IS Consulting Process ( IS 6005 )

IS Consulting Process (IS 6005)

Masters in Business Information Systems 2006 / 2007Programme in Professional Information System Practices

Fergal CartonBusiness Information Systems

MBS (BIS) / 6005 / IS Consulting Process

This week

• Revision class• Reading list


Topics covered 1st termThe IS Consulting Business: • What does the IS Consultant do?

•Segmenting consulting practice (eg. Vision)•Role of consultants on PPARS•Typical asssigments•PCB example•GAP analysis (eg. UCC)•ERP Projects: scope, resources, timescales, phasing•Consultant skills (analytic, technical, project)•Consultant tools•Identifying unique features of business

Managing Client Engagements:• Requirements analysis and understanding the client goals

•Handouts• Task definition and project resources

•SIB• Preparing and presenting the solution options

•In-house vs custom


Consulting practice in Ireland• Segmenting the market

– Emphasis on services (from Helpdesk to ASP model)

– Any other research on market?

– Homework on Vision

• Typical consulting assignments• Role of consultants• Perspectives on IS function• Do you know more than the client?


Segmenting the IS consulting market

• What services are provided?– IT strategy definition (laying out an investment plan for IT spend)– Advise on IT cost reduction– Feasibility study or business case for IT spend– Develop requirements for new system– Package selection and implementation– Software development (Design, Build, Run, …)– Outsourcing operations (ASP, Helpdesk, IT support, …)– …

• What markets are operated in?– Public– Commercial– SME


Propose, or not to propose?

• “Changing” your spots just to snag a project• Fit of project with your capabilities• Trade off between need to grow and comfort zone• Challenge the sales team?• Respond with a polite “no-bid” letter


Vision exercise

• Background, size, structure, locations

• Unique selling point (if one exists)

• Industry sectors/practice areas

• Offers/services within these areas


What do consultants do?

• Consulting project examples– ERP projects: big-bang or phased approach?– Vital role of consultants: availability, courageousness and tenacity– Telephone company uses Tel no. to identify customers!– Catering trade: 14% stock loss, use of IT for control

• Gap analysis example: colour coded “fit” of ERP to actual processes• PCB case studies presented

– Skills a key issue in implementation debate (Project Mgt, IT support, PU’s, …)

– Structured process overview diagram a good communication tool– Top down approach, talk to managers first: protocol and common courtesy– Including regional users in requirements specification


Gap analysis

• Homework: how to reconcile Requirements Specification (wish list) with ERP generic processes?

• ERP Finance modules for UCC– Scope

– System requirements

– Responding to an ITT / RFP

• Requirements definition report– Functional requirements by dept, process, module, …


Gap analysis: expectation mgt• Describe existing processes

– Document how things are currently done – Review inputs and outputs of current process (screens, forms, reports)– Outline problems with current way of doing things (speed, risk of

error, …)– What improvements are expected from system (single point of data

entry, faster reports, less manual work, …)

• How to design and communicate the proposed solution– Review requirements documentation: answer with – Walk-through solution– Get sign-off from users


Managing the GAP: workshop with client managers

– Off-site, phones off, informal, actual consulting team members present, start in “working together” mode

– Company history and current challenges (get people saying yes)

– Overview of ERP (education, building awareness, testing the water for resistance, …)

– Requirements for ERP (generic and company specific)– Focus on benefits– Understanding the cost of the Gaps (alternative functionality,

workaround, modification)– Addressing the functionality gap (get commitment for

resources to work on B’s and C’s)


Last week• Role of consultants (cf. Wang & Chen paper)

– Personal commitment: invest the time in getting to know the client– Winning trust– Significant “knowledge asymmetry”– Not doing, but advising : how to disentangle yourself from an operational role– Conflict resolution

• Freeman 5 concepts of IT advisory role:– Relationship– Role– Visualise success– You advise, they decide

• Disentangle yourself from operational role• Give the criteria by which you would make the decision, rather than the decision

– Be results oriented• Managing the GAP: workshop with client managers

– Off-site, phones off, informal, actual consulting team members present, start in “working together” mode – Company history and current challenges (get people saying yes)– Overview of ERP (education, building awareness, testing the water for resistance, …)– Requirements for ERP (generic and company specific)– Focus on benefits– Understanding the cost of the Gaps (alternative functionality, workaround, modification)– Addressing the functionality gap (get commitment for resources to work on B’s and C’s)

