Chapter 7: Enterprise Infrastructure, Metrics, and Business Continuity ...
Chapter 7: Enterprise Infrastructure, Metrics, and Business Continuity Planning Tuesday, April 05, 2011 3:33 PM
INTRODUCTION • Service-oriented architecture (SOA or SoA)→ a software architecture perspective that focuses on the development, use, and reuse of small self-contained blocks of code (called services) to meet many or even all the application software needs of an organization ○ New applications build on past solutions organically using established building blocks ○ All software is developed from reusable units of code ○ High level, holistic organizational approach to how an organization views and acts on all its software needs • Organization with a SOA philosophy ○ Lean, agile: takes advantage of every resource in the most efficient and effective way ○ React quickly in a proactive way to perceived changes in the market, competition, and customer demographics, wants and desires ○ Respond quickly to and adapt to new advances in technology ○ Transform its processes, structure, and HR initiatives to match a changing and dynamic workforce Customers • Provide multichannel service delivery options and customizable products and services • Plug-and-play: into any communications channel with your organization such as fax, the web, face to face, phone call etc. • Experience should be the same regardless of communication channel • Personalize products and services ○ Plugging in their desires and wants Mass customization
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End-Users End-users of IT: employees within the organization Achieved through a fully integrated enterprise resource planning (ERP) system that meets every application software and information need of each and every employee ERP should support transparent interoperability across multiple vendors and within ERP modules provided by the same vendor Take advantage of multichannel service delivery ○ Able to access computing and information resources regardless of where they are (mobile computing) ○ Regardless of IT in hand, employees should enjoy access to a full range of application software services and information
Software Development • Orgs can choose among numerous software development methodologies that focus on the production and reuse of blocks of code to speed the process of software development ○ Rapid application development (RAD) ○ Extreme programming (XP) ○ Agile methodology Information Needs • Most vitally important organizational resource -- information • Ppl throughout your org need access to info , BI, and knowledge that supports their decision making efforts • SOA approach to info requires that: Info be in a standard format no matter where it exists CCT225 Page 1
• SOA approach to info requires that: ○ Info be in a standard format no matter where it exists ○ Strict and rigorous integrity control mechanisms are in place to ensure the completeness, accuracy, and validity of the info ○ No duplicate info exists in disparate silos anywhere in your organization ○ Any kind fo info from any source (even external) can be quickly and easily coupled with other info Hardware Requirements • Org should be free to choose diff technologies and diff technology platforms and integrate them seamlessly (plug and play) • Powerful storage area networks should have the capacity to store all your info needs • You should not have to care where within these networks info is stored; your access to info should be simple and easy • Telecommunications platform should be safe and secure, and at the same time, enable you to access a network, either wired or wireless, using the same steps or procedures HARDWARE AND SOFTWARE INFRASTRUCTURE • Infrastructure→ the structure beneath a structure ○ Diff players of structure, which provide support or services Enterprise Resource Planning (ERP) Revisited • ERP market is at the top of the IT spending list • Vendors are continuously updating their products and adding new technology based features • Major vendor qualities for product selection and implementation: ○ Long term vision ○ Commitment to service and support ○ Specialty features ○ Experience ○ Financial strength for R&D The Evolution of ERP systems • ERP systems replace islands of info and processes, with a single, packaged software solution that integrates all the traditional enterprise management functions such as financials, HR, and manufacturing and logistics • Early stage of ERP (1970s) system: materials requirement planning (MRP) ○ Focus: internal production, planning, calculating time requirements components, procurement, and materials planning ○ Developed to provide the right materials at the right time ○ No focus on service orientation ○ For the first time, management was able to answer the question "when?" • Early 1980s: manufacturing resources planning or MRPII ○ Evolved ○ Closed the loop with the accounting and financial management systems ○ Crossed boundaries of production functionality and started serving as decision support systems (DSS) and executive information systems (EIS-digital dashboards in the modern day) ○ Company could have an integrated business system that provided visibility for the requirements of material and capacity ○ Good info → good decisions: integrated IT systems provide competitive advantage ○ Late 1980s to early 1990s: time to market: increasingly short • Beg 1990s: enterprise resource planning (ERP) ○ Encompasses all the resource planning for the enterprise including product design, warehousing, material planning, capacity planning, and communication systems ○ Help companies become leaner and more agile to technology by integrating the basic transaction programs for all depts, allowing quick access to timely info • Evolved into ERPII SCM CCT225 Page 2
