3 YEAR IT MANAGEMENT AND BUDGET PLANSEnterprise Value Chain and Application Maps

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VALUE CHAINS

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Objective3

To give agency personnel a better understanding of Enterprise Value Chains.

To give agency personnel multiple examples in order to increase understanding and to find a starting point to create their own value chain

To give agency personnel techniques that could make creation of the value chain easier

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What is a Value Chain?4

Value Chain theory comes from Michael Porter’s book Competitive Advantage (1985)

A model that breaks down an organization into a series of value-generating activities

A Value Chain is a Business Model High Level Model Performance Feedback Model Beginning stages of an Application Map Beginning stages to look at the State’s

business goals as one enterprise

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Parts of the Value Chain5

Support Activities Primary Activities

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Porter’s Model6

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Support Activities7

Do not directly add value, but are still necessary in providing the services or products

Close to universal for every agency

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Support Activities (continued)

8

Porter’s Breakdown of Support Activities Firm Infrastructure: organizational

structure, control systems, company culture, ect.

Human Resource Management: employee recruiting, hiring, training, development, and compensation.

Technology Development: technologies to support value-creating activities.

Procurement: purchasing inputs such as materials, supplies, and equipment.

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Support Activities (continued)

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State of Kansas agencies have modified support activities to include: Administration Management IT Management HR Management Financial Management Procurement Supporting Assets

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Primary Activities10

The links in the value chain are the “strategic relevant activities” that add value to the services or products you are providing.

Every agency is going to have unique “strategic relevant activities” Some may be similar

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Primary Activities (continued)

11

Porter’s Breakdown of Primary Activities Inbound logistics: the receiving and

warehousing of raw materials, and their distribution to manufacturing as they are required.

Operations: the process of transforming inputs in finished products and services

Outbound logistics: the warehousing and distribution of finished goods

Marketing and Sales: the identification of customer needs and the generation of sales.

Service: the support of the customers after the products and services are sold to them.

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Primary Activities (continued)

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Porter’s list does not have a direct one-to-one correlation to State government in many cases. His focus is mostly directed to manufacturing companies

that have a certain product they are producing His primary goal is the get the company to get more

value out of the sale of those goods. Value chains give a good starting point to think

about what your agency does to meet their goals The services that our state agencies provide might in

some cases do not have goods that are sold, but the services provided are still important

The benefits of the value chain can still be realized in the governmental arena. We care about getting the most out of our limited money. Value chains can help in that goal.

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Primary Activities (continued)

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The value chain links are not independent activities

Links exist inside of value chains Horizontal Links Vertical Links

These links can help lead to optimization and coordination of activities

Also provide a basis for quality assurance and monitoring performance

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KBOR Value Chain

SupportingActivities

PrimaryActivities

CoreBusinessProcess

ProcessManagement

QualityManagement

ProductInformation

Support AssetInfo

SupportingProcesses

Supporting (Financial, HR, IT, …) Assets

User Feedback and Program Management

Process Management

New or Existing

Program orPolicy

BudgetSubmissionTo Board

BoardReview

BudgetReview

Board Approval

FundingRequest

Policy &ProcedureDevelop. /Revision

FundingApproval

Review

Fundsdispersed

Program and Policy Review

Students, Citizens

“Through its diverse postsecondary education system, the KBOR seeks to provide educational opportunities for all of Kansas’ citizens to achieve their greatest potential.”

Policy and Quality Programs

HR Management

Financial Management

IT Management

Administration Management Goal

Customers

Governance and Coordination of Public Higher Education

Funding of Public Higher EducationAdequate Funding for Programs and Services

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Fort Hays State20

Financial Management

HR Management

IT Management

Administration Management

Supporting ( Financial, HR, IT, Admin ) Assets

Individual Instructor Research

Process Management

Product / Service Assets

AQIP / Accreditation

Instructor Level Assessment

Supporting Processes

Support AssetInformation

Product Information

Quality Management

Core Business Process

Process Mangement

PrimaryActivities

SupportingActivities

Public Service

Goal“Instructing students within a computerized environment in order to provide a foundation for entry into graduate school, for employment requiring well-developed analytical and communication skills, and understanding an American society of increasing diversity and global complexities of the 21st century.”

