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Showing posts with label Information System Management. Show all posts
Showing posts with label Information System Management. Show all posts

Thursday, October 18, 2012

Inside Amazon Web Services


From storage to payment, the king of clouds is dangling an array of low-cost services. We take a close look at the tools for IT and developers.
Amazon's Web Services (AWS) are based on a simple concept: Amazon has built a globe-spanning hardware and software infrastructure that supports the company's Internet business, so why not modularize components of that infrastructure and rent them? It is akin to a large construction company in the business of building interstate highways hiring out its equipment and expertise for jobs such as putting in a side road, paving a supermarket parking lot, repairing a culvert, or just digging a backyard swimming pool.

Friday, September 28, 2012

Customer Relationship Management (CRM)


A Customer Relationship Management (CRM) program is a software product designed to help businesses focuses on the relationships with its customers. CRM software tracks contact with customers, collect sales information, product support data and other issues. All data are analyzed, categorized, and organized into reports to management.

Thursday, September 27, 2012

Business Intelligence


Business Intelligence (BI) can be defined as a strategy that uses information technology to improve business competitiveness. Business Intelligence is often taught in Information System Management program. It focuses on the policies, standards, technology, and processes required allowing a company to get the information needed to support its business strategies and to improve competitive advantage. 

Thursday, September 13, 2012

Global management


With globalization, companies are opening offices all other the world to take advantage of skilled workers and lower costs. However, opening offices in foreign countries is easy, managing it effectively and efficiently are much more difficult. This is a major challenge that all global companies are facing because managing people from different cultures, speaking different languages, having different education skill levels is something few people know how. As companies move from national to global with offices and manufacturing facilities around the world, “manage global people” is becoming the critical skills in very high demand.

Global leaders


Globalization means more business opportunities and more competition than ever before. New markets are available to every company but new competitors are emerging from every corners of the world. The most challenging task today is developing leadership to manage this vast and complex global business because the traditional management training does not work anymore. Companies that invest in developing global leadership will find more opportunities and better execution, while companies that do not face more risks and potential failure. To start doing business globally, companies need strong “Brand name” because when people have more choices, they will buy the “Brand name” rather than “Unknown brand”. By having a strong brand name, company can hire top people because highly skilled people want to work for well-respected companies. Companies that invest in developing strong global brands enjoy better chances of hiring top candidates with global experience. For example, companies like Toyota, Honda, IBM, Microsoft, Google, Intel, Nokia or Samsung will not have much problem in developing a global leadership management. With globalization, the world is the market; companies with strong leaders can change the competitive equation toward their direction because highly skilled global leaders not only know the customs and culture of the region in which companies operate, but they also understand the issues of doing business in those areas.

Friday, September 7, 2012

Cloud Computing Pattern


Diagram:
Depiction of generic security pattern that indicates the relationship and application of the main NIST control families.OSA is licensed according to Creative Commons Share-alike.Please see:http://www.opensecurityarchitecture.org/cms/community/license-terms.

Wednesday, September 5, 2012

CIO - Sharing experience


Dear professor, I always remember that you asked graduates to share their working experience with current students so here is my story:

“The dream of many Information Technology (IT) graduates is to work for software companies like Microsoft, Google, Apple, IBM or Oracle etc. When graduated, I got job offers from Microsoft, Google and a manufacturing company in New Jersey. I chose the manufacturing because it was located not far from Pennsylvania, where my parents live. To work nearby home instead of moving far away to California was a difficult decision for me. Most professors advised me that working for Software Company would be better for my career with better future and higher salary. You were the only professor who told me that nothing is better than staying close to my family to visit my parents often.”

