Organization Environment of Alcan - Essay Example

? Alcan operates based on the case facts. Introduction Technological advancements in various disciplines have helped spur economies of various countries worldwide. The field of Information Technology has been one key area that has impressed technology to the latter. This paper explores the application of IT within the Alcan organization which is an organization that is IT supportive. Organization Environment. Alcan is an IT Organization based in Canada with its head office at Montreal along the Sherbrook and Stanly streets (INDUSTRY CANADA, 2005). It is one of the world famous cutting-edge enterprises having a remarkable combination of skilled and talented workforce with advanced technology, innovative products, as well as a decidedly focused customer-culture. The enterprise has operating facilities across 61 countries with a work force of about 68,000 employees. The organization takes the leading position in production of raw materials, fabricated products and primary metals. Its four principal business groups include Bauxite and Alumina, Primary Metal, packaging and the engineered products. The four business groups are the main revenue contributors for the organization (Binet, GUALARD, and JACLOT, 2000). The associated products of the business groups include Aluminum sheets for beverage cans, automotive systems, mass transportation markets, personal care industries and the pharmaceutical products. The enterprise is involved in creating and selling of a variety of products, which include bauxite, automobile iron, sheet ingot, aluminium recycling services, forging stock. It is extremely vertically integrated having eight mines and deposits, a transport network with ports and facilities, seven alumina plants, 26 aluminium smelters, 17 laminated products plants, 12 electric power plants, seven alumina refineries, 180 packaging materials plants and 49 engineered products plants. Organizational Structure. How Alcan is, staffed, structured and organized. An organization staffing and structure includes a company or business entity management and operation. Alcan organization has a workforce of about 68,000 employees. In this organization, the CIO is responsible directly for the company’s management team (Dube, Bernier, & Roy, 2009). His services are shared at the bottom of the ladder. The senior management in Alcan Company is made up of a CIO and four associates. These associates include: Strategic IT-Program director, Chief information-security- officer director, performance-management director, and the Enterprise Architectural director. At the bottom of the ladder, two services that are shared exist. One service is for the application, and the next is for infrastructure. All these are directed towards the senior management. In the centre of the ladder, there are different business groups of IT Directors. In this organization, the policy of decentralization ensures that each group is headed by an IT director normally referred to as VP. This director is concerned with the management of the IT in his specific group. He is also accountable for the top management of his group (Dube, Bernier, & Roy, 2009). Normally, the four IT VPs reports 75% of their group to the top management. They also report a 25% of their group to the CIO. These directors, therefore, are responsible in attaining the global objectives of the company. On the other hand, the shared services act as the business group internal consultants. Challenges Faced by Alcan Organization. Alcan organization like any other large organization is faced with various environmental, economical, social as well as technological challenges. Environmental challenges. The greatest environmental challenges affecting Alcan Organization are sustainable raw material development, industrial waste, air emissions, and water. These challenges have affected this company since laws requested organizations to change procedures and equipments so as to meet standards imposed to them. This change was to cause any company a substantial amount of money. The revolution of industries leads to a transformation of societies and interaction with the environment. This raised the consumption of natural resources, processes, and new product development pace. This resulted to the permanent depletion of resources, natural resources and pollution out of the un-wanted products. Therefore, the Alcan Company is facing a significant challenge of insufficient resources and raw materials. The company is trying to overcome this challenge by developing a clean manufacturing process and designing a method of recycling the products (Foster, 2007). Economic Challenges. First, high costs across various company support functions due to funds misappropriation by the individual, business groups has been a challenge for the Alcan Organization. Because of lack of mechanism for group financial coordination, there resulted a case where there was many methods of recording IT costs, leading to IT costs being included in the operating expenses of each group expenses mismatched with cost of goods sold. The head office could not, therefore, get the true picture of IT expenses (Dube, Bernier, & Roy, 2009). This made it impossible for the Management to know the real amount of money that the organization invested in IT. Governance, setting and monitoring of the priorities by the head office was also not easy. Secondly, each of the group was mandated to manage its own IT organization that helped the individual, business group to pursue its own objectives basing on the needs and orientation of the group. Hence the autonomy culture had taken root within each group. The business processes were ineffective and inefficiency because of diversified and fragmented IT environment, making use of IT, as well as management of the organization excessively complex (Dube, Bernier, & Roy, 2009). This demanded the use of a lot of efforts so that financial and managing of information is achieved. Additionally, it made it difficult and costly to manage and apply government regulations. Lack of