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CASE – 1
The 2004 Athens Olympics Network: Faster, Stronger—and Redundant
Claude
Philipps, program director of major events at Atos Origin, the lead IT
contractor for the Olympic Games, likes to be prepared. “We were ready before
August, but we were still testing, because we wanted to be sure that every
stupid thing that can happen was planned for,” Philipps said. “In a normal IT
project, we could have delivered the application to the customer almost eight
months earlier.”
But the Olympic
Games was far from a normal IT project. The deadline was nonnegotiable, and
there were no second chances: Everything must work, from the opening ceremony
on August 13 right to the end, said Philipps, whose previous experience
includes developing the control system for the world’s first computerized
nuclear power plant.
With all that
pressure, Philipps’s team was doing its utmost to ensure that the network would
not fail. They were building multiple layers of security and redundancy, using
reliable technology, and then testing it rigorously.
In the weeks
before the games, the team went through two technical rehearsals in which 30
Atos Origin staffers put the network through its paces. The team spent a full
week stimulating the busiest days of the games, Philipps said, dealing with
“crazy scenarios of what might happen in every area: a network problem, staff
stopped in a traffic jam, a security attack…everything that might happen.”
The rehearsals
were intended to test people and procedures as much as the hardware and
software. That was important because the IT organization Philipps built for the
Athens Olympics grew from nothing to a staff of 3,400 in less than three years.
The two major
components of the software that were run over the Olympic network were Atos
Origin’s GMS (Games Management System), a customized suite of applications that
acts as kind of ERP for the Olympics, and the IDS (Information Diffusion
System).
GMS ran on
Windows 2000 servers in Athens, an upgrade from the Windows NT 4 used at the
Salt Lake City games in 2002. “We’re not using sexy technology,” Philipps said.
“The main goal for us was to reduce the amount of risk.”
Together, GMS
and IDS imposed exacting requirements on the network. GMS was, among other
things, used to manage access accreditations for the games, so security was
vital. Speed, too, was important: Philipps’s goal was to have the results on
commentators’ screen 0.3 seconds after the athletes had crossed the line,
complete with rankings, statistics, and biographies—everything that helps commentators
during a live broadcast.
Yan Noblot,
information security manager at Atos Origin, said the key to that was to build
in redundancy—and lots of it. “We doubled everything, because we needed 100
percent availability at games time,” he said.
And when he
said everything, he meant it. There was backup redundancy for the routers and
switches at each site, the datacenters that processed the results, and event
the PCs on the desks in the control room.
Too keep things
orderly, Atos designed three different LAN configurations: one for the largest
venues, including the Olympic stadium and the water sports center; another for
mid-size venues such as the equestrian center; and one for the many smaller
venues.
Atos used VLANs
both to simplify troubleshooting and to limit damage if anyone managed to break
into the network. There were separate VLANs for the commentator information
system, information diffusion applications, and the game management system.
Technical services, directories, management and monitoring, and the on-venue
results system each had their own VLANs too, sometimes several per venue for
the same function.
“The purpose
was to segment the traffic so we could monitor it and contain potential
issues,” Noblot said. “If someone brought in a virus, it would be contained on
systems on the same VLAN and could not spread to other VLANs.”
Event results
and data from the games management system were stored in two physically distant
data centers hosted by OTE, which also supplied the SDH network. The primary
data center was located near OTE’s headquarters in Marousi, just across the
main highway from the Olympic stadium; the other was another several hundred
miles away, still in Greece but in a different earthquake zone.
What makes the
Olympic Games a unique project is that the athletes aren’t going to stop
running just because the server does. As Philipps said, “When we speak about
fixing something, it might be a work-around or a decrease of functionality, but
the key thing is that the show must go on.”
Questions
1.
Could the 2004 Athens Olympics have been a success
without all of the networks and backup technologies?
2.
The 2004 Olympics is a global business. Can a business
today succeed without information technology? Why or why not?
3.
Claude Philipps said dealing with “crazy scenarios of
what might happen in every area: a network problem, staff stopped in traffic
jam, security attack…everything that might happen,” was the reason for so much
testing. Can you think of other business that would require “crazy scenario”
testing? Explain.
