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Global means: Having a presence in other countries Standardization International focus: reduction of ties to any one

Global means: Having a presence in other countries Standardization International focus: reduction of ties to any one country and community - Minimization of country-oriented images and values Having acquisitions or alliances in other countries .

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Global means: Having a presence in other countries Standardization International focus: reduction of ties to any one

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  1. Global means: • Having a presence in other countries • Standardization • International focus: reduction of ties to any one • country and community • - Minimization of country-oriented images and values • Having acquisitions or alliances in other countries

  2. Catalysts for Global Software Teams: 1. Specialized Talent Send the work to where the resources are 2. Mergers and acquisitions Enter a foreign market quickly 3. Reduction in cost Reduce labor costs offshore 4. Global presence Participate in global markets 5. Reduction in time-to-market Follow-the-sun development 6. Proximity to the customer Establish an ongoing relationship with key customers

  3. Five forces that make Global IT management very difficult: 1. Geographic dispersion 2. Loss of communication richness 3. Coordination breakdown 4. Loss of “teamness,” the sense of belonging to a team 5. Cultural differences

  4. Dispersion Global Software Teams Problems 30 20 10 10 Probability of communication at least once a week 25 50 100 Separation distance (in meters)

  5. Loss of Communication Richness FACE-TO-FACE SENSUALNESS VIDEO CONFERENCING TELEPHONE EMAIL US MAIL INTERACTIVENESS / IMMEDIACY

  6. Coordination Breakdown: Increasing Complexity with Larger Teams 2 = 1 4 = 6 6 = 15

  7. Coordination Breakdown: Team Size / Number of Relationships NUMBER OF COMBINATIONS = n * (n - 1) / 2 n = size of the project team

  8. Loss of Teamness TO BE A TEAM YOU MUST HAVE: • SHARED GOALS • SHARED CULTURE • SHARED PERSONAL RELATIONSHIPS

  9. Loss of Teamness TEAM BUILDINGTRUST – CLASSIC DEVELOPMENT

  10. Loss of Teamness Comparison of Behavior/Strategies of High and Low Trust Teams

  11. YOUR EXPERIENCE IS THE CLASSIC MODEL OF TRUST CONSISTENT WITH YOUR EXPERIENCE AS A TEAM MEMBER – AT DEPAUL OR ELSEWHERE . . . TOM PETERS (IN SEARCH OF EXCELLENCE) SAID: A CUSTOMER RELATIONSHIP IS STRONGER AFTER A PROBLEM HAS BEEN HANDLED WELL THAN IF NO PROBLEM HAD OCCURRED. IS THIS CONSISTENT WITH YOUR EXPERIENCE?

  12. FACE-TO-FACE MAINTAINS/RENEWS TRUST MILESTONE MEETING / CELEBRATION SHARE THE VISION WHAT’S THE GOAL OF THE PROJECT AND HOW DOES EACH PART OF THE TEAM FIT IN SOCIAL GET TO KNOW ABOUT EACH OTHER MORE / AGAIN. BUILD SHARED EXPERIENCES.

  13. CULTURE: BELIEF/VALUES/COMMUNICATION Reward BELIEFS VALUES COMMUNICATION Social organization Nonverbal communication Emotional response Competition Independence Risk-taking Group harmony Cooperation Age-seniority Information Devotion Interrelationship Family harmony Formality/status Life/Death Nature History Religion

  14. People who speak: 3 languages: trilingual 2 languages: bilingual 1 language: American

  15. In Heaven, The Police are British, The Cooks are French, The Lovers are Italian, and It’s all Organized by the Germans In Hell, The Police are French, The Cooks are British, The Lovers are German, and It’s all Organized by the Italians.

  16. CULTURE AND SUBCULTURES NATIONAL CULTURE PROFESSIONAL CULTURE CORPORATE CULTURE FUNCTIONAL CULTURE RELIGION? TEAM CULTURE RACE? GENDER?