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SCM CRM DWBI e-bus
ERP and a SOA 2 primary goals: 1. Provide interoperability within an ERP vendor and for modules among different ERP vendors 2. Hide the underlying IT infrastructure of info and hardware from end-users and customers Interoperability→ the capability of two or more computing components to share information and other resources, even if they are made by different manufacturers Sustainable interoperability→ can replace software modules within the ERP suite you choose Physical structure and location of info should not be of concern to you as an end user, nor should the physical hardware infrastructure matter
ERP Advantages and Disadvantages • Advantages ○ Centralize database ○ Reliable info access ○ Avoid data and operations redundancy ○ Delivery and cycle time reduction ○ Cost reduction ○ Easy adaptability ○ Improved scalability ○ Global reach ○ e-bus support • Disadvantages ○ Time consuming ○ Expensive ○ Lack of conformity of modules ○ Vendor dependence ○ Too many features, too much complexity ○ Questionable scalability and global reach ○ Not enough extended ERP capability Supporting Network Infrastructures • Fundamental underlying infrastructure for any IT environment: network ○ 2 + comps sharing info, software, peripheral devices, and processing power Decentralized Infrastructure • Decentralized infrastructure→ little or no sharing of IT and other resources such as information ○ Arises from users or depts developing their own systems or applications, without any central control • Gives users the liberty to develop applications that meet their needs and maintain control over the applications they develop • Prevents users from easily combining processing power or even comparing info between various information systems • Encourages data duplication, frequently leading to inconsistencies Centralized Infrastructure • Centralized infrastructure→ sharing information systems in one central area or on one central mainframe • Great advantage: allows a high degree or control, making it easy to: 1. Maintain standards of hardware, software, procedures and operations 2. Control access to information CCT225 Page 3
1. Maintain standards of hardware, software, procedures and operations 2. Control access to information • Main disadvantage: inflexibility ○ Built so that it can be used by everyone, but that does not mean that the system is optimal for everyone ○ Diff dept and remote sites have diff info needs Distributed Infrastructure • Distributed infrastructure→ distributing information and processing power of IT systems via a network • All locations can share info and applications • Major benefit: processing activity can be allocated to the location(s) where it can most efficiently be done • To improve performance and reduce network traffic, a distributed infrastructure will often store the same application and/or info in 2+ locations • More complex than centralized and decentralized ○ Distributed infrastructure must be able to determine the location of specific applications and info ○ Must be more sophisticated in determining the optimal way to request the application and info ○ Order in which the system processes a request can make a sig diff in the amount of data transmitted over the network Client/Server Infrastructure (client/server network) • Client/server infrastructure→ has one or more computers that are servers that provide services to other computers, called clients • Form of distributed infrastructure • Application processing is divided btw the client and the server • Functions of an IS are vided among connected comps (or clients) on a network while centralizing processing and storage for all info is on a server • Ex. Surfing on the Internet • Advantage: it offloads the application programs and info from the server • Info must flow rapidly btw server and clients for adequate performance • Places a heavy load on the network capacity: sometimes a disadvantage Tiered Infrastructure • Tiered infrastructure (layered infrastructure)→ partitioned into tiers (or layers) where each tier (or layer) performs a specific type of functionality • Evolved from 1-tier to n-tier • Tier→ one or two or more rows, levels, or ranks arranged one above another ○ 1-tier infrastructure→ most basic setup because it involves a single tier on a single machine Ex. Basic word processor or desktop file utility program ○ 2-tier infrastructure→ basic client/server relationship Client handles the display and the server handles the request, and the application tier is contained on one or both of the two tiers ○ 3-tier infrastructure→ most common approach used for web applications today Web browser that acts as the client, an application server that handles the business logic, and a separate tier (DBMS) that handles database functions ○ n-tier infrastructure→ balances the work of the network over several different servers n=number of tiers Starts with basic 3-tier model and expands it to allow for greater performance, scalability, and a host of other benefits IT SUCCESS METRICS • Benchmarking→ process of continuously measuring system results and comparing those results to benchmarks • Benchmarks→ baseline values a system seeks to attain ○ Industry specific, process specific, generated internal to your organization, or some combination of the three CCT225 Page 4
