Information Systems Strategy, Information Systems and Globalization: when

1
Information Systems Strategy, Information Systems
and Globalization when best practice meets
cross-cultural communication Bob Galliers,
Provost, Bentley
ESRC Seminar Nottingham University 10 May, 2004
2
Bentley???
3
Bentley the USs first business university

• Bentley is a business university. We do for
  students interested in business and related
  professions what the leading technological
  universities do for students of science and
  engineering.

4
Bentley the Business School for the Information
Age
Bentley blends the breadth and technological
strength of a university with the values and
student experiences of a small college.
5
The campus and the facilities
6
Center for Marketing Technology
7
The Trading Room
8
Todays agenda

• To surface issues confronting multi-national
  companies, relating to cross-cultural
  communication and relationship management
• Focusing on
• Information systems strategy and development
• Best practice solutions
• Two case vignettes

9
Towards a more inclusive framework for
Information Systems Strategizing
Source Galliers, 2001
10
Two vignettes

• Case company A
• Engineering
• ERP KMS
• Newell, Huang, Galliers, Pan (Bentley,
  Nottingham, NUS)
• Case company B
• Financial services
• Software development
• Chand, David, Moore and Vasudevan (Bentley)

11
Case Company A background

• Multinational engineering company
• Designs and manufactures standard and
  custom-built products provides consulting
  services
• Corporate clients from over 70 countries
• 60,000 employees
• 8 billion sales turnover in 2000

12
Case company organization

• Four main product divisions global basis
• Power Generation
• Transport
• Infrastructure
• Gas Oil
• Fifth division regional basis
• Logistics and Warehouse
• Support functions at HQ, e.g.
• Finance
• HR
• Consulting arm project-by-project basis

13
Implementing ERP and KMS in tandem

• Efficiency and innovation
• ERP
• Integrate business functions into single system
  with shared database (Lee Lee 2000)
• Overcome problems of legacy systems
• Common business processes
• Improved competitiveness through increased
  productivity
• KMS
• Improved competitiveness through knowledge
  utilization
• Free flow of knowledge across organization(s)
• Knowledge capture and transfer through ICT
• Data mining

14
Efficiency and/or flexibility?

• Burns and Stalker (1961) mechanistic versus
  organic organizational designs
• Mintzberg (1979) machine bureaucracies versus
  adhocracies
• Senge (1990) adaptive learning versus generative
  learning
• March (1991) exploitation versus exploration

Flexibility is achieved at the expense of
efficiency Hannan Freeman (1989)
15
Efficiency and/or flexibility?

• Long history of polarity, but empirical evidence
  limited and contradictory (Adler et al. 1999)
• Evidence for (Hayes Wheelwright 1984)
• Evidence against (MacDuffie et al. 1996)
• Ambidextrousness (Daft 1998 Tushman OReilly
  1997)

16
Research method

• Interpretivist case study (Gopal Prasad 2000
  Walsham 1995)
• Data sources
• 37 semi-structured, face-to-face interviews
  (1998-99)
• Interviews via telephone and email
• Informal dialogue
• On-site observation
• Documentation
• Open coding (Strauss Corbin 1990)
• Adler et al.s (1999) theoretical framework used
  as a sensitizing device (Klein Myers 1999)
• Unintended negative consequences (Robey
  Boudreau 1999)
• Conceptually clustered matrix (Miles Huberman
  1994)
• Process of reflexivity (Alvesson Sköldberg 2000)

17
The ERP initiative background

• 1995 Four month evaluation study conducted by IT
  service provider
• 2nd Q 1996 top management go-ahead, for
• 3 year project Europe and North America
• One of the most important in terms of capital
  investment and coverage in companys history

18
The KM initiative rationale

• trying to start KM is more than just catching
  up with the latest managerial fashion. The people
  at the top are constantly going on about how
  critical innovation is to us and how desperate
  they are to develop an innovative culture. But
  innovation has to come from somewhere
  Personally, I believe KM is the philosophy that
  provides the inspiration to create the
  innovation. (Consulting division)

19
The KM initiative implementation

• Project team Corporate Knowledge Center
  (CKC)
• Web-based, corporate-wide knowledge directory
  (K-bank)
• 11,000 personal homepages
• Standard info plus personal info column
• Product-based learning and innovation communities
  (LICs) - spread across the globe
• 100 or so
• 60 through CKC workshops/training programs
• 50 with continuously updated websites

