Technology

in Research

TEAM 6
Introduction

IT Process
strategies

Competitors &
Partners

Business Unit Plans

Analysis &
Technology
Strategy Development

IT plans

IT use outside
O&G Industry Regional & Business
Process Teams

Business
Processes
ARCO IT SBU
Used Business Focus Groups to
identify the business needs
Business Focus Groups
New Business
New Business Development
Development

Exploration
Reservoir Engineering
Drilling UPSTREAM

Productions & Operations

Facility Design & Construction

Facility Management
Manufacturing, Wholesale & Supply Optimization
DOWNSTREAM
Retail
Logistics

Finance/Planning
Procurement
Human Resources Integral Processes
EH&S
Tax & Legal
External Affairs
Information Technology SBU

The IT set out to answer eight

questions...
Fundamental Questions

Vision • What is vision for information technology?

• What are the major strategy differences?

Current • What are our competitive strengths/weaknesses in IT today?
Situation
Technology
Trends
Strategic • What are the key information technologies for growth today?
Implicatio
ns
 A set of IT Principles was created
Principles

early in the study to serve as a

guideline for future strategy
Principles
formulation .
1) Will develop a comprehensive IT strategy as an integrated part of the business
planning process with investments measured against a predefined set of
performance criteria
2) Business Groups and AIT will work in close partnership to proactively seek
opportunities to exploit IT in support of business strategies
3) Recognizes that IT plays different roles in our business:
a) Foundation technologies
b) Commodity technologies
c) Table stakes technologies
d) Differentiating technologies
• We will be best quartile in cost at acceptable reliability for b) and achieve
increased effectiveness in c) and d). Approach in a) will depend on contribution
for c) and d)
• 4)will adopt common standards where they advance business objectives
Vision & Strategy

Recommended Strategy

Create Value
■ Take early adopter/industry leader positions in select differentiating technologies
■ Use existing technologies in more innovative and creative ways than our competitors
■ Buy commercially available mature technologies and implement rapidly
■ Establish corporate seed process for information technology

Improve Processes
■ Implement IT planning process to integrate with business
– IT Board of Directors for enterprise decision making and standard setting
– Technology management process for evaluation through adoption
– Portfolio approach for management of IT assets through life-cycle
■ Externally focused performance measurement achieving lowest quartile cost
■ Invest in workforce through training and effective use of tools

Deliver the Basics

■ Define service level requirements, develop and implement an improvement plan
■ Evolve infrastructure that is adaptable to technology changes with acceptable cost struct
■ Implement best practices for major IT project management
 Alignment of IT strategy with ARCO’s
Improve Processes

strategy requires a comprehensive

planning process. Investment Decision
IT Planning Making
Process Organizational Approach
• Align business
unit and IT • Responsible
IT for
Board of Directors

Technology Management • Common

Portfolio Management
set of IT strategy
• Balance
investment IT • Value, prioritize
• Technology investment
criteria and approve
monitoring and
transfer process • among
Enterprise enterprise & line
differentiating,
investment of business
–Monitor, table stakes,
decisions
research, commodity and
pilot, operate foundation AIT Management Council
and retire • Strategy by • Strategy
category for Execution
sourcing,
Information Technology Planning Process
• Define information technologyresources and
vision
competitive
• Integrate business andpositioning
information
technology strategies and plans
• Benchmark
• Define roles and responsibilities
performance
• Organizational effectiveness
 Strategy vs Competitors

Recommended Strategy Regions

APC AAI
Catalytic IT
TrendAPL APU
Fast Follower
Ad op tion /
Taco Bell Early
e
Drifting
s t F oll ower / Selectiv ip
Fa h
Leaders
Lifeboats
r
Followe Execute
te ise
TechnologySlow Followe
r Replica Enterpr
ise
Leadership Enterpr
in es s Unit
Unit
Bu s
e r / I n d ustry
Decision Bu s in es s
us tr y Provid
/ Ind
Priority P rovider
ise rategic
Enterpr i ty / S t
Sgelectiv
Standards Local ic B u i
eld r i
Partn tnering
n
ra t eg Par
B uy / St
Buy r a li zed/
Custom / D ec en t
C o o rd ination
a l/ ed e
SourcingLo c
D e centraliz oordinE a tniotenrpris
alized nterprise C
Decentr E
e c ent r alized
OrganizationD
Global Information System

An organized collection of
computer hardware,
communication equipment,
software, data, and personnel
designed to capture, store,
update, manipulate, analyze,
and immediately display
information about worldwide
business activities.
Data versus Information

 Data—the raw facts—record measures

of certain phenomena.
 Information—facts in a form suitable
for managers to base decisions on or a
body of facts in a format suitable for
decision making or in a context that
defines relationships between
pieces of data.
Knowledge

A blend of information,
experience, and insights that
provides a framework that can
be thoughtfully applied when
assessing new information or
evaluating relevant situations.
Characteristics of Valuable
Information

