BSc is Project

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BSc_IS_ProjectBy S. Samina

Student ID XXXXXX

UNIVERSITY OF

Faculty of

BACHELOR OF SCIENCE IN COMPUTING

MODULE ID - XXXXXX

Project Report

TITLE OF PROJECTInvestigating the effects of organizational culture on IS project

implementation and how this can be controlled by changemanagement: A case of Waterfront UK Limited

Author's initials and surnameS. Samina

Students Registration NumberXXXXXX

Month and year of submissionFEBRUARY 2008

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Abstract

This project focuses on the effect of organizational culture on three aspects ofInformation systems project implementation (planning, stakeholder managementand training). The implementation of an IS/IT strategy will result in lots ofchanges and issues occurring in an organisation that need careful considerationand management. Amongst one of these issues is an organizations culture. Aroadblock to successful implementation of information systems / IT projects isthe vulnerability of such initiatives to powerful, yet poorly understood, culturalinfluences [1]. If already-existing cultural patterns are inconsistent with newvalues and cultural implication of the impending change initiatives, thendefensiveness, withdrawal, and distortion of important information may result[2]. These effects can powerfully inhibit an organizations ability to implementsuccessful, durable IS / IT change.

In this project, prior research would be utilized in the definition of culture and away of understanding how culture is created and maintained is examined, thisincludes patterns of organizational metaphors, beliefs, thought, action andstructures driven by corporate values. The secondary research will look at howmodels of change management can help integrate, incorporate and maintain anorganizations culture after a major IS / IT reengineering, and recommend usinga change control system to do this. Qualitative primary research will be gatheredfrom a case study organisation by the use of interviews. These will look at thecase study employees opinions and features of their change control practices.This evidence can then be compared to the existing research, to try to satisfy theprojects aim and objectives.

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AcknowledgementsThere are many people who have helped make this project possible.

I would first of all want to thank God for his grace and guidance. My sincerethanks also go to my supervisor XXXXX, for her enormous support and interest inthe project. I would also like to acknowledge the contributions of XXXXX andXXXXX who provided me with much advice.

This project would not have been possible without the help of the members ofstaff and top management of both Waterfront Consultants UK Limited for theiranswers to all my enquiries, their willingness and co-operation in supplying mewith the secondary research data and reports used in this project.

For their ongoing support and excellent proof reading skills, I would like to thankmy parents, XXXXX and XXXXX for their kind support and I am grateful to all myfamily and friends for their support and understanding throughout mypreparation of this report.

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Table of ContentsChapter 1 .......................................................................................................7

1. Introduction .............................................................................................71.1 Problem Definition & Goals .....................................................................71.2 Aim .......................................................................................................81.3 Objectives ..............................................................................................81.4 Discussion of changes to the Aims and Objectives ....................................81.5 Indication of the following chapters and Structure ....................................9

Chapter 2 ......................................................................................................10Research Methodology ...................................................................................10

2. Introduction ...........................................................................................102.1 Secondary Research .............................................................................102.2 Primary Research .................................................................................10

2.3.1 Ethics and considerations when conducting primary research ............112.3.2 Quantitative or Qualitative research methods ...................................112.3.3 Sample for Primary Research ..........................................................12

2.4 Limitations and Critical Analysis .............................................................132.5 Conclusion ...........................................................................................13

Chapter 3 ......................................................................................................15Literature Review ..........................................................................................15

3.1 Introduction .........................................................................................153.2 Culture ................................................................................................15

3.2.1 Critical Analysis ..............................................................................16

3.3 Organizational Culture ..........................................................................173.3.1 Stages in Development of Organizational Culture .............................17

3.3.1.1 Birth Stage ..............................................................................173.3.1.2 Mid-life Stage ...........................................................................183.3.1.3 Maturity Stage .........................................................................18

3.3.2 Shared Knowledge among Workforce ..............................................183.3.3 Transmission Agents .....................................................................183.3.4 The learning Process ......................................................................19

3.4 Main Cultural and Structural Problems in IS Projects ...............................193.5.1 Symbols .........................................................................................20

3.5.1.1 Influence on IS Project: Daimler-Chrysler .................................20

3.5.2 Power Structures ............................................................................213.5.2.1 Influence on IS Project: National Probation Service: NPSISS(CRAMS) .............................................................................................21

3.5.3 Organizational Structures ................................................................213.5.3.1 Influence on IS Project: Failure of Project Everest Ford MotorCompany ...........................................................................................21

