveraging of

/ S
partner networks and expertise. By leveraging each other’s networks and

O L
expertise, partners can gain access to new markets or customers. They
can also learn from each other and improve their operations, resulting in

/ C
increased efficiency and cost savings.

E
An example of the use of IT-enabled value creation in strategic alliances
C
D
is the partnership between Indian IT company Wipro and the American

©D
engineering company GE. The two companies formed a strategic alliance
in 2016 to develop and market Predix, an industrial Internet of Things
platform. By leveraging their complementary strengths in IT and engineering,
they were able to create a new product that has the potential to transform
industrial operations worldwide.
Example from Indian Industry: Mahindra Satyam and Tech Mahindra
Mahindra Satyam and Tech Mahindra, two leading IT services companies
in India, formed a strategic alliance in 2009 to provide end-to-end IT

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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes services to customers worldwide. The alliance leveraged the complementary

strengths of both companies, with Tech Mahindra’s expertise in telecom
and Mahindra Satyam’s expertise in other industries. The alliance also
provided access to new markets and resources, enabling the companies
to expand their customer base and service offerings. IT played a crucial
role in the alliance, enabling communication, coordination, and knowledge
sharing between the partners. IT also enabled value creation by facilitating
collaboration on research and development projects and leveraging partner
networks and expertise.
h i
e
Example from Indian Industry: Tata Consultancy Services (TCS) l
D
TCS, a leading IT services company in India, has formed strategic

of
alliances with several organizations to provide innovative solutions to its
clients. For instance, TCS has formed a strategic alliance with a leading

i ty
automobile company to develop an end-to-end connected car solution. This

r s
solution uses IoT, AI, and cloud technologies to provide a seamless driving

e
experience and improve vehicle safety. This partnership has enabled TCS

v
n i
to leverage its expertise in IT and the automobile company to leverage its
expertise in the automotive industry to develop a cutting-edge solution.
IN-TEXT QUESTIONS
, U
L
7. A strategic alliance is formed when ___.
O
/ S
(a) Two or more organizations collaborate to achieve mutual

L
benefits

CO
(b) One organization works in isolation to achieve its goals

E/
(c) Sharing the work that needs to be done

C
(d) None of these

D D 8. IT facilitates value creation through ___.

©
(a) Advertising
(b) Leveraging of partner networks and expertise
(c) Information Society
(d) All of these

76 PAGE
© Department of Distance & Continuing Education, Campus of Open Learning,
School of Open Learning, University of Delhi
 STRATEGIC MANAGEMENT OF INFORMATION TECHNOLOGY

3.6 Summary Notes

In conclusion, Strategic Information Systems Planning, Learning

Organizations, Outsourcing IT Functions, and IT for Strategic Alliances are
all crucial concepts in today’s business environment. Organizations must
continually adapt to new technologies, market demands, and competitive
pressures to remain successful. The effective use of IT is essential to
achieving this goal.
Strategic Information Systems Planning helps organizations align their IT
h i
investments with their overall business objectives. By understanding the
e l
D
organization’s strategic goals and objectives, SISP enables IT to support

of
and enhance business operations. The process involves analyzing the
current state of the IT infrastructure, identifying gaps, and developing a

ty
plan to fill those gaps. The end result is a roadmap that outlines the IT

s i
initiatives that will support the organization’s strategic objectives.

e r
Learning Organizations are those that value continuous learning and

i v
growth. These organizations create an environment where employees

U n
are encouraged to learn and innovate, leading to improved business
performance. IT plays a vital role in enabling learning organizations by

L ,
providing access to information, facilitating collaboration, and supporting

O
knowledge sharing.

/ S
Outsourcing IT Functions can be an effective way for organizations to

O L
reduce costs, access specialized skills, and focus on their core competencies.
However, it is important to carefully evaluate outsourcing decisions to

/ C
ensure that the benefits outweigh the risks. Outsourcing can lead to

C E
reduced control, communication challenges, and cultural differences that
can impact the success of IT initiatives.
D
©D
IT for Strategic Alliances enables organizations to collaborate with other
companies to achieve common goals. The use of IT can help streamline
joint operations, improve communication, and support knowledge sharing.
Successful strategic alliances require careful planning, strong communication,
and a shared vision.
Real-world examples from the Indian industry demonstrate the importance
of these concepts. Companies like Tata Steel have leveraged IT to improve
their operations, reduce costs, and enhance their competitive position.

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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes By using IT strategically, Tata Steel has been able to achieve significant
business success and maintain its position as a leader in the steel industry.
In conclusion, IT plays a critical role in today’s business environment.
The effective use of IT can help organizations achieve their strategic
objectives, create a learning culture, and form successful alliances.
However, it is important to carefully evaluate IT initiatives to ensure
that they align with the organization’s overall goals and objectives. By

i
understanding these concepts and using them effectively, organizations
can improve their performance and stay ahead of the competition.
l h
3.7 Answers to In-Text Questions
D e
1. (a) Strategic Initiatives
of
2. (d) All of these
i ty
r s
3. (c) Organizations can be designed in a way that enables them to learn
and adapt continuously
v e
4. (d) All of these
n i
5. (d) All of these

, U
L
6. (a) Practice of contracting out certain IT services to external service

O
providers

/ S
7. (a) Two or more organizations collaborate to achieve mutual benefits

O L
8. (b) Leveraging of partner networks and expertise

/ C
E
3.8 Self-Assessment Questions

D C 1. Discuss the relevance of emerging paradigms such as BI and BA.

©D
2. Discuss the role of IT in enabling knowledge sharing between partners
in a strategic alliance.
3. Discuss the best practices for outsourcing IT functions.
4. What are the benefits and challenges of outsourcing IT functions?
5. What are the attributes of Strategic Information Systems?
6. Discuss SISP process phases in detail.
7. What are the key goals of SISP process?

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 STRATEGIC MANAGEMENT OF INFORMATION TECHNOLOGY

8. Discuss the role of IT in value creation in strategic alliances. Notes

9. Elaborate the six phases of the outsourcing lifecycle.
10. What are the main goals of learning organizations?

3.9 References
‹ J. Ward and J. Peppard, Strategic Planning for Information Systems,

i
Third. West Sussex: John Wiley & Sons Ltd., 2003.
‹ T. L. Wheelen, J. D. Hunger, A. N. Hoffman, and C. E. Bamford,
l h
Strategic Management and Business Policy Globalization, Innovation,
D e
of
and Sustainability, Fourteenth. Pearson Education, Inc., 2015.
‹ R. Durand, R. M. Grant, and T. L. Madsen, “The Expanding Domain

ty
of Strategic Management Research and the Quest for Integration,”
Strateg. Manag. J., vol. 38, no. 1, pp. 4–16, 2017.
s i
‹

e r
R. P. Rumelt, D. Schendel, and D. J. Teece, “Strategic management

i v
and economics,” Strategic management journal, vol. 12, no. S2. pp.
5–29, 1991.

U n
S. P.-J. Wu, D. W. Straub, and T.-P. Liang, “How Information
,
‹

L
Technology Governance Mechanisms and Strategic alignment

O
Influence Organizational Performance : Insights From a Matched

/ S
Survey of Business and IT Managers,” MIS Q., vol. 39, no. 2, pp.
497–518, 2015.

O L
L. Erasmus, S. Parappat, and R. Weeks, “Strategic Management of
C
‹

E /
Information Technology : An Investigation into It Alignment at a
Tertiary Education Institution,” 2012 Proc. PICMET ’12 Technol.

D C
Manag. Emerg. Technol. Strateg., pp. 2670–2678, 2012.

©D
‹ T. Cui, H. Ye, H. H. Teo, and J. Li, “Information technology and
open innovation: A strategic alignment perspective,” Inf. Manag.,
vol. 52, No. 3, pp. 348–358, 2015.
‹ Raquel Flodström, “A Framework for the Strategic Management of
Information Technology,” 2006.
‹ N. Melville and K. Kraemer, “Information Technology and Organizational
Performance: An Integrative Model of IT Business Value,” MIS Q.,
vol. 28, no. 2, pp. 283–322, 2004.

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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes ‹ P. P. Tallon and A. Pinsonneault, “Competing Perspectives on the

Link Between Strategic Information Technology Alignment and
Organizational Agility: Insights from A Mediation Model,” MIS
Q., vol. 35, No. 2, pp. 463–486, 2011.
‹ Ikerionwu, Charles. (2019). Secured Service Delivery Model for
Outsourced Services in a Business Process Outsourcing Relationship.
International Journal of Information and Communication Sciences.

i
4. 7. 10.11648/j.ijics.20190401.12.
‹ Alamri, Samar & Almutiri, Noura & Ballahmar, Hanaa & Zafar,
l h
D e
Aasim. (2016). Strategic Information System Planning: A Case Study
of a Service Delivery Company. IARJSET. 3. 78-84. 10.17148/

of
IARJSET.2016.3518.

ty
‹ Hemmatfar, M., Salehi, M., & Bayat, M. (2010). Competitive

i
Advantages and Strategic Information Systems. International Journal

s
r
of Biometrics, 5, 158.

v e
3.10 Suggested Readings
n i
‹

, U
O’Brien, J. (2005). Introduction to information systems (12th edition).

O L
Boston: McGraw-Hill/Irwin.
Boddy, D., Boonstra, A., & Kennedy, G. (2005). Managing information
S
‹

/
systems: An organisational perspective (2nd edition). Harlow: Pearson.
L
O
‹ Carr, N.G. (2003). IT doesn’t matter. Harvard Business Review,

/ C81(5), 41-49.

C E ‹ Clarke, S. (2001). Information systems strategic management: An

integrated Approach. New York: Routledge.

D
©D

80 PAGE
© Department of Distance & Continuing Education, Campus of Open Learning,
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L E S S O N

4
Organizational
Transformation Through IT
Ms. Juhi Gupta
Assistant Professor

i
Email-Id: [email protected]

l h
STRUCTURE
D e
of
4.1 Learning Objectives
4.2 Introduction
4.3 Organizational Transformation Through IT
i ty
4.4 Customer Relationship Management (CRM)
r s
v e
i
4.5 Supply Chain Management (SCM)
4.6 Industry 4.0
U n
,
4.7 Data Warehousing
4.8 Knowledge Management
O L
S
4.9 Business Intelligence and Data Analytics
4.10 Summary
L /
O
4.11 Answers to In-Text Questions
4.12 Self-AssessmentCQuestions
4.13 ReferencesE
/
D C Readings
4.14 Suggested

4.1©
D
Learning Objectives
‹ Understand the concept of organizational transformation and how IT can be used
to drive significant changes in an organization’s structure, processes, and business
model.

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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes ‹ Define Customer Relationship Management (CRM) and Supply Chain

Management (SCM) and understand how these technologies can be
used to improve customer satisfaction, reduce costs, and streamline
operations.
‹ Describe Industry 4.0 and its key components, including the Internet
of Things (IoT), big data analytics, and automation, and how these
technologies can enable smart manufacturing, predictive maintenance,

i
and real-time monitoring.
‹

l h
Explain the concept of data warehousing and how it can be used to

support business intelligence and analytics.

D e
store and manage large amounts of data from multiple sources to

‹
of
Understand the concept of business intelligence and how it can be

ty
used to analyze data to identify trends, patterns, and insights that
can inform business decisions.

s i
e r
v
4.2 Introduction

n i
U
Strategic management of IT is he process of aligning an organization’s

,
Information Technology (IT) resources and capabilities with its overall

O L
business strategy and goals. It involves developing and implementing a
comprehensive IT strategy that supports and enables the organization’s

/ S
objectives. Effective strategic management of IT can bring numerous

O L
benefits to an organization, such as improved efficiency and productivity,
enhanced customer experience, better decision-making, and increased

/ C
agility and innovation.

C EOrganizational transformation through Information Technology (IT)

D
refers to the use of technology to bring about significant changes in the

©D
way an organization operates. This may include the adoption of new
systems or processes, the automation of manual tasks, the improvement
of communication and collaboration, or even a complete overhaul of the
business model.
In today’s rapidly changing business environment, organizations must
be able to adapt quickly to remain competitive. IT plays a critical role
in facilitating this transformation, allowing companies to streamline
operations, increase efficiency, and improve decision-making. By leveraging

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© Department of Distance & Continuing Education, Campus of Open Learning,
School of Open Learning, University of Delhi
 ORGANIZATIONAL TRANSFORMATION THROUGH IT

technology, organizations can gain a competitive edge, reduce costs, and Notes
improve overall customer satisfaction.
Customer Relationship Management (CRM) and Supply Chain Management
(SCM) are two critical business processes that focus on different aspects
of an organization’s operations but are equally important in improving
its overall efficiency and profitability.
CRM refers to the strategies, tools, and technologies that companies use

i
to manage and analyse their interactions with customers throughout the
customer lifecycle. It encompasses a wide range of activities, including
l h
marketing, sales, customer service, and support. The goal of CRM is to
build strong, lasting relationships with customers by understanding their
D e
of
needs and preferences and providing personalized experiences.

ty
SCM, on the other hand, involves the planning, execution, and management

i
of all activities involved in the production and delivery of goods and

s
r
services, from the sourcing of raw materials to the delivery of finished

e
products to customers. SCM encompasses a wide range of activities,
v
i
including procurement, manufacturing, logistics, and distribution. The goal
n
U
of SCM is to optimize the flow of goods and services from suppliers to

,
customers, while minimizing costs and improving quality.

L
This chapter also discusses about data warehousing and knowledge

O
S
management in an organization. They are increasingly being used by

/
organizations to manage their data and knowledge resources in a more
L
O
effective manner. Data warehousing is a process of collecting, storing

C
and managing large volumes of data from multiple sources into a single

E /
centralized repository. This data can then be used to support business

C
intelligence and analytics, providing valuable insights into customer

D
behaviour, market trends, and other key business metrics. Knowledge

©D
management involves the process of creating, sharing, and managing
knowledge within an organization to improve decision-making, innovation,
and collaboration. This includes capturing and organizing information,
fostering a culture of knowledge sharing, and leveraging technology to
enable easy access to knowledge resources. Business intelligence and
data analytics are two important components of knowledge management,
as they provide organizations with the tools and insights they need to
make informed decisions and drive innovation. Business intelligence
refers to the process of collecting, analysing, and presenting data in a

PAGE 83
© Department of Distance & Continuing Education, Campus of Open Learning,
School of Open Learning, University of Delhi
 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes way that supports strategic decision-making. This may involve the use
of tools and technologies such as dashboards, scorecards, and reports
to provide real-time insights into key performance metrics and trends.
Data analytics, on the other hand, involves the use of statistical and
computational techniques to analyse data and extract insights that can
be used to inform business decisions.

