El Panorama Internacional

The IS/IT organization of Company X is a small organization that consists of two domains. First, there are the two system administrators who deal with the IS/IT infrastructure. Second, there are two programmers who develop and maintain the ERP system. The IS/IT manager who leads the department also does programming work for the ERP system.

For analysing the IS/IT organization we use the two ideal IS/IT configurations of Johnston and Yetton from section 3.4.7. To start with, the focus of Company X’s IS/IT organization is on adding value to the company as a whole. In the vision of the IS/IT manager the IS/IT organization should aim to devote the majority of its time to development and innovation. This way the IS/IT organization can continue with adding value to organization. There is regularly contact with other business departments about possible improvements or new functionality of the ERP system. Within the IS/IT department there is a lot of knowledge about the processes, which allows personnel to think along with employees of other departments about how they can service the needs of the different business units.

The structure of the organization is quite decentralized and professional. Most of the decisions are made on a team basis and there is very little bureaucracy within the organization. The management processes are flexible and the focus is on empowerment by thinking together about problems. Although there is specialization within the department, employees work together on a team basis most of the time. Within the team tasks are coordinated, which reflects an organic structure. Although that the management processes have much in common with the divisional configuration, the organization differs from this ideal configuration by working with position-based rewards.

When focussing on the systems element of the configuration, the IS/IT organization of Company X behaves more like the ideal bureaucracy configuration. The personnel focuses on keeping the IS/IT landscape maintainable by using a single dominant platform and using a simple architecture. This is reflected by the use of a single ERP system that supports all processes. When enhancements should be made to the ERP system, the developers usually first discuss how they can fit this in the current architecture. For changes regarding the IS/IT infrastructure the employees also discuss together how these changes can be made without disturbing the current architecture.

The IS/IT department has a long-serving staff, but sometimes hires external staff for specific expertise. The recruitment and development for IS/IT employees is performed internally. Within the department the emphasis is on merit and not on seniority.

The full overview of the IS/IT configuration of Company X can be found in Table 9. The table shows that in terms of the strategy, structure and management processes the IS/IT configuration of Company X is almost similar to the divisional configuration. In contrast, the systems en roles/skills elements show more similarities with the bureaucracy configuration. The IS/IT organization of Company X is thus a mix of the two ideal configurations.

Table 9: IS/IT configuration of Company X

Characteristics IT in the machine

bureaucracy

IT in the divisional form Company X

Strategy Cost focus - efficiency

IT driven Value added focus – effectiveness Business unit driven

Value added focus – effectiveness

Business unit driven

Structure Centralised Bureaucratic Decentralised Professional Decentralised Professional Management

processes Formalised Control emphasis Mechanistic Position-based rewards IT standards Flexible Empowerment emphasis Organic Performance-based rewards IT service Flexible Empowerment emphasis Organic Position-based rewards IT service

Systems Single dominant platform

Common IT standards Simple architecture Multiple platforms Incompatible systems Complex architecture Single dominant platform Common IT standards Simple architecture

Roles/skills Long-serving staff

Internal recruitment & development

Seniority emphasis

Mobile staff

External recruitment & development

Merit emphasis

Long-serving staff Internal recruitment & development

Merit emphasis We believe that the configuration of the IS/IT organization is affected by the role that IS/IT has within an organization. The managing director of Company X is quite IS/IT minded and sees it as an instrument that can strengthen the company. As an example he mentioned the flexibility that the internally developed ERP system offers. The trend in the market is that customers are becoming bigger and have more demands. Without the functionality that the ERP system offers it would be much harder - if not impossible - to serve those customers. In fact, the managing director argued that in terms of the alignment model of Henderson and Venkatraman [35], Company X follows the

technology transformation perspective. This reinforces our perception that IS/IT takes an important

place within the organization.

The pro-active role that IS/IT has within Company X allows a more flexible IS/IT organization configuration. In contrast, when IS/IT would be solely considered as a supporting mechanism and cost center, the organizational configuration is likely to be different. In such cases the strategy would automatically be on efficiency and control.