3.5.4 Control Systems .............................................................................22

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3.5.4.1 Influence on IS Project: Daimler-Chrysler .................................223.5.5 Rituals and Routines .......................................................................22

3.5.5.1 Influence on IS Project: Failure of Project Everest Ford MotorCompany ..........................................................................................22

3.5.6 Stories ...........................................................................................23.........................................................................................................233.5.6.1 Influence on IS Project: Daimler-Chrysler ..................................23

3.6 Change Process Models ........................................................................233.6.1 Lewins Change Model....................................................................23

3.6.1.1 Unfreezing ...............................................................................243.6.1.2 Moving ....................................................................................243.6.1.3 Refreezing ...............................................................................25

3.7 IS Project Implementation activities Utilized ...........................................263.7.1 Implementation Planning ................................................................26

3.7.1.1 Implementation Strategies ........................................................26................................................................................................................273.7.1.2 Systems Development ..............................................................273.7.1.2i. Life Cycle Models ....................................................................27i. Systems Development Lifecycle (SDLC) ..............................................27ii. Adaptive Software Development ......................................................29iii. Problems Ascertaining Customer Requirements and Constraints .........30iv. Implementation Strategy / Product Releases ....................................31

3.7.2 Training .........................................................................................313.7.3 Stakeholder Management / Project Sponsors ...................................32

3.8 Justification for Project Topic ................................................................32

3.9 Conclusion ...........................................................................................33Chapter 4 ......................................................................................................34Case Study Findings ......................................................................................34

4. Introduction ...........................................................................................344.1 Company Background and Problem Situation .........................................344.2 Strategic Outlook ..................................................................................354.3 IS Implementation: Cross Functional Business Programme ......................36

4.3.1 Systems Objectives ........................................................................364.3.2 Implementation Planning ................................................................37

IS Implementation: Cultural Issues & Changing Requirements ..............39

IS Implementation: Cultural issues & Scope Escalation ..........................394.3.3 Implementation Strategy ................................................................394.3.4 Stakeholder Management ...............................................................404.3.5 Training .........................................................................................41

4.4 Application of Change Management Models ............................................424.4.1 Levels of Culture: Values ...............................................................424.4.3 Lewins Change Model....................................................................43

4.4.3.2 Moving ....................................................................................43

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4.4.3.3 Refreezing ...............................................................................444.5 Conclusion ...........................................................................................45

Chapter 5 ......................................................................................................46Discussion of Findings ....................................................................................46

5. Summary of Research Results .................................................................465.1 Secondary Research: Objectives ............................................................46

5.1.1 Concept of Culture and Organizational Culture .................................465.1.2 Various cultural and organizational problems expected during ISproject implementation ...........................................................................465.1.3 Change Process Models & IS Implementation Activities .....................475.1.4 Overall Comments on Secondary Research ......................................47

5.2 Primary Research .................................................................................475.2.1 Implementation Planning ................................................................475.2.2 Implementation Strategy ................................................................48

5.2.3 Stakeholder Management / Project Sponsorship ...............................485.2.4 Training .........................................................................................49Chapter 6 ......................................................................................................50Conclusion ....................................................................................................50

6.4 What Has Been Learned .......................................................................516.5 Conclusion ...........................................................................................526.6 Future Work .........................................................................................52

Bibliography ..................................................................................................53Appendix A ...................................................................................................58Test Results: Waterfront Consultants ..............................................................58

Appendix B ...................................................................................................59

Screen Shots For Error Reports: Waterfront Consultants ..................................59Screen Shot: Manual Testing Error Report ...................................................59Screen Shot: Automated Testing Error Report ..............................................62

Appendix C Project Progress Reports 1-3 ........................................................64

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Chapter 11. Introduction1.1 Problem Definition & GoalsIT plays a significant role in the overall re-engineering of the firm.Due to the fast pace of changing technology in todays world, manyorganisations find themselves at a stage where they may have to introduce,update and sometimes replace their existing IT / IS (information technology /information systems), to maintain their status and continue to be effective intodays competitive business environment [4]. Due to this, companies will findthemselves at a stage where they have to manage an IT project to successfullyimplement a new system, or make changes to an existing system. Therefore, youwould expect large companies to manage their IT projects and implement theirIT systems effectively.