Community Outreach

Alumni RelationsRegional & State

OutreachSternberg Museum

Academic Advising

UndergradCourses / Seminars

Graduate Courses / Seminars

Virtual College

Recruiting / Retaining

Research

Instruction

Department Level Assessment

University Level Assessment

College Level Assessment

Job Placement

/ Career Services

FHSU-SponsoredResearch

Docking Research

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Value Chain Template21

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Why a Value Chain?22

Uniform way of looking at all agencies Start to look at how IT helps each one of

the links of the value chain netMBA.com has Information Systems at

every level of the value chain KDOT’s application maps prove this for

their particular agency Building block for Application Mapping

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Technology and the Value Chain

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Technological change is not important for its own sake. It is important to the value generating activities of your organization

Technology is imbedded at every link of the value chain

Information / Data is becoming more pervasive

Overall technology is playing a greater roll in business strategy

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Value Chain Linkages24

Activity to Activity Business Unit to Business Unit Agency to Agency

Department of Education to Regents Institutions

KCJIS

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Value Chain Linkages (continued)

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Human Resources Management

IT Management

Finance Management

Asset Management

Program/Project Management

Planning ConstructionPre-Construction Maintenance Real-TimeOperations

Safety

Research/Laboratory

Highway Infrastructure Assets

Administration / Services

Procurement

Local Support

HighwayImprovements

Aviation, Rail, Water andPublic TransportationNetworks

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Vertical Linkages26

Human Resources Management

IT Management

Finance Management

Asset Management

Program/Project Management

Planning ConstructionPre-Construction Maintenance Real-TimeOperations

Safety

Research/Laboratory

Highway Infrastructure Assets

Administration / Services

Procurement

Local Support

HighwayImprovements

Aviation, Rail, Water andPublic TransportationNetworks

There are easy to see vertical linkages between planning and real-time operations. They span the entire three chains

But there are also be linkages between supporting activities and primary Activities that are harder to see with the model alone

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Horizontal Linkages27

Human Resources Management

IT Management

Finance Management

Asset Management

Program/Project Management

Planning ConstructionPre-Construction Maintenance Real-TimeOperations

Safety

Research/Laboratory

Highway Infrastructure Assets

Administration / Services

Procurement

Local Support

HighwayImprovements

Aviation, Rail, Water andPublic TransportationNetworks

Changes made in each activity could change how other activities are performed

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Performance / Quality Assurance

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Human Resources Management

IT Management

Finance Management

Asset Management

Program/Project Management

Planning ConstructionPre-Construction Maintenance Real-TimeOperations

Safety

Research/Laboratory

Highway Infrastructure Assets

Administration / Services

Procurement

Local Support

HighwayImprovements

Aviation, Rail, Water andPublic TransportationNetworks

At the Activity Level:

When you start looking at advanced usage of the Value Chains one canbegin to look how each activity is performing.

At the lowest level you can look at each specific activity

This metric will let you know if each activity is performing optimally.

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Performance / Quality Assurance

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Human Resources Management

IT Management

Finance Management

Asset Management

Program/Project Management

Planning ConstructionPre-Construction Maintenance Real-TimeOperations

Safety

Research/Laboratory

Highway Infrastructure Assets

Administration / Services

Procurement

Local Support

HighwayImprovements

Aviation, Rail, Water andPublic TransportationNetworks

The same type of performance metric can be applied to an entireValue chain.

