© 1999, chuck ehrlich all rights reserved1 e-business systems planning chuck ehrlich...
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© 1999, Chuck Ehrlich all rights reserved
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E-Business Systems Planning
Chuck [email protected] 415-441-7140
© 1999, Chuck Ehrlich all rights reserved
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E-Business Systems Planning
Systems Planning process How to, relationship to business plans
Systems Strategy issuesOutsourcing options
© 1999, Chuck Ehrlich all rights reserved
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Systems Planning
E-businesses are systems businessesSystems are key elements of
Competitive advantage Technical Feasibility Strategic Direction Schedules Cost
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Systems influence Plans
Schedule for launchCost to buildOperating costs Staffing requirements
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Systems Planning Process
Business Concept
Process Model
Application Architecture
Systems Architecture
Capacity Planning Model
Implementation Plan
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Systems Planning
Level of detail and formality varies: Napkin Flip Chart Specification documents CASE tools
Process is iterative and subject to change
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Systems Bus Planning
Process Model operations plan
Application Architecture and Systems Architecture design plans
Capacity Planning Model operating costs
Implementation Plan development costs and schedule
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Business Concept
Your idea for the business, all of its flows
Your Business
Inflows
Outflows
Interactions
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Process Model
‘Operationalize’ the business concept
Information flowsBusiness process definitions
(manual and automated)Who does what to whom and what
do they need?
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Process Modeling tools
Analogies to excellent businessesFlow charts and process diagrams
Visio, Process Charter, Case toolsProcess descriptionsData Dictionary
Define what information is required Analysis Data Dictionary case tools
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Application Architecture
Defines Applications Maps Business Processes to
ApplicationsDefines information flows between
applications
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Application checklist
Make sure you include:Customer billingFinancial and tax accounting Sales, Customer Relationship Management,
Customer ServiceSupply chain managementManaging and accounting for alliancesMarketing management and reporting (DW)
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Applications Architecture tools
DiagramsDescriptionsData Dictionary
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Systems Architecture
Defines specific systems and packages
Maps Application Architecture to implementation environment
Reuse is essential, don’t build things that you can outsource or buy
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Systems Architecture tools
DiagramsDescriptionsData Dictionary
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Capacity Planning Model
Predict resources requirements for different levels of activity
Tool for: Estimating costs Evaluating trade-offs Predicting and avoiding problems
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Capacity Planning items
Number of users, transactions/time period Peak hour, day, month, etc.
Page views and bandwidth required Other interface activity levels Database access, update ratesDatabase and file sizes
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Capacity Planning example
Average 1,000 users per dayAverage 100 pages/user =
100,000/day30% returning customers= 300
lookups10% new registrations= 100
creates/dayPeak period is 20% of daily volume
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Capacity Planning tips
Integrate capacity and business models Like sales models, for consistency
Document your assumptions clearly Assumptions are a key part of the process
Test your assumptions as early as you can And update the model based on reality
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Capacity Planning tools
Excel and similar programsSpecialized system modeling toolsStatistical analysis toolsSimulation programs
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Implementation Plan
DeliverablesTasks definitionsSchedules and MilestonesResource requirementsCosts
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Implementation Planning process
Plan backwards: Define you deliverables (systems,
applications, facilities, etc.) Identify what has to be done to create
them (development lifecycle, build, test train, etc.)
Schedule based on tasks and resources (critical path method)
Build cost and cash flow models
© 1999, Chuck Ehrlich all rights reserved
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Implementation Planning tools
Excel and similar programsProject Management software
Microsoft Project Primavera, etc.
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Getting the numbers
Estimating cost and schedule is hard Look for comparable projects/companies Look for relevant experience in
consultants, employees, vendorsVendors may be ‘optimistic’
Talk to other customers directly
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Systems strategy
Think big, scalable systems, applications you won’t outgrow
Think fast, time-to-marketThink continuously, 24x7Think globally, no boundaries on the
NetFocus, outsource everything that is
not your core business
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The -ility definitions
Scalability: can increase system capacity
Reliability: works without dropping, mangling, or duplicating transactions
Availability: percentage of time the system can be used
Related and not free
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Scalable
Mainframe approach: get a bigger boxInternet approach: add more serversRequires load balancing tools to
distribute traffic over multiple servers or locations Ex: Cisco Distributed Request Protocol
(DRP) Agent, Local Director, Distributed Director
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Reliable
Protect data against loss Backups, multiple media, etc.