However, there is the threat and vulnerability of such projects / changeprograms to powerful yet poorly understood cultural forces. If we acknowledgethe potential causal role of culture in the success or failure of organizationchange, then it makes sense to investigate the strategies for examining andredesigning cultural systems as an integrated aspect of change management,this is what I intend to achieve in carrying out this project.

The theories of change management will be applied to a case study ofWaterfront UK Cross Functional Business Programme (CFBP) project, during myinvestigation, I realised how a good change control system contributed to thesuccess of an IT project implementation. Different aspects of change as adoptedby the company were analysed, these ranged from changes in the roles ofindividuals through to changes in the structure of the company.

The change affected all aspects of the operations and functioning of theorganisation. A series of critical success factors first had to be taken intoaccount, these include; management buy-in and ownership, action to attract andkeep the right staff to achieve change, employee ownership of change, effective

organizational structures. Lewin /Schein change process model will be employedto encapsulate the IS project implementation phenomena. While some of theissues represented in this study have been addressed individually in previousstudies, they have not been adequately viewed in the context of IS projectimplementation in a manufacturing setting.

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1.2 AimTo study the area of organizational culture and IS / IT project implementation, toassess how the culture of a firm influences IS / IT project implementation. It will

then use a case study to help understand how change control can be used tomanage the transition process, and therefore reduce the risk of an organizationsability to implement successful, durable IS / IT change.

1.3 Objectives1. To discuss the concept of culture and organizational culture

2. Investigate the various cultural and organizational problems expectedduring IS project implementation

3. Outline and discuss the change process models utilized during IS projectsand reengineering

4. Outline and discuss the three IS implementation activities affected byorganizational culture utilized in this project

5. Analyze the implementation of Waterfront UK Cross Functional BusinessProgramme (CFBP) and how successful was the planned change initiative

6. Outline any improvements for the future in the context of change

management models utilized, approaches and IS project implementation

1.4 Discussion of changes to the Aims and ObjectivesThe aims and objectives have been structured to allow the reader to gain anunderstanding of the topic of organizational culture and IS projectimplementation, and then focus on investigating how organizational cultureaffects IS project implementation. Upon the understanding of an organizationsculture and ways in which it can be maintained, the final objective is to considerchange control as a method for controlling the transition process, to reduce the

risk of an organizations ability to implement successful, durable IS / IT change.

The topic, aims and objectives has changed hugely from the original projectproposal. This was as a result of a feedback received from my tutor who advisedthat the initial topic was too vague and wide and the need to investigate onlyone factor (organizations culture) rather than all the issues affecting IS projectimplementation.

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1.5 Indication of the following chapters and Structure

Chapter Two outlines the research methodology used in this study. This chapterlooks at how both the primary and secondary research was conducted. It alsohighlights the limitations and complexities that were found during the researchphase of this study.It justifies why the research methodology was selected as the design for thisstudy.

The third chapter gives an overview of literature and previous studies relevant toestablishing a theoretical background to the theme. This chapter discusses thesecondary research findings.

The fourth chapter is an overview of culture, its definition, models and concepts.

The fifth chapter explains the background of the case study organisation used forthe primary research, and discusses the key themes and opinions that wereobtained during the primary research.The sixth chapter will look to what extent each of the individual objectives wasachieved. It will also highlight any possible weaknesses within the research anddraw on the findings from the primary and secondary research, to make anoverall conclusion of the study.

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Chapter 2Research Methodology

2. IntroductionThis section describes the research methods that have been conducted toachieve the projects individual objectives.The research was from both primary and secondary sources. The findings fromthese were cross checked and compared to achieve the aims and objectives ofthis project. This multi method approach is known as triangulation, and is usedto produce a full and balanced study [3].2.1 Secondary Research

A literature review was carried out, in order to provide secondary research forthe project. This was done to gain a greater understanding and familiarity of theresearch topic. Also to gain an insight of the previous research that has beencarried out in the topic area, also to help plan the primary data collection [7].The secondary information was collected from the University learning centre andfrom the British library. The sources used for this was books, as there was agreat amount of material on effective project management. A disadvantage ofusing these texts is that many may be dated. Also, due to IT being a fastchanging industry, some of these texts may be out of date and irrelevant in

relation to todays business environment.

To compensate for this, literature from current journals was also examined.These included case studies of organisations that have encountered projectfailure. These were used to back up any claims the older literature made. All ofthe sources used to conduct the literature review were personally evaluated inregards to its respectability and reliability. This was to ensure that a qualityliterature review was produced. By completing a literature review the first threeobjectives had been met. It highlighted the issues that should be taken intoaccount for when the primary research was conducted [3].