4.3 Organizational Transformation Through IT

h i
e l
Organizational transformation refers to a significant change in the way an

D
organization operates, often involving a complete overhaul of its business

of
model, processes, and systems. The goal of organizational transformation is
to improve the overall performance and effectiveness of the organization,

ty
enabling it to adapt to changing market conditions, customer needs, and
other external factors.
s i
e r
Organizational transformation may involve a wide range of initiatives,

i v
such as the adoption of new technologies, the introduction of new

n
products or services, the restructuring of departments or teams, or the

, U
implementation of new business processes or strategies. It often requires
significant investment of time, resources, and effort from all levels of the

O L
organization, as well as strong leadership and effective change management.

/ S
Organizational transformation is driven by a variety of factors, including

O L
market disruptions, changes in customer preferences, advancements in
technology, and increasing competition. Companies that are able to

/ C
successfully navigate these changes and adapt to new business realities

C Eare often the ones that achieve long-term success and growth. Information
Technology (IT) and organizational structure are intertwined. IT services

D play a crucial role in organizational transformation by enabling companies

©D
to implement new technologies, streamline processes, and improve overall
efficiency and effectiveness.
One key area where IT services can support organizational transformation
is in the adoption of digital technologies such as cloud computing, artificial
intelligence, and the Internet of Things (IoT). These technologies can help
companies to automate processes, improve data management, and enhance
customer experiences, among other benefits. Below diagram illustrates
the various IT services influencing the transformation of an organization

84 PAGE
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 ORGANIZATIONAL TRANSFORMATION THROUGH IT

Notes

h i
e l
D
of
i ty
r s
v e
n i
Figure 4.1: IT Services Influencing Organizational Transformation

, U
Cloud computing is increasingly becoming an essential part of modern

O L
business operations, with a wide range of benefits for organizations of
all sizes and across all industries. One of the primary benefits of cloud

/ S
computing is its ability to scale up or down quickly and easily, depending

O L
on the needs of the organization. This allows companies to expand their IT
resources as they grow, without the need for significant capital investment

/ C
or the risk of over-provisioning. Artificial Intelligence (AI) is rapidly

E
transforming the way organizations operate, enabling greater efficiency,
C
D
accuracy, and innovation. AI can automate repetitive tasks and processes,

©D
freeing up employees to focus on more strategic and creative work. This
can improve productivity and reduce errors, while also lowering costs.
AI-powered chatbots and virtual assistants can provide personalized and
efficient customer service, improving customer satisfaction and loyalty.
The Internet of Things (IoT) is a network of connected devices and
objects that can communicate with each other, collect and analyse data,
and perform tasks autonomously. IoT can be a transformative technology
for organizations, providing a range of benefits for operational efficiency,
cost savings, and innovation.

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© Department of Distance & Continuing Education, Campus of Open Learning,
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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes Another area where IT services are critical is in the implementation of

new business processes and systems. This may involve the development
of custom software applications, the integration of disparate systems, or
the migration of data to new platforms. Effective IT services are essential
to ensuring that these initiatives are implemented smoothly and with
minimal disruption to business operations.
IT services also play a key role in change management, which is a critical

i
component of successful organizational transformation. By providing

l h
training and support to employees, as well as tools and technologies to

e
enable collaboration and communication, IT services can help to ensure that

D
employees are prepared and engaged throughout the transformation process.

of
Therefore, every organization must strive to bring about transformation
using varied levels of services enabled by IT.

i ty
4.4 Customer Relationship Management (CRM)
r s
v e
i
CRM or Customer Relationship Management, is a business strategy and

n
set of technologies that organizations use to manage interactions with

, U
customers and potential customers. It is a powerful tool for managing
customer interactions and building strong relationships with customers.

O L
The goal of CRM is to improve customer satisfaction and loyalty, while

S
also increasing sales and profitability.

L /
Small businesses can replace their current methods of tracking client

O
data, which often involve a combination of spreadsheets, databases, and

C
/
apps, with a CRM software. This can result in improved organization,

C Eefficiency, better time management, and more satisfied clients.

D
A CRM software enables businesses to consolidate all their sales leads

©D
and customer data into a single platform. Additionally, it allows for the
integration of all communications, such as form fills, calls, emails, text
messages, and meetings, as well as documents, quotes, purchases, and tasks
associated with each lead and client. This information can be accessed
by the entire team at the appropriate time, whether to close a sale or
provide exceptional service. There are three main types of CRM systems
that businesses can use to manage their interactions with customers:
‹ Operational CRM: This type of CRM system focuses on automating
and improving the day-to-day operations of a business, such as sales,

86 PAGE
© Department of Distance & Continuing Education, Campus of Open Learning,
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 ORGANIZATIONAL TRANSFORMATION THROUGH IT

marketing, and customer service. Operational CRM systems typically Notes

include features such as lead management, contact management,
and customer service and support.
‹ Analytical CRM: This type of CRM system focuses on analysing
customer data to gain insights that can be used to improve customer
interactions and business operations. Analytical CRM systems
typically include features such as data mining, predictive modelling,

i
and customer segmentation.
‹ Collaborative CRM: This type of CRM system focuses on improving
l h
collaboration and communication between different departments
within a business, such as sales, marketing, and customer service.
D e
of
Collaborative CRM systems typically include features such as
customer portals, social media integration, and project management
tools.
i ty
r s
In addition to these main types of CRM systems, there are also industry-

e
specific CRM systems that are designed to meet the needs of businesses
v
i
in particular industries, such as healthcare, finance, and retail. Some
n
U
CRM systems are also designed specifically for small businesses or large

,
enterprises. Ultimately, the type of CRM system that a business chooses

L
will depend on their specific needs and goals.

O
S
CRM software typically includes features such as customer data

/
management, sales automation, marketing automation, and customer
L
O
service and support. It allows organizations to collect and analyse data

C
about their customers, including contact information, purchase history, and

E /
communication preferences. This data can then be used to create targeted

C
marketing campaigns, track sales and revenue, and provide personalized

D
customer service.

©D
CRM is an important tool for businesses of all sizes, as it enables them
to build strong relationships with customers, improve customer retention,
and increase sales. It can also help organizations to streamline their sales
and marketing processes, and improve collaboration between departments.

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© Department of Distance & Continuing Education, Campus of Open Learning,
School of Open Learning, University of Delhi
 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes

h i
e l
D
of
i ty
r s
Figure 4.2: Customer Relationship Management (CRM)

v e
i
4.5 Supply Chain Management (SCM)
n
U
SCM stands for Supply Chain Management. It is the process of managing

,
L
the flow of goods and services from the point of origin to the point of

O
consumption. SCM involves the coordination and integration of various

/ S
activities such as sourcing, procurement, production, logistics, and customer

L
service to ensure that goods and services are delivered to customers in

O
a timely and cost-effective manner.

C
E /
SCM is important for businesses because it helps to optimize the supply
chain, reduce costs, and improve efficiency. By effectively managing the

D C supply chain, businesses can ensure that they have the right amount of

©D
inventory at the right time, minimize waste and inefficiencies, and improve
the quality of products and services. SCM also enables businesses to
respond quickly to changes in customer demand and market conditions,
which can be critical in today’s fast-paced business environment.
SCM involves a series of interconnected activities that work together to
manage the flow of goods and services through the supply chain. Here
are the key steps in the SCM process:
‹ Plan: This involves developing a strategy for managing the supply
chain, setting goals and objectives, and determining the resources

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 ORGANIZATIONAL TRANSFORMATION THROUGH IT

required to achieve them. This step also involves forecasting demand, Notes
planning production schedules, and determining the optimal inventory
levels.
‹ Source: This involves identifying and selecting suppliers, negotiating
contracts, and managing supplier relationships. This step also involves
ensuring that the necessary raw materials, components, and other
inputs are available to meet production requirements.

i
‹ Make: This involves transforming the raw materials and components
into finished goods. This step includes managing production processes,
l h
scheduling production runs, and ensuring that quality standards are
met.
D e
‹
of
Deliver: This involves managing the logistics and distribution of finished

ty
goods to customers. This step includes managing transportation and

i
warehousing activities, coordinating with suppliers and customers,

s
r
and managing the flow of information throughout the supply chain.

v e
Return: This involves managing the return of products from customers
i
‹

n
and managing the disposition of defective or excess inventory. This

U
step also involves managing customer service and support activities
to ensure customer satisfaction.

L ,
O
SCM is a complex process that involves coordination and collaboration

S
across multiple departments and organizations. The use of technology

L /
such as RFID, barcodes, and other tracking systems can help to improve

O
visibility and control throughout the supply chain, making it easier to

/ C
manage and optimize the flow of goods and services.

C E
Information Technology (IT) plays a critical role in SCM by providing
the tools and systems needed to manage the flow of goods and services
D
effectively. Here are some examples of how IT can be used in SCM:

©D
Enterprise Resource Planning (ERP) systems: These systems integrate
all the different functions of a business, including finance, manufacturing,
inventory, and distribution, into a single system. ERP systems provide a
unified view of the supply chain, enabling better coordination and planning.
Warehouse Management Systems (WMS): These systems help to manage
warehouse operations, including inventory management, order processing,
and shipping. WMS systems use barcode scanning and other technologies
to track inventory levels and movements throughout the warehouse.

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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes Transportation Management Systems (TMS): These systems help to

manage the movement of goods from one location to another. TMS systems
enable businesses to optimize shipping routes, reduce transportation costs,
and improve delivery times.
Electronic Data Interchange (EDI): This technology allows for the
electronic exchange of business documents, such as purchase orders
and invoices, between suppliers and customers. EDI helps to streamline

i
communication and reduce errors and delays in the supply chain.

l h
4.6 Industry 4.0
D e
of
Industry 4.0, also known as the Fourth Industrial Revolution, is a term
that refers to the use of advanced technologies to transform manufacturing

ty
and industrial processes. It involves the integration of technologies such

s i
as artificial intelligence, the Internet of Things, cloud computing, and

e r
big data analytics to create “smart factories” that are highly automated,
connected, and efficient.
i v
U n
Industry 4.0 is characterized by the use of cyber-physical systems,
which are interconnected and communicate with each other and with

L ,
humans in real-time. This allows for increased efficiency, flexibility, and

O
responsiveness in manufacturing and supply chain operations. In 2014,

/ S
the term “Industry 4.0” was relatively obscure in Google searches, but

O L
in 2019, a global survey by McKinsey showed that 68% of respondents
considered Industry 4.0 to be a top strategic priority, and 70% reported

/ C
that their companies were already testing or deploying new technology.

C EIndustry 4.0 builds upon the advances of the Third Industrial Revolution,

D
also known as the digital revolution, which took place from the 1950s

©D
to the early 2000s and gave rise to computers, the Internet, and other
electronic technologies. Industry 4.0 takes these innovations beyond what
was previously thought possible by leveraging four disruptive technology
categories that can be applied throughout the value chain:
‹ Connectivity, Data, and Computing Power: Examples include cloud
technology, the Internet, blockchain, and sensors.
‹ Analytics and Intelligence: Examples include advanced analytics,
machine learning, and artificial intelligence.

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 ORGANIZATIONAL TRANSFORMATION THROUGH IT

‹ Human-Machine Interaction: Examples include Virtual Reality Notes

(VR) and Augmented Reality (AR), robotics and automation, and
autonomous guided vehicles.
‹ Advanced Engineering: Examples include additive manufacturing
(such as 3D printing), renewable energy, and nanoparticles.
The manufacturing industry has a significant opportunity to embrace the
fourth industrial revolution by creating smart factories. By leveraging

i
the large volumes of data generated by sensors on the factory floor,
manufacturers can obtain real-time visibility into their assets, allowing
l h
them to predict maintenance needs and reduce equipment downtime. Smart
factories equipped with IoT devices can drive productivity improvements
D e
of
and enhance product quality. The use of AI-powered visual insights
replaces manual inspection methods, reducing errors in manufacturing

i
while saving both time and money. With minimal investment, quality
ty
r s
control personnel can monitor manufacturing processes remotely via

e
a smartphone connected to the cloud. By employing machine learning

v
n i
algorithms, manufacturers can quickly identify errors, enabling them to
address issues in real-time rather than at later stages when repair work
is more expensive.
, U
O L
The concepts and technologies of Industry 4.0 can be implemented
across a range of industrial companies, including discrete and process

/ S
manufacturing, as well as in sectors such as oil and gas, mining, and

O L
other industrial segments. Some of the benefits of Industry 4.0 include
reduced costs, increased productivity, improved quality, and faster time
to market.
/ C
C E
Industry 4.0 is not just about technology, but also about the transformation

D
of business models and organizational structures to adapt to the changing

©D
landscape. It requires a shift towards more collaborative and integrated
approaches to manufacturing and supply chain management, as well as
a focus on skills development and training to enable the workforce to
adapt to the new technologies and processes.

4.6.1 Smart Factory

A smart factory is a highly digitized and connected manufacturing facility
that uses advanced technologies such as artificial intelligence, machine

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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes learning, Internet of Things (IoT), and robotics to increase automation,

optimize production, and enhance efficiency. In a smart factory, production
processes are connected to a digital network, enabling real-time monitoring,
analysis, and control of manufacturing operations.
By leveraging digital technologies, a smart factory can improve quality,
increase productivity, reduce downtime, and lower costs. It can also enable
greater flexibility in production, allowing for customization and fast

i
response to changing demands. With the help of predictive maintenance

l h
and data-driven decision-making, smart factories can anticipate and avoid

e
potential issues before they occur, resulting in better asset utilization and
lower maintenance costs.
D
of
Smart factories can be found across various industries such as automotive,
electronics, pharmaceuticals, and consumer goods. They offer a new era of

i ty
manufacturing that emphasizes efficiency, productivity, and agility, which

r s
can help companies remain competitive in an increasingly dynamic and

e
demanding market. Some of the key characteristics of a smart factory

v
include:

n i
U
1. Automation and Robotics: Smart factories are equipped with robots

,
and automation systems that can perform repetitive tasks with high

L
precision and speed.

O
S
2. IoT and Sensors: Sensors embedded in machines, tools, and products

/
enable real-time monitoring of the manufacturing process. This
L
O
data is used to optimize production, reduce downtime and improve

C
quality.

E /
3. Big Data and Analytics: The large amount of data generated by

D C smart factories is analysed using advanced analytics to gain insights

into the manufacturing process. This information is used to improve

©D
processes, optimize resources, and reduce costs.
4. Artificial Intelligence and Machine Learning: Smart factories use
AI and machine learning to learn from data and make autonomous
decisions. This helps to improve productivity, quality, and safety.
5. 3D Printing and Additive Manufacturing: Smart factories use 3D
printing and additive manufacturing to produce customized parts,
reduce waste, and improve production speed.

