This reflective paper analyses IT governance model adopted by Alcan Engineered Products Company. It explores the Accenture model used by Alcan. The model operates on the assumption that if IT model operate as a profit center in an organization, then there will be increased operational efficiency and leverage of the whole company. It also analyzes Alcan’s IT model in line with Weills and Rose model.
Finally, it compared Ouelette model with Accenture model. Rito Tinto Alcan (Alcan Engineered Products) is involved in making finished aluminum products in automotive, transportation, aerospace and manufacturing. In addition, it provides engineering expertise, research, and development services. With these services in their production line, the company falls in the first quadrant of the Accenture model which is a responsive solution provider. This can be attributed to the fact that it is a renowned company and therefore, cable of changing fast in response to the dynamics of business environment. In addition, the company would need to be efficient in its operations in order to maintain competitive advantage in the product and service market. In the context of Alcan Engineered Products, the decision areas outlined in the Weill and Ross IT governance model entails clarification of the business role of IT in the company. At Alcan, this decision was made by top management.
The process of defining integration and standardization requirements was done by a team of IT group from Alcan and Accenture consultants. The same team of IT group from Alcan and Accenture consultants determined and laid down all infrastructure requirements for desired change and specified the business needs for purchase or internally development of an IT application. Besides, top managers (business monarchy) posses the veto powers on the choice of an initiative for funding the resolutions.
In addition, these top managers decide on how much to spend on each project. The business top management, IT group, and consultants from Accenture were involved in the decision making process for the change-over at Alcan Engineered Products reflecting a monarchy type of governance. Factually, this can be attributed to the nature of work expected.
It would require specialist in the field of IT in support from top management reflecting governance style where decision making authority is vested in few individuals, groups, or managers mostly of senior rank. Decisions made in this type of governance are strong, authoritarian, and visionary. Notwithstanding, it is a prompt way of making decisions since the fewer the parties involved in the process, the shorter the time frame for action plan and quick response on major issues and changes. Consequently, there is low risk of dissent or conflicts between parts of the organization. On the contrary, the decision making process in not participative as most of the staff members are left out when the company is making decisions which might affect their own professional input. Also, this criterion limits members of the organization’s inner ability to be flexible and to adapt to minor issues and changes without creating numerous hidden costs and redundancy.
The governance style that was adopted by this company is not all inclusive. Since IT services cuts across all the department of the organization, it would be advisable to engross most of the organizations’ departments in the decision making process organs and steps as outlined in Weill and Ross model. Use of the consultants from Accenture would be advisable since it’s a model they invented and are well conversant with. Therefore, it would be important to engage the specialists of that model for high quality outcome at optimal balance between cost and benefits. For the Alcan Company, the first process of decision making is clarifying the business roles of IT in the organization as a constituent of an organ seeking contributions from all departments of the organization. When faced with this situation, I will appoint anarchy of knowledgeable team to define integration and standardization requirements for the company. Development of infrastructure would be done by IT group and consultants from Accenture.
Besides, the IT group in conjunction with another department such as finance or procurement would be involved in making decision on whether to purchase or internally develop IT application. Finally top management would decide on which investment to fund and how much to spend. The results of changes in an organization are uncertain; this uncertainty may emerge from unplanned changes in the environment or from fears employees harbor.
Therefore, it is necessary for Alcan to integrate and create substantial room for uncertainty of outcome in their IT governance model. Outcomes are difficult to plan for, predict, or focus in short or long term. Often, these negative outcomes affect peoples’ psychological health both directly and indirectly. In addition, environmentally initiated or self initiated events that were not in the initial plan might also affect peoples’ health especially when their occurrence is uncontrolled. Fortunately, Ouellette plans a working model for the dynamics of daily life in a company setting. This model emphasizes on close relationship between the need for prediction, control, and formulation for enacting plans.
Moreover, it factors in the close relationship between the outcome of social events and the need to belong. Using the Accenture model, Alcan Isolated IT unit is expected to work jointly with businesses to develop prioritized investment plans to accommodate longer term capability road maps, deliver the planned new capabilities, and market window of operations and opportunities. As a result, it will proactively manage lifecycle of information technology assets in accordance with the capability road. Since the IT unit at Alcan Engineered products will be operating as a profit center, there are lots of uncertainties in the outcomes expected. Therefore, it might not be accurately possible to quantify the benefit expected over a period of time considering the ever swinging economic climate.
The Accenture model cannot incorporate uncertainties in the outcome as this cannot be planned. Therefore, Ouelette model is not consistent with Accenture model since the component of uncertain outcome is not incorporated. In conclusion, from the Alcan Engineered Product Company analysis, IT governance concept is a broad subject that has a lot of challenges. Moreover, it is challenging to come up with perfect IT governance for a company. However, with the challenges, it is possible for a company to leverage its existing investment when deploying an IT governance strategy.
There is no specific IT governance model that would work across all organizations. Therefore, a company needs to carry out detailed research for suitability of any IT governance model before putting it into operation. As in the case of Alcan, the Accenture model adopted improved the operation of the organization and the performance of IT department. Generally, on an individual basis, IT performance remains high. This has seen Rito Tinto Alcan maintain its high performance.