  17. DIMENSIONS OF IT CULTURE – Exercise Rank these countries (USA, Japan, Hong Kong, Germany) and these characteristics from highest to lowest. • Revering hierarchy Example: USA Japan Hong Kong Germany • Individualism/collectivism • Work-life/Personal-life • Risk avoidance • Long term orientation

  18. DIMENSIONS OF IT CULTURE and IT • Revering hierarchy ‒Organization of the IT Department • Individualism/collectivism ‒ IT Reward Systems • Work-life/Personal-life ‒ Online, Oncall, 24x7 • Risk avoidance ‒ Quality v. schedule ‒ Technological change • Long term orientation ‒ Technological change

  19. FACE-TO-FACE BUILDS TRUST KICK-OFF MEETING SHARE THE VISION WHAT’S THE GOAL OF THE PROJECT AND HOW DOES EACH PART OF THE TEAM FIT IN METHODOLOGY WHAT METHODOLOGY [PROCESS/FRAMEWORK] WILL WE USE COMMUNICATION HOW SHOULD THE TEAM COMMUNICATE CULTURE IN WHAT WAYS ARE WE DIFFERENT AND IN WHAT WAYS ARE WE THE SAME SOCIAL GET TO KNOW ABOUT EACH OTHER. BUILD SHARED EXPERIENCES. IF YOU TELL PEOPLE CLEARLY WHAT YOU WANT YOU HAVE A MUCH BETTER CHANCE OF GETTING IT THAN IF YOU DON’T.

  20. OUTSOURCING

  21. Outsourcing • a management tool (a tool makes work easier and/or more productive) • emphasizes what is to be done, rather than how or who • task-level management responsibilities rest with supplier • work takes place mainly/entirely off site • supplier provides all resources • employee relations managed by supplier • typically paid by performance not time

  22. OUTSOURCING DRIVERS • • RE-FOCUS ON “CORPORATE CORE COMPETENCIES” • - SHIFT IN BUSINESS STRATEGIES AWAY FROM DIVERSIFICATION • - SENIOR EXECUTIVES VIEW IT AS A NON-CORE ACTIVITY • • PERCEPTION OF IT AS A COST BURDEN • UNCERTAINTY ABOUT IT’S VALUE • IT FAILED TO DELIVER THE PROMISE OF COMPETITIVE ADVANTAGE

  23. Outsourcing Drivers • Cost savings (especially offshore) • Outside the core business • Functionally discrete • Lack of internal skills • Political compromise

  24. FACTORS FAVORING IT OUTSOURCING • TECHNOLOGY CHANGE EXPANDS OPTIONS - MANY INFORMATION PRODUCTS/SERVICES BECOME COMMODITIES - SEPARATION OF MANAGEMENT, OPERATION, AND DELIVERY OF INFORMATION SERVICES - FIRMS CAN NOT COPE WITH RAPID ADVANCEMENT OF TECHNOLOGY AND SKILL REQUIREMENTS • CHANGES IN THE MANAGEMENT OF IT - DIFFICULTY IN MEASURING BENEFITS FROM AN IT INVESTMENT AND ITS COST CIOs TAKING A BUSINESSVIEW, NOT JUST A TECHNICAL VIEW DECENTRALIZATION OF THE IT ORGANIZATION • INDUSTRY LEVEL CHANGES - RAPID TECHNOLOGICAL CHANGE CREATED OVER CAPACITY IN CERTAIN FUNCTIONS - THE NUMBER OF OUTSOURCING VENDORS INCREASED OFFERING PRICE COMPETITIVE SERVICES - OUTSOURCING VENDORS HAVE FLEXIBILITY IN RECRUITING AND REWARDING TECHNICAL TALENT • FIRM LEVEL CHANGES - CORPORATE IMPERATIVE TO REDUCE COSTS - GLOBALIZATION OF BUSINESS CREATES NEW NEEDS

  25. 3 CATEGORIES OF OUTSOURCING • TOTAL OUTSOURCE ALL IT • SELECTIVE OUTSOURCE SELECTED ACTIVITIES • TRANSITIONAL OUTSOURCE “LEGACY” SYSTEMS WHILE WORKING ON NEW SYSTEMS