IT as a Service (ITaaS)


What is it all about?
For the last 20 years, Information Technology (IT) has gone through a huge evolution. From enormous machines, which were as big as a small house they are now the size of a Blackberry “toy”. Their power has increased significantly. But the number of problems has grown as well. To overcome this , the need to service both the equipment and the software has to be re-evaluated. A new delivery model is required.   “IT as a Service” (ITaaS) keeps all the advantages of a leading edge computer system and at the same time it avoids all the major problems:

Tuesday, September 4, 2012

Career in Information system Management


If you are studying information system management or soon to graduate in this field, you are making the right decision. Even with the global financial crisis, the future continues to look bright for those in the information technology areas and there are many job opportunities for people who can manage information systems. Many of you may ask what kind of jobs that you can do with a degree in Information Systems Management (ISM), the answer is you can work in any businesses, any fields that have information systems. From government systems, banks, financial companies to manufacturing companies and private companies as they all need to use information systems.

Monday, September 3, 2012

The new management principle

Last week, during class discussion about the impact of globalization, a student asked: “Most people know that with globalization, things can change very fast and if you do not catch up, you will be left behind. How come many companies and management are still operating the same way like nothing happen?

Service Manager


A person wrote to me: “I graduated in Computer Science but got a job as service manager for a small Cloud Computing service company. The company trained me on technical aspects such as network, storage, and security but not much on service. I want to succeed in this job. Do you have any advices?"

Information System Management career

To college students, Information Technology (IT) is a field full of promising. The issue is choosing which area of this vast field to build a career and which program to enroll in. Basically, IT is the common name for several areas including Computer Science (CS), Software Engineering (SWE), Computer Engineering (CE), and Information System Management (ISM). According to the view among college students, Computer Science is focusing mostly on mathematical theories, data structures, algorithms, logic, and programming languages. Software Engineering is more practical and better alignment with the industry than CS as it focuses more on process, methods and tools. Computer Engineering is suitable for students who like to study both hardware and software so they can enter specialization in robotics, automation machinery, electronic devices, and semiconducting area. Information System Management is focusing more on the data, information, storage, network and the management aspect of them.

According to industry report in 2011, roughly 150,000 jobs in IT industry were unfilled in the U.S. This gap may go much higher in the next few years because high demand and less supply. There are high demand for CS and SWE graduates in the IT industry but the largest demand today is in ISM for jobs such as Database Administration, Cloud Computing, Service Management, Network Administration, Web Development, Web management and Search Engine Optimization (SEO). Many companies, both large and small are moving into online business or to use the intranet for disseminate internal information, and they urgently need ISM graduates. Today ISM newly graduates can make from $87,000 to $98,000 a year in the U.S and with experience they can get much more as many will be paid according to management level rather than technical level. An ISM senior manager or Chief Information Officer can make from $250,000 to $450,000 a year.

In the past, most Information System Management (ISM) programs were offered in Business School because of the management aspect. Today this field is offered as a cross between Computer Science School and Business School as it requires students to have strong foundation of technical as well. ISM is a combination of both technical and business where students learn the fundamental of technology to build their knowledge but also learn the business and management so they can manage technology effectively. Most students in ISM must have a technical background but also develop their skills in the area of business and management.

Today, many ISM graduates are managing the intranet and Internet of company where they make decision on information and content, as well as business transaction and how this information is communicated in a company. Today most companies have an intranet as well as access to the internet. These systems are easy to set up but difficult to maintain its efficient as technology often changes quickly. Therefore, every company need to hire ISM people to keep their system updated, operate efficiently and secured. There is high demand for ISM graduates and ISM students can look forward to a bright future in the next ten or twenty years.

Finding jobs may be the easiest thing but choosing among many offers may be more difficult because this area is so vast with so many specialties. Today ISM program is experiencing unprecedented growth with students who selected business and finance areas are now switching to ISM due to the decline in business job market. A student explained: “You study business and hope to get job in the banking industry. Today many banks are using ATM machines and they do not need to hire bank tellers or officers anymore. Most banks are using ERP system, so they do not need accountant and finance anymore. To get into bank management, you need 5 to 10 years of banking experience. If you look for job, you have to compete with thousand of unemployed banking people who were laid-off from the financial crisis few years ago. Most of them have more experiences and skills than you. However, if you switch to ISM and know how to manage the web, the intranet and internet, as well as the database then your chance is completely changed. Bank will beg you to work for them. ISM graduates make more money than Business and Finance graduates because of high demand as more bank are getting into on-line and computing automation now.”