CASE – 2 Argosy Gaming Co.: Challenges in
Building a Data Warehouse
When you’ve got
half a dozen riverboat gambling operations, it’s important that everyone plays
by the same rules. Argosy Gaming Co. (www.argosycasinos.com), with headquarters
in Alton, Illinois, and a fleet of six Mississippi riverboat casinos, had
decided that bringing all customer data together would enhance management’s
view of operations and potentially help strengthen customer relationships. To accomplish
those goals, though, the company needed to access a variety of databases and
develop an extract, transform, and load (ETL) system to help construct and
maintain a central data warehouse.
Jason
Fortenberry, a data-warehousing analyst, came aboard at Argosy just as the
company’s data warehouse project started in 2001. His job was made easier, he
says, by the adoption of Hummingbird Ltd.’s Genio ETL software tool, which
helped bridge systems and automate processes. But like others going through
such projects, he learned the hard way that preparing for the ETL process is
just as important as having the right software.
The riverboats
each had unique and incompatible ways of defining a host of operational
activities and customer characteristics—in essence, the floating casinos were
each playing the same game but with different rules. But those problems
remained hidden until reports from the company’s data warehouse began to turn
up inconsistent or troubling data. That’s when Fortenberry and his staff discovered
conflicting definitions for a wide range of data types—problems he wished he
had identified much earlier. Fortenberry’s troubles—and his successes—are
typical of ETL, the complex and often expensive prelude to data warehouse
success.
ETL is often
problematic because of its inherent complexity and underlying business
challenges, such as making sure you plan adequately and have quality data to
process. Analysts, users, and even vendors say all bets are off if you don’t
have a clear understanding of your data resources and what you want to achieve
with them. Then there are choices, like whether to go for a centralized
architecture—the simplest and most common configuration – or a distributed
system, with ETL processing spread across various software tools, system
utilities, and target databases, which is sometimes a necessity in larger, more
complicated data warehouses. Even if you navigate those waters successfully,
you still need to ensure that the ETL foundation you build for your data
warehouse can meet growing data streams and future information demands.
As the term
implies, ETL involves extracting data from various sources, transforming it
(usually the trickiest part), and loading it into the data warehouse. A
transformation could be as simple as reordering the fields of a record from a
source system. But as Philip Russom, a Giga Information Group analyst,
explains, a data warehouse often contains data values and data structures that
never existed in a source system. Since many analytical questions a business
user would ask of a data warehouse can be answered only with calculated values
(like averages, rankings or metrics), the ETL tool must calculate these from
various data sources and load them into the warehouse. Similarly, notes Russom,
a data warehouse typically contains “time-series” data. The average operational
application keeps track of current state of a value such as a bank account
balance. It’s the job of the ETL tool to
regularly add new states of a value to the series.
For his
year-long ETL project, Argosy’s Fortenberry says Hummingbird’s Genio Suite, a
data integration and ETL tool, quickly became the project’s “central nervous
system,” coordinating the process for extracting source data and loading the
warehouse.
But for Argosy,
getting all that data into the warehouse didn’t produce immediate usable and
dependable results. “ The lesson was that people thought that they were talking
about the same thing, but they actually were not,” says Fortenberry. For
example, riverboats calculated visits differently. One riverboat casinos would
credit a customer with a visit only if he actually played at a slot machine or
table. Another had an expanded definition and credited customers with visits
when they redeemed coupons, even if they didn’t play. So identical customer
activity might have on riverboat reporting 4 player visits and another
reporting 10. “This type of discovery was repeated for everything from defining
what a ‘player’ is to calculating a player’s profitability,” says Fortenberry.
IT played a
lead role in identifying problems and helping to hammer out a consensus among
the business units about how to define and use many categories of data, he
says. Now, the data warehouse is running smoothly and producing dependable
results for business analysis and management reporting, so the number of
problem-resolution meetings has dropped dramatically. Still, Fortenberry
reckons that three-quarters of the meetings he attends nowadays have a business
focus. “For our part, we now know better what questions to ask business users
as we continue with the data warehouse development process,” he says.
Questions
1.
What is the business value of data warehouse? Use
Argosy Gaming as an example.
2.
Why did Argosy use a ETL software tool? What benefits
and problems arose? How were they solved?