group coordination also made it costly to implement any IT program separately that put immense pressure on the resources of the Alcan Organization. In curbing misappropriation of funds, The VP first summoned all the business group IT managers and asked them to bring him the problematic IT files to help him do the auditing and do the analysis of the IT costs (Dube, Bernier, & Roy, 2009). The Chief Officer for IT along with the management team identified and formulated outstanding management principles. The principles were strictly based on business values, reduced diversity within the Technology Park, human resource and development importance, reuse, software package purchase, infrastructural management, and economies of scale. The principles were all then integrated into strategic planning to boost the decisions and actions taken. Social Challenges Socially, the challenges posed by the organization groups brought about incomplete system integration. There were also inadequate skills and knowledge, as well as frustrations for the IT management cutting across unit business groups. Secondly, the IT management systems were decentralized but lacked co-operation and coordination among the business groups. The people of each group had not been taught the culture of cooperation with each other. This made each group work in order to meet the main requirement of the group. Every IT business group was totally independent having its own the strategic IT plan, choices of infrastructure based upon its specific needs along with (Dube, Bernier, & Roy, 2009). In solving the challenge of lack of coordination among the business groups, the VP ensured there was a well organized IT management at all levels in the entire organization. The measures put in place ensured IT services and institution for the shared services became a priority of the senior management. All measures were taken to see to it that business groups reduce system diversity through adoption of the SAP strategy. Additionally, progress was made to standardize and consolidate IT infrastructure especially in line with global email and network. The IT team had to prepare a blueprint for the IT management new orientation. The orientation IT plan focused on tight alignments between the creations of the services that were shared with the IT business strategy (Dube, Bernier, & Roy, 2009). The plan helped establish a common vision for the IT management in the whole organization. The plan as well laid the foundation for the application of the philosophy of the shared-services endorsed by Alcan. This new plan dictated that management of services common among the business groups were to be carried out by the central unit of organization that being supported by the internal billing mechanism. The centralization of the services that were shared would promote economies of scale, consolidation, reuse, standardization, shared competences, and accessing of the experts at a low cost. The new strategic plan would also help the senior management to integrate the IT services in the corporate strategies. Technical Challenges. There was a challenge in the internal available skills. The skills were at times not sufficient and poorly aligned to the needs. There was a problem in identifying, compensating and evaluating the IT competences by various business groups. It, therefore, necessitated outsourcing the consultants and the contract workers (Dube, Bernier, & Roy, 2009). Secondly, there was insufficient evaluation of projects risks that included planned transformations and inadequate expertise for the projects undertaken by the business groups, as well as at the helm of the management cutting across all sectors of IT. Thirdly, inadequate coordination of the IT projects and initiatives ended up affecting all the processes of the business groups especially coordination of the procurement and finance One other challenge was in the five organization structure of Corporate IT functions which was based on the sectors of responsibilities (Dube, Bernier, & Roy, 2009). For instance, the group that was concerned with support and developing of corporate applications had 14 resources, but the exact resources lacked central management, architecture for applications, and lacked corporate leadership for the financial applications. The architecture group, on the other hand, was not equipped to taking responsibilities for information management and layers of architectural applications. In solving the emerging technical problems the experts, optimal utility of specialists and connections in all projects, the strategic plan had to define priorities for the coming periods. This implies that with the vision of shared services, services that are used by business groups have to be centralized and be provided by the shared service centers. The internal teams were mandated to plan, reflect make wise choices that affect IT organization. There were supplies created to be working with internal experienced team that is more competent in partnership management and also in terms of content. The changes were implemented to disrupt as little as possible the normal daily operations while reusing contracts, hiring new people and their competences improved through training. Streamlining of leadership in helping promote coordination among senior management and other workers was achieved through coming up with an IT leadership committee that combines all the IT directors for the shared services and for the business groups meeting twice a month. This helps to take note of current initiatives and to improve the future project plans. All the issues that are considered irritants are noted; there solutions identified and possibly implement them. More so, IT management meet twice each year with the internal Audit committee for the company for the assessment of the IT risk management with respect to the internal control practices that are dictated by the regulatory body and legislation, as well as those that ensures business continuity and sustainability. Other challenges were addressed through the creation of the new enterprise