Teropitka Business and Finance

Posts Tagged ‘management’

According to the Project Management Institute, companies in North America spend more than $ 1 trillion in the implementation of IT projects and spending almost $ 300 billion for the delay, over budget, or implementations that fail in the years 1999-2001 (based on the riser of the Project Management Institute. focus, direction and control mechanisms rather than a major advantage of many companies. the picture is actually worrying because the projects are being / about to place a company should represent the engine of growth, modernization and transformation. project and other initiatives usually take share of 25% of the total IT budget (the remaining assets are allocated in the form of existing applications, infrastructure, people, processes, and others).

With changing times, the IT budget also continues to take an increasingly large portion of the overall company budget. Critical function of IT to business operations and cost / large losses in the event of downtime would have an impact down to the most basic level. Customer demands will increase over time, and the company will continue to develop their operations. Very understandable if their company focusing on the demand side efficiency and provide quality, integrity, service can not be doubted, and continuous innovation. As a result, many IT companies transform fixed costs into variable costs through mechanisms such as IT outsourcing. This allows companies to focus on their core values​​. description of the background of the company and the business scope of firms that were subjected to experiments.

Many companies maintain a set of IT projects  supported by the budget can not afford them. Ironically many IT managers do not realize:

• The type of ideas and concepts that are being done in research and development
• How many IT projects that are in the development phase and their alignment with the future strategic
• Number resources, or risks associated with each IT investment
• The reason why IT investments initiated or criteria for approving an IT investment
In addition, information concerning the size and scale of operations and maintenance budget (in percentage of IT spending), and how the allocation of these funds are placed in the legacy systems vs. new system, there is usually no. Hiding the cost of IT into the project-, the political dynamics that can sometimes exceed the company’s strategic objectives, and implementation and execution of a bad system is very easy to find and common. In addition, other harmful things that are normally companies do not have the discipline to continuously measure performance. To further complicate matters, usually accountable to the initial assumptions of IT investments can not be traced. This happens because the roles, responsibilities and ownership are not clearly defined. Here we can find a world of configuration management, change management, transition management, and governance processes at the lowest level of maturity. There is almost no possibility to be able to manage IT resources effectively and efficiently, identify who is responsible, and relevant metrics.

In the early era of the 2000s we have witnessed the surge of IT spending on a large scale. That is because the number of ERP implementation on a large scale, the Y2K issue, and the emergence of dot com companies at that time. For now we can say that that era is over. At the present time companies face new obstacles in the form:

• The uncertainty increases.
• The presence of competitors with offers of lucrative.
• Spending more stringent.
• New technology.
• Changing customer demands and heightened level of personalization of the product.
• Pricing, service variety.
• Government regulations, laws and safety standards.
• Production costs are increasing.

While many of the challenges above are from an external company, internally companies face:

• How to define and communicate a clear business strategy.
• Complexity / complexity experienced when presenting the changes and new innovations.
• Identify and manage investments in a number of divisions and business units,
• Selection of the focus on the product or service
• Partners in the value chain.
• Relationships with vendors / providers.
• Reduced costs.
• Improved response.
• Increased efficiency.

Although changes in the IT field will always increase the speed of work and impact, many companies continue to reduce or maintain their IT spending levels on the threshold of what they have today. The CIO and management in the IT field is now required to declare the business value of IT. Capabilities that are important in supporting the business value of IT, among others:

• Determination of priorities and alignment with corporate vision.
• Investments that equilibrium between business units.
• The cost of matching and risk control mechanisms
• The process of making rational decisions
• Flexibility in reviewing and balancing priorities in a highly dynamic environment
• The desire to meet the standards and requirements set by the rules / regulations.

To achieve growth and achieve business value in a very challenging business climate currently causing many companies to focus them on their core capabilities. Focusing on core excellence means developing a closer alignment between the business with IT, where IT will represent a percentage of the budget of the company and will quickly develop into a valuable strategic asset for the company. There is research suggesting that the percentage of IT budgets ranged from 1.5% to 7% of total revenue, and IT spending could be as much as 70% of the total expenditures made many companies.

