SASI

1
SASI

• Lecture 9
• Spring 2004

2
Local versus Central Control

• One of the most important business decisions is
  whether to control applications locally or
  centrally
• Centralizing gives you economies but sacrifices
  flexibility it is hard to tinker with centrally
  run applications
• Local control gives you flexibility, but
  sacrifices economies it is hard to share
  decentralized applications

3
Local versus Central Control
4
Buy versus Make

• Buy vs. Make is the question of whether to
  develop solutions in-house or pay to have someone
  else develop them this is the outsourcing
  dilemma, a form of central vs. local control
• Outsourcing gives you economies but sacrifices
  flexibility it is hard to tinker with outsourced
  processes
• Making your own processes gives you flexibility,
  but sacrifices economies it is hard to share
  locally held processes

5
Buy versus Make
6
Centralizing

• Outsourcing buying is form of centralizing
• Therefore there are three levels to centralizing
• Keep things local (dont centralize)
• Centralize things, but keep them in-house
  (moderate centralization)
• Outsource (serious centralization)
• When you centralize you get economies of scale.
• Central control can do what it does repeatedly
  for several clients at once
• Central control can do it consistently, quicker,
  as well as cheaper

7
Why Centralize?

• SASI
• Security
• It is easier to secure data, applications, the
  physical hardware, and the telecommunication
  connections from one place
• Availability
• It is easier to keep data and applications online
  if these are in one central place
• Scalability
• At a central IT shop one can add databases and
  servers as well as integration packages to enable
  ramping up
• Integration
• It is easier to make systems interoperate if the
  systems are available to and made to conform to
  the standards of central control.

8
Why Decentralize?

• Quality, innovation, and customization
• Open source development is a form of mass
  decentralization because more people are working
  on the application, the result is a far better
  product
• The problem with decentralization is sharing the
  solutions

9
Current Trend

• The current trend is to outsource and to
  centralize everything because of SASI benefits
• But these SASI benefits come at a cost, namely
  the lose of
• Quality
• Innovation
• Customization
• Control

10
Management In the Networking Era

• The best IT Manager is one who knows
• What and when to outsource development
• What and when to develop centrally (at an
  in-house IT shop)
• When to develop systems locally (at the local IT
  shops)
• The best business Manager is one who knows
• What and when to outsource business processes
• What and when to develop business processes
  centrally (at corporate)
• When to develop business processes locally (at
  the local business units)