architecture, management of IT investment, application management, as well as managing of the technological infrastructure. How Alcan manage IT resource allocation and prioritization of its projects. The management of the IT resources and its projects was done by a central unit of organization that obtained some support from the internal mechanism billing. All IT services, human resources, and financial services, the centralization of services that were shared promoted the shared competencies, standardization, consolidation, low cost, reuse, and economies of scale. Each project made use of SAP variants that increased its complexity, and needed wide expertise (Dube, Bernier, & Roy, 2009). This lead to the complication of the information transfer reuse, and updates to be used for future new version implementation. This diversity was then advanced in all the Alcan applications. With direction from IT-senior manager, a strategic office was set up so as to monitor IT projects closely. This office evaluated the proposals of all projects to ensure compliance with methodology was given enough respect. Annotated Bibliography Foster, B. (2007). Alcan IT Organization. Retrieve on 22nd May 2012 http//www.iwaysoftware.de/applications/alcan.h The author presents the Alcan Organization as an IT Organization. The author focuses on the Alcan organization giving much description about its locality, as well as its management. The article covers a range of IT business units cutting across the challenges the organization experiences while implementing key changes within it. In essence, this source is helpful in getting an overview of the environmental organization of the organization the Alcan organization as far as IT department is concerned. Dube, L, Bernier, C, & Roy, V. (2009). Taking on the challenge of IT management in a global business context: The Alcan case – Part B. International Journal of Case Studies in Management. 7(2), 1-12. The authors discuss the challenge of managing IT management in a business. They summarize the challenges of implementing changes in Information Technology department of the Alcan organization, as well as the change in management style owing to the coming of the new chief officer in charge of IT. The authors indicate that poor management leads to reduced effectiveness and hence low production. This source is particularly vital because it provide an overview of how change in management style can be healthy for a growing organization. Dube, L, Bernier, C, & Roy, V. (2009). Taking on the challenge of IT management in a global business context: The Alcan case – Part A. International Journal of Case Studies in Management. 7(2), 1-10. The authors discuss the challenge of implementing and managing IT in the Alcan Organization. They discuss the transformation that Alcan organization undergoes with respect to Information Technology. The article summarizes the historical background of the Alcan organization with a view to indicate the challenges the organization has had to experience as a business entity that is trying to impress IT. The source is particularly vital in the light of research presented because it provides an overview of the structure of the Alcan organization, its historical background, as well as the transformational challenges especially when implemented Information technology. Binet, E. GUALARD, R, and JACLOT, E. (2000). Les fusions Alcan-Pechiney-Algroup et Alcoa-Reynolds. Paris: University press. The authors present the Alcan organization as an IT outsourcing based on the combined results of a survey administered to IT firms as well as statistical measures from domestic and French firms. Their data cover a wide range of IT business unit types; however, the lack of longitudinal data weakens their conclusion that the slower pace of French IT outsourcing has had a positive effect on business in those countries long-term. This article also discusses the new standards for outsourcing developed by the AICPA ethics committee. The standards are summarized, and a brief discussion is included of the implications going forward for business and international trade. The authors indicate that changes to the business community will be relatively minor. This is a helpful source for getting an overview of the current ethics standards in outsourcing. INDUSTRY CANADA (2005). Canadian aluminum industry technology: The Canadian aluminum industry. Retrieved on 20th May 2012 from http://www.ic.gc.ca The article discusses the Aluminium industry as an organization that impresses Information Technology. It summarizes challenges: environmental, social and economic challenges that any manufacturing industry such as the Aluminium producing industries experiences. Through such highlighted challenges, one can get an overview of the challenges the Alcan organization as one of the main alumunium producing company is made to go through in the wake of the ever changing business environment. References Binet, E. GUALARD, R, and JACLOT, E. (200). Les fusions Alcan-Pechiney-Algroup et Alcoa-Reynolds. Paris: University press. (Book with two authors) Dube, L, Bernier, C, & Roy, V. (2009). Taking on the challenge of IT management in a global business context: The Alcan case – Part A. International Journal of Case Studies in Management. 7(2), 1-10. (Article with two authors/Article in a journal with continuous paging/Article with with no DOI)   Dube, L, Bernier, C, & Roy, V. (2009). Taking on the challenge of IT management in a global business context: The Alcan case – Part B. International Journal of Case Studies in Management. 7(2), 1-12. (Article with two authors/Article in a journal with continuous paging/Article with no DOI) Foster, B. (2007). Alcan IT Organization. Retrieve on 22nd May 2012 http//www.iwaysoftware.de/applications/alcan.h (Article with one author/Article without DOI-URL as home page used) INDUSTRY CANADA (2005). Canadian aluminum industry technology: The Canadian aluminum industry. Retrieved on 20th May 2012 from http://www.ic.gc.ca (Article with an organization as author/Article located online) Read More