3.
What are some of the major responsibilities that
business professionals and managers have in data warehouse development? Use
Argosy Gaming as an example.
CASE – 3
Allstate Insurance, Aviva Canada, and Others: Centralized Business
Intelligence at Work
The most common
approach to business intelligence is to assemble a team of developers to build
a data warehouse or data mart for a specific project, buy a reporting tool to
use with it, and disassemble the team upon the project’s completion. However,
some companies are taking a more strategic approach: standardizing on fewer
business-intelligence tools and making them available throughout their
organizations even before projects are planned. To execute these strategies,
companies are creating dedicated groups, sometimes called competency centers or
centers of excellence, to manage business-intelligence projects and provide
technical and analytical expertise to other employees. Competency centers are
usually staffed with people who have a variety of technical, business, and
data-analysis expertise, and the centers become a repository of
business-intelligence-related skills, best practices, and application
standards.
About 10
percent of the 2,000 largest companies in the world have some form of
business-intelligence competency center, Gartner Inc. and Howard Dresner says.
Yet approaches vary. While most are centralized in one location, a few are
virtual, with staff scattered throughout a company. Some are part of the IT
department – or closely tied to it—while others are more independent, serving
as a bridge between IT and business-unit
managers and employees.
Allstate
Insurance Co.’s Enterprise Business Intelligence Tools Team is responsible for
setting business-intelligence technology strategy for the company’s 40,000
employees and 12,000 independent agents, says Jim Young, the team’s senior
manager.
Based in
Allstate’s Northbrook, Illinois, headquarters, the center was created earlier
this year by consolidating three groups built around separate
business-intelligence products used in different parts of the company. The
center serves as a central repository for business-intelligence expertise,
providing services and training for Allstate employees, and is developing a set
of standard best practices for building and using data warehouses and
business-intelligence applications.
“That way, we
can execute on a common strategy,” Young says. The center maintains a common
business-intelligence infrastructure and manages software vendors and service
providers.
At Aviva Canada
Inc., a property and casualty insurance
company, the primary role of its Information Management Services department is
to bridge the communication gap between business-intelligence-tool users and
Aviva’s IT department.
“Business
intelligence isn’t a technology issue. BI is a business issue,” says Gerry Lee,
information management services VP. Centralization is critical, because Aviva’s
goal is to grow by 50 percent over the next five years, partly through
additional acquisitions, Lee says. The center also impacts the company’s
numerous customer relationship-management initiatives. “We couldn’t get into
CRM until we had solid data-management and business-intelligence capabilities,”
he says.
Cost reduction is often the driving factor for
companies to create competency centers and consolidate business-intelligence
systems. Standard technology and implementation practices can reduce the cost
of some business-intelligence projects up to 95 percent, says Chris Amos,
reporting solutions manager at British Telecom. BT established a center of
excellence around Actuate’s reporting software three years ago and is
developing business-intelligence systems for the telecommunications company’s
wholesale, retail, and global services operations.
Despite the
potential savings, funding can be an issue for creating and running
business-intelligence centers of excellence. Start-up costs for a
business-intelligence competency center can be $1 million to $2 million,
depending on a company’s size, Gartner’s Dresner says.
Many believe
the payoffs are worth it. General Electric Co.’s energy products business
formed its Business Data-Modeling Center of Excellence last year to improve
data-management and business-intelligence practices for GE Energy’s 8,000
employees. That has helped the business move beyond simple reporting o
financial and supplier data to more advanced forecasting and predictive
analysis.
“The data’s
become more actionable. The visibility of this data to the business has brought
millions in savings,” says Rich Richardson, manager of business data modeling
and delivery, who manages the center. That’s a business-intelligence competency
center that’s more than paid for itself.
Questions
1.
What is business intelligence? Why are
business-intelligence systems such a popular business application of IT?
2.
What is the business value of the various BI
applications discussed in the case?
3.
Is a business-intelligence system an MIS or a DSS?
CASE – 4
Blue Cross, AT & T Wireless, and CitiStreet: Development Challenges
of Self-Service Web Systems
When Web-based
self-service is good, it’s really good. Customer satisfaction soars and call
center costs plummet as customers answer their own questions, enter their own
credit card numbers, and change their own passwords without expensive live
help.
