06.16.04

Navigating The Outsourcing Map
FASTER TIME TO market, a more linear and predictable cost model than insourcing, and access to a better-trained resource when discreet skill sets are required.

Sound like a dream? Actually, those are three competitive advantages that Keith Morrow, vice president of information systems at convenience retailer 7-Eleven, says outsourcing can deliver.
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Start-up Finalizes Suite of IT Management Apps
Start-up vendor ITM Software Corp. has completed the development of an integrated suite of IT management applications that early users and analysts said is something akin to an ERP system for CIOs.

The ITM Business Suite is a set of five software modules designed to help IT executives manage vendor relationships, project portfolios and the process of aligning internal IT skills with business needs. Last month, the Mountain View, Calif.-based company added an IT governance and regulatory compliance application and formally announced the entire suite.
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HP Aims To Link IT Platforms And Business
Hewlett-Packard will unveil several new offerings at its Software Forum in Montreal on Tuesday designed to broaden its Adaptive Enterprise effort and provide greater linkage between business processes and IT platforms.

"Business and IT should be synchronized to capitalize on ongoing change," says Bill Emmett, chief solutions manager at HP's management software organization. "We want to take more steps towards providing a very comprehensive way of realizing the core value proposition that [process] management provides in dynamically linking business and IT, Management software provides that link--we're taking a business process and understanding its technical enablement for IT and its overall business impact."
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IT and the Channel Do Matter
According to Harvard Business Review's editor-at-large, Nicholas Carr, IT doesn't matter. Since IT is ubiquitous, it has no strategic value or competitive advantage, only high cost and potential downside. Carr's assumption is that scarcity is the essence strategic value. "You only gain an edge over rivals by having or doing something they can't have or do." To use Carr's logic, since every company has channels and salespeople, channels must be strategically insignificant. After all, the idea of channels is as old as Satan using Eve to sell Adam a bite of the apple.

Carr further argues the following points in his article and blossoming book and consulting business:
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Across the digital nation: Outsourcing pool: Local govts. swim, states test the water
Information technology outsourcing is a tough sell in the state and local government marketplace.

Public-sector organizations embrace consulting and systems integration work, often mislabeled as outsourcing, for turnkey projects, but there is usually stiff resistance to transferring management of IT operations to a third-party vendor in a multiyear contract (true outsourcing).
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Putting IT Theory Into Practice
For the past two decades, IT survival has meant management organized and optimized around specific IT resources, such as networks, PCs, databases and Unix servers. But as executives now know, the rules have changed -- someone moved the cheese. CIO survival requires strategies that are less technology-focused and more aligned with initiatives and services that are meaningful to the business.

CIOs are responding. They've created liaisons with business units to determine overall IT strategies and ways IT improvements should be reported to the business. Why then aren't these new strategies put into practice more often? It turns out that creation of a brilliant IT-business alignment strategy is the easy part. The bigger challenge is getting the strategy implemented and accepted within an IT organization that's currently operating with a different set of criteria.
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