• Phasing discussion: big bang vs phased– Business constraints or seasonality in business cycles (eg. Hershey)– Scale (# users, # countries, …)– Scope (# modules, # interfaces, level of customisation, …)– Timescale and cost (NB. PPARS still costing €21m. a year)– Different requirements between sites, resistance to ERP (get quick wins first)

• Format of tenders– Functional requirements might be by dept, process, module, …

• Analysis of data volumes (process flow for revenue and expenditure cycles)– # non-PO invoices (40%)– # debtor accounts– Research account maintenance


Picture

All Homes ProvideA roof over your head

A floor under your feet

A lock on the door

Electricity, water, sewer

All Homes ProvideA roof over your head

A floor under your feet

A lock on the door

Electricity, water, sewer

A starter home Uses standard blue prints

Can be built with generic skills

Requires much compromise

Doesn’t have unique features

Is very similar to the next house

Is generic in style and function

A starter home Uses standard blue prints

Can be built with generic skills

Requires much compromise

Doesn’t have unique features

Is very similar to the next house

Is generic in style and function

Your dream homeArchitect develops a custom plan

Requires skilled craftsman

Requires little compromise

Is unique where you value it

Is like no other house

The style and function are specific

Your dream homeArchitect develops a custom plan

Requires skilled craftsman

Requires little compromise

Is unique where you value it

Is like no other house

The style and function are specific


ERP

• Why ERP ?– Automate and streamline sales/quote/order/invoice– Shorten order processing time– Better inventory control– Consolidates all sales information– Improve sales information on customers– Why reinvent the wheel, use best practice– Scalability– Robustness – one system, minimises repetition– Faster to implement– Clear upgrade path (linked to vendor): better expansion capability– Develop ERP skills in-house, useful for further projects– Ability to implement, large team required!– Quantifiable outcome & timescale


In-house

• More control over process design• More adherence to specific requirements• More programmers required• Own processes may be better than ERP template• Have we got the resources / experience

– Design– Build– Support

• Cost of back fill • Long term Support issues • Time scale & cost


Phasing discussion: big bang vs phased

– Business constraints or seasonality in business cycles (eg. Hershey)

– Scale (# users, # countries, …)

– Scope (# modules, # interfaces, level of customisation, …)

– Timescale and cost (NB. PPARS still costing €21m. a year)

– Different requirements between sites, resistance to ERP (get quick wins first)


Package vs. custom debate

• What is unique to the business?

– Business model (cost, products, design, customer satisfaction, …)– Unique feature (products, production methods, IS, supply chain, …)

• Leading questions

– Revenue, headcount, …– Current successes, recent announcements, …

• Project timescale: – a trade off between cost and tying up resources– Scope creep because of changes to the business model

• Eg. EMC integration of DG rejected because of timeline impact but later regretted


Consulting skills• IS consulting profession

– Consultant, project manager, analyst

• Consultant skills– Analytic abilities

• Analysis tools (IT audit example)• Checklists, presentation matrices, …• Adding value in reporting findings in a way that prioritises actions to be taken

– Technical abilities– Project management abilities– Example from Accenture


Roles on ERP projects• Key roles in ERP project: Accenture example

– Client, consultant and technology vendor resources– Doubling up of client and consultant resources (experience where it counts)

• ERP project team example (PCB case study)– Steering committee (SC) meets once a month, only want a report on progress– Project issues should be sorted out before SC meeting– SC members represent first and foremost their functional areas– Project Manager should not be on Steering Committee?– Clarity of project team presentation, keep like resources together– Time commitment to project (increases downwards through org chart)– Reporting lines not trivial: think where decision bottlenecks can occur (and

place a consultant at that point)


Things to think about

• In considering change, think about how people are goaled / measured

• It will always benefit you if you make your boss look good

• Policy driven approach

• Statement of work– Decisions– Reporting– Milestones– Planning– Policies


Things to think about

• Resistors easier to deal with than the George Hall’s

• Pfizer: 3 IT development centres competing against each other

• Communication– set your stall out, be determined– Deliver tough message first, but how you communicate it is key– Different deal shapes (eg. SAP licence issue)– Is manufacturing cultural?