Value chain level:

At this level you can begin to start measuring the success of your process in meeting your high level business goal

This could done via the results gained from each activity level evaluation, or done via a macro level approach

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Performance / Quality Assurance

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Other ways to think about this “White Space Gaps” Prioritized Processes / Focus Agency to Agency Performance Pier Agency Performance

Other Kansas Agencies Federal Partners Local partners Other state partners

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Where to begin?31

Goals First Define the goals of the agency

Budget Documents, Strategic Plans, Responsibility and Authority documents, Organizational Charts, surveys

Determine what steps occur to carry out each goal Use Porter’s model along with other agency

examples as a reference point

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Where to Begin (continued)32

Application catalog Group applications according to services

they provide This should be a good alternative to finding

goals of the agency (If possible) Break down the group of

applications into smaller links Again use Porter’s model and other agencies

examples as a reference point

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Where to Begin?33

Combination Approach Define the goals of the agency Find group applications based on the goals

defined Break down the groups into smaller links Fill any holes in the value chain using other

methods Document review, survey, organizational

charts, ect

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Level of Detail34

Collect at the level of Detail that works for you.

Include Summary level on the ITMB

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ENTERPRISE APPLICATION MAPS

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Objective36

To give a quick review of Value Chains To understand what an application map

is To understand the scope of the

application map

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What is an Application Map37

An Enterprise Application Map is an extension of the value chain

It seeks to categorize the applications and systems in your agency with links on the value chain.

It an application map is a Business and technology hybrid model High Level

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Application Map Example39

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Map Example #240

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Regents: University of Kansas Medical Center

IT Management

Research Resources Management

Physical Plant Management

Supporting (Financial, HR, IT, Research,…) Assets

University Infrastructure Assets

Community Service: Evaluation, Tenure

Patient Care: Evaluation, Accreditation

Research: Peer Review, Research Awards, Tenure

Education: Assessment, Degrees, Credentialing, Transcripts

ProcessManagement

University of Kansas Medical Center Enterprise Application Map (2007 Draft)

RecruitmentAdmissions,Enrollment

InstructionAcademic Support

Placement,Counseling

Research Institute

AmbulatoryCare

CommunityService

CentersResearch

CoresResearch

ClinicalResearch

BasicSciencesResearch

InpatientCare

SurgicalCare

TeachingRounds

Off-site Clinics

ProfessionalService

UniversityService

ExternalAffairs

AlumniSupport

Education Activities

Research Activities

Patient Care Activities

Community Service Activities

GoalsThe University of Kansas Medical Center, an integral and unique component of the University of Kansas and the Kansas Board of Regents system, is composed of the School of Medicine, located in Kansas City and Wichita, the School of Nursing, the School of Allied Health, the University of Kansas Hospital in Kansas City, and a Graduate School. The KU Medical Center is a complex institution whose basic functions include research, education, patient care, and community service involving multiple constituencies at state and national levels.

SupportingProcesses

SupportAsset Info

ProcessManagement

CoreBusinessProcesses

QualityManagement

ProductInformation

SupportingActivities

PrimaryActivities

See key to symbols on page 2

Major IT Applications

Other major database

HR Management

Financial Management

8

1 2 5 7 8 1 3 12 16 17 18

12

3

4

5

7

8

13 12

1316

1718

8

1 5 7 81

3

6

12

13

15

17

19

2 4 5 7 6 16 17 18

1 2 3 4

5 6 7 8

1 2 3 4 107

12 13 16 17 18

5 14

5

53 10 14

14

11

11Major IT Apps 2,4,5,8,9 and Major databases 1,3,5,12,14,16,20 support all Research Activities

99818

18 18

1

12

11 1115

1519

6

6Major IT App 6 and Major database 6 support all Patient Care Activities

3 3

3

9 9

911 11 14

Major IT Apps 5,6,8 and Major database 14 support all Community Service Activities

9Major IT Apps 3,5 and Major database 9 support all Education Activities

7 8 1

12

9 10 3

14

6 7 9 10

56

1415

20

Regents: University of Kansas Medical Center (continued)

1

2

3

4

5

6

7

8

9

10

PeopleSoft HR/Pay system

PeopleSoft Financials system

PeopleSoft Student Admin system

Telephone billing system

Major IT Applications (from Section III)

World Wide Web system

Library system and Online catalog

Data Warehouse and integrated reports system

Identity Management systems

ANGEL Learning Management system

LXR Online Testing system

Other major databases

2

1

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

Active Directory

Central Server database

Chalk (for training)

