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AgCredit case study

Synopsis

This is a case study that focuses on an agricultural credit and loan company that has its core competency anchored in vast knowledge of its customers. However, the IT structure does not suit the company’s business model as required. The current infrastructure is not pure enterprise architecture and there are rampant issues about the staff. A lot of preparatory work had been done and the situational analysis developed where a new team was chosen to chart a proper course of action to better the IT structure. With all the information gathered by the team, the next task now is to inform and convince the organization’s leadership of the drafted changes so that they can be brought on board for discussion and implementation. To enhance more effectiveness in the IT department, there is need to regularly communicate the company’s goals as well as the future plans that involve the business operations (Smith & McKeen, 2008).

Overview of strategy for case evaluation

The report looks at a “horizontal” slice of several interrelated issues in the enterprise. Mixing all the details provided for the case with the general concerns into a cogent and relevant analysis was the main aim and it involved various methods.

i.                    Setting the context

In this analysis, I role-played various possible structures and looked for those relationships that are effective to allow formulation of and organizational structure. The case has many good starting points to lend and I carried some other ideas forward focusing on the future.

ii.                  Major priorities and initiatives of AGCredit

After establishing a clear strategy an getting an idea of how the structure of the organization would look like, I applied knowledge from the related cases and some best practices mentioned in the class textbook to suggest a likely prioritization process for the organization’s project selection. After further developing the scenarios for SOA’s new model to test, I looked at the likely outcomes as well as the significant advantages. These recommendations were used to answer the discussion question four.

iii.                Looking back

More ideas on governance and capabilities also came from readings, lecturers and even previous case work done. Although the case has very different specifics in a sense that the equipment’s standardization is not common among the cases hence the cases need an improved IT-business partnerships and oversight as well. On the other hand, looking forward for the elements that make the cases similar and different gave a very unique and distinguishing perspective to each case.

Discussion questions

The following are responses to the discussion questions in the textbook;

Propose an organizational structure for the IT department that you feel would support the transformation of AgCredit into a process-centric organization 

Recognition of the company’s business ownership is very important for the organizational structure. It will be instrumental to have the business sign on and also join the conversation the Information Technology and the related projects (Smith & McKeen, 2008). A steering committee needs to be created so that it can be part of the approval process for the company’s projects. This committee is also vital to ensure all the projects take an enterprise view. It is the same multidivisional committee that will also ensure that the projects undertaken fit the SOA framework.

The chief information officer should also be involved in the boardroom and be allowed to access the senior management including the chief executive officer. The CIO should hire the top management individuals that can actually convey the business and departmental objects so that they help guide the IT employees (Boudreau, Serrano, & Larson, 2014). Each LOB’s account manager that belongs to the business but reporting to the top IT management should also be installed. All IT employees need to be reassessed so that the company ensures all the workers do the right roles they deserve.

There is also need to bring the IT functionality in alignment to the enterprise’s vision and mission. One of the options to achieve this is to try and internally promote for the vacant positions in IT and also insource that positions that cannot be filled by the current employees. Insourcing is convenient as it will have a significant benefit of training the IT personnel at the same time getting the job well done.  Outsourcing for IT functions that are not among the core competencies can also be undertaken if the enterprise management desires.

Outline a project selection process for AgCredit to ensure alignment with the enterprise business vision

As discussed in the previous question, a multidimensional steering committee to represent several LOBs needs to be established and also given the capabilities to make decisions (Smith & McKeen, 2008). The process should kick off by establishing the connection between the project’s objectives and the vision of the company. Next step should be for the committee to outline the effects of the project on their division and how it can be used to meet the departmental needs of the enterprise if possible. In addition, it needs to ensure that if fits within the SOA and that it is not duplicates by the current processes or other software application nodes. It the project is just an add-on or an enhancement to another existing project, early communication with the end user should be done so that they can be aware of the enhancement and the benefits. 

The projects should also be checked for modularization as well as standardization for the business process. The process of ensuring the project is standardized is very vital in the establishment of a proper architecture for the enterprise that is aligned with its vision (Yoo, Boland, & Lyytinen, 2006). In addition, all the projects should be made sure that they are considered and funded through a certain percentage of the tax upon the LOBs so that it supports the SOA.

How should Manley “make the case” for SOA to ensure that the executive team at AgCredit buys in?

Manley will have to present the major strengths of SOA and ensure that they focus on how it aligns and supports the vision of the company.

–          Current products and services will be available to customers or modified for usability

–          The transition will also simplify the needs of the organization and speed up the implementation process for the products.

–          It supports all the web services that ensure the company expands its relationship with customers, allow continuous growth opportunities and also has ability to sell across all the divisions.

–          It will also offer numerous opportunities for all the divisions both in terms of stretching the development dollars and possible financial gains.

–          Current services can be acquired and be implemented as fast as possible within the SOA. This ensures that the company increases its capabilities and that it stays caught up with other large companies. In essence, this is a good way to level the playing field by providing valuable systems and resources.

–          After centralizing the customer information which is essential to the SOA, the saving has to be realized from the reducing database.

