Information Technology projects: a case study into the failure of synergy within and between value chains.

Author: Van Rooyen, Ockert
Supervisor: Professor Erik Schmikl
Date: September 2010

Global financial markets are showing strains on a scale and scope not witnessed since the Great Depression. Banks will implement more aggressive cost saving measures using technologies such as Unified Computing, Virtualisation (Server, Desktop and other) and Green IT. Organisations continue to innovate through the slump. There is a drive for stronger risk management, greater transparency, more-aggressive customer retention and managing data as a strategic asset. As a result, there is a need for increased system agility to respond to changing business needs; a more strategic partnership between IT and the business; vigilant security mechanisms in the face of constant threats, whilst still allowing users to experiment with newer more collaborative technologies; social networking and the business application of these collaborative technologies and a well implemented knowledge management strategy.

The opportunities and challenges identified within the Technology Cluster of a large financial institution in South Africa are to expedite the delivery and execution of key strategic initiatives, ensuring that banking services are available all day, everyday, re-use, simplify the technology landscape, standardise and rationalise end-to-end. More should be done to improve business processes and software quality. There are still challenges around workforce optimisation, transparency and disclosure of information to business partners. There are still opportunities for more aggressive business optimisation to further increase the cost saving footprint in the Technology Cluster.

Key Indicators show good achievement in “Run the Business”, going forward more focus will be placed on “Change the Business”. The stronger focus on Change the Business is also supported by industry benchmarks. The Technology Cluster performs well in Run the Business, but lags in Change the Business.
Identified client satisfaction areas for improvement were value for money, transparency and accessibility.

The vision of the Technology Cluster is to be this particular financial institution’s preferred technology partner and consistently outperform industry benchmarks. The Cluster strategic targets are to lead as a corporate citizen, accelerate transformation and to build a unique culture and technology for competitive advantage. To partner with business to grow their EP the Technology Cluster must manage for value through the cycle, step change in Non Income Revenue (NIR) growth, enhance productivity and execution, manage risk as an enabler and be client driven.

Because of the ever improving Information Technology and software development environment and the increasing demand to conform to its standards, it is critical that the synergy of the clustered environment be optimized to enable these projects to be more rapidly and effectively deployed. A study of the failure of synergy in and between divisional clusters will guide preferred human resource attitudes and behaviour that could contribute towards effective project deployment strategies.

The key research objectives of the researcher within this dissertation are the following:

  • The objective of the contributions formulated within the ambit of this dissertation have a practical application in the solving of real-world problems not only of the target organisation and its people but could be applied to benefit other organisations with similar problems.
  • To recommend and employ synergy strategies that could provide the preferred behaviour of all personnel within the divisional cluster to promote information flow and project delivery effectiveness.
  • The aim is to further use these strategies to move towards synergy within other divisional clusters and also between all divisional clusters to deliver projects faster within the group environment.
  • The objective is to inform and promote that it should be essential for personnel at all levels per cluster and between clusters to cultivate and foster the preferred attitude and behaviour so that the entire group could benefit from working towards a learning and strategic thinking work-force that could ultimately positively affect change implementation.

Applied research will be used in this dissertation and serve as the ‘research type’. This research type will be used as it is designed to apply its findings to solving a specific, existing problem. The proposed research will be conducted in the social world as social scientific theory has to do with ‘what is’, not what ‘should be’, in the analogy that social science allows for the development of theories about ‘what is’ and ‘why’. The research will be ‘empirical’ and ‘theoretical’ in nature. Empirical research, being the dominant paradigm in business and management is frequently associated with a pessimistic view.  This will be theoretical in nature. Theoretical research refers to the study of a subject through the writings of others.
The research method which will be used to conduct the research study is case study research.