As Information Technology is changing many industries, it also creates a huge opportunity for technically trained students who can solve business problems such as control and manage information systems. Today IT is a major expense to the business and executives want to know whether it is being spent wisely. Consequently, ISM graduates must be able to know what IT services are needed and what the cost is. They must understand how IT impacts the business and the value of IT to help business increase profits. They need to determine which IT services deliver the best value and which deliver little or no value and recommend to executives so they can make IT investment decisions. Since business needs high quality and available IT services, ISM graduates must provide support to the business by selecting the best technology possible. Today business people do not understand IT very well, they do not know whether cloud computing is a technical or business solution, or both. This is where ISM graduates can provide training to keep them up to date on technology area that is why ISM students need to have very strong soft-skills, probably more than CS and SWE graduates.
Prof John Vu    
Carnegie Mellon University
Original source: http://www.segvn.org/forum/mvnforum/viewthread_thread,1419

Saturday, September 1, 2012

New technology

My friend, a manager of a large company told me that he brought a new software product to improve productivity and efficiency but he is having a tough time to make it work in his company.
I told him: “Many people purchase software and assume that “install it and it will work” then find out that they have to do more because buying software is easy, but changing the way people work requires more efforts. I have seen many companies invested a lot of money in software but did not receive the benefits because they do not understand the “change process”.
With any new technology there is a set of steps that need to be in place before it can be of any use. The most important is the people. There must be communications and trainings about the new technology because people must understand the value of the new technology and receive training on how to use it. They need to know how it affects their works and how it benefits them such as getting their works done faster, better, before they will accept it and use it. In my opinion, People are the center of everything therefore communication is essential for the change to take place.
The second step is the process or the way people work. In order to use the new technology a certain process is involved. For example, manager used to rely on accounting people, give them the number and let them calculate the results which may take several hours. With software, manager can click on the icon, enter the number and let the computer displays results immediately. The old process of relying on accounting people to do the calculation is the way people understand well. The process using computer instead of people is new and people may not feel comfortable. It is important to explain to them the benefits (Faster and more accurate) and train them to use the new software. When people understand how things are done today and how things will be done after installing the new software and the benefits they receive then they will change.
The change process requires that we must start with the people, help them to understand the new process by provide training, and finish with the software being used. Without this change process, people will experience confusion and sometime resist the change.
The same thing can be applied to the new education program. Do not expect “Just bring it in and students will enroll”. University must clearly communicate to students about the differences between the new training programs and the old. Professors need to explain the value, benefits and how it will help students to learn new knowledge, skills so they can have better jobs, better careers. More than ever, communication is essential in this change process. Unless students and their family understand it well and accept it as the better programs, new education program may not be successful.
By Prof John Vu
Orignal source :http://johnvublog.com/?p=374