2.2 Primary ResearchAs objective four was focusing on a real-life situation, a case study was used tofulfil the objectives requirements. Yin (1993), describes a case study as lookingat a real life program whose complexity cannot be captured by surveying, andthat a case study is used to illuminate how, and why things take place. The typeof case study that will be used is known as an individual case studywhich

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focuses on antecedents, contextual factors, perceptions and attitudes. This isused to explore processes and experiences [5]. This method will be used as theresearcher is trying to understand the case studies change control processes andthe users experience of those process. It must be recognised that this case

study will not be holistic (represent a global level) as it is only focusing on oneorganisation [4].The researcher is familiar with the company that was used for the case study. Hehas contacts within the company, in the course of enquiries to get researchdocuments. Due to this, a more open and reliable response would be obtainedfrom the research, as trust had been built up with the company in the past [3].2.3.1 Ethics and considerations when conducting primary researchThe researcher had to take into consideration the ethics of using a case studywhen obtaining primary data. Although I was reluctant in using the companysname, however, I was dissuaded from doing so by the personnel manager. Butall of the participants of the study remained anonymous as recommended bySapsford and Evans (1984), they were referred to by their job role.

The researcher had to obtain authorisation to use the company as a case studyfor the research project, therefore permission was sought early in the study. Thecompany has been informed of any information disclosed in this study. Also theintentions of this study have been fully explained to all concerned. Theresearcher must also not keep records of any of the interviews or company

information for longer than is needed to comply with the data protection act [7].2.3.2 Quantitative or Qualitative research methodsFor the primary research qualitative research methods were chosen overquantitative research methods. They provide a greater detail of peoplesunderstandings and feelings than quantitative methods can attain [8]. To obtainthis qualitative data the researcher chose to perform a number of interviews.

Arksey and Knight (1999) describes how choosing an appropriate interviewingapproach is a skilled and difficult activity. The interview approach chosen for this

study, were one-to-one semi structured interviews. These interviews wereconducted as they provide a more exploratory and qualitative response than astructured interviews. King (1994) refers to semi structured interviews asqualitative research interviews. This exploratory approach allowed the researcherto follow a set of questions but also probe into areas of interest to the researchtopic [3]. The interviews were audio taped. These were then typed up using atranscript methodology which can be seen in appendix B. This ensured that theinterviewer could give his full attention to the respondent and make sure that

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there was no loss of data. This would also enable any claims made by theresearcher, to be effectively backed up.The interviews were constructed to follow the themes and findings that werebrought to light by the secondary research, focusing on the main arguments that

occurred. The questions were structured to allow correlation between theprimary and secondary research. They were also asked to more than oneinterviewee, which allowed the comparison of opinions and feeling between eachof the interviewees. The answers from each interview was discussed, comparedand contrasted, in relation to each of the relating set questions. These findingswere triangulated with the secondary research from the literature review, using adata triangulation method [8], in order to gain confirmation of the findings [10]and provide completeness [11]. By using a data triangulation method it helpedto reduce bias and improve the validity of the research [12].

An alternative research method to interviewing, to collect primary data, mayhave been the use of questionnaires. This method was not chosen as it onlyallows limited answers to the given for each question. This is therefore not asflexible as a semi structured interview and does not enable the researcher toclarify ambiguous answers and misunderstandings [5]. There were also only alimited number of people within the company that had expertise in this area ofthe study. Therefore, a mass questionnaire would have been non-effective inreceiving a qualitative response. The researcher had chosen to interview to showa willingness and commitment to the company. This enabled him to utilise hisrelationship with the organisation. This was done as it was believed that a richerresponse would be obtained, as the interviewer was present when the questions

were asked.

2.3.3 Sample for Primary ResearchThe sample interviewees were chosen in relation to their expertise of theresearch topic, as they all extensively interacted with the companys changecontrol system. Change control is a very specialised area and many people donot understand its full scope or purpose.Therefore there were only a limited number of candidates available for interview.The following describes why each interviewee was chosen for the primary

research.

Change control manager: Due to their extensive knowledge of the companyschange control processes. They understand the importance of having a changecontrol system in place. The change control team manager must ensure that thechange control system is working correctly to comply with the laid down qualitycontrol.

