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July 1-15, 1999 My CT Almanac Column |
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CORPORATE USAGE Reeling Under Infotech Force As more and more IS managers grapple with E-commerce applications and other Web development trends, they are confronting a new paradigm of deploying IT for conducting business on a global scale, round-the-clock. T.A. Balasubramanian
Bewrae! Alien forces are arriving in packages! Chances ar that in-house application programming, traditionally managed by internal IS departments in organisations, may be nearing extinction, as the growing supply of packaged software, particularly products like ERP packages, have been proliferating. Barely two years ago, only large, diversified companies (Rs 100 crores and above) could budget for ERP, but now it has become affordable enough for even the Rs 10 crore companies with less number of branches, increasing the spread of such packages phenomenally. Faced with such new packages, CEOs everywhere are being forced to re-evaluate the role of in-house application programmers. Many in-house corporate software projects are being weighed against external off-the-shelf ERP solutions like SAP and BaaN. These packages are all-encompassing bundles of software applications that automate business processes. IS managers have always considered such complex, fine-tuned development projects to be the exclusive domain of their own in-house programmers with the contention that home-grown fits better. Yet, the latest generation of increasingly inexpensive ERP packages are turning out to be more intelligent. This is mainly because they bundle the knowledge of hundreds of software programmers who add new functions and capabilities to the program every few months, and make it available to all their customers. Outsourcing Punch Dark forces are taking over the IT world! If ERP packages are arriving, outsourcing, which is the complete handing over of the IS function to an outside party on a contractual basis, cannot be far behind. The given wisdom in business thinking was that core functions should never be outsourced or plugged into a ready-to-run information systems package. The fear was that when a corporation exposes itself to outsiders this way, it may have lost it's unique identity and what gives it a distinctive edge over competitors. Yet, today, core functions like inventory control, materials management and supply chain management-the lifeblood of large corporations-are being captured totally in pre-fabricated ERP packages by vendors like SAP or BaaN. Although the trend is yet to catch on in India, it is a roaring fact that today's market leaders are increasingly using IT outsourcing as a way to build and sustain competitive advantage. Migration Menace Programmers are escaping the gravity field of corporations! It may be right to say of the IS function that "programmer migration" causes "manager migraine". Hence, the challenge of software development projects is to obtain and retain skilled people. Increasingly, the best and brightest programming talent, especially from the IITs, is migrating out of India, what with the lure of bright careers, better lifestyles and bigger pay. It is imperative for organisations to create a culture of taking in the brightest and giving them the latest in terms of technical and financial environment. That kind of knowledge must be perfected with creative tension, a goal to strive for, and attractive rewards for reaching it. Race for Knowledge Jedi warriors need new fighting technology! The traditional role of the programmer has been under siege. IS teams do not build the application anymore. Their new job is to tune it, or integrate it with other applications. The way a package is configured determines how a particular function will be performed. So IS professionals need to understand the business function or flow that is being automated. Their skills will be applied to implement or maintain packaged solutions, but they need a new infusion of knowledge to get there. They need to learn to transfer skills and expertise from outsiders for use in their own teams. Getting Net Wisdom Yoda, the wise old creature in Star Wars, probably became wise using the Internet! As more and more IS managers start to grapple with emerging E-commerce applications and other Web development trends, they are confronting an entirely new paradigm of deploying IT for conducting business on a global scale, round-the-clock. The task they face is really a mammoth one getting senior management to understand that the model of the business in the age of the Internet is radically different from the good old one. Prevailing business concepts like supply chains, customer service, or internal purchasing are changing in a complex manner on virtually every few months. Justifications for E-commerce applications, are based on their own merits. First, it involves aligning IT with the strategic direction of the company. If the chief decision makers realise the Internet changing their industry, and zero in on it as a strategic weapon to pull buyers and suppliers closer, then upgrade needs to be done and the applications developed. The second justification is on a per application basis for moving the company towards latest Internet technologies. For example, in manufacturing, typical value propositions for working with potential buyers include: better forecasting of needs, cross-selling products, putting "engineers" in the customer's premises, and greater and faster access to the vast information database. Each parameter must be weighed to see if it can be put into a Web-enabled form. So, whether it is fencing with package invasions, grappling with outsourcing, reigning in escaping programmers or honing skills for Internet battles, IS managers have to become a new breed of Jedi warriors to win their own corporate Star Wars. May the Force be with you! The writer is former senior manager (systems), Hindustan Petroleum Corp. Ltd, Mumbai |
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Even as the long-awaited prequel to
Star Wars, The Phantom Menace, is making waves in cinema, IS managers in India may be
involved in some galactic high technology battles of their own. Their immediate energies
may be directed to Y2K bug elimination or containment issues,yet most managers are
discovering that their traditional IS function is under assault everywhere. Rapidly
changing technologies and trends are making IT management increasingly susceptible to the
impact of external forces. The most significant of these forces, in my view, are: packaged
software, outsourcing intrusion, programmer migration, knowledge insufficiency, and
Internet-wisdom. 
Hit By Packages