Computer security

Today, computer security is the fastest growing area in software industry. With more hackers, cyber attack, cyber crimes, computer viruses, industrial espionage, identity theft, and fraud, security is becoming more important than ever. As Information Technology (IT) systems grow larger and more complex, they require more sophisticated security systems.
Contradict to many beliefs, security is NOT a product you could buy and add to a system. It should be an integrated part of the system when it is built. Of course, you could fix security deficiencies after the system is built but it would cost you more and nobody could guarantee that all deficiencies are fixed. The security of an IT system depends on the design of the system so it is best to build security in when you design the system. The question is how many students are taught about security in the design course? How many schools have security course in their curriculum? Even in programming course, how many students are taught that coding is the fundamental for security? A lack of security knowledge can create many security deficiencies in code. For example the most common mistake is stack overflow where hackers can take advantage to seize control of the system. Today with more computer users all over the world, how many are taught to follow certain necessary caution? Even when you have strong password, good firewall, install security software but most hackers know how to by-pass them. You can defense your system to some degrees but new threats come in all the time so you must keep up with all current developments. You need to use preventative means for known risks and be ready to deal with new ones. As soon as a new security threat is detected, it needs to be secured immediately. That is what software security updates and patches do. As soon as some vulnerability is reported or detected, a company task force will find a way to repair it. Although these patches are necessary, they could be a security risk themselves too. Patches could point out directly where the weaknesses are and hackers would then exploit them. It always takes a while until everyone has updated the software and many may never do it unless it is too late.
When it comes to design a secured IT system, security must be taken in consideration with the whole software development life cycle. The key concept is that you identify security risks early in the system under development and fix them so you can have high quality security. As developers, you need to see that security requirements are clearly defined for the system during the requirements phase. During requirements review, you must check to see if the system is adequately defined with security in mind. Many customers only know how to require certain functions but do not know about security so it is important for the technical leader to come up with new security requirements for the system. During design phase you must make sure that security is part of the design and during implementation phase, you must follow guidelines for secure coding and perform all the tests accordingly. Because security testing has usually been considered as non-functional tests. As with most non-functional tests, these testing are performed at the last part of development after everything else. The consequence is that many security defects which could be detected and fixed early, go easily through development stages until the last part of development. The risk is at that time, most developers and testers are exhausted and time is running out, so many skip these tests. Many users did not check carefully on security issue when they receive the software product. As long as the software does what they need and run well, then they are happy with it. That is why today, most software is vulnerable for hackers to attack.
With outsourcing, software development is divided to many teams, team members can be split anywhere in the world. If the test data contain private information, proprietary data then manager must make sure that they are not sent unprotected from one place to another. However, many managers and developers are not trained in security and do not know how to distinguish them. The Internet can be easily contaminated so if you use Internet as a part of your test environment, you must make sure that all communication lines are secured; try to keep it as much as possible inside the corporate networks, use VPN, SSL-secured links or encryption depending on the situation.
Today, many people use Laptops. They are used in the secure company network, and then are used outside in some wireless network at an internet coffee shop, airport or home with much less security. The risk of contamination is overwhelming if your computer is not properly protected. A contaminated computer can comes back in the secure network then endangering the whole network. A small program that captures and transmits information without being discovered can sneak in this computer; the whole network can be endangered, since it might take a while to be detected. This causes a security hole in the entire company network.
It is important for all developers to learn about security risks and how to fight them. It is important to follow a security procedures and rigorous testing in all software throughout the development phases. Only by awareness, we can prevent damages caused by hackers.
By Prof John Vu
Orignal source :http://johnvublog.com/?p=376

Information technology Management

Today Information Technology (IT) has become an integral part of the operation of many businesses. The success of the company is tied to its effective use of information technology and its applications. Activities are becoming standard processes with roles, responsibilities and authorities. Workers will have access to information that allows them to make certain decisions based on their responsibility without have to wait for management direction. IT applications are used to automate many operations, from finance, accounting, to tracking, measuring and collecting data for further analysis and report.

With the application of IT, there is a high demand for new types of manager who can optimize the business process by manage and implement new technologies. With the use of cloud computing and Software as a Services, companies would no longer need lower skilled IT workers in data center to maintain and support IT systems since they will be outsourced to cloud computing service providers. However, the company will need higher technology skilled workers to automate their business processes for efficiency and productivity. These automation and standardization will require a well designed architecture to ensure company-wide fully integrated information systems. Without them, there will be chaotic if every unit or function in the company could turn on any application they wanted without any consideration on how their information is integrated with or shared across other areas of the company. That is why a new type of manager is needed to manage these information systems.

Traditional business managers are trained to manage people but the new type of managers is educated to manage technology. These managers must have both business and technical skills. The focus is on the management of critical technical resources and controls them to ensure effective governance of systems and resource utilization. These managers should have knowledge of process design and optimization, understand business processes, and have access to data to support planning and decision-making such as Business Intelligence systems.