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Project manager: Responsible for the running of selected IT projects withinWaterfront UK and depends on the change control system to place controls uponthe project.

System controller: This person relies on the change control system to enablechanges that the users may request, to be made to the current system. Thesystem controller requires a successful change control system to ensure the dailyrunning of the business activities, and is responsible for the testing of anychange made to the system.

These people were interviewed on the same day, using the same interviewmethod. One to one semi structured interviews with open ended questions. Thiswas to ensure that there was consistency and integrity between the interviews[3]. The questions were also constructed in such a way that would allow the

correlation and comparison of answers between each interviewee, to contrasteach of the interviewees views.

2.4 Limitations and Critical AnalysisA data triangulation method was used in order to gain confirmation of thefindings [10] and to provide completeness [11]. This was also used to reducebias and improve validity [12]. However, Fielding and Fielding (1986) havechallenged this view of data triangulation, arguing that it only allows a fullerpicture of the problem, by gaining depth and understanding but does not offer agreater accuracy. The researcher still felt that by using a triangulation method,

the findings would be strengthened. It was therefore felt more beneficial to usethis method, than not to. As the researcher had his own experiences andobservations from his experiences working at Waterfront UK, the researchersviews and interpretations may have been biased from his experiences [3]. Theresearcher was aware of this and worked to prevent any bias that may haveexisted, from entering the study.

The researcher was aware that Waterfronts change control process or businesspractices would not be representative of all companies. A single case study doesnot provide a holistic view [4]. Using multiple case studies would have been abetter way of conducting the primary research. Due to time limitations and lackof budget, the researcher was restricted to using only one company for this casestudy.

2.5 ConclusionEach of the research methods used was chosen in respect to their effectivenessin completing the criteria for each of the projects individual objectives.

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Considerations about the experience of the researcher and the availability andease of use had also to be considered when choosing the research methods. Thischapter has justified the use of each of the chosen methods, and explained howthe researcher utilised each of these within this study.

The main methodology mentioned in the proposal that I had intended to use inthis study was of an entire case study method. Due to time limitations and lackof budget, the researcher was restricted to using only one company for this casestudy. It was also felt by completing the literature review and participating in theinterviews the researchers understanding of the study would not benefit anyfurther from applying these methods to the study.

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Chapter 3Literature Review

3.1 IntroductionThis chapter gives an overview of the relating research fields with the purpose ofachieving the first three objectives of this project.Charles Handy (1993) defines organisational culture as the shared values,assumptions, norms, and the personality of the organisation. This can beevident in the way the organisation conducts its activities such as the way itraises capital, the treatment of its staff, formal and informal relationship thatexists within it [14].3.2 Culture

According to Argyris (1994) in many organizations, IS project implementationrequires a transition period of at least three to five years. Major factorscontributing to the lengthening of this transition are the complexity, ambiguity,and power of organizational culture [1]. Yet, managers who embrace values-based change initiatives often have little awareness of the causal impact ofcultural forcesvalues, assumptions, patterns of thought and actionon thesuccess or failure of their plans [2]. If we are going to address cultural factorsthat affect the implementation of IS projects, then it may be useful to clarify

what we mean by culture.

Edgar Schein (1992) has proposed the following clarification of what we mean byculture. First builds a holistic context within which culture is to be understood:

Culture somehow implies that rituals, climate, values, and behaviors which bindtogether into a coherent whole. This patterning or integration is the essence ofwhat we mean by culture.[15]. Next he offers a formal definition of culture:

A pattern of shared basic assumptions that the group learned as it solved itsproblems of external adaptation and internal integration, that has worked wellenough to be considered valid and, therefore, to be taught to new members asthe correct way to perceive, think, and feel in relation to these problems[15].Culture is built up through its continuing enhancement of an organizations abilityto deal with its problems in a way that fixes its identity. While culture is asystemic phenomenon, its primary architects are those at the very top [15].Schein models culture on three levels (Figure 1). The first level, artifacts,includes observable daily features of organizational life such as activities, rituals,

jargon, office layouts, and so forth. The second level, values and beliefs, includes

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an organization's espoused judgments about what is good and bad, which makesense of how actions are evaluated as exemplary or ineffective. The third level,basic assumptions, includes our deepest and most comprehensive explanation ofrealityour views of fundamental truths about people and the world. This layer is

usually tacit. Additionally, to be found in this deepest layer, Schein points out,are the mental models and value systems that actually drive organizationalbehaviour [15].