of the three
Efficiency and Effectiveness Metrics Efficiency→ doing something right in the least amount of time, lowest cost and with the fewest errors Effectiveness→doing the right thing Most infrastructure centric metrics today in the IT world are efficiency metrics Infrastructure-centric metric→ typically a measure of the efficiency, speed, and/or capacity of technology ○ Throughput→ the amount of info that can pass through a system in a given amount of time ○ Transaction speed→ the speed at which a system can process a transaction ○ System availability→ usually measured inversely as downtime, or the avg amount of time a system is down and unavailable to end-users and customers ○ Accuracy→ (measured inversely as error rate), the number of errors per thousand that a system generates ○ Response time→ avg time to respond to a user-generated event, such as request for a report, a mouse click etc. ○ Scalability→ how well a system can adapt to increased demands • Effectiveness metrics→ measure results of the technology or application in some environment ○ CRM -- increase (top line initiatives) Number of cross selling successes Cost per thousand Number of new customers generated Avg length of time a customer stays active ○ SCM -- reduce (bottom line initiatives) Number of stockouts Excess inventory Distribution and warehousing costs • • • •
Web Centric Metrics • Web-centric metrics→ a measure of the success of your web and e-bus initiatives ○ Unique visitors→ the number of unique visitors to your sites in a given time ○ Total hits→ number of visits to your web site, many of which may be the same visitor ○ Page exposures→ avg number of page exposures to an individual visitor ○ Conversion rate→ % of potential customers who visit your site who actually buy something ○ Click-through→ count of the number of ppl who visit a site, click on an ad, and are taken to the site of that advertiser ○ Cost-per-thousand→ sales dollars generated per dollar of advertising ○ Abandoned registration→ number of visitors who start the process of completing a registration page and then abandon the activity ○ Abandoned shopping carts→ the number of visitors who create a shopping cart and start shopping and then abandon the activity before paying for the merchandise Call Centre Metrics • Call centre metrics→ measure the success of call centre efforts ○ Abandon rate→ % number of callers who hang up while waiting for their call to be answered ○ Average speed to answer (ASA)→ the avg time, usually in seconds, that it takes for a call to be answered by a person ○ Time service factor (TSF)→ % of calls answered within a specific time frame ○ First call resolution (FCR)→ % of calls that can be resolved without having to call back Financial Metrics • Commonly referred to as capital analysis financial models ○ Payback method→number of years to recoup the cost of an initiative based on projected annual net cash flow Cost-benefit ratio→ ratio comparing the benefits to the costs CCT225 Page 5
net cash flow ○ Cost-benefit ratio→ ratio comparing the benefits to the costs ○ Return on investment (ROI)→ the overall value of an initiative (total benefits minus total costs and depn) as compared to the useful life of the initiative, expressed as a percentage ○ Net present value (NPV)→ the total net PV of all cash flows over the life of an initiative ○ Internal rate of return (IRR)→ the net PV expressed as a percentage return Service Level Agreements Revisited • Service level agreement (SLA)→ formal, contractually obligated agreement btw two parties • Measure the success of interactions btw the two parties • Service level specification (SLS) or service level objective (SLO)→ defn of metrics and specifications (tech) • Application service provider (ASP)→ supplies software applications (and often related services such as maintenance, tech support, info storage) over the Internet that would otherwise reside on the customers' computers BUSINESS CONTINUITY PLANNING • Business continuity planning (BCP)→ rigorous and well-informed organizational methodology for developing a business continuity plan • Business continuity plan→ step by step guideline defining how the org will recover from a disaster or extended disruption of its business processes • Aka: disaster recovery plan, contingency plan Phase 1: Organizational Strategic Plan • Relative importance of resources, processes, systems and other organizational assets • Understand and develop a ranking of the importance of these assets because you cannot and should not develop a business continuity plan that enables you to recover