Heartfelt thoughts and prayers to those touched by the events of September 11, 2001. We salute the heroism of those who continue to work tirelessly in rescue and relief efforts. Let's hope that the world achieves its aim - not just the elimination of Osama ben Laden and his band of fanatics, but the removal of the causes of terrorism. Then at least something worthwhile will have come from the tragedy.

In this newsletter:-

Next "Strategic Use of IT" course

from HBR:-

The Superefficient Company

From Datamation (Earthweb):-

High Availability - Processes are more important than redundancy

From IDG:-

Outsourcing - You'd think we'd know how to do it by now!

You are receiving this newsletter because you are on my "Strategic Use of IT" mailing list. If you want to be removed, just reply "Remove". Feel free to pass this on: if you're received this 2nd hand, then please let me know (robert.barnes@xtra.co.nz) if you'd like to be added to the list.

Regards, Robert Barnes.

Strategic Use of IT.

The next offering of my "Strategic Use of IT" 2-day course will be offered by University of Auckland Business School on October 15-16. Details of this course, including contact details for enrolling, are available on my web site, http://www.robertb.co.nz/strategi.htm. If you have a colleague who may be interested in this course then please pass this email on to them. Full details of the course, including the presentations that were used last time (this is not a course that stands still - the presentations have to be updated every time) are available on the web site.

The Superefficient Company

Harvard Business Review, September 2001, by Michael Hammer. pp 82-91

I found this article, from the September issue of HBR, particularly interesting. It is not technical, so you won't find anything about EDI, XML, ... - it is about the management and business issues, not the technology. I've included it in my Strategic Use of IT course!

Most companies do a great job promoting efficiency within their own walls, streamlining internal processes wherever possible. But they have less success coordinating cross-company business interactions. When data pass between companies, inconsistencies, errors, and misunderstandings routinely arise, leading to wasted work--for instance, the same sales, order entry, and customer data may be entered repeatedly into different systems. Typically, scores of employees at each company manage these cumbersome interactions. The costs of such inefficiencies are very real and very large. In this article, Michael Hammer outlines the activities and goals used in streamlining cross-company processes. He breaks down the approach into four stages: scoping--identifying the business process for redesign and selecting a partner; organizing--establishing a joint committee to oversee the redesign and convening a design team to implement it; redesigning--taking apart and reassembling the process, with performance goals in mind; and implementing--rolling out the new process and communicating it across the collaborating companies. The author describes how several companies have streamlined their supply-chain and product development processes. Plastics compounder Geon integrated its forecasting and fulfilment processes with those of its main supplier after watching inventories, working capital, and shipping times creep up. General Mills coordinated the delivery of its yoghurt with Land O'Lakes; butter and yoghurt travel cost effectively in the same trucks to the same stores. Hammer says this new kind of collaboration promises to change the traditional vocabulary of corporate relationships. What if you and I sell different products to the same customer? We're not competitors, but what are we? In the past, we didn't care. Now, we should, the author says.

High Availability - Processes are more important than redundancy.

(This article was written August 23rd. We've since seen a magnificent demonstration of the exchanges' Disaster Recovery plans).

Recent high-profile outages illustrate that highly available IT systems cannot be created through redundancy alone. People and processes are the key.

A recent outage at one of the major stock exchanges shows that simply having two of everything cannot eliminate all downtime. Failover may occur, but if the failover node is also running corrupted software, it too will fail. Although it is universally accepted as more reliable and available than distributed platforms, the mainframe is not inherently more reliable. It simply has more defined processes, procedures, roles, and responsibilities (e.g., scheduling groups, change management groups, or security groups) than the distributed platform. Centralized infrastructure support models are a first step that every IT organization must consider when developing an HA strategy.

Here is a 5-part strategy to ensure your system stays on course.
http://itmanagement.earthweb.com/netsys/article/0,,11961_871911,00.html

Outsourcing - You'd think we'd know how to do it by now!

"Classic Outsourcing Blunders," Darwin Magazine, by Lauren Gibbons Paul, August 2001.http://www.darwinmag.com/read/080101/blunders.html

You would think that since outsourcing has been around for 25 years, it would be a piece of cake for IT organizations to get it right, but it's not. With every new technology and new outsourcing attempt, comes the painful lessons of how hard it is to negotiate, maintain and manage a technology once it is no longer in-house, according to this feature article by freelance writer Lauren Gibbons Paul.

The most common scenario for failure, according to Paul, is the classic outsourcing underprice disaster. It plays out like this: a hot technology hits, outsourcers underprice their offerings to compete without realizing the true cost of the service they are providing and either go out of business or are forced to cut back on service. In this same scenario, customers assume they are working with "experts" in the new technology and do not protect their interests or watch over the arrangement.

This scenario, often ending in a shakeout of firms offering the specific outsourcing service, is now playing out in the latest outsourcing trend, ASPs. According to experts quoted in this story, the ASP consolidation is well under way and customers are learning how to shop for the best ASP services, but mistakes are still happening.The good news is that while the outsourcing learning cycle repeats itself with each new technology, there are some lessons that can be learned.

Paul offers several examples of past failures and lessons that can and should be learned. Here are some of the highlights:

* Don't sign long term contracts. No one really knows how technology or business needs will change in the next five or ten years so don't commit to a specific plan for more than one or two years. Long term contracts can also lead to less attentive outsourcing partners. If they know they have you for the next 5-10 years, why worry?

* Make sure both sides understand their responsibilities. This is key in avoiding the finger pointing that can often cripple an outsourcing agreement.

* Spell out performance requirements. Define acceptable levels of performance and make sure the outsourcer can meet your needs now and grow with you as well.

* Learn to let go. Don't expect the outsourcer to do things exactly the way your internal IT would do them. Outsourcing firms have their own way of
leveraging their resources and too much interference may keep them from doing the best job possible.

* Look for a proven track record. There will always be a new player trying to get your business for less money but that may be a dangerous
bet. Research the outsourcing firm thoroughly and make sure they have the experience to handle your business.

Taming the Web
"Information wants to be free." "The Internet can't be controlled." We've heard it so often that we sometimes take for granted that it's true. But THE INTERNET CAN BE CONTROLLED, and those who argue otherwise are hastening the day when it will be controlled too much, by the wrong people, and for the wrong reasons. http://www.technologyreview.com/magazine/sep01/mann.asp?nt=9mannh

Please note that my email is now Robert.barnes@xtra.co.nz

You can find past newsletters, various presentations, and other information on my web site,
www.robertb.co.nz.