In the traditional way of organizing a company, each part of business operates as “independent functions”. Each function can be optimized for its particular roles, to develop product or provide service. For example, a finance function will have its own finance people, its own computer system that focuses on finance. The Finance system has nothing to do with the human resource (HR) function which focuses on hiring and managing company employees. As Human resource function operates independently from other functions, they will have their own HR people and its own computer system that focuses on employee records, payrolls, and other policies. In every company, there are several independent functions and independent computer systems that do not interact with each other. Therefore it would be very difficult to get meaningful information for optimization or data collection. It is very inefficient, expensive and difficult to change.

With globalization, competition is fierce and the new rules are speed and efficiency. The application of IT would help improving the competitiveness of the company by improving speed and efficiency. This means that everything must change and be integrated. The application of comprehensive IT applications such as Enterprise Resource Planning (ERP), Customer Relationship Management (CRM), and Supply Chain Management (SCM) are being applied in many companies to gain those advantages.

However, for companies that organized by traditional independent functional structure, it would be very difficult to adapt to changing business needs. For many years these functions have evolved for a single purpose and its systems are optimized for that single purpose. In the new way of organizing a company structure, businesses are organized as “Integrated standard processes” to provide services to meet the needs of multiple functions of business. The management of processes is separated from the management of business. The design of services requires systems design expertise, the integration of services requires enterprise data management, and the efficient utilization of technology requires technical standards and skills. The agility of the company will depend on an overall design in which business services participate to produce customer value. These responsibilities do not belong to individual functional managers or line of business managers, but require a cross-company perspective. Effective governance also relies on access to information about the operation of the business, derived from the various business operation systems and integrated into consistent views.

Consequently, as manager of technology, the new information system managers are trained to support the effective use of technology to ensure that the solutions are optimized for the company as a whole, not for the particular interests of one unit of business or functional area. As they manage systems integration, they will drive the alignment of business and the supporting information systems according to a vision set by company owners. Basically they should be able to develop and enforce technical standards and policies to support integration and optimization throughout the company. They should manage all data collection to support the analysis, planning and decision-making at all levels. They should manage the company architecture-specification of business capabilities, the information systems that support them and the processes by which they contribute value to the company and its customers. They should control information protection to ensure the confidentiality, integrity and availability of enterprise data and the systems that process and communicate it.

Today enterprise software packages such as ERP, SCM and CRM are being implemented all over the world but the failure rate is also high because many companies are still operate as “independent functional units: and not as “Integrated standard process” across the enterprise. Unless the management who are responsible to make it happens are well trained in managing information system and understand the interaction of multiple systems across the company, these systems will not be effective as they should.

As the job of manager are changing from managing people to managing technology the question is how many people are ready for this change in direction? How many schools are prepared to provide management training in this “Information technology age”?
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Prof. Vu
Carnegie Mellon University
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Original source:  http://www.segvn.org/forum/mvnforum/viewthread_thread,1377

The Business Information System

 Business owners always need information for making decisions. They need to know the market demand of their products so they can set the selling prices; they need to know the cost and revenue to calculate their profits; they need to know the price fluctuation in the market so they can buy raw materials at the best price possible. Without knowing this information, they cannot control their business effectively. Before the use of computer, many have to obtain these information from the newspapers, from radios, from government’s directions, from their own intuition, or even from market rumors. With information system, they can get all information that they need to make decision without have to leave their desks, and these information are much more accurate with more details.

Business Information System can be defined as a system that processes data generated by business and creates information that helps management making decisions, solves problems, reduces risks, and controls the business. Today information system is based on computers and telecommunication technology that access, collect, and process data from all over the world, 24 hours a day and 7 days a week. It would be difficult to find a business that does not depend on information systems. Today, these systems collect market data via the Web, processes business transactions in India or China when managers in the U.S are still in bed. They process, analyze, and develop full reports for managers when they enter their office in the morning.