every asset within minutes of some sort of disaster ○ Expensive and unnecessary Phase 2: Analysis • Impact analysis: ○ Truly differentiate btw critical, core IT apps and info and those that are non critical ○ Risk assessment→ process of evaluating IT assets, their importance of the org and their susceptibility to threats • Threat analysis: ○ Document the possible threats to your organization and its assets ○ Disease, earthquakes, flood, fire, cyber attack, terrorism ○ Helps you understand the magnitude of threats and how you should choose to recover from them • Impact scenario analysis: ○ Consider each threat and build a worst case scenario for each • Requirement recovery document: ○ Build a requirement recovery document→ detailed doc that describes: 1. The distinction btw critical and non critical IT systems and info 2. Each possible threat 3. Possible worst case scenarios that can result from each disaster Phase 3: Design • Disaster recovery plan→ a formal, technical, and detailed plan for recovering from a disaster ○ Location of the backup info Off site storage facility or place that is located separate from the company and often owned by another company (collocation facility) Collocation facility→ available to a company that rents space and telecommunications equipment from another company □ Ex. Storage tek Hot site→ separate and fully equipped facility where the company can move immediately after a CCT225 Page 6
○ Hot site→ separate and fully equipped facility where the company can move immediately after a disaster and resume business ○ Cold site→ separate facility where employees can move after the disaster but does not have any comp equip • Should be based on disaster recovery cost curve→ charts 1. The cost to your org of the unavailability of info and tech 2. The cost to your org of recovering from a disaster over time ○ Intersection: best recovery plan in terms of cost and time Phase 4: Implementation • Engage any businesses that will be providing collocation facilities, hot sites and/or cold sites, and implement the necessary procedures for recovering from a disaster • Train employees • Evaluate each IT system and ensure that it is configured optimally for recovering from a disaster Phase 5: Testing • Executing simulated scenarios of disasters and having employees execute on the disaster recovery plan to ensure that the solution satisfies your org recovery requirements • Deficiencies identified: return to steps 3 and 4 Phase 6: Maintenance • Continually assess new threats and re-evaluate your IT systems and related assets to determine their changing importance to the organization • Needs constant monitoring, support and maintenance
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INTRODUCTION • Service-oriented architecture (SOA or SoA)→ a software architecture perspective that focuses on the development, use, and reuse of small self-contained blocks of code (called services) to meet many or even all the application software needs of an organization ○ New applications build on past solutions organically using established building blocks ○ All software is developed from reusable units of code ○ High level, holistic organizational approach to how an organization views and acts on all its software needs • Organization with a SOA philosophy ○ Lean, agile: takes advantage of every resource in the most efficient and effective way ○ React quickly in a proactive way to perceived changes in the market, competition, and customer demographics, wants and desires ○ Respond quickly to and adapt to new advances in technology ○ Transform its processes, structure, and HR initiatives to match a changing and dynamic workforce Customers • Provide multichannel service delivery options and customizable products and services • Plug-and-play: into any communications channel with your organization such as fax, the web, face to face, phone call etc. • Experience should be the same regardless of communication channel • Personalize products and services ○ Plugging in their desires and wants Mass customization
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End-Users End-users of IT: employees within the organization Achieved through a fully integrated enterprise resource planning (ERP) system that meets every application software and information need of each and every employee ERP should support transparent interoperability across multiple vendors and within ERP modules provided by the same vendor Take advantage of multichannel service delivery ○ Able to access computing and information resources regardless of where they are (mobile computing) ○ Regardless of IT in hand, employees should enjoy access to a full range of application software services and information
Software Development • Orgs can choose among numerous software development methodologies that focus on the production and reuse of blocks of code to speed the process of software development ○ Rapid application development (RAD) ○ Extreme programming (XP) ○ Agile methodology Information Needs • Most vitally important organizational resource -- information • Ppl throughout your org need access to info , BI, and knowledge that supports their decision making efforts • SOA approach to info requires that: Info be in a standard format no matter where it exists CCT225 Page 1