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6. Cloud Computing: Smart factories use cloud computing to store and Notes
process large amounts of data from multiple sources. This enables
real-time collaboration and decision-making.
7. Cybersecurity: With the high level of connectivity in smart factories,
cybersecurity is a critical concern. Smart factories must have robust
cybersecurity measures in place to protect against cyber threats.

i
4.7 Data Warehousing

l h
e
A data warehouse is a large and centralized repository of data that is used
by organizations to store, manage, and analyse their data from various
D
of
sources. It is designed to support Business Intelligence (BI) activities
such as data mining, reporting, and analytics. A data warehouse collects

ty
data from multiple sources including operational databases, flat files,

s i
and external sources, and transforms and consolidates the data into a
consistent and unified format.
e r
i v
The purpose of a data warehouse is to provide decision-makers with a

U n
reliable and consolidated view of organizational data that can be used for
analysis, reporting, and planning. The data stored in a data warehouse is

L ,
usually historical in nature and is organized around specific subject areas

O
such as sales, marketing, finance, or customer data. Data warehousing is

/ S
an essential component of modern business intelligence and is used by

and markets.
O L
organizations of all sizes to gain insights into their operations, customers,

/ C
The concept of a data warehouse emerged in the late 1980s when

E
companies began to realize that they needed to analyse and utilize their
C
D
vast amounts of data more effectively. The term “data warehouse” was

©D
coined by Bill Inmon, who is considered the father of data warehousing.
Inmon defined a data warehouse as a “subject-oriented, integrated, time-
variant and non-volatile collection of data that supports management’s
decision-making process.”
In the early days, data warehouses were expensive and time-consuming
to build. Data had to be extracted from various operational systems,
transformed into a common format, and loaded into the data warehouse.
However, the benefits of having a central repository of data for analysis and
decision-making made it a worthwhile investment for many organizations.

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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes In the 1990s, data warehousing became more mainstream as technology

advanced and costs decreased. The emergence of online analytical processing
(OLAP) and multidimensional databases made it easier to analyse data
stored in data warehouses.
In the 2000s, data warehousing evolved further with the rise of big data
and the development of new technologies such as Hadoop, NoSQL, and
columnar databases. These technologies made it possible to store and

i
analyse large volumes of structured and unstructured data more efficiently.

l h
Today, data warehousing is an essential component of many organizations’

D e
data strategies. It enables companies to gain insights into their operations,
customers, and markets and make informed decisions based on data-

of
driven analysis.

i ty
r s
v e
n i
, U
O L
/ S
O L
/ C
C E Figure 4.3: Data Warehousing

D
Characteristics of a Data Warehouse

©D
1. Subject Oriented
The aim of a data warehouse is to facilitate the modelling and
analysis of data for decision-makers. As such, it typically presents
a focused and streamlined perspective on a specific topic, such as
customers, products, or sales, rather than encompassing the entirety
of an organization’s ongoing operations. This is achieved by filtering
out irrelevant data and including only the data necessary for users
to comprehend the subject matter. This makes it easier for business
users to understand and analyse the data.

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 ORGANIZATIONAL TRANSFORMATION THROUGH IT

2. Integrated Notes
A data warehouse integrates data from various sources within an
organization, including transactional systems, operational databases,
and external sources. This ensures that all data is consistent and
accurate.
3. Time Variant
A data warehouse stores historical data, and it is designed to
support time-based analysis. In contrast to transactional systems,
h i
which typically retain only the most recent file, a data warehouse
e l
D
enables retrieval of files from various timeframes such as 3 months,

of
6 months, 12 months, or even earlier data. This allows business
users to analyse trends and patterns over time.

ty
4. Non-Volatile

s i
A data warehouse is physically distinct from the source operational

e r
relational database, having undergone a transformation process.

i v
Importantly, it does not undergo operational data updates, meaning

U n
that operations such as updates, inserts, and deletes are not performed.
Data accessing typically involves only two procedures: the initial

,
data loading and data retrieval. Due to the absence of transaction
L
O
processing, recovery, and concurrency requirements, data retrieval

S
from a data warehouse is often significantly faster. Additionally,

L /
the non-volatile nature of the data warehouse means that the data

O
should remain unchanged once it has been entered.
5. Large Scale
/ C
E
A data warehouse is designed to store large amounts of data, often
C
D
in the terabytes or petabytes. This requires specialized hardware

©D
and software to manage and maintain the data warehouse.
Types of Data Warehouses
There are three main types of data warehouses namely Enterprise Data
Warehouse (EDW), Operational Data Store (ODS), and data mart. Each
type of data warehouse has its own strengths and weaknesses, and the
choice of which type to use depends on the organization’s specific needs
and goals.

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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes Enterprise Data Warehouse (EDW)

It is the most comprehensive type of data warehouse, which provides
a complete view of the organization’s data across all departments and
functions. EDW is designed to integrate data from various sources within
an organization and support decision-making at all levels of management.
Operational Data Store (ODS)
An ODS is a smaller, more tactical data warehouse that is designed to

i
support operational decision-making in real-time. It is often used to store
h
l
the most current data from transactional systems, and it may be updated in
e
D
real-time. An Operational Data Store (ODS) serves as a central database

of
for operational reporting and as a data source for the enterprise data
warehouse mentioned previously. It complements an EDW and is utilized

ty
for operational reporting, controls, and decision-making.

s i
Unlike an EDW, an ODS is updated in real-time, making it more suitable

r
for routine activities such as storing employee records. An EDW, in
e
v
contrast, is designed to support tactical and strategic decision-making.
Data Mart
n i
U
A data mart is a subset of the EDW, which is designed to serve the
,
L
needs of a specific department or business unit such as finance or sales.

O
Data marts are smaller in scale and scope than an EDW, but they can

/ S
be developed and deployed more quickly. They are often used to support

O L
specific business functions, such as sales or marketing. It is oriented
toward a particular subject, making relevant data more quickly accessible

/ C
to a specific group of users, which enables them to gain critical insights.

C EThe provision of specific data means that users do not have to spend
time sifting through an entire data warehouse.
D
©D
4.8 Knowledge Management
Knowledge management refers to the process of creating, sharing, using,
and managing knowledge and information within an organization. It involves
collecting, organizing, and making information available to employees and
stakeholders to enhance decision-making and improve business outcomes.
It encompasses a range of activities, including knowledge creation,
acquisition, storage, retrieval, sharing, and application. It also involves

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 ORGANIZATIONAL TRANSFORMATION THROUGH IT

identifying knowledge and information that is critical to an organization’s Notes

success, and then developing strategies to capture, manage, and use that
knowledge effectively.
Knowledge management also involves creating a culture of knowledge
sharing within an organization. This includes fostering a collaborative
environment that encourages employees to share their expertise, experiences,
and ideas with their colleagues. Organizations may use various tools and

i
technologies to facilitate knowledge sharing, such as wikis, intranets,
forums, and social media platforms.
l h
Types of Knowledge

D e
of
When it comes to knowledge management, it’s beneficial to explore the
various kinds of knowledge and methods for disseminating it throughout an

ty
organization. Typically, knowledge management deals with three primary
types of information:

s i
r
1. Explicit Knowledge: This is formal knowledge that can be easily
e
v
communicated and transferred through various mediums like documents,

n i
manuals, and videos. Explicit knowledge can be easily codified and

U
stored in databases.

,
2. Tacit Knowledge: This type of knowledge is informal and is rooted
L
O
in personal experience and expertise. Tacit knowledge is often

S
difficult to transfer as it is not easy to articulate and may require

L /
hands-on training and mentoring.

O
3. Implicit Knowledge: Implicit knowledge refers to the knowledge

C
/
that explains the optimal way to apply explicit knowledge. For

C E
instance, imagine discussing a task with an experienced colleague
who provides explicit instructions on how to complete it. However,
D
they may also draw on their comprehension of the situation to

©D
evaluate various options and determine the most suitable approach
for your specific circumstances. By utilizing and imparting their
implicit knowledge, the experienced employee enhances the team’s
functioning.
Effective implementation of knowledge management for implicit and tacit
knowledge can be challenging, but with appropriate measures in place, it
is possible to ensure the sharing and retention of all relevant information
across the company, even as staff retire or move on. By leveraging the

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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes collective expertise within the organization, businesses can reap numerous
benefits, including the establishment of best practices for routine tasks,
heightened situational awareness, the cultivation of employee intuition for
course corrections, and the enhancement of overall organizational capacity.
Benefits of Knowledge Management
A well-implemented knowledge management strategy can offer numerous
advantages to enterprises, with far-reaching and manifold benefits. Some

i
of the advantages of having a well-defined knowledge management
strategy are as follows:
l h
D e
of
i ty
r s
v e
n i
, U
O L REDUCED

/ S
DUPLICATION OF
EFFORTS

O L
/ C
C E
D Figure 4.4: Benefits of Knowledge Management

©D
1. Encourages Collaboration
A well-defined knowledge management strategy promotes collaboration
and facilitates the exchange of ideas, leading to more effective
decision-making. Enhanced decision-making capabilities can improve
the customer experience and boost business prospects for the company.
Moreover, a collaborative environment promotes innovation within
the organization.

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 ORGANIZATIONAL TRANSFORMATION THROUGH IT

2. Enables Digital Transformation Notes

With the acceleration of digitalization in organizations, they now
have access to a vast amount of structured and unstructured data.
Implementing a well-defined knowledge management program enables
them to effectively leverage this information for their growth and
benefit.
3. Increased Innovation
Knowledge management can facilitate collaboration and information-
h i
sharing, leading to new ideas and solutions to existing problems.
e l
D
4. Reduced Duplication of Efforts

of
A significant advantage of implementing knowledge management
is the enhancement of operational efficiency and the consequent

ty
saving of time and effort. One of the key benefits of knowledge

s i
management is the elimination of duplicated efforts. For example,

e r
suppose a customer support executive is struggling to assist a customer

i v
with a query related to a rarely-used feature. In a typical scenario,

U n
the executive may spend a considerable amount of time searching
for the information, potentially frustrating the customer. However,

,
with knowledge management, the executive can quickly access any
L
O
previous instances of a similar query and use that information to

S
address the current inquiry. This approach helps the organization

L /
avoid making the same mistake again.

O
5. Increased Employee Engagement and Satisfaction

C
E /
Knowledge management can create a culture of learning and development,
making employees feel valued and empowered.

D C
©D
4.9 Business Intelligence and Data Analytics
Business Intelligence (BI) refers to the use of technologies, applications,
and practices for the collection, integration, analysis, and presentation
of business information. The goal of BI is to support business decision-
making by providing timely, accurate, and actionable insights. BI typically
involves the use of data mining, data warehousing, and data visualization
techniques to identify patterns, trends, and relationships in data. These

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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes insights can be used to optimize business processes, improve efficiency,

reduce costs, identify new opportunities, and gain a competitive advantage
in the marketplace. BI is used across various industries, including finance,
healthcare, retail, and manufacturing, among others.
Business Intelligence (BI) tools allow users to access various data types,
including historical and current, third-party and in-house, as well as
semi-structured and unstructured data such as social media, in order to

i
analyse the data and gain insights into how the business is performing.

l h
Business intelligence has its roots in the 19th century when companies

D e
began using basic forms of data collection and analysis to inform decision-
making. The development of computers in the mid-20th century enabled

of
the creation of more sophisticated data processing techniques, leading
to the emergence of decision support systems in the 1960s and 1970s.

i ty
During the 1980s and 1990s, the concept of data warehousing was

r s
developed, allowing organizations to store and analyse large volumes of

e
data from various sources. This led to the emergence of Online Analytical
v
i
Processing (OLAP) tools, which allowed for multidimensional analysis
n
U
of data. The 2000s saw the rise of self-service BI tools, which made it

,
easier for business users to access and analyse data without the need for

O L
IT support. In recent years, the use of artificial intelligence and machine
learning in BI has become more prevalent, allowing for more sophisticated

/ S
analysis and predictive modelling.

O L
BI Tools Used in Organisation

/ C
There are various types of BI tools used in organizations, including:

C EReporting Tools: These tools allow users to create, generate, and share
reports based on the data stored in the system. They typically provide a
D variety of report formats, such as tables, charts, and graphs.

©D Dashboard Tools: These tools display Key Performance Indicators (KPIs)

and other metrics in a visual format, making it easy for users to monitor
performance and identify trends.
Data Visualization Tools: These tools enable users to create interactive
visualizations of data, such as maps, charts, and graphs, that help users
to identify patterns and trends in the data.
Data Mining Tools: These tools use statistical analysis and machine
learning algorithms to identify patterns and relationships in data sets,

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allowing users to gain insights into customer behaviour, market trends, Notes
and other business metrics.
OLAP Tools: OLAP (online analytical processing) tools allow users to
analyse large volumes of multidimensional data, such as sales figures,
customer data, and inventory levels, using interactive dashboards and
reports.
Predictive Analytics Tools: These tools use statistical algorithms and

i
machine learning techniques to analyse historical data and make predictions
about future events, such as sales forecasts or customer behaviour.
l h
Self-Service BI Tools: These tools enable business users to access and
D e
of
analyze data without the help of IT professionals, allowing them to make
better-informed decisions based on real-time data.

ty
Business Intelligence (BI) and data analytics are closely related and often

s i
used together in organizations. BI is the process of gathering, analysing,

r
and presenting data to support business decision-making. Data analytics,
e
v
on the other hand, involves the use of statistical and quantitative methods

n i
to extract insights from data. For example, a company might use a BI

U
tool to gather data on sales, customer behaviour, and inventory levels.