20
Findings

• Complementary or contradictory nature of ERP and
  KM systems?Both judged to be successful, and
  complementary
• ERP
• Faster strategic info
• Better coordination of activities
• KM
• Effective exploration and exploitation of
  knowledge (March 1991) both intra- and
  inter-organizationally
• Improved continuous learning (Fiol Lyles 1985)

21
Mutual reinforcement of ERP and KMS unintended
consequences

• Internal boundaries reinforced in products
  divisions
• Emphasis on individual department performance
  through ERP internal competition
  rather than collaboration
• KMs LICs set up with representatives from single
  production units no cross-unit learning
• Reduction in social capital
• Reduction in suppliers and service providers
  critical source of knowledge for innovation
  being cut off
• Creation of inter-group conflict and resistance
• Shift in information ownership from ERP
  negative impact on KM initiative

22
Case Company B background

• Founded in 1946
• Headquartered in Boston, MA
• The largest mutual fund company in the United
  States
• More than 880 billion under management as of
  June 30, 2003
• More than 19 million customers company wide
• Products include mutual funds, brokerage,
  insurance

23
Globally distributed software development

• Information services in financial markets
• A profit center competing for company business
  with third parties
• USA, Ireland, India
• India a threat to Ireland, and esp. USA
• Low cost imperative
• Standardized technology, software, methodology
  imposed top-down

24
Research Project Activities

• Interviews
• 18 interviews conducted with
• Engagement Managers in Boston and Ireland
• Project Managers in Merrimack, Dublin, Galway,
  and Gurgaon
• Team members in Merrimack, Dublin Galway, and
  Gurgaon
• Field research
• Site visits to Boston, Merrimack, Dublin, Galway,
  and Gurgaon
• Attended 9 Engagement Manager video conferences
  (8 in Boston and 1 in Dublin)

25
Summary of Preliminary Findings

• 1. The importance and challenge of building team
  cohesion among distributed personnel
• Recognizing the role of team cohesion as an
  important variable in team productivity
• Allocating people to teams based on past
  cohesiveness index
• Installing project initiation techniques that
  increase cohesiveness of the team

26
Summary of Preliminary Findings

• 2. The need to develop integrative and
  collaborative work among distributed teams
• Providing the social networks to develop rapport,
  relationships, and trust among team members
• Balance formal and informal communications among
  team members
• Building and creating an in-company culture to
  offset other cultural differences

27
Summary of Preliminary Findings

• 3. The reliance upon standardized processes, best
  practices, development methodologies, and
  information and communication technologies
• While the standardization of work can aide in
  establishing understanding and increased
  productivity among distributed teams, it can also
  have negative effects, e.g.,
• minimizing innovation
• hurting morale
• limiting development of employee skills
• Needs to be a balance between imposing a global
  work culture and allowing one to emerge

28
Summary of Preliminary Findings

• 4. Evolution of roles versus planned assignment
  of roles
• Emergent sense of anxiety and uncertainty over
  changing roles
• Perception of inter-center competition, which can
  hurt collaboration
• Importance of articulating and, preferably,
  negotiating a shared common vision of the roles
  and responsibilities of different solution
  centers

29
From Knowledge Management to Relationship
Management

• Through Processes
• Standardized methodologies
• Best practices
• Technological pipelines
• Through Technologies
• Telephone Sametime (IM)
• Conference calls Webcams
• E-mail Video conferences
• Bulletin boards On-line discussion groups

30
From Knowledge Management to Relationship
Management

• Through Processes
• Standardized methodologies
• Best practices
• Technological pipelines
• Through Technologies
• Telephone Sametime (IM)
• Conference calls Webcams
• E-mail Video conferences
• Bulletin boards On-line discussion groups
• Through Face-to-Face

31
Summary Implications

1. Increasing dependence on ICT in accomplishing
   distributed work
2. Substitution of face-to-face interaction for
   technologically-mediated communication in team
   building
3. Development of a more fully realized cost model
   in project off-shoring, including hard and
   soft costs
4. (Over?)reliance on standardized processes and
   methodologies in coordinating distributed work
5. More structured approach to communication

32
Towards a more inclusive framework for
Information Systems Strategizing
Source Galliers, 2001