How does a company grow into an Information Resource Management (IRM) environment? Does it happen overnight? Hardly. It evolves slowly over time as companies become aware of the role of information in their organization. For most companies, it is a costly and painful learning process. The following is a description of the four stages of maturity that companies typically follow: Birth, Childhood, Adolescence and Adulthood.
The day a company goes into business is the day when its information systems are born. When a new company or organization is established, there are some very primal information requirements to accommodate the operation of the enterprise. For example, basic bookkeeping (billing, payroll, government reporting, etc), minutes of meetings, recording of policy decisions, correspondence, etc.
To implement these basic administrative requirements, simple office equipment is all that is required, such as typewriters, dictation equipment, calculators, photocopiers, telephones, etc. An Office Manager with a clerical staff (e.g., secretaries, book-keepers) normally implements these processes and operates the equipment. During this stage, their concern is for implementing basic manual procedures with an eye for work simplification to minimize overhead.
As the business expands and becomes more complicated, whether from an increase in employees and/or business, there is a growing demand for more information which leads to the next stage of growth...
This stage is entered either by an emerging company or an established firm that is pressured to investigate the potential of new technology, namely the computer, to give leverage to their business needs. This is a stage which most of the "FORTUNE 500" companies and major government institutions went through in the 1950's, 60's and 70's.
In the childhood stage, the intent is to investigate the potential of the computer. This is an age of experimentation where a highly complicated and technical device is introduced to a company. This new technology, of course, requires a technically oriented individual to operate it. Someone who is more in tune with the equipment, as opposed to the problems and objectives of the enterprise.
The computer is typically centralized in one location until someone can determine an appropriate way to apply it to the business.
This stage results in the executive's "black box" image of the computer. As a consequence, they divorce themselves from the machine, and appoint a "Data Processing Manager" who is given free reign over the new technology. Like the staff that supports him, the D.P. Manager is technically inclined (probably just one step ahead of a programmer).
The "Data Processing Department" tackles simple problems aimed at automating some of the basic administrative routines of the company. There is not considerable pressure to satisfy business problems, only a "see what you can do" type of attitude. As a result, the D.P. staff takes an ad hoc, "quick and dirty" programming approach to problem solving. This type of philosophy sows the seeds for problems to come in the years ahead. For example, applications are not integrated, data is not shared (data redundancy is commonplace) and documentation is non-existent, applications are not easy to maintain or modify. As a result, they are constantly being discarded and rewritten, further compounding the problem.
One of the most significant aspects of this stage is that it fosters the "tool oriented approach" for solving problems. The attitude of the staff is that the only legitimate problems worth solving are those that can be addressed by the computer. All others are immaterial. This is a frame of mind that will take considerable time to overcome. The indifferent attitude of the D.P. Department irritates and alienates end users who have increasing demands for information.
Impatient for results, management begins to apply pressure on the D.P. Manager for more applications to satisfy user demands. This forces the next stage ...
This is the age of awakening for most companies, an era when the D.P. Department begins to manage itself in order to accommodate growing business demands. The D.P. Manager is supplanted by an "MIS Director," someone who is a little more adept at management politics. In fact, the "MIS" (Management Information Systems) designation is indicative of the company's growing awareness of the need for information.
In this stage, the MIS Director implements rudimentary management controls, particularly in the areas of project management and documentation. Using the "tool oriented approach" to improve staff productivity, the MIS Director implements several software tools and techniques, such as: Data Base Management Systems (DBMS), Data Dictionaries, Program Generators, Report Writers, Fourth Generation Languages (4GL), Test Data Generators, Computer Aided Software Engineering (CASE) workstations, Structured Programming, Object Oriented Programming, etc.
Dazzled by sophisticated software and in fear of "falling behind" in the technology race, the MIS Director authorizes the purchase of tools that implement esoteric (some prefer to call it "Voodoo") management principles.
Unfortunately, the MIS Director is seduced and abandoned by the technology; the results are still the same: Applications do not satisfy user needs, applications are not integrated, data redundancy is still pervasive, applications are still difficult to modify and maintain, and the staff remains a free-spirited group of technicians.
The "tool oriented approach" is very costly to the company, but the results are still the same. The MIS Director is still supported by a technical staff that believes that the "real work" is in the production of software, where their programming skills excel. The "Analyst/Programmer" is really nothing more than a senior programmer.
