Nortel-Re-inventing I/S What does Nortel want to do? Break down product silo mentality and organization. Why, What are the problems? Customers want one solution, contact point. "Separate business units could operate as one in providing integrated solutions and a single customer interface, without turning the company into one large ineffective monolith." Systems do not support new Nortel organization structure--diverse and customized Processes do not support new Nortel structure either What are the barriers? Culture, inertia, geography, organization, reward system How are they going to do it? 1. Reorganize (Public Carrier Networks, Wireless Networks, Broadband Networks, Enterprise Networks) 2. Have IT lead the way, why? They have corporate presence and technical knowledge The first step is to "Reinvent IT" -Why? Get its own house in order, redefine structure and process to support "new" business Design work delegated to IS with no business ownership of systems What are the barriers? Poor reputation among user community--why? Technology focus, poor at relationships, over budget and not meeting needs Geographic dispersion Divisional organization Incompatible systems with same data class defined differently Many systems 1700, 100 for order management alone No corporate development standards on architecture, languages, of development methods Centralized funding of IS (what are consequences?) Given a corporate allocation, wanted their fare share of IS resources Divisions formed own IS organization with no oversight whatsoever What did IS do? Tried to "Reinvent" Itself I/S Plan-- Redefine core processes of I/S function Ensured participation of critical stakeholders (8 design teams led by director level individual) (full time on team) "Super-team" of team leaders. 60 individuals involved, clients involved, external benchmarking, and industry best practices reviewed. Result was three key processes--Client management, Solution delivery, and Business support (See pp 10-11 (66-67) for more detail. Essentially, user liaisons, systems developers, support. Will the IS Reorganization Work? Why or why not? If yes, support what they are doing that will make it successful If no, what should they do differently to have a better chance of success? Case Background Nortel was changing the way it does business and its I/S organization had to transform itself to accommodate the new direction (in fact lead the new direction). I/S had been distributed (decentralized) to support product divisions creating a major silo mentality and operating environment. 1996--Brad Taylor was the manager responsible for transforming I/S and had to make sure a transformation plan was viable and to implement it. Notel was changing from a supplier of products to a provider of solutions-- integration across product divisions was now required. I/S developed core systems, but when sent out to divisions, they were customized. In 1996, company changed business model creating a "process owner" role (processes--order management, order delivery, global logistics, etc.) 1996--Notel employed 1,700 I/S personnel in 40 locations, 1700 unique systems (100 related to order management). Leaders of I/S teams reported to both CIO and business unit head (matrix org) Each unit had own development environment No corporate standards for systems architecture or languages I/S funding changed from chargeout to divisions to corporate divisional allocation (Changed emphasis from value for cost to get a fair share of the allocation)-- Increased demand, I/S client relations suffered since not all demand could be met Ended up with "client group" financial responsibility (cost and value) CIO to report to both EVP and COO See quote on pg. 7 (63) for view of I/S April 1995--Keith Powell named CIO and VP of Process Engineering (brought respect and good relations with business managers) Charged with process change--line managers to "own" change. How?? Question at case end: Use usual process of forming an implementation team to install the new process in the usual manner or--- Break the organization and put the new process in directly. Issue was that Taylor felt that Nortel was still operating in the old silo mentality and would only pay lip service to the change unless something dramatic were done. Would the radical process work?
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