 Relevance
 Quality
 Timeliness
 Completeness
 Decision Support System
 A computer-based system that helps
decision makers confront problems
through direct interaction with databases
and analytical software programs.
 The purpose of a decision support
system is to store data and transform
them into organized information that is
easily accessible to marketing
managers.
A Decision Support System
Has Two Components

• Database
• Software
Database

A database is a collection of raw

data arranged logically and
organized in a form that can be
stored and processed by a
computer.
E.g., a mailing list of customer
names is one type of
database or employment
data.
Database, Contd.,
Several types of databases from outside
vendors and external distributors are so
fundamental to decision support systems,
such as:
• Full-text databases, e.g., ABI/INFORM,
ProQuest.com
• Statistical databases/Geographic, e.g.,
GIS
• Financial databases, e.g., Income
statement/Balance sheet.
• Image and video databases, e.g., Cartoon
Bank.
Data Warehousing
 Data warehousing systems are
developed by compiling and storing
many different databases by a
company.
 It is a process that allows
information from operational
systems to be stored and organized
into separate systems designed for
simple access.
Data Warehousing, Contd.,
 The concept of data warehouse is a term
that IT Managers use to discuss a
comprehensive collection of data that
describes the extensive operations of an
organization.
 Data warehouse management requires that
the detailed data from operational systems
to be extracted, transformed, and stored
(warehoused) so that the various database
files are consistent.
Example: Customer
Relationship Management
(CRM)
 Bring together lots of pieces of
information
 customer profiles

 sales

 marketing
effectiveness/responsiveness
 market trends

 Provides the enterprise with a complete,

dependable, and integrated view of its
customer base.
Example: Customer Relationship
Management (CRM), Contd.,
 Management, salespeople,
customer service, and perhaps the
customer can directly
 access information e.g. other
products a customer has purchased
 match customer needs with
satisfying product offerings
 remind customers of service
requirements.
 Software

 Various types of programs that tell

computers, printers, and other hardware
what to do.

 Software allows managers to combine

and restructure databases, diagnose
relationships, build analytical models,
estimate variables, and otherwise
analyze the various databases.
Four Major Sources of Input
For a Decision Support
Systems

 Internal records
 Proprietary business research
 Business intelligence
 Outside vendors and external
distributors
Internal Records
 Internal records that may become
useful information for managers.
 Accounting reports of sales and
inventory figures, provide
considerable data.
 Data about costs, shipments,
inventory, sales, and other
aspects of regular operations are
routinely collected and entered
into the computer.
Proprietary Research

 Emphasizes the company’s

gathering of new data.
 Not conducted regularly or
continuously.
 Projects conducted to study
specific company problems.
Business Intelligence

 A business intelligence system

consists of a network of sources
and regular procedures by
which executives obtain
everyday information about
nonrecurring developments in
the external business
environment.
Outside Vendors And External
Distributors
 Distributors of market
information as their products.
 Many organizations specialize in
the collection and publication of
high-quality information.
E.g. A. C. Nielsen Company
provides television program
ratings, audience counts.
Example of Computerized
Data Archives

 Organized and retrievable

 DVD and CD-ROM
 Internet
On-line Database
Searching Systems
 DIALOG
 ABI/INFORM

 PROMT (The Predicast Overview of

Markets & Technologies)
 DOW-JONES NEWS RETREVIAL
 Business Newsstand
 Historical Market Data Center

 LEXIS-NEXIS
Input Management

 Inputs - all numerical, text,

voice, and image data entered
into the decision support
system.
Electronic Data Interchange

 Electronic Data Interchange

(EDI) is the term used when one
company’s computer systems is
integrated directly with another
company’s proprietary computer
system.
Internet

 A worldwide network of
computers that allows users
access to information and
documents from distant
sources.
 A combination of a worldwide
communication system and the
world’s largest library.
URL

 Uniform Resource Locator

 Web site address
World Wide Web (WWW)

 Graphic interface
 1000s of interconnected pages
or documents
Selected Web Sites

 http://www.usatoday.com
 http://www.businessweek.com
 http://www.adcritic.com
 http://www.ceoexpress.com
 http://www.census.gov
Home Page -Basic
Information Plus Menu
 http://www2.bus.okstate.edu/zik
mund/
Search Engine

 A computerized directory to
search the WWW
 YAHOO -www.yahoo.com
 HOTBOT - www.hotbot.com
 GOOGLE - www.google.com
 DOGPILE - www.dogpile.com
Push Technology

 Smart agents
 Find information
 Do the searching for you
 Distribute it to desktop
Cookies

 “Magic cookies”
 Small computer files
 Provides saves onto the
computer of someone who visits
 Tracks websites and files visited
Intranet

 Private data network

 Uses internet standards and
technology
 Firewalls for security