Before the use of computer and the internet, all information have to be collected via newspapers, radios, and phone calls between offices around the world. Business transactions have to be entered, processed and prepared by several people manually. They have to be analyzed by business specialists then typed into reports by secretaries, using typewriters. These reports are sent to several offices for managers to review before compiled into an executive report to the company owner. Such a manual system will typically takes several weeks or months to generate reports. They were also exposed to errors at several points, and could be modified by managers at certain levels before it reaches the company owner. Information systems using computers, could process all data, doing elaborate analysis, and generates reports in a matter of hours. Therefore, company owner has all the information to make decision quickly.

Information systems process data by special business software written for particular purpose. Such software can command the computer to analyze data in numerous ways and produce different kinds of reports. Different managers get the data analyzed in different ways to suit their roles, responsibility of their jobs. For example, managers at the factory will only see factory data so they can make decision at the factory level. Sales and marketing managers will only see sale data so they can make decision about advertising and marketing to increase product sale. Of course, company owner will see everything if he wishes but mostly he needs important data that allows him to make strategic decision. These types of reports would have been impossible in a manual system.

With the advancement of information technology, many information systems have specific sophisticated functions that analyze data for different purposes. Since data are organized and stored in database for retrieval and update. There specific business intelligence software will search them to analyze for trends in business and generate special reports to senior executives or company owner. These software applies data mining, data analysis and search technology to identify inaccuracy, flaws, or even fraud within the systems. It starts by create certain standards targets then accumulate data along and make it possible to check whether actual performance is meeting these standards and whether targets have been changed or are likely to be modified. It can summarize both internal and external data in graphic formats to alert senior management of certain issues in the company. When needed, it allows senior managers to look for any specifics to further investigations. These software also collect external information such as industry and market data to help managers understand emerging trends.

Development of these information system starts with the analysis of specific requirements. Each company has different needs and different ways to do business so their requirements will vary. Software developers who design these systems must understand their needs and write different programs for each company. As more companies are buying information systems, they need more developers to write specific software. Suddenly the demand for software developers and IT workers exploded all over the world. That is why today the demand for IT workers is much higher and the shortage of IT skilled workers become critical as more companies need these information systems.

To operate such robust information systems requires a new type of managers who are knowledgeable about technology. A good information system manager can provides senior managers and company owner with up-to-date status reports and also point out problem areas. They can organize certain reports based on internal operational or external market. Today several of these information systems have been standardized into an Enterprise Resource Planning (ERP); Customer Relations Management (CRM); and Supply Chain Management (SCM) that help global companies to manage their operations all over the world.
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Prof. Vu
Carnegie Mellon University
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Original source: http://www.segvn.org/forum/mvnforum/viewthread_thread,1382

Perfomance Management

Performance management is about comparing the actual results against desired results and if needed, takes corrective actions. All managers are responsible for managing performance, depending on their roles and responsibilities they may have different perspectives. For example, an executive is concerned with the performance of the company measured by profits and growth. A director is concerned with the performance of a major business function in alignment with the company objectives as it may impact revenue and profit. A project manager is more concerned with the performance of the project to make sure that it meets the quality, cost, and time expectations.

Performance is achieved by develop a plan, execute activities, measure these activities to collect actual performance against the plan and take corrective actions to ensure the execution achieve the desire results. For the executive, achieving profits and growth involves managing performance in several areas such as improving sales, streamline company process, reducing cost, and creating a strategy to deal with competitors. For the CIO and directors, achieving company objectives involves managing performance in areas such as automation, improve skills of employees, standardize organizational processes for consistency, ensure that IT systems are providing value to the business, and make sure that internal communication and collaboration are encouraged to improve efficiency etc.

In theory, most text books defines performance management approach as: Plan the work and set expect desired results; Monitor the actual work performance by metrics; Develop the ability of workers to perform; Ensure that they follow the process; Measure workers performance; Compare actual results and desired results; Reward top performance; Take corrective actions when needed.