• How do you judge level of interdependence between plants

• Interdependence betweeen ERP and legacy (ownership issues?)


More tips on proposals

• Consistency in style throughout proposal• Knowledge of a sector: state it or show it• Who is the biggest benefactor of MIS? • IT resources are important• Customers like frameworks• An architecture of functions might re-assure• Phasing, on what basis?• Package vs. custom discussion• Security deserves attention• Maybe customer doesn’t understand new business model• Honesty looks professional and increases credibility


A methodology …

• Requirements are “representational”: you can’t interview everybody

• Breaks a large task into manageable chunks• Shows knowledge and experience• Allows negotiation over the scope of work• Inspires confidence• Can take account of latest research / thinking• Helps calculate FTE and budget


Popular issues / projects

• Read current business press for ideas (SBP, FT, Economist, CEO, Fortune, …)

• Outsource to Puerto Rico: like Ireland 20 years ago

• Outsourcing: the knowledge economy in Ireland

• IFSC now has reputatation for “futures” currency trading

• “Centre of excellence” notion: holding on to higher value activities

• …


Marketing funnel

• Consulting sales is like any other sales: creating client need is critical

• Discuss sales tactics with someone you know who is a good sales person

• Quantify the levels in the funnel (as you would for a sales campaign)


What’s an IT strategy

• Strategy is a report which matches business goals to IT directions

• Lays out a plan for future investment• Contains pointers to implementation initiatives• Can refer to your experience of implementing

solutions• Hopefully leads to you being retained for the

implementation work


Croker Strategy• Customers

– Sports organisations (IRFU, FAI, IOC, …)– Club / county / national team supporters– Corporate Ireland– Business conference users– Concert goers– Tourists– TV viewers– Internet users– …

• Stakeholders– GAA– Govt.– Sponsors– …

• Suppliers– Tourist Board– Dublin City council– …

• Products– Sports events (seats and viewing rights)– Entertainment events– Business conferences– Not for profit events– Hotel accommodation– Museum– Retail– Telecoms– ….


PPARS project

• Governance• Complexity

– Job title– Responsibilities– No payscale– Bonuses– Overtime– Link roster to payroll?

• Resources• Business process change, not system issue


PPARS project information

• http://irishhealth.com/index.html– PPARS is only a tool, a computer system, to aid the recording

personnel data and payroll. – Problems lay deeper than the PPARS system,

• e.g Business Process is poor,• no standardisation, • poor management of resources, • no reports to monitor pay expenditure and pull back on over

spends. – The system is only highlighting the problems that exsist. – The system is being used as an excuse. If managers managed and

were held accountable and responsible for their actions, the roll out of a new system should not be such a chore!!


PPARS scope (www.PPARS.ie)• Personnel Administration • Organisational Management • Time Management • Payroll (full Gross to Net) • Personnel Development (Qualifications only) • Training & Events • Travel Management (Expenses only) • Compensation Management (Mass Pay Increases only)

• Managers Self Service • Employee Self Service (Limited Pilot) • Electronic time capture (Pilot)


PPARS.ie

Core Benefits • An integrated HR system for the Irish Health System. • Comprehensive employee data and profiles. • Improved reporting / standardised reporting across and

within agencies.• Enhanced potential to improve the facilities for resource

planning / costing. • Potential to improve the alignment of resources to service

plans. • Enhanced information on organisational structure,

reporting relationships, positions and staffing complements.


PPARS.ieCore Benefits (cont.)• Standard & streamlined processes, procedures and forms.• Reduced administrative costs. • Compliance with the reporting requirements of the

Department of Health & Children, the Health Services Employers' Agency and the Office of the Comptroller and Auditor General.

• Potential for electronic information flow between Health Agencies and the Department of Health & Children.

• Enhanced empowerment of Line Managers – In line with best practice in HR.

• Improved employee satisfaction through, for example, improvements to career and organisation planning.


