Creating a Process-Driven Organization at AgCredit Case Study

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Case Summary

The case study in the assignment concerns a company known as AgCredit, a financial institution whose business focus is on agribusiness.  The company finds itself at a fix after making three months efforts with the task of restructuring its information technology systems for the purpose of enhancing their growth and operations.  Steve Stewart who is the company’s COO  moans that the firm’s IT system is in a total mess and anytime he assigns the task to the relevant staffs they do not comply, and they instead give a reason as a way to escape from being accountable.  The lack of process orientation, in the organization, means that even the IT system is disintegrated, hence unable to deliver the promised value.  The current system of this firm is characterized by project delays, bad information, poor human resource management, and customer complaints among other issues.

The Issues Bedeviling the Organization

  • The company is ruled by an application-centric attitude thereby resulting in four separate databases and data untidiness as well as redundancy.
  • All the lines of business are not benefiting from IT due to its disintegration.
  • While the company’s executives are only concentrating on new initiatives and the normal daily routine, the IT competence has experienced delays as the company structure on the other hand not aligned to its vision
  • On one hand the IT staffs do not fully understand the company’s business processes while on the other hand the business also lacks a thorough knowledge of its processes.
  • The lines of business have not fully grasped their role in supporting the corporate vision and objectives. That is evidenced by their departmental goals that are not in alignment with the company’s strategic drivers.
  • There is a lack of compatibility with the company’s systems, and their interactions are very poor despite the achieved backend tinkering.

Organizational Structure for the IT Department

A proposed organizational structure that is aimed at supporting the IT department and enhancing the firm’s transformation into a process-driven organization is far different from what is being used at the moment. The restructuring of the IT to make it centralized will help to support a greater chance of becoming more innovative (Henderson & Venkatraman, 1993). There is also need to ensure that business management is well organized because it plays a crucial role in the analysis and modification of the organizational structure. Regarding the technology related projects, the enterprise needs to mechanize more so as to mechanize a process-centric organization in AgCredit.  For one, they ought to focus on the hardware as well as the software that are in the requirement by the company. The technology in the requirement in the company needs to satisfy it, and its client needs.

The company should also have a council that is responsible for assessing the processes in the company in the view of process centralization. These processes should also have a tight connection to the service oriented architecture. The company also needs to have a framework of assigning tasks to the various staffs and their management. The company also needs to assign the CEO the role of overseeing the operations and the systematic planning, making sure that they support the company goals. The CEO will also have the responsibility of monitoring the operations of the lower level; officers in the firm including the chief information officer (CIO), the chief financial officer (CFO), and the chief marketing officer (CMO).  These low-level officers have various responsibilities vested in them by the company.

The CIO is the head of the IT department and is responsible for directing the IT leaders in the required way towards the achievement of the organizational goals. The CFO is also responsible for managing the financial including the budget-related issues for the projects developed by the company. The CMO, on the other hand, is also responsible for managing the marketing issues between the enterprise’s clients and the consumers. These are the major officers that will work under the CEO in the organization, but other employees will also be in place to manage other minor issues in the enterprise. The company also ought to have a business auditor who will be served with the responsibility of uniting the IT and the business sections. That union between the IT and the business departments is crucial for harnessing the capability of IT in the whole enterprise. The auditor will also forecast the needs of IT and the business in the company.

Project selection process to ensure alignment with the enterprise business vision

The process of selecting a project should begin with the observation of how that project aligns with the overall strategy of the organization.  The innovativeness orientation can meet the business vision if the organization creates a structural plan for the information technology department to upkeep the makeover of the company in question into a process-driven business (Verhees, & Meulenberg, 2004). The company will also need to create a technology roadmap to guide the implementation of new technology, the opportunities, and practices that can make the company more valuable. The next thing after the technology roadmap will be the performance of gap analysis aimed at understanding the current and future state of technology. The project planners, the technical professionals, and the engineers should be conversant with the imminent business endeavors.

Furthermore, there will be a need to conduct a business analysis so as to meet the company’s business needs, the organization of IT as well as estimate the business enterprise schemes. There will also be a need to evaluate how the projects meet the business strategy and vision. The other thing that is crucial for the project selection is the application of portfolio management to help in assessing, rationalizing, and categorizing the projects that can exhibit more significance to the organization.  Project portfolio management is the centralized management of the methods, technologies, and processes that are useful for analyzing and collectively managing proposed projects based on several key characteristics (LaBrosse, 2010). It promotes additional anticipations in changes or upgrades in the portfolio synthesis as well as the probable revenues leveraging other quantifiable factors.

The other thing that is useful in supporting the project selection process is the design of a business case as it is useful in executing the successful deliverables, goals, metrics, procedures, and the reporting structure. For the purpose of maintaining functionality and quality, projects should be outlined, assessed, evaluated, and managed very well before their execution takes place.  Lastly, there is a necessity for a directing committee that will be served with the duty of leading the approval of all the plans including the upkeep of the project costs and processes.

How Manley ought to “make the case” for SOA to make sure that the executive team at AgCredit buys-in?