However, in specific implementation, performance management requires all levels of management to clearly explain what is to be achieved to workers. They must develop vision, direction, and objectives in a plan that consists of specific goals for each level to be achieved and communicate it to all workers. It is important to set achievable goals that can be measured. A goal that cannot be measured cannot be achieved. For example: “Improve quality of company products” is an unachievable goal. A better goal should be specific such as “Improve quality of company products by reducing numbers of defect by 10% against the average numbers of defect last year.”

Managers have to make detailed steps of what is involved in achieving the level of desired performance and explain to their workers. An executive can do it through memo but middle level or lower level managers should do it in person to make sure that everybody understands what they must do to support the achievement of the goal. For example a broad goal such as “Improve company profits by 10%” may seems irrelevant to most workers. They may think: “I am just a worker and have nothing to do with the profit of the company so that goal has nothing to do with me.” If they do not believe it, nothing will change. That is why it is important to have several discussions where manager can explain to workers about their contribution to the overall goal. For example a director may explain the important of a major product that company is developing and planning to sell at the end of the year. He may say: “If we complete this product on time with quality and be able to sell it during the end of the year, we can achieve the 10% profit goal.” A project manager may say: “Our software is a major function of the company’s key product, if we are successful, we will be able to help our company to achieve the 10% profit improvement”.

It is easy to set goals and communicate to workers but without assigning people to implement it, nothing will be done. This is the common mistake that managers often made. They set good target but rarely pay attention to the implementation or assign workers to implement it. The common term in the industry is “wishful thinking” or “slogan illusion” as it is easy to say something but poorly execute it. I have seen many companies set goals such as “Being the best companies in the industry”, “Being the best software company” but never put anyone in charge or assign workers to do something about it. In that case nothing will change. In that case their managers fail the performance management responsibility.

Every action needs skilled people, tools and budget to execute. An important factor of performance management is about the skills of workers. It is workers that execute the task so managers must select the most skilled workers to perform each task, and develop their competence by additional trainings to help them perform effectively. One of the questions that I often ask company about performance management is their training plan and data on how many people are trained to do the job. Without skilled workers to do the work, nothing can be achieved.

Managers are often busy with their day-to-day routines and it is important that they take the time to develop performance plans and then review actual results against the plans. The main elements of the plan are measurements and metrics. Depending on the levels of management, different metrics may be used. For example at the project level, metrics could be the actual results against the plan on quality, cost and schedule; at director level, metrics could be the actual results of business functions against the plan on productivity, costs, outputs, quality; at the executive level, metrics could be actual results against the plan on profits, revenues, costs and market shares etc. Although measurements are the core of performance management but another important element is the follow-up on actions based on the review and provides rewards for good performance. In working environment, rewards play important part in motivating and sustaining good performance. Top performance companies often have good rewarding system such as stock options, bonus incentives for highly performance workers.

Implementing performance management is not easy. Smaller company typically lacks the skills to do it. Larger companies tend to become bureaucratic with many layers of managers to implement a cohesive approach. That is why even everybody recognizes that performance management is a responsibility of today’s management but few would do it. Most are still focus on managing people instead of managing process or managing performance. That is why so many companies failed in today’s competitive environment.
To be effective, strong leaderships are needed to ensure that these important responsibilities are not ignored. Performance management and process management are major responsibilities of all managers. They must not be allowed to become another routine with no clear results to show. According to several studies, performance management can provide benefits such as increasing revenues and growth; high customer satisfaction; reduce costs; efficient business processes; effective management; higher skilled workers but the most important is the flexibility and faster to change in the fast changing business world.
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Prof. Vu
Carnegie Mellon University
Original source: http://www.segvn.org/forum/mvnforum/viewthread_thread,1448

A lesson of history

We are living in a world that is constantly changing. With globalization and information technology, the rate of change has been accelerated. The ability to respond to change requires new thinking based on new information and the ability to use them to the best advantage. However, technology can change quickly but it takes much longer for people to change and that is why the Information Technology (IT) industry has so many failures with late delivery, poor quality, and high costs. So many times we see great companies fail because they cannot adjust to changes. A senior executive admitted: “We have been successful of what we do, there is no reason to change and that is why we fail.”