L ,
Data analytics can then be used to analyse this data and identify trends
in customer purchasing behaviour. This can help the company to identify

S O
areas where it can improve its sales and marketing strategies, such as by

/
targeting certain customer demographics or adjusting pricing strategies.
L
O
Data Analytics

/ C
Organizations have access to a vast amount of data, and when utilized

C E
effectively, it can have a significant impact on decision-making, strategy
development, and overall business performance. Data analytics is the
D
process of examining, transforming, and modelling raw data in order to

©D
extract useful insights and draw conclusions. It involves using statistical
and computational techniques to analyse data sets to identify patterns,
trends, and relationships. Data analytics can be used to solve complex
business problems, drive decision-making, and improve overall business
performance.
Data analytics can be used for various purposes, such as improving
operational efficiency, identifying new business opportunities, reducing
costs, and enhancing customer experience. It can also help organizations

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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes to optimize marketing strategies, personalize customer experiences, and

mitigate risks.
As an instance, manufacturing companies commonly collect data on the
runtime, downtime, and work queue of different machines, and then utilize
data analytics to enhance workload planning, resulting in the machines
operating closer to their peak capacity.
Types of Data Analytics
Data analytics encompasses various techniques and methods to analyse
h i
l
and derive insights from data. The field of data analytics can be broadly
e
D
classified into four categories, namely descriptive, diagnostic, predictive,

of
and prescriptive analytics. Each of these categories serves a distinct
purpose in the data analysis process, and they are also widely used in

ty
various business applications.
‹ Descriptive Analytics
s i
e r
Descriptive analytics is a type of data analytics that aims to provide

i v
insight into what has happened in the past. It involves analysing

U n
historical data to understand trends, patterns, and relationships.
Descriptive analytics is often the first step in the data analysis process

,
and can provide a foundation for further analysis. Its primary goal
L
O
is to summarize and describe data in a meaningful way that can be

S
easily understood by stakeholders. Some common techniques used

L /
in descriptive analytics include data visualization, data aggregation,

O
and summary statistics.

/ CAn example of descriptive analytics is analysing website traffic data

C E to understand how many visitors came to the website, what pages

they visited, how long they stayed on each page, and what actions
D they took while on the website. This type of analysis provides

©D
insights into the current state of the website’s performance and
can inform decisions on how to optimize the user experience and
increase engagement.
‹ Diagnostic Analytics
Diagnostic analytics is a type of data analysis that seeks to determine
the root cause of an event or problem. It involves analysing historical
data to identify patterns or relationships and using that information
to diagnose why a particular outcome occurred. Diagnostic analytics

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ORGANIZATIONAL TRANSFORMATION THROUGH IT

helps to answer the question “Why did it happen?” and is often Notes
used in combination with descriptive analytics to provide a more
complete understanding of a situation.
An example of diagnostic analytics would be analysing sales data to
identify why there was a sudden decrease in revenue for a particular
product line. By examining data such as sales figures, customer
demographics, marketing campaigns, and pricing strategies, analysts

i
can identify the factors that contributed to the decline in sales and
develop a plan to address the issue.
l h
‹ Predictive Analytics

D e
of
Predictive analytics is a type of data analytics that involves the use
of statistical techniques and machine learning algorithms to analyse

ty
historical data and make predictions about future events or trends.

i
The goal of predictive analytics is to identify patterns in the data

s
r
and use them to make informed decisions about the future.

v e
For example, a retail company might use predictive analytics to

n i
forecast sales for the upcoming holiday season based on past sales

U
data, economic indicators, and customer behaviour. This can help

L ,
them to optimize inventory levels, adjust pricing strategies, and plan
marketing campaigns to maximize revenue. Similarly, a healthcare

S O
provider might use predictive analytics to identify patients who

/
are at high risk of developing a particular disease based on their
L
O
medical history, lifestyle factors, and demographic data, and take

C
proactive measures to prevent the onset of the disease.
‹

E /
Prescriptive Analytics

D C
Prescriptive analytics involves using advanced analytical techniques
to recommend actions that will optimize a particular outcome. It

©D
goes beyond predicting what is likely to happen in the future and
instead recommends specific actions that should be taken to achieve
a particular goal or outcome. Prescriptive analytics is used in a
variety of industries, including healthcare, finance, and marketing,
among others.
For example, a healthcare provider might use prescriptive analytics
to recommend a specific treatment plan for a patient based on their
medical history, current symptoms, and other factors. In finance,

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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes prescriptive analytics can be used to optimize investment strategies

or recommend specific trades. In marketing, prescriptive analytics
can help determine the best messaging, offers, and channels to use
to drive customer engagement and sales.
IN-TEXT QUESTIONS
1. What is the primary goal of organizational transformation
through IT?
(a) Maintaining the status quo
h i
(b) Minimizing IT investments
e l
(c) Enhancing efficiency and competitiveness
D
of
(d) Reducing the role of IT in the organization

ty
2. What is a common challenge in the process of organizational
transformation through IT?
s i
e r
(a) Lack of technological expertise among employees

i v
(b) Insufficient investment in employee training

n
(c) Avoiding any changes to existing processes
U
,
(d) Relying solely on IT without involving other departments

L
3. Which IT strategy involves replacing older systems and technologies
O
S
with newer ones to drive organizational transformation?

L /
(a) Digital optimization

CO
(b) Digital disruption

E/
(c) Digital transformation

D C (d) Digital preservation

4. Which type of CRM system focuses on improving interactions

© D with existing customers?

(a) Operational CRM
(b) Analytical CRM
(c) Collaborative CRM
(d) Strategic CRM

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5. How does CRM help organizations improve customer relationships? Notes

(a) By decreasing customer communication

(b) By limiting customer feedback
(c) By providing a 360-degree view of customer information
(d) By reducing the need for personalized services
6. What is the significance of the customer lifecycle in CRM?
(a) It represents the lifecycle of the product or service
h i
(b) It helps track and manage customer interactions from
e l
acquisition to retention
D
of
(c) It focuses on managing supplier relationships

ty
(d) It determines the company’s financial stability

i
7. Which term refers to the process of strategically managing the
s
r
movement of goods, information, and finances across the supply

e
v
chain?
(a) Inventory control
n i
(b) Demand planning
, U
(c) Logistics
(d) Supplier negotiation
O L
/ S
L
8. What is the purpose of demand forecasting in supply chain

O
management?

/ C
(a) To predict customer complaints

E
(b) To estimate future customer demand for products or
C
D
services

©D
(c) To reduce supplier costs
(d) To improve internal communication
9. What does Industry 4.0 primarily refer to?
(a) The fourth industrial revolution characterized by the
integration of digital technologies into manufacturing
(b) The decline of traditional industries and the rise of service-
oriented businesses

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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes (c) The globalization of manufacturing

(d) The reduction of automation in factories
10. What is the primary benefit of implementing Industry 4.0
technologies in manufacturing?
(a) Increased production costs
(b) Reduced workforce
(c) Improved efficiency and productivity

h i
(d) Greater reliance on manual processes
e l
D
11. What does the term “smart factory” refer to in the context of

of
Industry 4.0?
(a) A factory that only produces high-end luxury products

i ty
(b) A factory with advanced automation and digital technologies

r s
for real-time data exchange and decision-making

v e
(c) A factory that relies on manual labour exclusively

n i
(d) A factory with outdated machinery and equipment

U
12. In a smart factory, what is the role of the Internet of Things
,
L
(IoT)?

O
(a) To replace human workers

S
L /
(b) To connect physical devices and machinery to the internet
for real-time data exchange

CO
(c) To eliminate all manual processes

E/ (d) To reduce the complexity of operations

DC
13. In a data warehouse, what is the ETL process?

©D
(a) Error Testing and Logging
(b) Extraction, Transformation and Load
(c) Email, Text and Logfile Analysis
(d) Encapsulation, Transformation and Layering
14. What is the purpose of data marts in data warehousing?
(a) To store unprocessed raw data
(b) To serve as a centralized data repository

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(c) To provide a subset of data focused on specific business Notes

areas
(d) To host transactional data exclusively
15. Which of the following is a key component of effective knowledge
management?
(a) Deleting outdated information

i
(b) Isolating knowledge within individual departments
(c) Encouraging knowledge sharing and collaboration
l h
(d) Storing all knowledge in a single unsearchable database
D e
4.10 Summary
of
i ty
Strategic management of IT encompasses a range of activities, including

r s
assessing current IT capabilities and identifying areas for improvement,

v e
identifying new technologies and tools that could enhance organizational

n i
performance, developing plans to acquire and implement new systems

U
and applications, managing IT infrastructure and resources, and ensuring

,
that IT projects and initiatives are aligned with the organization’s overall
strategic priorities.

O L
S
IT can be a powerful tool in driving organizational transformation, enabling

L /
organizations to streamline operations, enhance productivity, and improve

O
customer experience. Organizational transformation refers to a significant

C
change in an organization’s structure, strategy, operations, or culture to

E /
achieve a specific goal or address a particular challenge. IT can play a

C
crucial role in organizational transformation by enabling greater agility,

D
efficiency, and innovation. However, it’s important to have a clear strategy

©D
and plan in place to ensure that IT initiatives align with organizational
goals and deliver tangible benefits.
CRM (Customer Relationship Management) and SCM (Supply Chain
Management) are two essential components of strategic management of IT
that organizations use to improve their operations and customer experience.
CRM systems help companies manage their interactions with customers,
including sales, marketing, and customer support. It allows organizations
to store and manage customer data in a centralized location, providing

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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes insights into customer behaviour and preferences. This information can
be used to improve customer service and satisfaction, increase sales, and
retain loyal customers.
On the other hand, SCM systems help organizations manage their supply
chain processes, from procurement and production to distribution and
delivery. It provides visibility into the entire supply chain, enabling
organizations to optimize their inventory levels, improve supplier

i
relationships, and reduce costs. By using SCM systems, companies can

l h
streamline their supply chain operations, reduce lead times, and improve

e
overall efficiency.

D
Industry 4.0, also known as the Fourth Industrial Revolution, is a new

of
phase in the evolution of the manufacturing industry. It involves the
integration of advanced technologies like artificial intelligence, big data

i ty
analytics, the Internet of Things (IoT), and machine learning into the

r s
manufacturing process to achieve a more interconnected and automated

e
system. Industry 4.0 aims to create a smart manufacturing environment

v
n i
with real-time data analysis, predictive maintenance, and increased
flexibility to adapt to market changes. The benefits of Industry 4.0 include

U
increased productivity, reduced costs, improved quality control, and better
,
L
customer service. However, the adoption of Industry 4.0 requires significant

O
investment in new technologies and workforce training.

/ S
Knowledge management refers to the processes and systems that organizations

O L
use to create, share, use, and manage knowledge and information. It involves
identifying, capturing, organizing, and making available the knowledge

/ C
and expertise that exists within the organization. Knowledge management

C Eis crucial for enhancing organizational efficiency, reducing duplication of

D
efforts, promoting innovation, and enhancing decision-making capabilities.

©D
There are various types of knowledge, including explicit, tacit, and implicit
knowledge, and different knowledge management approaches and tools
can be used to manage each type. Effective knowledge management can
lead to improved organizational performance, better customer experiences,
and increased competitiveness in the marketplace.

108 PAGE
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ORGANIZATIONAL TRANSFORMATION THROUGH IT

4.11 Answers to In-Text Questions Notes

1. (c) Enhancing efficiency and competitiveness

2. (d) Relying solely on IT without involving other departments
3. (c) Digital transformation
4. (a) Operational CRM
5. (c) By providing a 360-degree view of customer information
6. (b) It helps track and manage customer interactions from acquisition
h i
to retention
e l
7. (c) Logistics
D
of
8. (b) To estimate future customer demand for products or services

ty
9. (a) The fourth industrial revolution characterized by the integration
of digital technologies into manufacturing
s i
10. (c) Improved efficiency and productivity
e r
i v
11. (b) A factory with advanced automation and digital technologies

n
for real-time data exchange and decision-making

U
,
12. (b) To connect physical devices and machinery to the internet for
real-time data exchange

O L
13. (b) Extraction, Transformation and Load

/ S
L
14. (c) To provide a subset of data focused on specific business areas

O
15. (c) Encouraging knowledge sharing and collaboration

C
E / Questions
4.12 Self-Assessment

D C
1. What is your understanding of the role of IT in strategic management?

©D
2. Can you discuss how IT can support organizational transformation
and change management?
3. What are some common challenges faced when implementing a
CRM or SCM system, and how can they be addressed?
4. What are some emerging trends in CRM and SCM, and how can
businesses stay up-to-date with these trends?
5. What are some key technologies associated with Industry 4.0, such
as the Internet of Things (IoT), Artificial Intelligence (AI), and
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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes blockchain, and how are they transforming manufacturing and other
industries?
6. What are the challenges and risks associated with Industry 4.0 and
how can they be addressed?
7. What is knowledge management and why is it important for
organizations?
8. What is data warehousing and how does it differ from a traditional
database?
h i
e l
9. What are some common types of business intelligence tools used

D
in organizations?

of
10. How can data analytics be used in marketing and customer relationship
management?

i ty
4.13 References
r s
v e
i
‹ Burgelman, R.A., Maidique, M.A., & Wheelwright, S.C. (1996).

Chicago: Irwin.
U n
Strategic management of technology and innovation (Vol. 2, p. 37).

L ,
Antoniou, P.H., & Ansoff, H.I. (2004). Strategic management of

O
technology. Technology Analysis & Strategic Management, 16(2),

/ S
275-291.

O L
4.14 Suggested Readings

/ C
CE
‹ Information Technology for Management: Digital Strategies for
Insight, Action, and Sustainable Performance by Efraim Turban,

D D Linda Volonino, and Gregory R. Wood.

©
‹ IT Strategy: Issues and Practices by James D. McKeen and Heather
A. Smith.

110 PAGE
© Department of Distance & Continuing Education, Campus of Open Learning,
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L E S S O N

5
Strategic IT Management
Success and failure in
Indian Industry
i
Dr. Geetika Vashishta

l h
Assistant Professor

D e
University of Delhi
Email-Id: [email protected]

STRUCTURE of
i ty
5.1 Learning Objectives
r s
5.2 Introduction to Strategic IT Management
v e
5.4 Success Stories of Indian Companies inn
i
5.3 Key Factors in Deciding Success and Failure of Strategic IT Management

, U Strategic IT Management

L
5.5 Failure Stories of Indian Companies in Strategic IT Management

S O
5.6 Critical Analysis of Strategic IT Management Successes and Failures in Indian

/
Companies
5.7 Summary
O L
CQuestions
5.8 Answers to In-Text Questions
/
5.10 ReferencesE
5.9 Self-Assessment

D C Readings
D
5.11 Suggested

©
5.1 Learning Objectives
‹ Explain the role of strategic IT management in enabling organizations to leverage
information technology as a strategic asset, aligning it with their business objectives
and driving sustainable growth and success.
‹ Understand the key factors behind the success or failure of strategic IT management.

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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes ‹ Understand and analyze the success and failure stories of Indian
companies in strategic IT management.

5.2 Introduction to Strategic IT Management

Strategic IT management refers to the process of aligning an organization’s
IT strategy with its overall business strategy to achieve organizational
goals and gain a competitive advantage. It involves making decisions and
implementing actions that leverage information technology in a way that
h i
e l
supports and enhances the organization’s strategic objectives. Igor Ansoff

D
is known as the father of Strategic management.

of
Strategic IT management encompasses several key elements:
1. Alignment with Business Strategy: It involves understanding the

i ty
organization’s business goals, objectives, priorities, and developing

r s
an IT strategy that supports and aligns with those goals. This ensures

e
that IT initiatives are directly linked to the overall strategic direction
of the organization.
i v
U n
2. IT Governance: It entails establishing structures, processes, and

,
policies to effectively manage and oversee IT activities within the

O L
organization. This includes decision-making processes, performance
monitoring, risk management, and resource allocation to ensure the

/ S
effective and efficient use of IT resources.