Figure 1: Layers of Culture (adapted from Schein, 1992)(Full written permissionobtained from author)

3.2.1 Critical AnalysisAccording to Pendegraft, (1996), the difficulty with examining and understanding

the levels of culture as stated by Schein in Figure 1, is that rarely are all threelevels out in the open. Certainly the level of artifacts is observable; it containsthe manifestations of culture that we see around us, the things, adornments,relations, and ways of speaking and address, that characterize tangible life in anorganization. But when we attempt to look beneath the artifacts to find out whythey are there we enter a realm that is often at least partially hidden fromconscious thought, even among members of the organization [16]. Directlybeneath the level of artifacts from Figure 1, lies the level of values and beliefs.

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These are the values that the organization holds dear and espouses a will toenact in practice. Common values are promote honesty, respect the needs ofco-workers, or strive for excellence. These values are usually highly visible,often prominently posted. Yet, research has found in Rugman & Hodgetts

(2000), states that routine organizational behavior sometimes reflects other,hidden values, especially in situations of stress and uncertainty. In contrast toespoused organizational values, these shadowy, alternate values are rarelyacknowledged openly, nor can we examine them directly. Instead, they must beinferred from patterns of behavior. An example of such a hidden value would be

win, do not lose[14]. These hidden values often conflict with publishedespoused values. Moreover, when we choose to act consistently with hiddenvalues, our actions will likely undermine other actions seeking to realize theespoused values of the organization [14].3.3 Organizational Culture

According to Thompson & Strickland, (1999), organisational culture can bedefined as the shared values, assumptions, norms, and the personality of theorganisation. This can be evident in the way the organisation conducts itsactivities such as the way it raises capital, the treatment of its staff[18].Organisational culture can also be broken down onto formal and informalrelationship that exists within it. Formal relationship include the hierarchical workrelationships within and between functional business areas, while informalrelationships are created through people working and socialising with each otheron a regular basis, and it cuts across functional barriers [18].3.3.1 Stages in Development of Organizational CultureSchein (1985) identifies organisations developing through the three stages of"Birth and Early Growth, Mid-life and Maturity".Schein doesn't believe that progression through each of these stages isinevitable. Changing an organisation's culture is possible, even inevitable. Heproposes various change mechanism for each of the stages and places greatemphasis and responsibility on the leaders for initiating and implementing these,often using organisational development techniques. Only at the Maturity stage

when decline and potential termination is likely, does he proposed more drasticactions, such as "Coercive Persuasion", "Reorganisation, Destruction, Rebirth","Bankruptcy and Reorganisation" (p272).

3.3.1.1 Birth StageBirth and Early Growth covers the formative years, when new organisations are"dominated" by the vision and drive of their founder. Here according to Schein

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(and others), "Culture is a distinctive competence and source of integrity; .. theglue that holds organisations together", and "Organisations strive towardsintegration and clarity" (p271). Handy (1985) see this phase typically being"power-oriented, politically minded, risk taking, and rate security as a minor

element in their psychological contract" (p189). A culture where organisations"judge by results and are tolerant of means".

3.3.1.2 Mid-life StageDuring the Mid-life phase, when "the sheer numbers of non-family members overweighs the family members" (Schein, p283), the original culture has becomeabsorbed and unconscious and then "Cultural integration declines as newsubcultures are spawned. Loss of key goals, values, and assumptions createscrisis of identity" (p272). This is Handy's "role culture, often stereotyped as

bureaucracy" (p190). This culture works by "logic and rationality" embodied inrules and procedures, and "rests its strength in its functions or specialities".Handy refers to Weber's (1963) definition of a bureaucracy.

3.3.1.3 Maturity StageFinally, Maturity is reached when "the organisation is unable to growth because ithas saturated its markets or become obsolete in its products" (Schein, p291)."Culture becomes a constraint on innovation. [It] preserves the glories of thepast, hence it is valued as a source of self-esteem, defence" (p272).

3.3.2 Shared Knowledge among WorkforceAccording to Goodstein et al (1993), an organisations culture is embedded in theminds of its employees. The norms within an organization are rarely writtendown; rituals and celebrations do not usually exist in procedure manuals;organisational metaphors are not found in corporate directories [19].Organizations therefore depend on a stable workforce to communicate andreinforce the dominant beliefs and values [20]. The Organizational culture canliterally disintegrate during periods of high turnover and precipitous downsizingbecause the corporate memory leaves with these employees [19, 20]. Corporateculture also weakens during periods of rapid expansion or mergers because ittakes time for incoming employees to learn about and accept the dominantcorporate values and assumptions.