Forty years ago, IBM was the largest and most powerful technology company in the world. Its computer systems and software were used in over 70% of companies. Its workforce of 300,000 technical people was considered the elite in the technical world. When two college dropouts created a small computer called “Apple” in their garage, IBM tried to do the same but could not build such a small devices. Why a powerful company with several research centers and thousands of best scientists could not compete with two lesser educated youngsters? The answer was simple, for so many years they were trained to think big (mainframe) and could not change their thinking to something small. It took IBM several years and a lot of failures until they hired a group of recent graduates, placed them in an isolated area, allowed them to think differently and they successfully developed the IBM PC (personal computer). Even with the PC, the largest software company with hundreds of thousand software engineers could not develop an operating system for it. They were used to think of a large operating system with several layers of sophisticated software so IBM could not build something small and simple. IBM executives worried about being late again so they hired an unknown company called “Microsoft” to build the software for them. When IBM announced the PC, it was a great success. The company expanded the production throughout the world. As PC demand grew, more companies were switching to PC. Of course, by having the operating system that controlled everything on the PC, Microsoft could control the market so within few years Microsoft dominated the market and destroyed IBM business. When PC was introduced, IBM was the third largest and most profitable company in the world but within seven years, IBM business lost hundred million dollars each year and had to laid-off hundreds of thousand people. At the same time Microsoft had grown to a most powerful and become much bigger and more profitable than IBM.

Time after time, we see so many cases where efforts to change fail because management cannot change their thinking or willing to accept new idea. An industry analyst concluded: “All the big mistakes were made by executives who cannot change their minds; they continue to operate as though the business is still unchanged. They manage the business as though it was the same business when they were successful. They did not know the need to improve, or re-engineering the business because change is not something you can change a little at a time. Today’s demand is not the same as last year’s demand and tomorrow’s demand will be different.” The thinking that change is an isolate event that can be deal with whenever you like rather than something that can affect the whole company all in once is a fatal mistake. Most managers cannot visualize the complete picture outside of their area. They only see a small piece as their thinking is so limited and that is why new idea, new innovation is inhibited by their current thinking. Such thinking is the major reason why so many efforts to change fail.

When PC dominated the business world, one of the largest and most successful companies was Ashton Tate who builds the database management system called DBase. The company started in 1980 and quickly became the third largest software at that time (Microsoft is number one and Lotus is number two) The Dbase was the most popular software which made over $250 million a year for Ashton Tate. When technology changed with faster processor and new window operating system, Aston Tate management was still enjoy their success and operated the business as nothing has changed. When competitors developed new products using the latest technology, Aston Tate management believed that their customers would never switch to new products. When competitors offered better and easier database products, Ashton Tate management panic and ordered new product called Dbase 4 and announced that they will have a new product by May 1988. Few months later, they changed it to August then December. In a hurry, the new product had so many defects that after the released, Ashton Tate had to recall them to fix. The more they fixed the more defects they found so they could not ship them until 1991. The company lost all of their best customers who were so angry and switch to their competitors. Within a year, the third largest company no longer exists. The cause of this problem was reactive bad management and poorly execute as they announced that they could have new software by 1988 then keep changing the date because of poor quality until 1991 but at that time it was too late.

Both IBM and Aston Tate forgot a key business rule: “If you do not improve, your competitors will. If you do not change, your competitors will.” In this highly competition world, you cannot feel complacent because if you do, you are surely will fail.
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Prof. Vu
Carnegie Mellon University
original source :  http://www.segvn.org/forum/mvnforum/viewthread_thread,1455