Confluence (for collaboration)

DSpace

GME Database

Jroller (for Blogs)

Maximo

MEDS

Measures Of Effectiveness

NDNQI (nursing quality)

Novell Production tree

Online Phone Directory

Perseus (for surveys)

Preceptor database

PeopleSoft Grants

Space Inventory

Stellant document imaging

STIX (for employee health)

Student Research Forum

University of Kansas Medical Center Enterprise Application Map (2007 Draft) page 2

Secretary of State

Aging, Department ofENTERPRISE APPLICATIONS MAP - AGING PROGRAM & POLICY

08/31/2007SYSTEM SYMBOLS:

Internal, Current

Internal, Proposedor In Development

External, Current[Owner]

INFORMATION RESOURCE MANAGEMENT

FINANCIAL AND PHYSICAL RESOURCE MANAGEMENT

HUMAN RESOURCE MANAGEMENT

ORGANIZATION AND ACTIVITY MANAGEMENT

OUTCOMES RESEARCH

QUALITY REVIEW, REGULATORY COMPLIANCE AND COST ACCOUNTING

CUSTOMER HEALTH, SAFETYAND SECURITY

COUNSELING

NUTRITION &TRANSPORTATION

SERVICE DELIVERY

CAREGIVERSUPPORT

FORECASTAND PLAN

PUBLICOUTREACH

INFORMATIONAND REFERRAL

INTAKE /ASSESSMENT

IN-HOME SERVICEDELIVERY

GROUPRESIDENCESUPPORT

NF RESIDENCESCREENING &SUPPORT

PROGRAM / CONTRACT / GRANT MANAGEMENT

MMIS[HCP]

MMIS[HCP]

MDS[CMS]

SHICK DB

KAMIS

KAMIS

KAMIS KAMIS

BSS

BSS

BSS

BSS

STARS[DOA]

BUDGET[DOB]

PAYMENT MGT[CMS]

INVENTORY TRACK-IT!

SHARP[DOA]

HR DB

SDS

ACCESS[KDHE]

ASPEN[CMS] QR DB

WAITING LIST

FILEPRO

AGINGWEB SITE

KAMIS

Internal, Twilight

KAMIS

RADAYS

IMAGENOW

IMAGENOW

Investigation, Kansas Bureau of

Education, Department of

Why an Application Map?47

It will allow agencies to see where each specific application fits in relation to the high level business areas in the organization

To find gaps where IT does not have any applications in a particular business area

To find how pervasive technology is in your organization

Can be used to illustrate justification for IT spending

Starts the process to visually see IT / Business alignment.

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What Applications to include?

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Applications that show up in Section 3 of the 3-Year Plan

Other things that do not show up in section 3. Access databases Big excel spreadsheets Ad hoc software running in someone’s office Applications that are shared by agencies

KDOT also added different goals and business areas to their map. This model can be tailored to help your agency

in a wide variety of ranges

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Creating the Application Map

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Place each application / system / ect on the appropriate area of the value chain. If it is used in multiple different functions

then put it in all of them that apply There is really not much more to it than

that. Creating the value chain is the biggest hurdle.

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Level of Detail50

Provide what ever level of detail you can realistically complete in the given time.

We would rather see a partial application map than no application map

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Reminder51

Deadline for the IT Management and Budget Plan is August 29th.

Contact us if you are having any problems, or have any concerns. The sooner the better, as we are getting busier by the day.

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Training Provided (9:00-11:00)

July 1 Radar Charts, Communication Models, Data Maps

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All sessions are hosted in the Eisenhower Building’s 4th Floor Auditorium and take place at 9AM

Conference Call capability will be available for all sessions.

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Questions?53

Bill Roth, CITA, 785-296-2108 william.roth@da.ks.gov

Bryan Dreiling, 785-296-2809 bryan.dreiling@da.ks.gov

http://da.ks.gov/kito/3YR_ITPlans.htm

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