Maintain transaction integrity Locking, journaling, transaction roll-back
Database systems provide data protection Oracle and other relational databases
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Available
Design to minimize the effect of failures Monitor to detect problems quickly
Network and system monitoring systemsRecover to minimize the impact of
failures Redundant equipment Backup systems Automatic restart
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Hosting provides
Servers and software Dedicated servers for large users
Massive (shared) Internet connectivityComputer room facilities
Security, air conditioning, fire suppression, backup power, etc.
24x7 Systems monitoring and supportOther resources and services (varies)
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Reasons for hosting
Access to skills and systems expertise Network connectivity: OC-48 linksSpeed of deployment
faster than getting lines and building centers
Cost savings In-house $1.5m first year vs. $4,000/mo
24/7 operation
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Hosting’s downside
Growing pains and resource shortages From $400m in 97 to $900m in 98 Hosters learn as they go
Confusing products and specialties Web of partnerships Changing strategies
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Successful hosting tips
Define requirements before you start And match vendors to needs
Shortlist vendors meeting requirements
Do your homework Site visits, detailed plans, service level
agreements, etc.Manage the relationship(s)
And monitor the systems externally
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Hosting checklist
Data Centers: Security, power, fire suppression, etc.
Network Redundancy, capacityOperations
Monitoring, 24x7 technical support, load balancing, backups, auditing, etc.
Customer Service Technical support team, Service Level
Agreements, Web based reporting
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Collocation services
Variation on hosting that provides space and connectivity, not hardware Secure rack space or vaults
Client retains control over hardware, software, data, etc.
Other services optional Installation, systems monitoring,
security, etc.
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The new A B C’s
ASP application service provider $2b in 03 License, maintain and rent software for
a range of clientsBSP business service provider
Offer a suite of services for an industryCSP computer service provider
Server farms for ASP, BSP, e-business
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ASP example: Corio
Rents Peoplesoft software Servers at Exodus Monthly charges
$10 for self-service user$795 for an active (daily) user
Promises 30% cost savings over five years
Siebel Sales Force Automation and Customer Service also available
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Some ASPs
Qwest/KPMG w/SAP, SiebelEDS w/SAPOracle w/OracleUSinterworking w/Broadvision,
Microsoft, Peoplesoft, Sagent Technology, Siebel
US Web/CKS w/Microsoft
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BSP example: Tibersoft
Food-distribution industry system Connects vendors, distributors,
restaurantsSysco uses Tibersoft with 300,000
customers Order supplies, schedule delivery, track
orders
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Some BSPs
Bidcom.com constructionE-steel marketplace for steelMail.com e-mailMarket-Touch.com sales fulfillment Sales.com w/SiebelWorks.com office product purchases
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CSP example: Exodus
Santa Clara: Clients: Lycos, Hotmail, Microsoft, etc. Broadband connections to six carriers 2,500 servers 55,000 square foot data center
Growing 40%/quarter, 2 customers/day from 12 to 21 data centers this year
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Some CSPs
Above.netDigexExodusFrontier Global CenterGTEQwestUUNet
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Recent entrants
Banks—mix of ASP and CSP Bank of America Wells Fargo & First Data Corp.
Intel Online Services CSP 10,000 servers racked and ready Pentium III and Sun
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Future directions
Large companies can’t afford not to hostIntegrators and ASPs focus on services
And work with any data centerCarrier’s networks give them advantages
Lower costs, better access to bandwidthLess collocation, more higher valued
services
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For more information
How It Works, Jeffrey Davis, Business 2.0, February 2000, pages 112-140.
Users’ Guide to Hosting, Forrester Research, July 1999 www.forrester.com
Buying Web Services, J. P. Frenza, Wiley, 1999