L
3. Technology Planning and Investment: It involves assessing the
O
C
organization’s technology needs, identifying emerging technologies that

E / can drive business value, and making informed decisions regarding

C
technology investments. This includes evaluating the costs, benefits,

D
and risks associated with different technology options.

©D
4. Innovation and Digital Transformation: Strategic IT management
involves fostering a culture of innovation and leveraging technology
to drive digital transformation within the organization. This includes
exploring new technologies, adopting agile methodologies, and
embracing disruptive trends to enhance competitiveness and create
new business opportunities.
5. Change Management: It encompasses managing the organizational
and cultural changes associated with implementing new IT initiatives.

112 PAGE
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 STRATEGIC IT MANAGEMENT SUCCESS AND FAILURE IN INDIAN INDUSTRY

This involves communication, training, and stakeholder engagement Notes

to ensure smooth adoption and acceptance of technology-driven
changes.
6. Performance Measurement and Continuous Improvement: Strategic
IT management involves establishing metrics and performance
indicators to measure the effectiveness and impact of IT initiatives.
It also emphasizes continuous improvement, learning from past
experiences, and adapting IT strategies and initiatives based on
feedback and changing business needs.
h i
Effective strategic IT management can yield several benefits for
e l
organizations, including improved operational efficiency, enhanced
D
of
customer experiences, increased innovation, cost savings, and a
competitive edge in the marketplace.

i ty
Overall, strategic IT management enables organizations to leverage

s
information technology as a strategic asset, aligning it with their
r
e
business objectives and driving sustainable growth and success.

v Failure of
5.3 Key Factors in Deciding Success iand
Strategic IT Management
U n
L ,
O
The success or failure of strategic IT management depends on several

S
factors. Here are some key factors that influence the outcome:

L /
1. Clear Alignment with Business Strategy: Success in strategic IT

O
management requires a clear alignment between the IT strategy

C
/
and the organization’s overall business strategy. The IT initiatives

C E
should directly support and contribute to the achievement of the
organization’s goals and objectives. Failure to align IT with business

D
strategy can result in misdirected efforts, wasted resources, and

©D
missed opportunities.
2. Effective Leadership and Governance: Strong leadership and effective
IT governance play a crucial role in strategic IT management.
Leaders need to provide a clear vision, set priorities, and allocate
resources appropriately. Robust governance structures and processes
ensure that IT initiatives are well-managed, risks are identified and
addressed, and decision-making is transparent. Failure to establish
effective leadership and governance can lead to a lack of direction,
poor decision-making, and increased risk exposure.

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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes 3. Adequate Resources and Investments: Strategic IT management

requires sufficient resources, both financial and human, to implement
and support IT initiatives. Adequate investments in technology
infrastructure, talent development, and innovation are essential for
success. Insufficient resources and underinvestment can lead to
subpar IT capabilities, limited innovation, and inability to compete
effectively.

i
4. Change Management and Stakeholder Engagement: Successful

l h
strategic IT management involves effectively managing organizational

e
change and engaging stakeholders throughout the process. Change

D
management activities such as communication, training, and support

of
are crucial to ensure smooth adoption and acceptance of new IT
initiatives. Failure to address change management can result in

ty
resistance, low user adoption, and project failures.

s i
r
5. Risk Management and Mitigation: Strategic IT management involves

e
identifying and managing risks associated with IT initiatives. Risks

v
n i
can arise from technological complexities, security threats, regulatory
compliance, and market dynamics. Effective risk management includes

U
proactive identification, assessment, and mitigation strategies. Failure
,
L
to manage risks adequately can lead to project delays, security

O
breaches, financial losses, and reputational damage.

/ S
6. Continuous Monitoring and Improvement: Successful strategic

O L
IT management requires ongoing monitoring of IT initiatives’
performance and continuous improvement based on feedback and

/ C
changing business needs. Regular evaluation of Key Performance

C E Indicators (KPIs) helps identify areas of improvement and make

D
necessary adjustments. Failure to monitor and adapt can result in

©D
stagnant IT capabilities, missed opportunities, and an inability to
respond to changing market conditions.
7. Innovation and Adaptability: Strategic IT management thrives on
innovation and the ability to adapt to technological advancements
and market trends. Embracing new technologies, exploring disruptive
trends, and fostering a culture of innovation are critical for success.
Failure to embrace innovation and adapt to change can result in
becoming obsolete, losing market share, and being outperformed
by competitors.

114 PAGE
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 STRATEGIC IT MANAGEMENT SUCCESS AND FAILURE IN INDIAN INDUSTRY

Summarizing, strategic IT management success depends on clear alignment Notes

with business strategy, effective leadership and governance, adequate
resources and investments, change management, risk management,
continuous monitoring and improvement, and a focus on innovation and
adaptability. Failure to address these factors can lead to misalignment,
resource constraints, resistance to change, risk exposure, and missed
opportunities.

i
IN-TEXT QUESTIONS
1. Strategic IT management requires ___.
l h
(a) Sufficient resources to implement and support IT initiatives
D e
of
(b) Ability to adapt to technological advancements and market
trends

i ty
(c) Effectively engaging stakeholders throughout the process
(d) All of these
r s
v
2. Risk Management and Mitigation comprises of___.
e
n i
(a) Innovating new techniques that has no risk involved

U
(b) Identifying and managing risks associated with IT initiatives
,
(d) None of these
O L
(c) Creation of a model that can ensure risk free operation

/ S
L
3. Who is called the Father of Strategic Management?
(a) Chandler

C O (b) Igor Ansoff

E /
(c) Michael Porter (d) John Nash

C
4. Which of the following is not a major element of the strategic

D
management process?

©D
(a) Formulation strategy (b) Implementing strategy
(c) Evaluating strategy (d) Assigning administrative
tasks
5. The primary focus of strategic management is:
(a) Strategic analysis (b) The total organisation
(c) Strategy formulation (d) None of these

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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes 5.4 Success Stories of Indian Companies in Strategic IT

Management
Let’s explore some practical examples of success and failure in strategic
IT management in Indian companies. Tata Consultancy Services (TCS)
serves as a notable success story, as it strategically aligned its IT initiatives
with business goals, invested in research and development, and cultivated
a skilled workforce, propelling it to become a global IT services leader.
Another successful example is Reliance Jio, which disrupted the telecom
h i
e l
industry through strategic IT management, offering affordable data plans

D
and data-centric services. On the other hand, Kingfisher Airlines faced

of
a strategic IT management failure due to inadequate financial planning
and an inability to adapt to market dynamics, ultimately leading to its

ty
shutdown. Satyam Computer Services also faced a major scandal, exposing

s i
governance failures and highlighting the importance of transparency

r
in strategic IT management. These examples showcase the practical
e
v
implications of strategic IT management and the impact it can have on

n i
the success or failure of Indian companies.

5.4.1 Tata ConsultancyUServices (TCS)

L ,
O
Tata Consultancy Services (TCS) stands as a remarkable success story
S
L /
in strategic IT management within the Indian industry. TCS, founded in
1968, has evolved into one of the world’s leading IT services and consulting

C O
companies, serving clients across various industries and geographies.

E / One of the key factors contributing

D C to TCS’s success in strategic IT

management is its unwavering focus

© D on innovation. The company has

consistently embraced emerging
technologies and positioned itself
as a leader in leveraging their potential for business transformation.
TCS invests heavily in Research and Development (R&D) to stay at the
forefront of technological advancements. Its innovation labs and centers
of excellence collaborate with clients, academia, and research institutions
to explore and develop cutting-edge solutions.

116 PAGE
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 STRATEGIC IT MANAGEMENT SUCCESS AND FAILURE IN INDIAN INDUSTRY

TCS’s commitment to innovation is reflected in its offerings across diverse Notes

domains. The company has developed advanced solutions in areas such
as Artificial Intelligence (AI), Machine Learning (ML), cloud computing,
data analytics, and Internet of Things (IoT). By harnessing the power of
these technologies, TCS helps its clients improve operational efficiency,
enhance customer experiences, and drive digital transformation.
Moreover, TCS has made strategic investments in talent development.

i
Recognizing the importance of a skilled workforce, the company focuses
on nurturing and retaining top talent. TCS provides comprehensive training
l h
e
programs, including digital upskilling initiatives, to equip its employees
with the latest technological expertise. By fostering a culture of continuous
D
of
learning and professional growth, TCS ensures that its workforce remains
adept at delivering innovative IT solutions.

i ty
TCS’s success in strategic IT management is also attributed to its global

r s
expansion strategy. The company has established a robust global delivery

e
model, enabling it to deliver high-quality IT services to clients worldwide.

v
n i
TCS has established a strong presence in key markets and diversified
its client base across industries. Its global delivery centers and strategic

U
partnerships enable TCS to cater to diverse client needs, adapt to local
,
L
market conditions, and provide cost-effective solutions.

O
Furthermore, TCS has developed a strong ecosystem of alliances and

S
L /
collaborations. The company partners with leading technology vendors,
startups, and academia to foster innovation and enhance its service offerings.

O
These collaborations enable TCS to access cutting-edge technologies,
C
E
industry challenges. /
expand its capabilities, and co-create solutions that address specific

D C
In summary, TCS’s success in strategic IT management can be attributed to

©D
its emphasis on innovation, investments in R&D and talent development,
global expansion, and strategic collaborations. By aligning its IT strategy
with business objectives, TCS has achieved sustained growth, built
long-term client relationships, and positioned itself as a global leader
in the IT services industry. Through its continued focus on strategic IT
management, TCS exemplifies the significance of leveraging technology
to drive business success in the Indian industry:

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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes - TCS has successfully leveraged strategic IT management to become

one of the world’s leading IT services and consulting companies.
- With a focus on innovation, TCS has developed advanced solutions
in areas such as artificial intelligence, cloud computing, and data
analytics.
- TCS’s strategic investments in research and development, talent
development, and global expansion have contributed to its sustained

i
growth and success.

l h
5.4.2 Infosys
D e
of
Infosys, a renowned Indian IT services company, has established itself
as a leader in strategic IT management. The company has consistently

i ty
emphasized quality and delivery excellence, which has earned it the trust

s
of major global clients. Infosys’s success can be attributed to its strategic
r
e
investments in emerging technologies, such as blockchain and automation,

i v
that have positioned it at the forefront of digital transformation.

U n Infosys has demonstrated its commitment

to strategic IT management through its

L , focus on quality and delivery excellence.

O
The company has implemented robust

/ S processes and frameworks to ensure

L
high standards of service and customer

C O satisfaction. Infosys has obtained various

/
certifications, including ISO and CMMI, which validate its adherence to

E
industry best practices. By consistently delivering high-quality solutions,

D C Infosys has built a strong reputation and secured long-term client

relationships.

©D
In terms of strategic investments, Infosys has been proactive in identifying
and leveraging emerging technologies. For instance, the company recognized
the potential of blockchain early on and invested in developing blockchain
solutions for various industries. Infosys partnered with ABN AMRO, a Dutch
bank, to develop a trade finance platform using blockchain technology.
The platform aimed to streamline the process of international trade,
reducing paperwork and enhancing transparency. Through this strategic
initiative, Infosys showcased its ability to anticipate market trends and
provide innovative solutions.

118 PAGE
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 STRATEGIC IT MANAGEMENT SUCCESS AND FAILURE IN INDIAN INDUSTRY

Automation is another area where Infosys has made significant strategic Notes
investments. The company has embraced Robotic Process Automation (RPA)
to automate repetitive tasks and improve operational efficiency. Infosys
collaborated with a leading global insurance company to implement an
RPA solution that automated policy administration processes. By leveraging
automation, Infosys enabled the client to achieve cost savings, reduce
manual errors, and enhance overall productivity.

i
In addition to specific technology investments, Infosys has also focused
on building a culture of innovation within the organization. The company
l h
e
encourages its employees to think creatively, explore new ideas, and
contribute to technological advancements. Infosys established innovation
D
of
labs and centers of excellence to facilitate collaboration, research, and
development of innovative solutions. Through these initiatives, Infosys has

ty
fostered a culture that promotes continuous learning and drives innovation
across its service offerings.
s i
e r
Infosys’s strategic IT management practices have resulted in significant

i v
business growth and financial success. For example, in the fiscal year

U n
2020-21, Infosys reported a consolidated revenue of INR 109,854 crores
(approximately USD 15 billion), representing a year-on-year growth of

L ,
5.8%. The company’s net profit for the same period stood at INR 19,351

O
crores (approximately USD 2.6 billion), reflecting a growth rate of 16.6%.

/ S
These figures demonstrate the positive impact of strategic IT management

O L
on Infosys’s financial performance.
In summary, Infosys’s success in strategic IT management can be attributed

/ C
to its focus on quality and delivery excellence, strategic investments in

E
emerging technologies like blockchain and automation, and fostering a
C
D
culture of innovation. Through these initiatives, Infosys has positioned

©D
itself as a global leader in the IT services industry and continues to drive
digital transformation for its clients. The company’s ability to leverage
technology to deliver value-added solutions exemplifies the significance
of strategic IT management in the Indian industry:
- Infosys, another prominent Indian IT services company, has effectively
implemented strategic IT management practices.
- Infosys has focused on building a strong reputation for quality and
delivery excellence, enabling it to secure major global clients.

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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes - The company’s strategic investments in emerging technologies, such

as blockchain and automation, have positioned it at the forefront
of digital transformation.

5.4.3 Reliance Jio

Reliance Jio, the telecommunications venture of Reliance Industries,
stands as a prime example of success in strategic IT management in the

h
Indian industry. Jio disrupted the market with its entry by introducing a
i
e l
4G network and affordable data plans, which rapidly gained traction and

D
challenged established players. Jio’s strategic focus on data-centric services,

of
innovative offerings, and customer-centric approach played a pivotal role
in its remarkable success.

ty
One of the key factors that propelled Jio’s
success was its strategic IT management
s i
centered around data-centric services.
e r
i
Jio recognized the growing demand for
v
n
data and positioned itself as a provider

, U
of high-speed, affordable data services.
The company invested significantly in

O L
building a robust 4G network infrastructure across the country, enabling

S
fast and reliable data connectivity. By focusing on data services rather

L /
than traditional voice calls, Jio tapped into the emerging trend of data

O
consumption and positioned itself as a market leader.