FOCUS ON INVESTMENT
IT can have a significant impact on the quality and performance of services and solutions from the company. IT investments are managed efficiently and effectively and able to meet the demands of mission and business which can create value-generating sources of new revenue, establish a significant competitive advantage, improve productivity and performance, and reduce costs. In the same IT investments could adversely company where he was dragged into the abyss.

IT portfolio management is a tool that can help the company during the period of rapid development and the current economic climate is not friendly. Portfolio management discipline to support improvements and refers to the consistency, repeatability, and accountability. But the main challenge for the company during the period of its development or kelesuannya is how to align with corporate strategic objectives and creating a framework for measuring, balancing, prioritizing, selecting, and flexibly to change the composition of IT investments and IT assets. Many companies have ‘bleeding’ in its IT spending due to:

• There are projects that
• Doubts to stop the project and / or retire assets
• Too many active projects
• How a skeptical view toward new technology
• Lack of a detailed catalog, the absence of an organized perspective and to see critical assets vs. immaterial assets
• Too underestimating TCO
• Inadequate Governance
• Process management programs that are ad hoc
This situation is reflected in the results of a survey that underscores the shortcomings of most companies in reaching the optimal value within an acceptable risk for their IT investments:

• 84% of companies do not run the business cases for their IT projects or just doing it on some project options.
• 83% of companies are not able to adjust and harmonize their budgets with business needs more than once a year.
• 67% of IT organiasi not ready for market. Benchmarking is rarely done, less than once a year.
• 89% of companies flying in darkness, without any exception in the area of ​​financial metrics
• 57% feel their companies are balancing the pressure between the reduction of costs and effectiveness of IT

The supply network management (in English , Supply chain management, SCM) is the planning process, implemented and operational control of the supply network in order to meet the needs of customers as efficiently as possible . The management of the supply chain through all the movement and storage of raw materials , the corresponding inventory resulting from the process and finished goods from point of origin to point of consumption. The proper administration of the supply chain must consider all possible events and factors that may cause an interruption.
Some experts distinguish between management of the supply network management and logistics , while others consider them interchangeable terms. From the point of view of a company, the scope of the former is limited in terms of resources, by the providers from your provider, and the client side, by the contractors.
The management of the supply chain must address the following issues:

• Setting up a distribution network: number and location of suppliers, production facilities, distribution centers, warehouses and customers.
• Distribution strategy: centralized to decentralized, direct shipment, cross dock, pull or push strategies, third party logistics.
• Information: integrating systems and processes across the supply chain to share valuable information, including demand signals, forecasts, inventory and transportation.
• Inventory Management: Quantity and location of inventory including raw materials, goods in process and finished goods.

Problems of administration and the inaccuracy of the supply chain

According to a survey conducted by Andersen ( 1996 ) [ citation needed ], in a typical afternoon in a supermarket in the United States , 8.2% of the articles are sold out and this number nearly doubles for items that are advertised. The cost of stockouts in supermarkets in the United States is estimated between 7 and 12 billion U.S. dollars of sales [ citation needed ]. In the same study, it was estimated that 33% of items not for sale are located in the store, but not in the correct location. Before being stored on shelves, the articles go through several processes that are the supply system, the process of preparing the order, and shipping and receiving process. Once received in the warehouse, all products are initially stored in the backroom. Then the shelf is replenished from time to time during the selling season, as the shelf space at retail sales is limited. During these processes, execution errors that may occur would reduce the availability of products on the shelves.
We can distinguish two causes of the limited availability of the product:

• A portion of products ordered is not received by the warehouse
• All products ordered are received but a portion is not available on the shelf due to internal problems of organization of the store. In the second case, the store may appear to lack a product, when in fact the product is available in the back of the store, or placed in the wrong shelf.