• SOA approach to info requires that: ○ Info be in a standard format no matter where it exists ○ Strict and rigorous integrity control mechanisms are in place to ensure the completeness, accuracy, and validity of the info ○ No duplicate info exists in disparate silos anywhere in your organization ○ Any kind fo info from any source (even external) can be quickly and easily coupled with other info Hardware Requirements • Org should be free to choose diff technologies and diff technology platforms and integrate them seamlessly (plug and play) • Powerful storage area networks should have the capacity to store all your info needs • You should not have to care where within these networks info is stored; your access to info should be simple and easy • Telecommunications platform should be safe and secure, and at the same time, enable you to access a network, either wired or wireless, using the same steps or procedures HARDWARE AND SOFTWARE INFRASTRUCTURE • Infrastructure→ the structure beneath a structure ○ Diff players of structure, which provide support or services Enterprise Resource Planning (ERP) Revisited • ERP market is at the top of the IT spending list • Vendors are continuously updating their products and adding new technology based features • Major vendor qualities for product selection and implementation: ○ Long term vision ○ Commitment to service and support ○ Specialty features ○ Experience ○ Financial strength for R&D The Evolution of ERP systems • ERP systems replace islands of info and processes, with a single, packaged software solution that integrates all the traditional enterprise management functions such as financials, HR, and manufacturing and logistics • Early stage of ERP (1970s) system: materials requirement planning (MRP) ○ Focus: internal production, planning, calculating time requirements components, procurement, and materials planning ○ Developed to provide the right materials at the right time ○ No focus on service orientation ○ For the first time, management was able to answer the question "when?" • Early 1980s: manufacturing resources planning or MRPII ○ Evolved ○ Closed the loop with the accounting and financial management systems ○ Crossed boundaries of production functionality and started serving as decision support systems (DSS) and executive information systems (EIS-digital dashboards in the modern day) ○ Company could have an integrated business system that provided visibility for the requirements of material and capacity ○ Good info → good decisions: integrated IT systems provide competitive advantage ○ Late 1980s to early 1990s: time to market: increasingly short • Beg 1990s: enterprise resource planning (ERP) ○ Encompasses all the resource planning for the enterprise including product design, warehousing, material planning, capacity planning, and communication systems ○ Help companies become leaner and more agile to technology by integrating the basic transaction programs for all depts, allowing quick access to timely info • Evolved into ERPII SCM CCT225 Page 2
○ ○ ○ ○
•
• • •
SCM CRM DWBI e-bus
ERP and a SOA 2 primary goals: 1. Provide interoperability within an ERP vendor and for modules among different ERP vendors 2. Hide the underlying IT infrastructure of info and hardware from end-users and customers Interoperability→ the capability of two or more computing components to share information and other resources, even if they are made by different manufacturers Sustainable interoperability→ can replace software modules within the ERP suite you choose Physical structure and location of info should not be of concern to you as an end user, nor should the physical hardware infrastructure matter
ERP Advantages and Disadvantages • Advantages ○ Centralize database ○ Reliable info access ○ Avoid data and operations redundancy ○ Delivery and cycle time reduction ○ Cost reduction ○ Easy adaptability ○ Improved scalability ○ Global reach ○ e-bus support • Disadvantages ○ Time consuming ○ Expensive ○ Lack of conformity of modules ○ Vendor dependence ○ Too many features, too much complexity ○ Questionable scalability and global reach ○ Not enough extended ERP capability Supporting Network Infrastructures • Fundamental underlying infrastructure for any IT environment: network ○ 2 + comps sharing info, software, peripheral devices, and processing power Decentralized Infrastructure • Decentralized infrastructure→ little or no sharing of IT and other resources such as information ○ Arises from users or depts developing their own systems or applications, without any central control • Gives users the liberty to develop applications that meet their needs and maintain control over the applications they develop • Prevents users from easily combining processing power or even comparing info between various information systems • Encourages data duplication, frequently leading to inconsistencies Centralized Infrastructure • Centralized infrastructure→ sharing information systems in one central area or on one central mainframe • Great advantage: allows a high degree or control, making it easy to: 1. Maintain standards of hardware, software, procedures and operations 2. Control access to information CCT225 Page 3