But when
Web-based self-service is bad , it’s really bad. Frustrated customers click to
a competitor’s site or dial up your call center—meaning you’ve paid for both a
self-service website and for a call center, and the customer is still unhappy.
A poorly designed Web interface that greets self-service users with a confusing
sequence of options or asks them questions they can’t answer is a sure way to
force them to call a help center.
Blue Cross-Blue Shield. For Blue
Cross-Blue Shield of Minnesota (www.bluecrossmn.com), developing Web
self-service capabilities for employee health insurance plans meant the
difference between winning and losing several major clients, including retailer
Target, Northwest Airlines, and General Mills. “Without it, they would not do
business with us,” explains John Ounjian, CIO and senior vice president of
information systems and corporate adjudication services at the $5 billion
insurance provider. So when Ounjian explained to executives that the customer
relationship management (CRM) project that would enable Web-based self-service
by client employees would cost $15 million for the first two phases, they
didn’t blink.
Blue Cross-Blue
Shield also learned the importance of communicating with business units during
the design phase of its Web self-service system. Ounjian and his technical team
designed screen displays that featured drop-down boxes that they thought were logical, but a focus
group of end users that examined a prototype system found the feature
cumbersome and the wording hard to understand. “We had to adjust our logic,” he
says, of the subsequent redesign.
AT & T Wireless. When AT & T
Wireless services (www.attws.com) began rolling out its new high-bandwidth
wireless networks, its self-service website required customers to say whether
their phones used the older Time Division Multiple Access (TDMA) network or the
newer, third generation network. Most people didn’t know which network they used,
only which calling plan they had signed up for, says Scott Cantrell, e-business
IT program manager at AT & T Wireless. So AT & T had to redesign the
site so the customer just enters his user ID and password, “and the application
follows built-in rules to automatically send you to the right website,”
Cantrell says.
According to
Gartner Inc., more than a third of all customers or users who initiate queries
over the Web eventually get frustrated and end up calling help center to get
their questions answered.
Whether a
self-service application is aimed at external customers or internal users such
as employees, two keys to success remain the same: setting aside money and time
for maintaining the site, and designing flexibility into application interfaces
and business rules so the site can be changed as needed.
CitiStreet. CitiStreet
(www.citistreetonline.com) is a global benefit services provider managing over
$170 billion in savings and pension funds and is owned by Citigroup and State
Street Corp. CitiStreet is using the JRules software development tool to make
rules changes in its benefits plan administration systems, many of them
featuring Web-based employee self-service. JRules manages thousands of business
rules related to client policies, government regulations, and customer
preferences. Previously, business analysts developed the required business
rules for each business process, and IT developers did the coding. But now
analysts use JRules to create and change rules, without the help from
developers, says Andy Marsh, CitiStreet’s CIO. “We’ve effectively eliminated
the detail design function and 80 percent of the development function,” says
Marsh. IT is involved in managing the systems and platforms, but it’s less
involved in rules management, he says.
The software
helps speed the development process for new business systems or features, says
Marsh. For example, it used to take CitiStreet six months to set up benefit
plans for clients; it now takes three months. CitiStreet can also react more
quickly to market changes and new government regulations. It has used the rules
development software to quickly revise business rules to accommodate the
changes in pension programs required by new legislation. And Marsh says that
when a client company recently added a savings plan to its benefits program,
CitiStreet was able to easily develop and implement changes with JRules.
Questions
1.
Why do more than a third of all Web self-service
customers get frustrated and end up calling a help center? Use the experiences
of Blue Cross-Blue Shield and AT & T Wireless to help you answer.
2.
What are some solutions to the problems users may have
with Web self-service? Use the experiences of the companies in this case to
propose several solutions.
3.
Visit the websites of Blue Cross-Blue Shield and AT
& T Wireless. Investigate the details of obtaining and individual health
plan or a new cell phone plan. What is your appraisal of the self-service
features of these websites? Explain your evaluations.
CASE – 5
Avon Product and Guardian Life Insurance: Successful Management of IT
Project
It’s déjà vu
again at many companies when it comes to track record in using IT to help
achieve business goals. Consider the following:
·
At companies that aren’t among the top 25 percent
of IT users, three out of 10 IT projects fail on average.