/ C
Jio’s strategic IT management also involved innovative offerings that

C Edisrupted the industry. The company launched attractive data plans and
bundled services that were significantly more affordable than those offered

D by competitors. Jio introduced free voice calls, low-cost data packs, and

©D
disruptive pricing models that brought data connectivity within the reach
of millions of previously underserved users. This innovative approach
quickly gained popularity and drove a massive subscriber base for Jio.
Moreover, Jio adopted a customer-centric approach in its strategic IT
management. The company focused on enhancing the user experience by
providing seamless connectivity, quick activation, and simplified recharge
options. Jio’s MyJio app, which offered a range of self-service features,
became immensely popular among subscribers. The app allowed users to

120 PAGE
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 STRATEGIC IT MANAGEMENT SUCCESS AND FAILURE IN INDIAN INDUSTRY

manage their accounts, check data usage, recharge, and access various Notes
Jio services, thereby providing a convenient and personalized experience.
Jio’s success in strategic IT management is evident from its rapid market
share growth and impressive subscriber numbers. Since its launch in
2016, Jio has acquired over 400 million subscribers, making it the largest
mobile network operator in India. The company achieved this milestone
in a remarkably short span of time, disrupting the market dynamics and

i
challenging well-established telecom players.
In addition to its telecom services, Jio leveraged strategic IT management
l h
to diversify into various digital services. Jio Platforms, a subsidiary of

D
Reliance Industries, expanded its offerings to include digital entertainment, e
of
e-commerce, fintech, and education services. For example, Jio launched
JioSaavn, a music streaming platform, and JioCinema, a digital content

i ty
streaming platform, providing a comprehensive digital ecosystem to its
subscribers.
r s
e
Jio’s success story in strategic IT management demonstrates the power
v
i
of leveraging technology and innovation to disrupt traditional industries.
n
U
By focusing on data-centric services, introducing innovative offerings,

,
and adopting a customer-centric approach, Jio not only transformed the

O L
telecommunications landscape but also paved the way for digital inclusion
in India. The company’s strategic IT management practices have been

/ S
instrumental in achieving its business goals and establishing Jio as a

L
dominant player in the Indian industry:

O
C
- Reliance Jio disrupted the Indian telecommunications industry through

E /
strategic IT management.

D C
- With its 4G network and affordable data plans, Jio rapidly gained
market share, challenging established players.

©D
- Jio’s strategic focus on data-centric services, innovative offerings,
and customer-centric approach contributed to its remarkable success.

5.4.4 Flipkart
Flipkart, one of India’s leading e-commerce companies, serves as a prime
example of success in strategic IT management. The company revolutionized
the online shopping landscape in India by strategically leveraging technology

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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes to offer a seamless user experience, secure payment options, and a wide
range of products. Additionally, Flipkart’s strategic acquisitions and
partnerships played a crucial role in solidifying its market position and
eventually leading to its acquisition by Walmart.
One of Flipkart’s key successes in
strategic IT management lies in its
relentless focus on delivering a seamless

i
user experience. The company invested

l h
heavily in building a robust technological

e
infrastructure, enabling fast and reliable website performance, smooth

D
navigation, and easy-to-use interfaces. Flipkart employed sophisticated

of
algorithms and data analytics to personalize product recommendations
and enhance the overall shopping experience. By prioritizing user-centric

ty
design and leveraging technology effectively, Flipkart was able to attract
and retain a large customer base.
s i
e r
Flipkart’s strategic IT management also encompassed the implementation

i v
of secure payment options. Recognizing the importance of trust and

U n
security in online transactions, the company developed robust payment
gateways and employed encryption technologies to safeguard customer

L ,
data. Flipkart introduced cash-on-delivery as a payment option to address

O
the concerns of customers who were reluctant to make online payments.

/ S
This strategic move expanded the customer base by providing a convenient

O L
and trustworthy payment method.
Moreover, Flipkart’s strategic IT management included building a diverse

/ C
product range and ensuring efficient inventory management. The company

C Ecollaborated with numerous sellers and brands to offer a wide selection

D
of products across various categories. Flipkart leveraged technology to

©D
streamline inventory management, track product availability, and optimize
logistics operations. By providing customers with a vast array of choices
and ensuring timely delivery, Flipkart became a preferred destination for
online shopping in India.
In addition to its organic growth, Flipkart’s strategic acquisitions and
partnerships played a significant role in its success. One notable acquisition
was the purchase of Myntra, a leading online fashion retailer, in 2014.

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 STRATEGIC IT MANAGEMENT SUCCESS AND FAILURE IN INDIAN INDUSTRY

This move allowed Flipkart to strengthen its presence in the fashion Notes
segment and tap into Myntra’s expertise. Another strategic acquisition
was that of PhonePe, a digital payments platform, which helped Flipkart
offer seamless payment solutions and further enhance the user experience.
Furthermore, Flipkart forged strategic partnerships with various companies
to expand its product offerings and reach. The company collaborated with
leading smartphone manufacturers to launch exclusive product launches

i
and attract customers with attractive offers. Flipkart also partnered with
local artisans and craftsmen to promote Indian handicrafts and provide
l h
e
them with a digital platform to showcase their products. These strategic
partnerships enabled Flipkart to differentiate itself and cater to diverse
D
of
customer needs.
The culmination of Flipkart’s success in strategic IT management came

i ty
with its acquisition by Walmart in 2018. Walmart recognized Flipkart’s

r s
technological prowess, vast customer base, and market dominance. The

e
acquisition not only provided Flipkart with access to Walmart’s global

v
i
resources but also validated its strategic IT management approach.

n
U
In conclusion, Flipkart’s success in strategic IT management is evident

,
in its seamless user experience, secure payment options, diverse product

O L
range, and strategic acquisitions and partnerships. By leveraging technology
effectively, Flipkart transformed the e-commerce landscape in India and

/ S
solidified its position as a market leader. The company’s strategic IT

O L
management practices paved the way for its acquisition by Walmart,
underscoring the significance of technology-driven strategies in the Indian
e-commerce industry:
/ C
C E
- Flipkart, an e-commerce company, demonstrated effective strategic

D
IT management by transforming the online shopping landscape in

©D
India.
- The company strategically leveraged technology to offer a seamless
user experience, secure payment options, and a wide product range.
- Flipkart’s successful acquisition of other companies and strategic
partnerships solidified its market position and led to its acquisition
by Walmart.

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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes 5.4.5 MakeMyTrip

MakeMyTrip, a prominent online travel company
in India, serves as a compelling example
of success in strategic IT management. The
company has leveraged technology effectively to
provide a user-friendly platform, comprehensive
travel offerings, and personalized experiences, allowing it to emerge as
a market leader in the industry. MakeMyTrip’s strategic focus on mobile
h i
l
applications and technology-driven solutions has been instrumental in its
e
D
growth and building customer loyalty.

of
One of MakeMyTrip’s key successes in strategic IT management lies in
its commitment to offering a user-friendly platform. The company has

ty
invested heavily in developing intuitive interfaces and seamless navigation

s i
to enhance the overall user experience. MakeMyTrip’s website and mobile

r
applications provide customers with a simple and hassle-free booking
e
v
process, allowing them to search for flights, hotels, and holiday packages

n i
with ease. By prioritizing user-centric design and usability, MakeMyTrip

U
has created a platform that resonates with its customers and encourages
repeat usage.

L ,
O
Furthermore, MakeMyTrip’s strategic IT management encompasses

S
providing comprehensive travel offerings. The company has partnered

L /
with a wide range of airlines, hotels, and travel service providers to offer

O
an extensive selection of options to customers. MakeMyTrip’s platform

C
allows users to compare prices, read reviews, and make informed decisions

E /
when booking their travel arrangements. The company also offers bundled

C
packages and discounts, further enhancing its value proposition. This

D strategic approach has positioned MakeMyTrip as a one-stop destination

©D
for all travel-related needs.
MakeMyTrip’s success is also attributed to its focus on personalized
experiences. The company utilizes data analytics and customer insights to
provide personalized recommendations and targeted offers. By leveraging
technology, MakeMyTrip tailors its offerings based on customer preferences,
search history, and previous bookings. For example, if a customer frequently

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School of Open Learning, University of Delhi
 STRATEGIC IT MANAGEMENT SUCCESS AND FAILURE IN INDIAN INDUSTRY

books beachside resorts, the platform may highlight similar destinations Notes
and offers. This personalized approach not only enhances the customer
experience but also fosters customer loyalty and drives repeat business.
Additionally, MakeMyTrip’s strategic IT management includes a strong
focus on mobile applications. The company recognized the growing trend
of mobile usage and developed robust mobile applications for both iOS
and Android platforms. MakeMyTrip’s mobile apps offer a seamless and

i
convenient booking experience, enabling customers to plan and book their

l h
travel on the go. The company also introduced exclusive app-only deals

e
and features, further incentivizing customers to use the mobile platform.
This strategic emphasis on mobile technology has helped MakeMyTrip
D
of
tap into a larger customer base and expand its reach.
MakeMyTrip’s growth and success in the Indian market is evident from

i ty
its financial performance and market presence. For instance, in the fiscal

r s
year 2020-21, the company reported gross bookings of INR 24,701 crores

e
(approximately USD 3.3 billion), reflecting a year-on-year growth of 28%.

i v
MakeMyTrip’s mobile app has been downloaded over 100 million times,

n
demonstrating the popularity and effectiveness of its mobile-centric strategy.

U
,
In conclusion, MakeMyTrip’s success in strategic IT management can be

O L
attributed to its user-friendly platform, comprehensive travel offerings,
personalized experiences, and focus on mobile applications. By leveraging

/ S
technology-driven solutions, MakeMyTrip has established itself as a leading

O L
online travel company in India. The company’s strategic IT management
practices have not only contributed to its growth and market leadership but

/ C
also transformed the way people plan and book their travel experiences:

C E
- MakeMyTrip, an online travel company, achieved success through

D
strategic IT management in the Indian market.

©D
- By providing a user-friendly platform, comprehensive travel offerings,
and personalized experiences, MakeMyTrip emerged as a market
leader.
- The company’s strategic focus on mobile applications and technology-
driven solutions contributed to its growth and customer loyalty.

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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes 5.5 Failure Stories of Indian Companies in Strategic IT

Management

5.5.1 Kingfisher Airlines

Kingfisher Airlines, once a prominent player in
the Indian aviation industry, serves as a notable

i
example of strategic IT management failure.

h
The airline’s inability to effectively manage

e l
its IT resources, coupled with inadequate

D
financial planning and failure to adapt to

of
market dynamics, ultimately led to its downfall.
One of the key factors contributing to Kingfisher

i ty
Airlines’ failure was its inadequate financial planning. The airline embarked

r s
on an ambitious expansion plan without a sustainable business model or

e
adequate capitalization. This led to a high debt burden, resulting in financial

i v
distress. Consequently, Kingfisher Airlines faced challenges in investing

U n
in and maintaining its IT infrastructure, impacting its ability to deliver
a seamless customer experience and optimize operational efficiencies.

L ,
Furthermore, Kingfisher Airlines struggled with inefficient use of IT

O
resources. The airline failed to leverage technology effectively to enhance

S
/
its operations, customer service, and cost management. For instance, its

O L
online booking system and website faced frequent technical glitches and
inconsistencies, leading to customer dissatisfaction. The airline also lacked

/ C
robust IT systems for inventory management, revenue optimization, and

E
route planning, hampering its operational efficiency and competitiveness.

D C Another significant factor contributing to Kingfisher Airlines’ failure was its

failure to adapt to changing market conditions and competitive pressures.

©D
The airline faced fierce competition from other established players in
the industry, especially low-cost carriers that offered competitive fares
and superior customer experiences. Kingfisher Airlines failed to respond
effectively to these market dynamics, resulting in a loss of market share
and profitability. The airline’s inability to quickly adapt its business
strategy and leverage technology to differentiate itself in the market
proved detrimental to its survival.
A notable example of Kingfisher Airlines’ failure in strategic IT management
was its inability to effectively manage its loyalty program, King Club.

126 PAGE
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 STRATEGIC IT MANAGEMENT SUCCESS AND FAILURE IN INDIAN INDUSTRY

While loyalty programs can be valuable tools for customer retention Notes
and revenue generation, Kingfisher Airlines struggled to deliver on the
promises of its loyalty program. Members faced challenges in redeeming
their points, and the program lacked the desired level of engagement
and benefits compared to rival airlines’ loyalty programs. This failure
to effectively leverage IT systems to enhance customer loyalty and
engagement further eroded the airline’s market position.
The consequences of Kingfisher Airlines’ strategic IT management failure
were significant. The airline faced severe financial distress, accumulating
h i
significant debt and operational losses. It was unable to sustain its
e l
D
operations and eventually had to suspend its flights and operations in

of
2012. The shutdown of Kingfisher Airlines resulted in job losses for
thousands of employees and left passengers stranded.

ty
In conclusion, Kingfisher Airlines’ strategic IT management failure can be

i
attributed to inadequate financial planning, inefficient use of IT resources,

s
r
and the inability to adapt to changing market conditions. The airline’s

e
failure to invest in robust IT infrastructure and systems, coupled with
v
n i
its inability to deliver a seamless customer experience, contributed to
its downfall. The case of Kingfisher Airlines serves as a cautionary tale,
U
highlighting the importance of effective strategic IT management, financial
,
L
planning, and adaptability in the highly competitive aviation industry:

O
- Kingfisher Airlines faced strategic IT management failure, leading

S
/
to its eventual shutdown.

O L
- Inadequate financial planning, high debt burden, and inefficient use
of IT resources contributed to its downfall.

/ C
E
- The airline’s failure to adapt to changing market conditions and

C
competitive pressures resulted in a significant loss of market share.

D D
5.5.2 Satyam Computer Services
© Satyam Computer Services, once considered
one of India’s leading IT services companies,
experienced a significant scandal that exposed
profound strategic IT management failures.
The company’s management was involved in a
massive accounting fraud, which had far-reaching
consequences, including financial implications

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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes and a severe erosion of stakeholder trust. The lack of proper governance,
internal controls, and transparency were key factors that contributed to
this damaging situation.
The scandal at Satyam Computer Services unfolded in 2009 when the
company’s founder and chairman, B. Ramalinga Raju, admitted to inflating
the company’s financial statements for several years. Raju manipulated
the company’s balance sheets, cash balances, and revenue figures to

i
present a false picture of financial health. This fraudulent activity was

l h
carried out to showcase inflated profitability, secure financing, and boost

e
the company’s stock price.