Manley should analyze the current system with the aim of detecting the flaws and imperfections as well as the working style of the employees. She will also need to watch out and have meetings with the staffs to help them understands how they should meet the goals and how the SOA converts the IT resources of the company to ensure there is the quick achievement of those goals. The SOA architecture makes it possible to make the applications accessible and change the business demands through availing the required facilities and modules (Hojaji & Shirazi, 2012).  Manley needs to mention that the incorporation of the SOA ecological modules, they can achieve a flexible structural design.

SOA implements some modifications like it lessens the duration, reduces the preservation demand as well as minor changes in the system (Jerstad, Dustdar & Thanh, 2005). She will also need to check the software testing results as well as the compliance check and its quality and dependability to ensure that it aligns with the required standards. Manley should also help the executives to understand the way the SOA enhances the return on investment and how it elongates the data of the systems and the legacy claims’ lifespan.  She should make sure that the SOA is thoroughly tested and checked to make sure there are no flaws. She also needs to convince the senior management they are using much effort for developing software and new improvements. Most importantly, the SOA has the capability of diminishing the IT budgets besides increasing the resources (Arsanjani & Allam, 2006). Manley should present all the key strengths of the SOA and ensure that she focuses on the way it will support the organization’s vision and goals.

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

If the company has to explore the business strategies as well as the structural plan, they should carry out a business analysis. Business analysis outlines both the positive and negative aspects of the current system. System analysis is also crucial for enhancing the understanding of the issues and the capabilities needed to support the business functioning. For improvements in the organization, there is tool that is necessary including business intelligence tools, application development tools, tools for data management, enterprise architecture,  project management tools, schematic approach, and quality assurance testing. The IT governance is necessary for the financial practice, the design and implementation of the technology infrastructure plan, performance improvement, and budget reduction. The SOA also incorporates high guidelines and standards that are very useful for managing the business. Also, the organization can improve the communications between the IT and the business sections through frequent cooperation and proper coordination.

The organization should also endeavor to improve the perception of IT and work towards the IT strengths and weaknesses. The company should also employ master data management which is the practice of obtaining, sharing, and improving the master data. It also entails the creation of the business entities through integration techniques throughout the internal systems and to the customers and partners (Berson & Dubov, 2007). It is related to data governance whose aim is to improve the quality of data, to share it broadly and use it for competitive advantage, comply with the standards, and manage change.  The other internal IT capabilities also required in the firm include the ability of data mining and integrating the IT system to support the process-driven architecture.

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

AgCredit should consider the IT risks such as project failures and security if it has to transform its authority, the chains of responsibility, communication, control mechanisms, policy, measurement, and standards.  IT needs to be part of the senior management team where most of the business strategies are started and finalized. There should also be an establishment of the IT portfolio management that enables better decision-making and sets the service-level agreements regarding the SOA’s (De Reyck et al., 2005). The SOA, on the other hand, offers firms with effective IT governance as well as more executive management involvement. The chief information officers will have to be involved in the in the IT governance for the purpose of enhancing success. The other senior level officers should also participate in the committees, the performance reviews, and the approval processes (Smith & McKeen, 2008).

The application of governance to the IT investments in the firm is essential also in the area of service delivery and change projects.  The management and control of projects are also others crucial aspects of IT governance required in AgCredit. That is used to ensure that IT change processes in the organization are compliant with the regulatory requirements. The IT leaders should fully master the processes in the organization, and they should also know that executing governance mechanisms entail process, creativity, and discipline (Schwalbe, 2015).

References

Arsanjani, A., & Allam, A. (2006, September). Service-oriented modeling and architecture for realization of an SOA. In null (p. 521). IEEE.

Berson, A., & Dubov, L. (2007). Master data management and customer data integration for a global enterprise. McGraw-Hill, Inc..

De Reyck, B., Grushka-Cockayne, Y., Lockett, M., Calderini, S. R., Moura, M., & Sloper, A. (2005). The impact of project portfolio management on information technology projects. International Journal of Project Management, 23(7), 524-537.

De Reyck, B., Grushka-Cockayne, Y., Lockett, M., Calderini, S. R., Moura, M., & Sloper, A. (2005). The impact of project portfolio management on information technology projects. International Journal of Project Management, 23(7), 524-537.

Henderson, J. C., & Venkatraman, N. (1993). Strategic alignment: Leveraging information technology for transforming organizations. IBM systems journal, 32(1), 4-16.

Hojaji, F., & Shirazi, M. R. A. (2012). A design science approach to develop a new comprehensive SOA governance framework. International Journal of Managing Information Technology, 4(3), 33.

Jerstad, I., Dustdar, S., & Thanh, D. V. (2005, June). A service oriented architecture framework for collaborative services. In Enabling Technologies: Infrastructure for Collaborative Enterprise, 2005. 14th IEEE International Workshops on (pp. 121-125). IEEE.

LaBrosse, M. (2010). Project‐portfolio management. Employment relations today, 37(2), 75-79.

Schwalbe, K. (2015). Information technology project management. Cengage Learning.

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

Verhees, F. J., & Meulenberg, M. T. (2004). Market orientation, innovativeness, product innovation, and performance in small firms. journal of small business management, 42(2), 134-154.



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