Superficial standards and pseudo-scientific management techniques are applied to the development process. An application project typically consists of the classical approach for developing systems: A primitive Feasibility Study, General Design (sometimes referred to as "External Design"), Detail Design ("Internal Design"), Programming (usually following a Structured Programming guru's technique), Testing, Installation, and Review. In this situation, programming remains 85% of the entire project. This approach is usually well packaged in voluminous standards manuals (which no one but the DP Auditors read).
The computer is decentralized with terminals, minis and PC's being distributed throughout the company.
The end User, who is frustrated by the lack of support from the MIS Department, turns to the Personal Computer (PC) for help. Unfortunately, the User is no more adept at using the computer as the MIS people are in using the mainframe and the problems are compounded even further (particularly in the area of redundant data).
Despite the substantial investment in computer hardware and software thus far, management finally recognizes that conditions are intolerable and that the company is not getting a satisfactory return on investment. This becomes the catalyst for change. Without it, the company stagnates and the situation worsens. Adolescence must eventually give way to ...
This stage represents a radical departure from the past mode of operation. Very few companies, if any, have reached this stage of growth yet. It represents a mature environment where the information systems staff is in tune with the mission of the company, and information is viewed as a corporate asset used for strategic purposes. This is the age of Information Resource Management (IRM). This philosophy gives rise to the Chief Information Officer (CIO), a legal officer of the company, not just a job title.
No longer is the "tool oriented approach" pervasive in the company. It was tried, and it failed. The latest "state of the art" technology is a worthless status symbol if it doesn't contribute to the profitability of the company.
Now, the CIO turns to tried and proven approaches to management. Information Systems design is no longer viewed as an art, but a science. The CIO organizes the systems development environment into an Engineering/Manufacturing company, complete with Assembly Lines, Production Control and Materials Management. As a result, the systems staff is transformed from free spirited programming "hackers" to a group of disciplined and quality conscious business professionals. In some respects, the staff will resemble the "Methods & Procedures" staff of yesteryear who had a business orientation.
The computer is viewed as just another piece of office equipment; they are not discernible. Users and management no longer fear technology because the CIO implements it effectively into the business. In the adult stage, the emphasis is on complete and integrated information systems, not just software. Programming is less than 15% of the entire development process, with the bulk of the work being expended on business analysis. Data is managed as a resource and redundancy is eliminated. All of the problems experienced earlier disappear.
As enticing as adulthood may sound, very few companies have the management skill or fortitude to make it happen, particularly in the United States. Most companies don't even understand the problem. Adulthood represents a substantial and long-term corporate commitment, not just departmental commitment, which most American companies strongly resist. Instead, they are content with short-term "quick and dirty" solutions. On the other hand, Japanese companies, who are more far-sighted, have a greater chance for success and are rapidly moving into the adulthood stage. This will make them increasingly more competitive in the years ahead.
Over the last ten years alone, computer technology has changed radically, job titles and terminology have changed, and salaries have risen sharply, but little else has changed. The information problems of today are no different than 10, 20 or 30 years ago. Despite today's technology, companies still experience:
The tools and characters have changed, but the tune remains the same. Regardless of the titles and technology used, most companies in North America are stuck in either the "Childhood" or "Adolescent" stages of growth. Indicative of this are the journals, trade groups, universities, and trade shows that still promote the "tool oriented approach" as opposed to promoting management. Systems Development is still viewed by many people as an art, not a science. Whereas, it is a science in reality. It has established and proven concepts and can be taught as a science.
"Age of IRM"
|APPLICATIONS||Basic book-keeping and clerical tasks.||Programs to automate basic administrative tasks.||Major systems, but lack integration.||Information is viewed as an asset and used as a strategic weapon.|
Business and systems plans are integrated.
|EQUIPMENT||Basic office equipment.||Centralized computer.||Decentralized computing.||Computers blend in with office equipment.|
|INFORMATION ENVIRONMENT||Concern for basic administrative processing.||Work simplification.|
'Quick & dirty programming.
Begin tool oriented approach for problem solving.
|Applying rudimentary management tools & techniques.|
Programming still represents 85% of the work.
|Strong management approach.|
Science vs. Art.
Disciplined, organized, and quality conscious.
Share & re-use resources.
|PERSONNEL||Office manager and clerical staff.||DP Manager reporting to administrative or financial area.|
Technically oriented staff.
|MIS Director with Programmer / Analysts.||CIO reporting to CEO. Business / engineering oriented staff.|