  26. TOTAL OUTSOURCING ADVANTAGES -CONSISTENCY AND STABILITY WITH THE SAME VENDOR FOR MANY ACTIVITIES -LOWER TRANSACTION COSTS DISADVANTAGES -VULNERABLE TO VENDOR MANIPULATION OF PRICING AND MAINTENANCE COSTS -VULNERABLE TO LOSS OF VENDOR SUPPORT ---------------------------------------------------------------------------------------------------- SELECTIVE OUTSOURCING ADVANTAGES -SELECT BEST-OF-BREED FOR AN ACTIVITY -CREATE A COMPETITIVE ENVIRONMENT -FLEXIBLE; ADAPT TO CHANGE -CAPITALIZE ON ORGANIZATIONAL LEARNING -LESS RISKY THAN TOTAL OUTSOURCING DISADVANTAGES -MULTIPLE VENDORS TO MANAGE -HIGHER TRANSACTION COSTS ASSOCIATED WITH MULTIPLE EVALUATIONS AND CONTRACT NEGOTIATIONS

  27. TRANSITIONAL OUTSOURCING ADVANTAGES -OUTSOURCE LEGACY SYSTEMS MAKES STAFF FREE TO FOCUS ON NEW SYSTEMS -LEGACY SYSTEMS ARE MATURE AND CUSTOMERS AND VENDORS UNDERSTAND REQUIREMENTS AND CAN WRITE A SOUND CONTRACT DISADVANTAGES -VULNERABLE TO VENDOR MANIPULATION OF PRICING AND MAINTENANCE COSTS -VULNERABLE TO LOSS OF VENDOR SUPPORT IF NEW SYSTEM IS DELAYED

  28. MEASURES OF OUTSOURCING SUCCESS • TARGETED COST SAVINGS REALIZED OF BETTER • SERVICE LEVELS MAINTAINED OR IMPROVED • USER MANAGEMENT SATISFIED • FEW CLIENT/VENDOR DISPUTES • VENDOR REPRESENTATIVES RESPONSIVE/ATTENTIVE • OUTCOMES MATCH OBJECTIVES • LIKELY CONTRACT RENEWAL

  29. Popular Outsourced Activities • Application development • Data center • Desktop/personal computers • Network (e.g., LANs, WANs) • Support services/help desk • Training

  30. OUTSOURCING PITFALLS • Cumbersome transition into and coming out of an outsourcing relationship. • Incomplete or vague contracts. • Lack of an infrastructure for supporting an outsourcing relationship. • Negotiating a contract with an unsuitable vendor. • Poor communications with vendors.

  31. PERSISTENT OUTSOURCING PROBLEMS • Cultural differences that lead to miscommunications and a lack of trust • Time zone differences • Poor English language skills • Strange foreign work-hour regulations • High employee turnover in India • Difficulties in arranging visas for foreign professionals to work in the United States • An offshore unit’s lack of domain knowledge • An unreliable telecommunications infrastructure.

  32. Outsourcing should not occur if: • the service is mission critical • the service can be done more effectively in-house • outsourcing cannot provide a savings of five percent or more • fear exists over losing controls.

  33. THE OUTSOURCING PROCESS

  34. STAGES OF OUTSOURCING

  35. Offshore Outsourcing Readiness vs. Attractiveness Ready but not attractive Ready and attractive High Offshore Readiness Not attractive and not ready Attractive but not ready Low Offshore Attractiveness Low High

  36. Who is Henri Fayol? A French engineer who: Defined the functions of management: • Planning • Organizing • Leading • Controlling And identified 14 principles of management: • Specialization/division of labor • Authority with responsibility • Discipline • Unity of command • Unity of direction • Subordination of special interests • Remuneration • Centralization • Chain / Line of Authority • Order • Equity • Lifetime jobs (for good workers) • Equity • Esprit de corps

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