1. Maintain standards of hardware, software, procedures and operations 2. Control access to information • Main disadvantage: inflexibility ○ Built so that it can be used by everyone, but that does not mean that the system is optimal for everyone ○ Diff dept and remote sites have diff info needs Distributed Infrastructure • Distributed infrastructure→ distributing information and processing power of IT systems via a network • All locations can share info and applications • Major benefit: processing activity can be allocated to the location(s) where it can most efficiently be done • To improve performance and reduce network traffic, a distributed infrastructure will often store the same application and/or info in 2+ locations • More complex than centralized and decentralized ○ Distributed infrastructure must be able to determine the location of specific applications and info ○ Must be more sophisticated in determining the optimal way to request the application and info ○ Order in which the system processes a request can make a sig diff in the amount of data transmitted over the network Client/Server Infrastructure (client/server network) • Client/server infrastructure→ has one or more computers that are servers that provide services to other computers, called clients • Form of distributed infrastructure • Application processing is divided btw the client and the server • Functions of an IS are vided among connected comps (or clients) on a network while centralizing processing and storage for all info is on a server • Ex. Surfing on the Internet • Advantage: it offloads the application programs and info from the server • Info must flow rapidly btw server and clients for adequate performance • Places a heavy load on the network capacity: sometimes a disadvantage Tiered Infrastructure • Tiered infrastructure (layered infrastructure)→ partitioned into tiers (or layers) where each tier (or layer) performs a specific type of functionality • Evolved from 1-tier to n-tier • Tier→ one or two or more rows, levels, or ranks arranged one above another ○ 1-tier infrastructure→ most basic setup because it involves a single tier on a single machine Ex. Basic word processor or desktop file utility program ○ 2-tier infrastructure→ basic client/server relationship Client handles the display and the server handles the request, and the application tier is contained on one or both of the two tiers ○ 3-tier infrastructure→ most common approach used for web applications today Web browser that acts as the client, an application server that handles the business logic, and a separate tier (DBMS) that handles database functions ○ n-tier infrastructure→ balances the work of the network over several different servers n=number of tiers Starts with basic 3-tier model and expands it to allow for greater performance, scalability, and a host of other benefits IT SUCCESS METRICS • Benchmarking→ process of continuously measuring system results and comparing those results to benchmarks • Benchmarks→ baseline values a system seeks to attain ○ Industry specific, process specific, generated internal to your organization, or some combination of the three CCT225 Page 4
of the three
Efficiency and Effectiveness Metrics Efficiency→ doing something right in the least amount of time, lowest cost and with the fewest errors Effectiveness→doing the right thing Most infrastructure centric metrics today in the IT world are efficiency metrics Infrastructure-centric metric→ typically a measure of the efficiency, speed, and/or capacity of technology ○ Throughput→ the amount of info that can pass through a system in a given amount of time ○ Transaction speed→ the speed at which a system can process a transaction ○ System availability→ usually measured inversely as downtime, or the avg amount of time a system is down and unavailable to end-users and customers ○ Accuracy→ (measured inversely as error rate), the number of errors per thousand that a system generates ○ Response time→ avg time to respond to a user-generated event, such as request for a report, a mouse click etc. ○ Scalability→ how well a system can adapt to increased demands • Effectiveness metrics→ measure results of the technology or application in some environment ○ CRM -- increase (top line initiatives) Number of cross selling successes Cost per thousand Number of new customers generated Avg length of time a customer stays active ○ SCM -- reduce (bottom line initiatives) Number of stockouts Excess inventory Distribution and warehousing costs • • • •