·
Less than 40 percent of IT managers say their
staffs can react rapidly to changes in business goals or market conditions.
·
Less than half of all companies bother to
validate an IT project’s business value after it has been completed.
Those are just
a few of the findings from a survey of IT managers at about 2,000 companies,
including more than 80 percent of the Fortune 1,000, released in June 2003 by
the Hackett Group in Atlanta. However, top-tier IT leader didn’t reach the top
of their professions by being softies.
Indeed, a vast
majority of them regularly rely upon hard-dollar metrics to consistently
demonstrate to top brass the business value IT investments are expected to
yield. That’s what sets them apart from so many of their colleagues. “Good
business-case methodology leads to good
project management, but it’s amazing how many companies fall short here,” says
Stephen J. Andriole, a professor of business technology at Villanova University
and consultant at Cutter Consortium. The lack of good project management at
such companies may also lead to business units taking on IT development
projects without the knowledge or oversight of a company’s IT department.
Business units may initiate such “rogue projects” because they see the IT
department as too slow, or a source of too much red tape and extra costs.
Avon Products. “We apply all of the analytical rigor and financial
ROI tools against each or our IT projects as well as other business projects,”
says Harriet Edelman, senior vice president and CIO at Avon Products Inc.
(www.avon.com) in New York. Those tools include payback, NPV, and IRR
calculations, as well as risk analyses on every investment, she says.
The $6 billion
cosmetics giant also monitors each IT project to gauge its efficiency and
effectiveness during the course of development and applies a red/yellow/green
coding system to reflect the current health of a project, says Edelman. A
monthly report about the status of projects that are valued at more than
$250,000 and deal with important strategic content is presented to senior line
managers, the CEO, and the chief operating officer. In addition, Avon uses an
investment-tracking database for every IT project to monitor project costs on a
rolling basis. The approach makes its easier for the company’s IT and business
managers to quickly determine whether a project should be accelerated, delayed,
or canceled and assists the finance organization in forecasting requirements.
Guardian Life Insurance. Dennis S. Callahan says he has “put a
strong emphasis on governance” since becoming CIO at The Guardian Life
Insurance Company (www.glic.com) two years ago, Callahan has done so, in part,
by applying NPV and IRR calculation to all IT projects with a five-year cash
flow. “The potential fallout from inaction could result in loss of market
share,” says Callahan, who was promoted to executive vice president recently.
So Guardian’s approach to IT investments “is very hare-dollar- and metrics
oriented, with a bias toward action,” he says. Still, Callahan and his team do
have a process for incorporating “soft” costs and benefits into their
calculations. They do that, Callahan says, by encouraging their business peers
“to discuss how an investment can impact market share and estimate how those
numbers are going to change. Same thing with cost avoidance – if we invest in a
project that’s expected to help us avoid hiring 10 operations staffer to handle
growing business transaction volumes.”
Callahan also
keeps close tabs on capital spending throughout the course of a project. New
York-based Guardian has a project management office that continually monitors
the scope time, and cost of each project valued at more than $100,000,
according to Callahan. Guardian also has monthly reviews of variances of scope,
time, and costs on all projects costing more than $100,000.
Using
return-on-investment calculations to cost-justify and demonstrate the value of
IT investments to senior management is only of the techniques top IT leaders
use to win project approvals, says Callahan and others. “We approach everything
that we do in terms of payback.” President and CEO Dennis Manning and other
board members “really relate to that kind of justification,” Callahan says. “So
we turn that into hard-dollar returns and benefits for application development
and infrastructure investment.” “One of the biggest things we do in
demonstrating value to the CEO and the board is showing that everything we do
reflects the company’s business strategy,” says Rick Omartian, chief financial
officer for Guardian’s IT department.
Questions
1.
What are several possible solutions to the failures in
IT project management at many companies described at the start of this case?
Defend your proposals.
2.
What are several key ways that Avon and Guardian assure
that their IT projects are completed successfully and support the goals of the
business?
3.
If you were the manager of a business unit at Avon or
Guardian, what are several other things you would like to see their IT groups
do to assure the success of an IT project for your business unit? Defend your
suggestions.
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