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Investments in New Architecture on razor-thin margins IBI Summit, Nashville, TN

Investments in New Architecture on razor-thin margins IBI Summit, Nashville, TN. June 4, 2008. Agenda. Agenda. Who is Tesch Consulting? Brief rewind… How did we get here? Side-effects of the journey… What have we learned? Change Strategy Adoption approaches Costs of approaches

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Investments in New Architecture on razor-thin margins IBI Summit, Nashville, TN

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  1. Investments in New Architecture on razor-thin margins IBI Summit, Nashville, TN June 4, 2008

  2. Agenda Agenda • Who is Tesch Consulting? • Brief rewind… How did we get here? • Side-effects of the journey… • What have we learned? • Change Strategy • Adoption approaches • Costs of approaches • Risks / Cautions • Q & A

  3. Who is Tesch Consulting? Who is Tesch Consulting? • Will Tesch • Over 20 years of Business Management experience • Former CIO • Owner and President of Tesch Consulting • Successful track record • Today we’re delivering services to some of the largest organizations in the US • The Team • Seasoned enterprise integration expertise • Proven experience matching technology solutions to business needs • Significant Project Management experience • Strong technical acumen • Across all technologies • “Lived in our solutions”

  4. Tesch Consulting Practice Focus • Thought Leadership • Enterprise Innovation • Domain Experience (Retail, Supply Chain, Oil, Healthcare, Document Management, Manufacturing) • Learning and Education • Executive Coaching • Project Quality Assurance • IT Department Assessments • Strategic Organizational Counseling • Business Intelligence • Retail Solution Framework • Data Warehouse Design • Enterprise Reporting Evaluations • Enterprise Integration • iWay integration expertise • Infrastructure Expertise • Mentoring Services

  5. Who is Tesch Consulting? Tesch Consulting – National Presence

  6. Who is Tesch Consulting? Companies we’ve worked with… • Impact21 Group • ExxonMobil • US Coast Guard • Eby Brown • Pamida Stores • Red Prairie • Manhattan Associates • Infor • Kehe Food Distribution • Hayes-Lemmerz • Information Builders (IBI) • Large Health Care Provider

  7. Business is… Momentary rewind… • ‘What business is’ – Sales, Acctg, Ops … hasn’t changed. • ‘How business is’ has changed significantly. • ‘How business has learned to be’ is fundamentally important as it will be a crucial input into what is ‘needed for the business to continue to operate.’

  8. Convergence Convergence of innovations • 40 years of technological advances • Continued personalization • Markets are defined by effective uses of innovations • Enterprise systems have grown organically

  9. Convergence Convergence of Innovations • Technology disparity escalates complexity • Myriad of environments • Multitude of languages • Near-term Asset Obsolescence • Evolution of the Technologist • Competing topologies / infrastructure • Governance continues to rise in importance • Marketplace competition drives company initiatives

  10. Side-effects Today’s Landscape • Skilled and knowledgeable resources across many technologies • Slower organizational response times due to challenges in managing the technologies • Lack of interoperability • Complexity is significant • IT methodology continues to get re-shaped • Reuse is compounded by knowledge of same styles across the technology expertise • Entrenchment as a strategy for technologists

  11. Side-effects On could argue that we are rather dis-integrated? Shortly before 4:11 p.m. (est) on August 14, 2003, a series of power surges over a 12-second period triggered a cascade of shutdowns at more than 100 generating plants throughout eight U.S. states and Ontario. The result was the biggest blackout in North American history. 61,800 megawatts of power were lost to over 50 million people. - ieso, Ontario Power Toronto, August 22, 2003 (6:00 p.m.) -- Ontario's power emergency will end at 8:00 p.m., marking the return to service of the majority of the province's generating capability. Consumers are urged to continue with their conservation efforts until 8:00 p.m. - ieso, Ontario Power Only 8 days…

  12. Side-effects IT Characteristics • Common attributes and constraints • Operationally driven • Innovation occurs outside of IT • Black-box syndrome • Shoe-string budgets • Technologist is tactically minded… • Point-to-point interface approaches • ‘Quick and Dirty’, ‘Hard-coded’, etc…

  13. Change Strategy Sunshine Moment! “While there are proud moments, ingenious alternatives and quick-fix acts of wonder, the recognition of the fatal nature of the on-going behavior of the organization isn’t abstract any longer.” - (IBIwhitepaper)

  14. Organizational Learning What have we learned? • The heritage of the organization’s learning resides in the existing operational systems and resources • Internal and external pressures on the organization to become more efficient will not change so there must exist continuous responsiveness by the organization’s business systems. • The technologist reflects the temperament of the organization as they tend toward quick remedies