Web Centric Metrics • Web-centric metrics→ a measure of the success of your web and e-bus initiatives ○ Unique visitors→ the number of unique visitors to your sites in a given time ○ Total hits→ number of visits to your web site, many of which may be the same visitor ○ Page exposures→ avg number of page exposures to an individual visitor ○ Conversion rate→ % of potential customers who visit your site who actually buy something ○ Click-through→ count of the number of ppl who visit a site, click on an ad, and are taken to the site of that advertiser ○ Cost-per-thousand→ sales dollars generated per dollar of advertising ○ Abandoned registration→ number of visitors who start the process of completing a registration page and then abandon the activity ○ Abandoned shopping carts→ the number of visitors who create a shopping cart and start shopping and then abandon the activity before paying for the merchandise Call Centre Metrics • Call centre metrics→ measure the success of call centre efforts ○ Abandon rate→ % number of callers who hang up while waiting for their call to be answered ○ Average speed to answer (ASA)→ the avg time, usually in seconds, that it takes for a call to be answered by a person ○ Time service factor (TSF)→ % of calls answered within a specific time frame ○ First call resolution (FCR)→ % of calls that can be resolved without having to call back Financial Metrics • Commonly referred to as capital analysis financial models ○ Payback method→number of years to recoup the cost of an initiative based on projected annual net cash flow Cost-benefit ratio→ ratio comparing the benefits to the costs CCT225 Page 5
net cash flow ○ Cost-benefit ratio→ ratio comparing the benefits to the costs ○ Return on investment (ROI)→ the overall value of an initiative (total benefits minus total costs and depn) as compared to the useful life of the initiative, expressed as a percentage ○ Net present value (NPV)→ the total net PV of all cash flows over the life of an initiative ○ Internal rate of return (IRR)→ the net PV expressed as a percentage return Service Level Agreements Revisited • Service level agreement (SLA)→ formal, contractually obligated agreement btw two parties • Measure the success of interactions btw the two parties • Service level specification (SLS) or service level objective (SLO)→ defn of metrics and specifications (tech) • Application service provider (ASP)→ supplies software applications (and often related services such as maintenance, tech support, info storage) over the Internet that would otherwise reside on the customers' computers BUSINESS CONTINUITY PLANNING • Business continuity planning (BCP)→ rigorous and well-informed organizational methodology for developing a business continuity plan • Business continuity plan→ step by step guideline defining how the org will recover from a disaster or extended disruption of its business processes • Aka: disaster recovery plan, contingency plan Phase 1: Organizational Strategic Plan • Relative importance of resources, processes, systems and other organizational assets • Understand and develop a ranking of the importance of these assets because you cannot and should not develop a business continuity plan that enables you to recover every asset within minutes of some sort of disaster ○ Expensive and unnecessary Phase 2: Analysis • Impact analysis: ○ Truly differentiate btw critical, core IT apps and info and those that are non critical ○ Risk assessment→ process of evaluating IT assets, their importance of the org and their susceptibility to threats • Threat analysis: ○ Document the possible threats to your organization and its assets ○ Disease, earthquakes, flood, fire, cyber attack, terrorism ○ Helps you understand the magnitude of threats and how you should choose to recover from them • Impact scenario analysis: ○ Consider each threat and build a worst case scenario for each • Requirement recovery document: ○ Build a requirement recovery document→ detailed doc that describes: 1. The distinction btw critical and non critical IT systems and info 2. Each possible threat 3. Possible worst case scenarios that can result from each disaster Phase 3: Design • Disaster recovery plan→ a formal, technical, and detailed plan for recovering from a disaster ○ Location of the backup info Off site storage facility or place that is located separate from the company and often owned by another company (collocation facility) Collocation facility→ available to a company that rents space and telecommunications equipment from another company □ Ex. Storage tek Hot site→ separate and fully equipped facility where the company can move immediately after a CCT225 Page 6
○ Hot site→ separate and fully equipped facility where the company can move immediately after a disaster and resume business ○ Cold site→ separate facility where employees can move after the disaster but does not have any comp equip • Should be based on disaster recovery cost curve→ charts 1. The cost to your org of the unavailability of info and tech 2. The cost to your org of recovering from a disaster over time ○ Intersection: best recovery plan in terms of cost and time Phase 4: Implementation • Engage any businesses that will be providing collocation facilities, hot sites and/or cold sites, and implement the necessary procedures for recovering from a disaster • Train employees • Evaluate each IT system and ensure that it is configured optimally for recovering from a disaster Phase 5: Testing • Executing simulated scenarios of disasters and having employees execute on the disaster recovery plan to ensure that the solution satisfies your org recovery requirements • Deficiencies identified: return to steps 3 and 4 Phase 6: Maintenance • Continually assess new threats and re-evaluate your IT systems and related assets to determine their changing importance to the organization • Needs constant monitoring, support and maintenance
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