D
The strategic IT management failure at Satyam Computer Services was

of
evident in several areas. First, there were significant lapses in governance
and internal controls. The company’s management bypassed established

i ty
processes and controls, allowing accounting fraud to go undetected for an

r s
extended period. This failure highlights the importance of implementing

e
robust internal controls and governance mechanisms to ensure transparency

v
i
and accountability in financial reporting.

n
U
Moreover, Satyam Computer Services failed to implement effective

,
risk management practices. The company did not adequately assess and

O L
address the risks associated with fraudulent activities. This lack of risk
management protocols allowed accounting fraud to occur and persist,

/ S
causing severe damage to the company’s reputation and financial stability.

O L
Another aspect of the strategic IT management failure at Satyam Computer

C
Services was the lack of transparency in financial reporting. The company’s

E /
financial statements were manipulated to present inflated revenues, profits,

C
and cash balances. This deceitful practice misled investors, creditors, and

D
other stakeholders, leading to significant losses when the truth emerged.

©D
The lack of transparency not only eroded stakeholder trust but also
exposed the weaknesses in the company’s financial controls and reporting
mechanisms.
The consequences of Satyam Computer Services’ strategic IT management
failure were severe. The company’s stock price plummeted, losing over
90% of its value within a few days of the scandal’s revelation. Satyam’s
clients lost confidence in the company, leading to a loss of business and
contractual relationships. Thousands of employees were affected as the
company struggled to maintain its operations and reputation.

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 STRATEGIC IT MANAGEMENT SUCCESS AND FAILURE IN INDIAN INDUSTRY

The fallout from the scandal also had a broader impact on the Indian Notes
IT industry as a whole. It raised concerns about corporate governance,
ethics, and transparency in the sector, prompting a significant overhaul of
regulatory and oversight mechanisms. The incident served as a wake-up
call for both companies and regulators, emphasizing the importance of
ethical practices, robust governance frameworks, and effective strategic
IT management.

i
In response to the scandal, the Indian government stepped in and initiated
legal proceedings against those involved in the fraud. Satyam Computer
l h
e
Services was eventually acquired by Tech Mahindra, another Indian IT
services company, which undertook significant efforts to rebuild the
D
of
brand’s reputation and restore stakeholder trust.
In conclusion, Satyam Computer Services’ strategic IT management failure

i
resulted in a major scandal that exposed significant governance and
ty
r s
transparency lapses. The accounting fraud carried out by the company’s

e
management severely impacted on its financials and eroded stakeholder

v
n i
trust. The incident highlighted the importance of robust governance,
internal controls, and transparency in ensuring the integrity of financial

U
reporting. It also prompted reforms in the Indian IT industry to prevent
,
L
similar incidents in the future and foster a culture of ethical practices

O
and responsible strategic IT management:

/ S
- Satyam Computer Services, a prominent IT services company, faced

L
a major scandal that exposed strategic IT management failures.

O
C
- The company’s management engaged in accounting fraud, impacting

E /
financials and eroding stakeholder trust.

D C
- The lack of proper governance, internal controls, and transparency
led to severe consequences for the company.

©D
5.5.3 Air India’s Passenger Service System (PSS) Migration
Air India’s migration to a new Passenger Service System (PSS) stands
as a prime example of a strategic IT management failure, leading to
significant disruptions and customer dissatisfaction. The airline’s poor
project management, insufficient testing, and inadequate training were
key factors that contributed to the failure of the migration project,

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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes highlighting the importance of comprehensive planning, stakeholder

engagement, and effective change management.
In 2018, Air India undertook
the migration of its legacy PSS
to a new system known as the
Travelport New Skies platform.
The objective was to enhance the

i
airline’s passenger experience,

l
streamline operations, and improve efficiency. However, the migration
h
e
process encountered multiple challenges, resulting in widespread disruptions
and negative consequences.
D
of
One of the critical factors contributing to the failure was poor project
management. The migration project lacked effective planning, clear

i ty
milestones, and a robust governance structure. There was a lack of

r s
coordination between different stakeholders, leading to miscommunication,

e
delays, and the inability to address issues promptly. The absence of a

v
and chaotic migration process.
n i
well-defined project management framework resulted in an uncoordinated

, U
Insufficient testing was another significant factor that contributed to the

O L
failure. The new PSS system was not thoroughly tested and validated
before its implementation. This oversight led to a range of technical

/ S
issues and glitches, such as booking failures, incorrect seat assignments,

O L
and inaccurate passenger information. The lack of comprehensive testing
resulted in a subpar user experience for both passengers and airline staff,

/ C
causing frustration and disruption.

C EAdditionally, inadequate training played a significant role in the failure

D
of the PSS migration. Air India failed to provide comprehensive training

©D
to its employees on the new system. As a result, the airline staff faced
challenges in adapting to the new processes and functionalities, leading
to further disruptions in operations and customer service. Insufficient
training also contributed to longer wait times, increased errors, and
reduced customer satisfaction.
The consequences of the PSS migration failure were significant. Air India
experienced a surge in flight delays, cancellations, and rebooking issues.
Passengers faced inconvenience, long queues, and uncertainty regarding

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 STRATEGIC IT MANAGEMENT SUCCESS AND FAILURE IN INDIAN INDUSTRY

their travel plans. The disruptions led to a decline in customer satisfaction Notes
and damaged the airline’s reputation. Moreover, the financial impact of
the failed migration was substantial, as Air India incurred additional
costs to address the issues, compensate affected passengers, and rectify
the technical shortcomings.
The incident highlighted the importance of comprehensive planning in
strategic IT management projects. A well-defined project management

i
framework should include detailed timelines, stakeholder engagement, risk
assessment, and contingency plans. Effective change management is also
l h
e
crucial, ensuring that employees are adequately trained and prepared for
the transition. Proper testing and validation processes must be implemented
D
of
to identify and address potential issues before implementation.
To mitigate the impact of the PSS migration failure, Air India had to

i ty
take several corrective measures. The airline worked closely with the

r s
PSS provider and other stakeholders to rectify the technical issues and

e
stabilize the system. Air India also introduced additional training programs

v
n i
to equip its staff with the necessary skills and knowledge to navigate
the new system. The focus on customer communication and support was

U
intensified to address passenger concerns and regain trust.
,
O L
In conclusion, Air India’s failed migration to a new Passenger Service
System underscored the importance of effective strategic IT management.

/ S
Poor project management, insufficient testing, and inadequate training

O L
were key contributors to the failure. The incident emphasized the need
for comprehensive planning, stakeholder engagement, and effective change

/ C
management to ensure the successful implementation of IT initiatives.

E
By learning from this experience, organizations can avoid similar pitfalls
C
D
and enhance their strategic IT management practices to deliver better

©D
outcomes and maintain customer satisfaction:
- Air India’s failed migration to a new Passenger Service System
resulted in widespread disruptions and customer dissatisfaction.
- Poor project management, insufficient testing, and inadequate training
contributed to the failure of the migration project.
- The incident highlighted the importance of comprehensive planning,
stakeholder engagement, and effective change management.

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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes 5.5.4 Aircel

Aircel, once a prominent telecom operator in India, serves as a notable
example of strategic IT management failure, which ultimately led to its
financial crisis and eventual bankruptcy. The company’s inadequate
investments in network infrastructure, technology upgrades, and market
positioning left Aircel unable to compete effectively in the highly
competitive telecommunications industry. Moreover, the failure to adapt
to changing customer preferences and emerging technologies further
h i
exacerbated the company’s financial losses and downfall.
e l
D
One of the key factors contributing to Aircel’s

of
failure was its insufficient investments in
network infrastructure. The telecom industry is

ty
highly reliant on robust and reliable network

s i
infrastructure to deliver high-quality services to

r
customers. Aircel’s failure to invest adequately
e
v
in expanding and upgrading its network infrastructure resulted in network

n i
congestion, call drops, and poor customer experiences. This inability to

, U
provide a seamless and reliable network negatively impacted Aircel’s
customer retention and acquisition efforts, leading to a loss of market
share.
O L
/ S
Another aspect of Aircel’s strategic IT management failure was the

L
company’s inability to keep pace with technology upgrades. In the rapidly

O
evolving telecom industry, companies need to invest in cutting-edge

/ C
technologies and services to meet customer demands and stay competitive.

E
However, Aircel lagged its competitors in adopting new technologies such

D C as 4G and data-centric services. This failure to offer innovative and data-

driven solutions limited Aircel’s ability to attract and retain customers,

©D
particularly in an era where data consumption and internet-based services
were on the rise.
Furthermore, Aircel struggled with inadequate market positioning and
differentiation. The telecom industry in India witnessed intense competition
from established players as well as new entrants offering aggressive
pricing and value-added services. Aircel failed to develop a strong market
position or a distinctive value proposition that could set it apart from
its competitors. The company’s offerings and marketing strategies were

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 STRATEGIC IT MANAGEMENT SUCCESS AND FAILURE IN INDIAN INDUSTRY

not aligned with evolving customer preferences and market trends. As a Notes
result, Aircel faced challenges in acquiring new customers and retaining
existing ones, leading to declining revenues and mounting financial losses.
The failure to adapt to changing customer preferences and emerging
technologies further contributed to Aircel’s downfall. Customers’ preferences
were shifting towards data-centric services, mobile internet, and digital
communication platforms. Aircel’s focus on voice-centric services and

i
limited investment in data infrastructure and digital solutions left it ill-
equipped to cater to the changing demands of customers. As a result,
l h
e
Aircel lost relevance in the market and struggled to compete with telecom
operators that had embraced digital transformation and offered a broader
D
of
range of services.
The consequences of Aircel’s strategic IT management failure were severe.

i
The company faced mounting debt, cash flow challenges, and regulatory
ty
r s
issues. It struggled to service its debt obligations and meet operational

e
expenses, leading to a liquidity crisis. In 2018, Aircel filed for bankruptcy,

v
of uncertainty.
n i
ceasing its operations, and leaving customers and employees in a state

, U
In conclusion, Aircel’s strategic IT management failure, characterized by

O L
inadequate investments in network infrastructure, technology upgrades, and
market positioning, played a significant role in the company’s financial

/ S
crisis and eventual bankruptcy. The telecom industry’s competitive landscape

O L
and evolving customer preferences require companies to continuously
innovate, invest in infrastructure, and adapt to emerging technologies.

/ C
Aircel’s failure to address these crucial aspects resulted in its inability to

E
compete effectively and ultimately led to its downfall. This case serves
C
D
as a reminder of the importance of robust strategic IT management in

©D
staying competitive and sustainable in rapidly evolving industries:
- Aircel, a telecom operator, faced failure due to strategic IT management
shortcomings during its financial crisis.
- Inadequate investments in network infrastructure, technology upgrades,
and market positioning left Aircel unable to compete effectively.
- The failure to adapt to changing customer preferences and emerging
technologies led to significant financial losses and eventual bankruptcy.

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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes 5.5.5 Sify Technologies Limited

Sify Technologies Limited, an IT services and solutions company, faced
challenges in executing its strategic IT initiatives, which resulted in
suboptimal outcomes. The company encountered difficulties such as delays
in project delivery, cost overruns, and inadequate technological advancements.
The lack of effective project management practices, alignment with
customer requirements, and innovation hindered its success in the highly
competitive IT services market.
h i
e l
One of the significant factors contributing to

D
Sify Technologies’ challenges was the lack

of
of effective project management practices.
Projects often faced delays, exceeding the

ty
planned timelines, and causing customer

s i
dissatisfaction. This failure to adhere to project

r
schedules and deliverables resulted in missed opportunities and loss of
e
v
competitive advantage. In addition, cost overruns were a common issue,

n i
with projects exceeding their allocated budgets. These cost overruns

U
strained the company’s financial resources and impacted profitability.

,
L
Furthermore, Sify Technologies struggled with aligning its offerings with

O
customer requirements. Understanding and fulfilling customer needs is

/ S
crucial for success in the IT services market. However, Sify Technologies

L
failed to consistently deliver solutions that aligned with the specific

O
demands and expectations of its customers. This misalignment led to

/ C
dissatisfaction among clients, erosion of trust, and loss of business

E
opportunities. It also hampered the company’s ability to secure long-term

D C partnerships and repeat business.

©D
Innovation and technological advancements play a vital role in the IT
services industry. Companies need to continually invest in research and
development to stay competitive and offer cutting-edge solutions to
clients. Sify Technologies faced challenges in keeping pace with emerging
technologies and failed to make significant technological advancements.
This lack of innovation limited its ability to differentiate itself from
competitors and deliver value-added services to customers. As a result,
Sify Technologies struggled to attract new clients and retain existing
ones in an industry that values innovation and technological expertise.

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 STRATEGIC IT MANAGEMENT SUCCESS AND FAILURE IN INDIAN INDUSTRY

To illustrate these challenges, consider the example of a project where Notes

Sify Technologies was responsible for implementing an Enterprise
Resource Planning (ERP) system for a client. Due to inadequate project
management practices, the project experienced multiple delays and cost
overruns. The extended timeline disrupted the client’s business operations
and resulted in financial losses. This incident not only impacted on the
client’s perception of Sify Technologies’ capabilities but also tarnished
the company’s reputation in the market.

h i
l
However, it is important to note that Sify Technologies also had successes

e
in its strategic IT management initiatives. For instance, the company
successfully implemented cloud computing solutions for various clients,
D
of
enabling them to optimize their IT infrastructure, enhance scalability,
and improve cost efficiency. These successful projects showcased Sify

ty
Technologies’ expertise in leveraging emerging technologies and delivering
value to clients.
s i
e r
In conclusion, Sify Technologies faced challenges in executing its

i v
strategic IT initiatives, which impacted its competitiveness and growth

U n
in the IT services market. The company struggled with delays in project
delivery, cost overruns, and inadequate technological advancements.

L ,
These challenges were primarily attributed to the lack of effective project

O
management practices, misalignment with customer requirements, and

/ S
insufficient innovation. To address these shortcomings, Sify Technologies

O L
should focus on enhancing project management capabilities, strengthening
customer engagement, understanding, and fostering a culture of innovation.

/ C
By addressing these areas, the company can improve its strategic IT

C E
management practices, deliver better outcomes for clients, and position
itself for long-term success in the dynamic IT services industry:

D
©D
- Sify Technologies, an IT services and solutions company, faced
challenges in executing its strategic IT initiatives.
- The company struggled with delays in project delivery, cost overruns,
and inadequate technological.
- Sify Technologies faced difficulties in executing its strategic IT
initiatives, leading to suboptimal outcomes.
- The company encountered challenges such as delays in project
delivery, cost overruns, and inadequate technological advancements.

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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes - The lack of effective project management practices, alignment with

customer requirements, and innovation hindered its success in the
highly competitive IT services market.

