Peter Weill - Leveraging the new infrastructure: how market leaders capitalize on information technology

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title	:	Leveraging the New Infrastructure : How Market Leaders Capitalize On Information Technology
author	:	Weill, Peter.; Broadbent, Marianne.
publisher	:	Harvard Business School Press
isbn10 | asin	:	0875848303
print isbn13	:	9780875848303
ebook isbn13	:	9780585181424
language	:	English
subject	Information technology--Management.
publication date	:	1998
lcc	:	HD30.2.W45 1998eb
ddc	:	658/.05
subject	:	Information technology--Management.

Page iii Leveraging the New Infrastructure How Market Leaders Capitalize on Information Technology Peter Weill and Marianne Broadbent HARVARD BUSINESS SCHOOL PRESS Boston, Massachusetts

Page iv Copyright 1998 by the President and Fellows of Harvard College All rights reserved Printed in the United States of America 02 01 00 99 5 4 Library of Congress Cataloging-in-Publication Data Weill, Peter. Leveraging the new infrastructure : how market leaders capitalize on information technology / Peter Weill and Marianne Broadbent. p. cm. Includes index. ISBN 0-87584-830-3 (alk. paper) 1. Information technologyManagement. I. Broadbent, Marianne. II. Title HD30.2.W45 1998 658'.05dc21 98-11335 CIP The paper used in this publication meets the requirements of the American National Standard for Permanence of Paper for Printed Library Materials Z39.94-1984.

Page v CONTENTS Preface vii Part 1 Creating Business Value through Information Technology Chapter 1 Management Challenges of the New Infrastructure 3 Chapter 2 Rethinking Technology Investments: The Information Technology Portfolio 23 Chapter 3 The Evidence for Business Value 47 Part 2 Identifying Opportunities to Create Value Chapter 4 Four Approaches to Information Technology Infrastructure Investment 81 Chapter 5 Matching Views with Infrastructure Capabilities 109 Chapter 6 Management by Maxim: Linking Strategy and Infrastructure 125 Chapter 7 Using Maxims to Drive Change 153

Page vi Part 3 Managing and Maximizing Value Chapter 8 Business Transformations and Infrastructure Capabilities 177 Chapter 9 Making the Investment Decision 205 Chapter 10 Leading and Managing the New Infrastructure 231 Appendix 1 List of Participating Companies 255 Appendix 2 Checking Your Level of Alignment 257 Appendix 3 Calculating the Components of Infrastructure View 260 Appendix 4 Clusters of Infrastructure Services 265 Notes 267 Index 283 About the Authors 293

Page vii PREFACE We have embarked on a new era of competition, one that is faster paced, more global, and increasingly volatile, simultaneously requiring that firms find new ways to differentiate and to create value while relentlessly reducing costs. Some of the most important investment decisions senior management can make to meet this challenge are in information technology. Such investment will be as critical for creating long-term shareholder value as were earlier waves of decisions affecting the physical infrastructure: locations, buildings, and plant. This book grew out of our fascination with how some firms make wise information technology investment decisions and how they reap the benefits of those decisions. Very little is known about why some firms are far more successful at generating business value from their information technology investments than others, or about which investment strategies actually pay off. During our work with hundreds of executives and managers, many told us how unprepared they were for the large and important information technology investment decisions that have shaped their firm's competitive capability. They realized the significance of these investments but struggled with the choices and their business implications. Information technology is the single largest capital expense in many firms today and integral to achieving business goals. In the service industries, information technology often accounts for more than half the capital investment. It is the new infrastructure for organizations that enables new products and services, new organizational forms, access to new markets, and innovative ways to deliver services faster. Managers must now have new skills to make business choices involving key competitive, financial, organiza-

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