3.3.3 Transmission AgentsAccording to Hofstede (1991), an organisational culture is learned, so aneffective network of cultural transmission is necessary to strengthen an

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organizations underlying assumptions, values, and beliefs. The cultural networkexists through the organisational grapevine. It is also supported through frequentopportunities for interaction so that employees can share stories and re-enactrituals [20]. Senior management and executives must tap into the culturalnetwork, sharing their own stories and creating new ceremonies and otheropportunities to demonstrate shared meaning. Company magazines and othermedia can also strengthen an organisational culture by communicating culturalvalues and beliefs more efficiently [20].3.3.4 The learning Process

According to Ridgeway et al (1997), individuals learn the values, expectedbehaviours, and social knowledge necessary to assume their roles within theorganization through a process called organizational socialization. By

communicating the companys dominant values, job candidates and new hiresare more likely to internalise these values quickly and deeply [21]. People learnabout an organisational culture through recruiting literature, advertising, andnews media reports about the company [21]. During the recruitment process,some companies provide information about the way things are done aroundhere. Even if this information is not forthcoming, applicants might learn fromemployees, customers, and others who regularly interact with the organization[21].3.4 Main Cultural and Structural Problems in IS ProjectsOne of the dominant models in analysing cultural problems within anorganization is the organizations cultural web analysis developed by Johnson andScholes (1999). This model was utilized by KPMG in a survey by Casey (1999) inanalysing the cultural fit and differences between Daimler and Chrysler during itsmerger. The factors identified in the cultural web analysis have a strong similarityto the factors found in the forcefield analysis.

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Figure 2: Organizations cultural web analysis (adapted from Johnson andScholes 1999)(Full written permission obtained from author)3.5.1 SymbolsThis would include titles, the type of language and terminology used, within anorganisation. In the case of an organization there are many symbols of hierarchyor ways of doing things in either a conservative or informal and formal way [23].3.5.1.1 Influence on IS Project: Daimler-Chrysler

According to Casey (1999), during the IS reengineering at Daimler-Chrysler, thedifferences in symbols and privileges between levels of management andexecutives led to mistrust, deep suspicion and undue delays in projectimplementation. In Daimler-Benz executives wanted to be addressed by theirDoctor title and this did not go down well with executives of Chrysler who felt itwas irrelevant [25]. This however led to instances where major key decisionswhere simply ignored by executives of Chrysler [25].

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3.5.2 Power StructuresAccording to Ridgeway et al (1997), there are differences in power structures in

different organizations depending on the structures in place. Top executiveseither work as a tight nit community working on a firm set of beliefs andassumption in terms of how the company should operate. On the other hand,Pendegraft (1996), states that in other organizations, executives are a select few,who are employed on the basis of achievements, reputation, level of prestigeand ideology. These structures normally affect the long-term work ethics in placeand bureaucracy [16].3.5.2.1 Influence on IS Project: National Probation Service: NPSISS(CRAMS)

According to a report by the National Audit office (2001), sites lack ofcommitment from top executives as one of the reasons responsible for the failureof the national probation service IS implementation project. The report statesdeliberate decision and power tussle among top executives as one of the reasonsin deliberately excluding the strategy board and IT manager from its key decisionprocess [27].

3.5.3 Organizational StructuresAccording to Hofstede (1991), an organizations structure can either be

hierarchical, matrix, flat, networked or T-formed. The hierarchical structures arethose where individuals are part of a bureaucracy where a small group holdauthority and are responsible for key decisions. While the matrix and flat is adecentralised structure allows authority to be dispersed throughout firm.Rosebeth Moss Kanter (1989) argues managers need to apply entrepreneurialprinciples to the traditional corporation, creating a marriage betweenentrepreneurial creativity and corporate discipline, co-operation and teamwork[20], as to do otherwise will stifle creativity.3.5.3.1 Influence on IS Project: Failure of Project Everest Ford Motor

CompanyAccording to Carr (2004), Project Everest embarked upon by Ford motorcompany, failed mainly due to the prevailing organizations structure at the time.Prior to the commencement of project Everest, the organizational culture at Fordwas such that it prided itself in its empowered unit entity, there was fierceindependence and competition among its units, largely encouraged by topmanagement [28]. Although on the surface, commitment was high among top

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management, and there were efforts to propagate the same among its units,however, reports reveal that most of them were not as committed, in fact, therewas a definite morale problem among members of staff on all levels [28]. Thedifferent perspectives of the stakeholders revealed fierce resistance mainly from

the unit managers and employees who plainly rejected the idea on the groundsof lack of consultation. This was after over $800 million was spent [28].3.5.4 Control SystemsThis emphasises what is important to monitor in an organisation and what tofocus attention and activity upon [18]. It intertwined between its Businessstrategy and its values as an organization.