–          Creating the processes in such a way that they are common will also help align the whole business and ensure the company gets value from the decreased uncertainty and increased communication.

–          Having this kind of technology base may steer up positive changes in the way the employees work for example working from home or any other place through a virtual private network.

What new internal IT capabilities will have to be developed in order to create an IT department to support AgCredit’s future business architecture? 

The new capabilities that are needed to support the SOA from the IT perspective include the, Information delivery options, information management tools, management tools, development cycles, and a customer service attitude toward the divisions. Clear role clarification will be of significant importance in setting up these capabilities. Management tools include visioning and business alignment processes, funding methods, measurement metrics and focus, and monitoring methods. Information management tools include collection activities, organize process including schemes and taxonomy, process modules to use the information, and maintenance procedures that support business functions. Development cycles must conform to SOA standards and guidelines, using compliant hardware and software to make systems that breakdown the functionality, and complaint with regulatory needs, including system proficiency in creating reports for audit purposes. The customer service attitude will be needed to manage perceptions and keep close ties with the business.

What aspects of IT governance do you think would be important in supporting this transformation?

The divisional and enterprise vision and objectives need to be outlined before the formalization of the governance structures. Some guiding principles should be drafted by the IT personnel alongside other enterprise management personnel. The principle drafting may also involve setting up various account managers within the LOBs and also forming a steering committee which is given a considerable power of decision making (De Weerdt, Schupp, Vanderloock, & Baesens, 2013). The multidivisional committee must work very closely with the CIO and other management personnel and have a corporate sponsorship and high level approval. The management team should concentrate on guiding the process of transformation and focusing on key issues such as regulatory compliance and sox. In addition, involvement of the enterprise stakeholders in the steering committee will allow the IT structures and the business become partners an effectively work together. It will also ensure all point of views within the enterprise are heard and considered during the process of decision making. Policy decisions should be outlined early on to support the vision of the organization.

Issues discussed

In the answers discussed above, the thoughts given follows the strategic view and also the organizational chart. In this case, the IT is often seen taking a backseat to some vital business concerns that it should have actually tackled. For instance, the CEO being approached during the weekend to address the IT issues shows total lack of perceived value in IT division. The company also has that reputation of the customer knowledge thus allowing it grab the competitive edge. The CEO is a very strong believer in IT as a potential business support. This belief can be reinforced with the process in which IT is set up to operate and also with its failure to meet the minimum credibility and competency standards. The instinctual desire have all the IT outsources by Manley is a very good indicator of the inability on the side of IT to deliver the required value to the enterprise.

One of the best practices that should be deployed before beginning the restructuring process or even the process of consolidation to a customer service file is to get the business need and develop some kind of technology roadmap (Tyagi & Sawhney, 2010). It is not a requirement to complement the entire process before beginning other initiatives but rather this process will give the enterprise a focus while setting the current expectations. This will be helpful as it will open the communication lines for IT and other business operations as well. Since the technological roadmap focuses largely on how technology will be deployed to support the strategy, vision and objectives of the business, this will therefore help to ensure all the divisions work in harmony towards to unification of the organization.

Once the divisional and organizational objectives and vision are lined out, other processes can begin. To ensure the processes are working properly alongside business operations, various guiding principles have to be established. This may be in form of setting up account managers within the LOBs as discussed and setting up a multidivisional steering committee which is empowered with considerable decision making capabilities. Communicating business needs is necessary to ensure the IT staffing is correctly done. It is also of great importance that the guiding principles align to the enterprise vision and objectives. According to the textbook, the vision of the enterprise would consist of the following;

1.      Continuous growth

2.      Ability to spend more time with the customers

3.      Expansion of customer relationships

4.      Ability to cross-sell products and services

5.      Provision of consistent experience to the organization’s customers

In addition, implementation of a SOA environment has to be considered within the process.

References

Boudreau, M. C., Serrano, C., & Larson, K. (2014). IT-driven identity work: Creating a group identity in a digital environment. Information and Organization, 24(1), 1–24.http://doi.org/10.1016/j.infoandorg.2013.11.001

De Weerdt, J., Schupp, A., Vanderloock, A., & Baesens, B. (2013). Process Mining for the multi-faceted analysis of business processes – A case study in a financial services organization. Computers in Industry, 64(1), 57–67.http://doi.org/10.1016/j.compind.2012.09.010

Smith, H. A., & McKeen, J. D. (2008). Creating a Process-Centric Organization at Fcc: Soa from the Top Down. MIS Quarterly Executive, 7(2), 71–84.

Tyagi, R. K., & Sawhney, M. S. (2010). High-performance product management: The impact of structure, process, competencies, and role definition. Journal of Product Innovation Management, 27(1), 83–96. http://doi.org/10.1111/j.1540-5885.2009.00701.x

Yoo, Y., Boland, R. J., & Lyytinen, K. (2006). From Organization Design to Organization Designing. Organization Science, 17(2), 215–229. http://doi.org/10.1287/orsc.1050.0168