1 Managing Operations Operations - Essential 33% budget for programming 70% maintenance 30% new development 10% administration 57% operations

2 Managing Operations How to measure operations: 1) Assess external service uptime downtime response time turnaround time

3 (Cont’d) 2) Assess internal service % capacity used % system availability queue length job runs application age

4 Managing Operations Efficient Center Operations Measures: How well do we meet user needs How easy are applications maintained How old are applications Applications development queue length Efficiency goes down as application age goes up Efficiency goes up as age of employees goes down

5 Managing Operations Outsourcing A firm’s computer operations are turned over to an outside vendor What are the reasons? Where do we add value? What are our competencies

6 Cont’d Examples Apparel companies don’t sew Publishing houses don’t print

7 Managing Operations Outsourcing Options -Buy professional services training, maintaining applications, contract program users -Buy transaction processing in the case of payroll, credit rating -Buy integrator services components, plan, develop, maintain, train

8 Managing Operations Cont’d Outsourcing is time-based All other are project-based

9 Managing Operations Outsourcing (cont’d) 1) Selective outsourcing - data center, helpdesk, network 2) How realistic are client’s expectations 3) How good is the contract 4) Does it include application development

10 Managing Operations Outsourcing (cont’d) Decision Making Questions Which applications are strategic? Does outsourcing save us 15%? Do we have needed technology, expertise? Do we become more flexible?

11 Managing Operations Recovery Multiple Data Centers Distributed Processing Backup Facility Off-line data storage Service bureaus