  15. Change Strategy Gleicher’s Formula Working in organizational change management David Gleicher’s seminal research work discovered that organizations will change at a pre-determined rate based on the following ingredients. Awareness of why the change is needed Desire to support and participate in the change Knowledge of how to change Ability to implement new skills and behaviors Reinforcement to sustain the change Awareness of why the change is needed Desire to support and participate in the change Knowledge of how to change Ability to implement new skills and behaviors Reinforcement to sustain the change

  16. Change Strategy Think Psyche-logically • Maneuvering in your company is unique to your style, but critical for long-term planning  building an architecture • The #1 factor for successfully adopting an enterprise integration framework is getting your IT team to change • Architectural planning begins a new chapter in your IT department / company • Instills a framework for software development disciplines • Map your goals to the business needs

  17. New Architecture What is the ‘New’ Architecture? • It is a FRAMEWORK • It depends on the effective deployment of the following components • IT leadership change - a commitment to adopt new methods of integration • Technology tools (iWay Service Manager, iWay developer workbench, adapters suitable to the existing operational systems of the organization) • Resilient commitment to stay the course

  18. Adoption Approaches Adoption Approaches… • Start with Integration • Stop custom point-to-point development; adapt existing systems; build a custom adapter • Eliminate system redundancies and breakdown points • Remove inter-system dependencies • Cascading FTP scenarios; reduces Help Desk support • Use to leverage the removal of legacy systems

  19. Adoption Approaches Adoption Approaches… • Align Integration effort with new business functionality • Sell to Sales; Market to Marketing; Show Accounting the beans • Visibility of approach should be pronounced

  20. Adoption Approaches Adoption Approaches… • Consider an Integration Layer for Enterprise System replacements / strategic projects • Higher risk, but richer rewards • Force the philosophy, require the immediate commitment by dedicated resources • Mentoring critical for long-term success of integration

  21. Adoption Approaches What are the costs? • Initial Investment considerations • Negotiate up-front for the long-term investment • Build into budget • Work with business vertical areas to include in integration strategy within overall project • Managing related costs depend on the ongoing commitment… • By IT Leadership • By the Technology team • By ability to deliver value quickly to • gain momentum

  22. Tool Investment Different Adoption Approaches Most Impact $ “The best practice for architecture adoption is to follow on the heels of a business feature enhancement that is politically charged!” – IBI Whitepaper Tool Investment Internal Costs rise Enterprise Critical Path; Must exist ulterior rationale Tool Investment Tool Investment New Business Functionality Overtakes Cost Same Investment $ Smallest impact $ Targeted IT Cost Reduction IT efficiencies Timid Driven Leveraged Versatile Glue

  23. Think Psyche-logically Adoption Approaches • Best ways • Market to Marketing • Sell to Sales • Show Accounting the beans • Plausible but boring ways • IT efficiencies • Human Resources • Internal Portal • Worst ways • Executive Information Systems • NON-Strategic; backlog projects GOAL… TO GET MOMENTUM!

  24. Think Psyche-logically Market to Marketing • Corporate-wide EDI initiatives (Supply Chain) • Real-time feeds of competitive information • Market differentiator opportunities with new functionality GOAL… Need Support From Internal Innovators

  25. Think Psyche-logically Sell to Sales • Enhance the company image through tight integration • Reusability creates quicker customer response • CRM integration • Messaging medium constantly changing… (Lots of opportunity here) GOAL… Have Sales Sell I.T.!

  26. Think Psyche-logically Show Accounting the beans • Review Accounting Batch Job interfaces • Post-Audit your implementation • Comparable estimating metrics for old-fashioned integration • Establish your plan for future reusability GOAL… Give your CFO the eyes to see the value of the new architecture

  27. Risks Risks and Cautions • Business Issues • Cost of initial investment • Architecture cant’ be deployed fast enough • Toolset doesn’t solve all ills • Design Issues • Master Data Management needs planning • Effect on operational systems for up-to-the-minute data requests • Old practices impede approach to designing the architecture

  28. Risks Risks and Cautions • Change Issues • Internal ‘expert’ inhibits momentum • Unsubstantial training on toolset • Inexperienced technology team • ‘Not invented here’ blind spots • ‘Why consider a new approach’ personalities • Feeling that one’s job may be threatened

  29. Risks Summary • Technologists embrace problems naturally… Organizations and their systems grown organically… They’ve been doing it for 40 years… • The ability for the organization to grow is directly related to the commitment by the technology team to change • Investments in new architecture are required for organizations positioned to grow quickly • IT budgets do not have to impede the ability to consider a new architecture • Begin a strategy to invest in a new architecture or you will continue to have ‘razor-thin’ margins…

  30. Questions & Answers TeschConsulting.com

  31. This too could be you! 6a. Sales reporting 4. Record purchase 3. Check credit 2. Validate order 6b.Manufacturing 5. Submit order 1. Enter order 6c. Notify service department E-Marketplace 8b. Billing 8a. Shipping 7. Order parts Business Customer Supplier

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