Environments for IS / IT planning

High

“Opportunistic” “Complex”

“Backbone”“Traditional”

Low High

Infusion – degree of dependence of the business on IS/IT

Diffusion – degree of decentralisation of

IS/IT control in the organisation

Internal Organiastional Pressures – demanding further distribution of IS/IT control organisation

External Competitive Pressures – increasing the criticality of IS/IT to

the business

ERP

CRM

Source : Sullivan (1985)in Ward & Griffiths (1996)


IT strategic grid (McFarlan & McKenney)

Strategic impact of application development portfolio

Strategic impact of existing systems

LOW HIGH

LOW

HIGH

Support Turnaround

StrategicFactory


IT strategic grid (McFarlan & McKenney)

Strategic impact of application development portfolio

Strategic impact of existing systems

LOW HIGH

LOW

HIGH

Support Turnaround

StrategicFactory

eg. cement

eg. steelworks eg. credit card

eg. retailer

“IT is a tightly managed shop which must not get beyond its

station”

“IT is integral to the business”

“Don’t call us, we’ll call

you”

“Let’s get on with it”


3 forces driving firms around grid

• Fit between IT potential and operations & strategy

• Strategic choices made about IT

• Changes in the competitive environment


Limitations of Strategic Grid

• Every company has systems in 4 quadrants

• Systems may migrate around quadrants

Therefore :

• Use grid to plot range of business applications

• Investment appraisal approach for each quadrant


Application Portfolio (adapted from Ward & Griffiths, Strategic Planning for Information Systems, 1996)

Strategic

High Potential

Key operational

Support

Applications critical to sustaining future business strategy

Applications which may be important in achieving future success

Applications on which the organisation currently depends for success

Applications which are valuable but not critical to success


Application Portfolio Example for a manufacturing company

Strategic

High Potential

Key operational

Support

• Sales order management• Links to suppliers• Sales Forecast & market analysis• Product Profitability analysis• …

• EDI with wholesalers• Manpower planning• Decision Support (capacity plan)• Expert fault diagnosis• Document processing• …

• Bill of Materials• Inventory management• Customer database• Receivables / Payables• Employee database• …

• Time recording• Budgetary control• General accounting• Cost accounting• Payroll• …


Reading list• Handouts in class

– 1 Oct 06• ERP Implementation Case Study (PCB), Fergal Carton• Rick Freedman (2000). The IT Consultant, Chapter One, Part One

– 18th Oct 06 UCC ERP project documentation?• Format of Tenders and Evaluation• Appendix II, current data volumes• Key roles and team structure

– 20th Nov 06• SIB Industries Inc. (case study on ERP implementation project)

– 8 Jan 07 (soft copies also sent)• “How to deal with difficult customer”, Peter Urs Bender • “Stand Up, Sit Down...Don’t Fight, Fight, Fight”, Jacobsen (2004)• Sales and Marketing, Ch. 6, Rick Freedman (2003). Building the IT Consulting Practice• What is the IT Consulting Business, Ch. 1, Rick Freedman (2003). Building the IT Consulting Practice

– 26th Feb• PPARS handouts : articles from Greg Baxter, Ciaran Buckley, Ian Campbell, John Kennedy and Auditor General report extracts

• Emails– Sent 18 Oct 06:

• “Effects of internal support and consultant quality on the consulting process and ERP system quality”, Wang & Chen (2006), Decision Support Systems 46, pp 1029-1041

– Sent 6th Nov 06: • “Blaming ERP”, Osterland (2000), CFO, pp 89-92

– Sent 14th Nov 06• “Business Process Management, The Future of IT “, Keen (2002), Working paper for Action Technolgies Inc.

– Sent 20th Feb 07:• “Strategy and The New Economics of Information”, Evans & Wurster (1997), BCG• “Systems Planning in the Information Age”, Sullivan (1985), Sloane Management Review

– Sent 26th Mar 07: • “2x2 Modeling and Problem Solving”, Lowy & Hood (2004), Consulting to Management, Vol. 15, No.4, pp 40-47

• Recommended reading– Rick Freedman (2000). The IT Consultant: A Commonsense Framework for Managing the Client Relationship, Jossey-Bass / Pfeiffer, San Francisco– Rick Freedman (2003). Building the IT Consulting Practice, Jossey-Bass / Pfeiffer, San Francisco


Freedman is light reading!– Building the IT Consulting Practice

• 1• 3 skim• 4 yes• 5 yes• 6 have• 7, 8, 9, 10 no

– The IT Consultant: A Commonsense Framework for Managing the Client Relationship

• Parts 1 and 2

IS Consulting Process ( IS 6005 )

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