5.6 Critical Analysis of Strategic IT Management Successes

and Failures in Indian Companies
In this exploration of strategic IT management successes and failures in
Indian companies, we have examined a diverse range of examples that
h i
e l
shed light on the importance of effective IT management practices. These

D
case studies provide valuable insights into the factors that contribute to

of
success or failure in leveraging IT for strategic advantage. By analysing
these examples, we can draw meaningful conclusions and lessons for

ty
future strategic IT management endeavours.

s i
Starting with the successes, Tata Consultancy Services (TCS) serves as

e r
an exemplary case of leveraging strategic IT management to become

i v
a global IT services and consulting leader. TCS’s focus on innovation,

U n
research and development, and global expansion has propelled its growth
and success. The company’s ability to adapt to changing market dynamics

L ,
and invest in emerging technologies has positioned it at the forefront of

O
the industry.

/ S
Infosys, another Indian IT services giant, has successfully implemented

O L
strategic IT management practices. With a strong emphasis on quality,
delivery excellence, and innovation, Infosys has secured major global

/ C
clients and positioned itself as a leader in digital transformation. The

C Ecompany’s strategic investments in emerging technologies like blockchain

and automation have enabled it to stay ahead of the competition and
D
©D
deliver value to its customers.
Reliance Jio’s disruptive entry into the Indian telecommunications industry
showcases the power of strategic IT management. By launching a 4G
network and offering affordable data plans, Jio rapidly gained market
share and challenged established players. Jio’s customer-centric approach
and focus on data-centric services contributed to its remarkable success,
transforming the telecom landscape in India.
Flipkart, the e-commerce giant, exemplifies successful strategic IT
management through its transformative impact on online shopping in

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 STRATEGIC IT MANAGEMENT SUCCESS AND FAILURE IN INDIAN INDUSTRY

India. By leveraging technology to provide a seamless user experience, Notes

secure payment options, and a wide product range, Flipkart emerged as
a market leader. The company’s strategic acquisitions and partnerships
further solidified its position and led to its acquisition by Walmart,
showcasing the value of effective strategic IT management in driving
growth and market dominance.
MakeMyTrip, an online travel company, achieved success by effectively

i
integrating IT management strategies into its business operations. With a
user-friendly platform, comprehensive travel offerings, and personalized
l h
e
experiences, MakeMyTrip emerged as a market leader in the highly
competitive travel industry. The company’s strategic focus on mobile
D
of
applications and technology-driven solutions played a crucial role in its
growth and customer loyalty.

i ty
On the other hand, the failures in strategic IT management also offer

r s
valuable lessons. Kingfisher Airlines, once a prominent player in the Indian

e
aviation industry, faced failure due to inadequate financial planning, high

v
n i
debt burden, and inefficient use of IT resources. The airline’s failure to
adapt to changing market conditions and competitive pressures resulted

U
in a significant loss of market share, leading to its eventual shutdown.
,
L
This case underscores the importance of effective strategic IT management

O
in navigating challenging market conditions and ensuring financial
sustainability.
/ S
O L
Satyam Computer Services serves as a cautionary tale of strategic IT
management failure due to accounting fraud and governance issues.

/ C
The company’s management engaged in fraudulent practices, leading to

E
severe consequences for the organization and eroding stakeholder trust.
C
D
This incident highlights the criticality of transparent governance, internal

©D
controls, and ethical practices in strategic IT management.
Air India’s failed Passenger Service System (PSS) migration illustrates
the importance of comprehensive planning, stakeholder engagement, and
effective change management. The unsuccessful migration resulted in
widespread disruptions and customer dissatisfaction. Inadequate project
management, insufficient testing, and inadequate training were key
contributors to the failure. This case emphasizes the need for meticulous
planning, robust testing, and effective change management strategies when
undertaking complex IT initiatives.

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 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes Aircel, a telecom operator, faced failure due to strategic IT management

shortcomings during its financial crisis. Inadequate investments in network
infrastructure, technology upgrades, and market positioning left Aircel
unable to compete effectively. The failure to adapt to changing customer
preferences and emerging technologies led to significant financiallosses and
eventual bankruptcy. This case highlights the importance of continuously
investing in technology and aligning business strategies with market
demands to sustain competitiveness and financial viability.

h i
l
Sify Technologies Limited, an IT services and solutions company, faced

e
challenges in executing its strategic IT initiatives, which resulted in

D
suboptimal outcomes. The company struggled with delays in project

of
delivery, cost overruns, and inadequate technological advancements.
These challenges were primarily attributed to the lack of effective project

ty
management practices, misalignment with customer requirements, and

s i
insufficient innovation. To address these shortcomings, Sify Technologies

e r
should focus on enhancing project management capabilities, strengthening

i v
customer engagement, and understanding, and fostering a culture of
innovation.

U n
The successes, and failures in strategic IT management in Indian companies

L ,
offer valuable lessons for organizations and individuals embarking on

O
similar journeys. The successes of companies like TCS, Infosys, Reliance

/ S
Jio, Flipkart, and MakeMyTrip demonstrate the power of effective strategic

O L
IT management in driving growth, innovation, and market leadership.
These companies have successfully leveraged technology to meet customer

/ C
needs, adapt to market dynamics, and gain a competitive edge.

C EKey factors contributing to success in strategic IT management include a

D
focus on innovation, research and development, talent development, and

©D
global expansion. Companies that invest in emerging technologies, build
strong customer relationships, and continuously evolve their offerings are
more likely to achieve success in today’s fast-paced digital landscape.
On the other hand, the failures in strategic IT management highlight
the risks and pitfalls that organizations must avoid. Kingfisher Airlines,
Satyam Computer Services, Air India, Aircel, and Sify Technologies faced
challenges such as financial mismanagement, fraud, inadequate planning,
poor project management, and failure to adapt to market changes. These
failures underscore the importance of financial prudence, transparent

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 STRATEGIC IT MANAGEMENT SUCCESS AND FAILURE IN INDIAN INDUSTRY

governance, effective project management, comprehensive planning, and Notes

agility in responding to market dynamics.
To achieve success in strategic IT management, organizations must
prioritize several key aspects. Firstly, they should establish a clear
vision and strategy that aligns with their business goals and customer
expectations. This involves understanding market trends, identifying
opportunities for innovation, and investing in the right technologies to

i
drive business outcomes.
Secondly, organizations need to build a strong IT governance framework
l h
that ensures effective decision-making, risk management, and accountability.
This includes establishing robust internal controls, ethical practices, and
D e
of
compliance mechanisms to maintain transparency and trust.

ty
Thirdly, successful strategic IT management requires effective project

i
management practices. This involves setting realistic goals, defining clear

s
r
project scopes, allocating resources appropriately, and monitoring progress.

e
It also entails conducting thorough testing, ensuring proper training, and
v
i
managing change effectively to minimize disruptions and ensure smooth
n
U
implementation.

L ,
Furthermore, organizations should foster a culture of innovation and
continuous learning. This involves encouraging experimentation, providing

S O
opportunities for employees to enhance their skills, and fostering collaboration

/
and knowledge-sharing across teams. Embracing emerging technologies,
L
O
such as artificial intelligence, blockchain, and cloud computing, can

C
help organizations stay ahead of the curve and meet evolving customer
expectations.
E /
D C
Lastly, organizations must prioritize customer-centricity in their strategic IT
management efforts. This involves understanding customer needs, preferences,

©D
and pain points to develop solutions that deliver value and exceptional user
experiences. Regular feedback loops, customer surveys, and data analytics
can provide valuable insights for enhancing products and services.

5.7 Summary
The successes and failures in strategic IT management in Indian companies
offer valuable lessons for organizations seeking to harness the power of
technology for business advantage. The successful companies demonstrated

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© Department of Distance & Continuing Education, Campus of Open Learning,
School of Open Learning, University of Delhi
 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes the importance of innovation, customer focus, talent development, and

strategic investments in driving growth and market leadership. Conversely,
the failures highlighted the risks of financial mismanagement, fraud,
inadequate planning, poor project management, and failure to adapt. By
learning from these examples and implementing effective strategic IT
management practices, organizations can position themselves for success
in today’s digital age.

5.8 Answers to In-Text Questions

h i
e l
D
1. (d) All of these

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2. (b) Identifying and managing risks associated with IT initiatives
3. (b) Igor Ansoff
4. (d) Assigning administrative tasks
i ty
r
5. (b) The total organisation
s
v e
n i
5.9 Self-Assessment Questions

, U
1. What do you understand by “Strategic IT management”?

L
2. What are the key factors in deciding success and failure of Strategic
O
S
IT management?

L /
3. Analyze the success story of TCS in strategic IT management.

O
4. Analyse the success story of Infosys in strategic IT management.

C
E /5. Analyse the reasons behind the failure of Sify Technologies Limited

C
in strategic IT management.

D D 6. Highlight the main reasons behind both success and failure of Indian
firms in strategic IT management.

© 5.10 References
‹ J. Ward and J. Peppard, Strategic Planning for Information Systems,
Third. West Sussex: John Wiley & Sons Ltd., 2003.
‹ T.L. Wheelen, J.D. Hunger, A.N. Hoffman, and C.E. Bamford,
Strategic Management and Business Policy Globalization, Innovation,
and Sustainability, Fourteenth. Pearson Education, Inc., 2015.

140 PAGE
© Department of Distance & Continuing Education, Campus of Open Learning,
School of Open Learning, University of Delhi
STRATEGIC IT MANAGEMENT SUCCESS AND FAILURE IN INDIAN INDUSTRY

‹ R. Durand, R.M. Grant, and T.L. Madsen, “The Expanding Domain Notes
of Strategic Management Research and the Quest for Integration,”
Strateg. Manag. J., vol. 38, no. 1, pp. 4–16, 2017.
‹ R. P. Rumelt, D. Schendel, and D. J. Teece, “Strategic management
and economics,” Strategic management journal, vol. 12, no. S2. pp.
5–29, 1991.
‹ S. P.-J. Wu, D.W. Straub, and T.-P. Liang, “How Information

i
Technology Governance Mechanisms and Strategic alignment
Influence Organizational Performance : Insights From a Matched
l h
Survey of Business and IT Managers,” MIS Q., vol. 39, no. 2, pp.
497–518, 2015.
D e
‹ L. Erasmus, S. Parappat, and R. Weeks, “Strategic Management of
of
ty
Information Technology : An Investigation into It Alignment at a

i
Tertiary Education Institution,” 2012 Proc. PICMET 12 Technol.

s
r
Manag. Emerg. Technol. Strateg., pp. 2670–2678, 2012.

v e
T. Cui, H. Ye, H. H. Teo, and J. Li, “Information technology and
i
‹

n
open innovation: A strategic alignment perspective,” Inf. Manag.,

U
vol. 52, no. 3, pp. 348–358, 2015.
‹

L ,
Raquel Flodström, “A Framework for the Strategic Management of

O
Information Technology,” 2006.
‹

/ S
N. Melville and K. Kraemer, “Information Technology and Organizational

O L
Performance: An Integrative Model of IT Business Value,” MIS Q.,
vol. 28, no. 2, pp. 283–322, 2004.
‹
/ C
P. P. Tallon and A. Pinsonneault, “Competing Perspectives on the

E
Link Between Strategic Information Technology Alignment and
C
D
Organizational Agility: Insights from A Mediation Model,” MIS

©D
Q., vol. 35, no. 2, pp. 463–486, 2011.
‹ Ikerionwu, Charles. (2019). Secured Service Delivery Model for
Outsourced Services in a Business Process Outsourcing Relationship.
International Journal of Information and Communication Sciences.
4.7.10.11648/j.ijics.20190401.12.
‹ Alamri, Samar & Almutiri, Noura & Ballahmar, Hanaa & Zafar,
Aasim. (2016). Strategic Information System Planning: A Case Study
of a Service Delivery Company. IARJSET. 3. 78-84. 10.17148/
IARJSET.2016.3518.

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School of Open Learning, University of Delhi
 MBAFT 7503 STRATEGIC MANAGEMENT OF IT

Notes ‹ Hemmatfar, M., Salehi, M., & Bayat, M. (2010). Competitive

Advantages and Strategic Information Systems. International Journal
of Biometrics, 5, 158.

5.11 Suggested Readings

‹ O’Brien, J. (2005). Introduction to information systems (12th edition).
Boston: McGraw-Hill/Irwin.

h i
Boddy, D., Boonstra, A., & Kennedy, G. (2005). Managing information
l
‹

e
systems: An organisational perspective (2nd edition). Harlow: Pearson.
‹
D
Carr, N.G. (2003). IT doesn’t matter. Harvard Business Review,

of
81(5), 41-49.

ty
‹ Clarke, S. (2001). Information systems strategic management: An
integrated Approach. New York: Routledge.

s i
e r
i v
U n
L ,
S O
L /
C O
E /
D C
©D

142 PAGE
© Department of Distance & Continuing Education, Campus of Open Learning,
School of Open Learning, University of Delhi
 Glossary
Big Data: A term used to describe the vast amounts of data generated by organizations,
which can be used for analysis and decision-making purposes.
Business Intelligence (BI): The use of data analysis tools to extract insights and information
from data, which can help organizations make more informed decisions.
Customer Relationship Management (CRM): The use of technology to manage interactions
h i
l
with customers, track customer data, and improve customer engagement and satisfaction.
e
D
Digital Transformation: The process of using technology to fundamentally change how an

of
organization operates, including its business models, processes, and customer interactions.
Enterprise Resource Planning (ERP): An integrated software system used to manage

i ty
and automate business functions, such as accounting, procurement, and human resources.

r s
Industry 4.0: The trend towards the integration of advanced technologies such as the

e
Internet of Things, artificial intelligence, and cloud computing into manufacturing and

v
industrial processes.

n i
U
Information Technology (IT): Information Technology (IT) is the use of computers to

,
create, process, store, retrieve and exchange all kinds of data and information.

L
Knowledge Management: The process of creating, sharing, using, and managing knowledge
O
S
and information within an organization.

L /
Strategic Alignment: Ensuring that the goals, objectives, and activities of an organization’s

O
IT function are closely aligned with the overall business strategy.

/ C
Strategic IT Management: Strategic IT management refers to the process of aligning

C E
an organization’s IT strategy with its overall business strategy to achieve organizational
goals and gain a competitive advantage. It involves making decisions and implementing
D
©D
actions that leverage information technology in a way that supports and enhances the
organization’s strategic objectives.
Supply Chain Management (SCM): The coordination and management of all activities
involved in the production and delivery of goods and services, from raw materials to the
final product.

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© Department of Distance & Continuing Education, Campus of Open Learning,
School of Open Learning, University of Delhi