FREE online courses on Information Technology - Chapter 4 IT AND CORPORATE
STRATEGY - THE ROLE OF MANAGEMENT COMMITTEE
Because of the size of the investment involved and the
importance of key systems to the organization, many firms establish committees
to help manage information systems activities. A committee can bring to bear
many different points of view on a problem, and it ensures widespread
representation of functional areas and management levels in key decisions.
One large multinational firm has organized a series of
committees to deal with planning for IT and reviewing proposals for new systems.
Offices of the president and chairperson are at the head of this firm. Each
major line of business in this firm is organized into a company with its own
president and staff. There are also corporate vice presidents for various
functional areas, such as vice president of finance. Service units such as
research and development and information technology are corporate divisions
reporting to appropriate corporate vice presidents.
This firm has recently established a corporate-level steering
committee for information technology. Its objective is to review plans and
determine the appropriate size of the firm's investment in IT. The corporate
committee reviews division plans, organizes and approves education about
systems, and seeks area for the development of common systems serving two or
more sub-organizations, such as two different companies with common
requirements. The purpose of a common system is to share resources and avoid the
cost of developing a tailored application at each site.
Each division also has a local steering committee that is
responsible for developing and approving long-range plans for IT in that
sub-organization. The local committee also reviews and approves short-term plans
and the annual budget for information technology activities in the division.
This committee serves to review proposals for new systems and to assign
priorities to them. Finally, the local committee reviews and approves staffing
requirements for information services.
For the multinational firm discussed above, the
corporate-level and division-level steering committees deal with policy. In a
smaller firm, only a corporate-level committee might be appropriate. Whatever
the size of the organization, it should develop a mechanism that involves users
and the systems staff to (1) set policy and review plans, (2) select
alternatives for a given application, and (3) participate in the actual design
of a system.