3.5.4.1 Influence on IS Project: Daimler-ChryslerAccording to Casey (1999), a breakdown in the IS implementation as carried outby Daimler-Chrysler, was due to the fact that Daimler-Benz was guilty of focusingon enhancing shareholder value instead of stakeholder value on a positive note,Daimler-Benz focused its attention on high quality goods [25]. In this case, bothDaimler and Chrysler are monitored on quality, profits, financial reporting andprofessional responsibility [25]. Some experts in the automotive field believe thatChrysler focused more attention on faster production and excessive research anddevelopment projects which in turn places less emphasis upon quality [25], thisis the total opposite of Daimler-Benz where quality comes at a high price. Thiswill prove to be a cultural problematic area [25].3.5.5 Rituals and RoutinesThis includes events and formal processes which the organisation emphasiseswhat is particularly important [16]. This would include relatively informalorganisational processes, which include attitudes to change, training, chances ofpromotion, working hours, attitude to training, work conditions, drinks afterwork, working less hours and a chat around the photocopier. Similar routinestake place across all the business entities of the organization.

3.5.5.1 Influence on IS Project: Failure of Project Everest Ford MotorCompanyAccording to Carr (2004), in the implementation of Project Everest, wadingthrough the rituals, politics, cultural and inter-departmental / regional suspicions,was an accident waiting to happen and the steps that killed off the project[25]. The unit / regional managers and employees, saw the new informationsystem as a threat, implying a loss of their jobs, distinct strategy and set pattern

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of productivity which they were already used to [25], thus leading todisintegrated work patterns they have been used to for decades, loss ofentrepreneurial freedom, product competence and loss of our distinct strategy,which has been sustained for four decades [25].3.5.6 Stories

According to Johnson et al (1999), stories are told by members of anorganisation to each other, to outsiders, to new recruits and so on, which embedthe present in its organisational history and so on and also flag up importantevents and personalities[23]. In most cases organisations have successes,disasters, heroes, villains and mavericks that have become part of theorganisations folklore [23].3.5.6.1 Influence on IS Project: Daimler-ChryslerIn recent history, Chrysler have almost gone bankrupt twice, perceived poorquality of product and has a villain in the form of pragmatic hands-on engineerRobert Eaton who effectively placed Chrysler into German hands, this has fuelledan anti-Daimler-Benz sentiment in US [23]. On the other hand Daimler-Benzmade engines and components for the Nazi war machine during WWII, theyhave a maverick in the form of Juergen Schrempp who masterminded the largestautomotive merger in history [23].Stories and folklore should not hamper IS project implementation at all, as the

organisation will be analysing the present and looking into the future and not thepast.

3.6 Change Process ModelsOne of my objectives is to consider change management as a method forcontrolling the effects of an organizations culture on IS project implementation.The dominant model of change management I would be utilizing in this projectwould be Kurt Lewin, this was developed in the 1930s and 40s.

3.6.1 Lewins Change ModelThis is a natural progression from Lewins forcefield analysis. According to Lewin(1952) the managed change occurs through the process of unfreezing thecurrent situation, moving to a desired condition, and then refreezing the systemso that it remains in the desired state [29]. Lewins model also recognises thatchange requires disequilibria between the restraining forces and the forces forchange [29]. Effective change involves minimising the restraining forces as well

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as making employees more aware of the forces for change [29]. Even thoughthis model is fifty years old it has stood the test time and is still popular as aconceptual framework[29].

Figure 3: Management of change (Lewin)(Full written permission obtained fromdistributor)

3.6.1.1 UnfreezingThis is the process where top executives, senior management and change agentsget their workforce in their respective organisations to recognise that the oldways of doing things are no longer satisfactory and to accept the need forchange [29]. This way, all the stakeholders, all those to be affected by the IT /IS change and everyone associated with both organisation and its IS would beaware that change would be inevitable some day, and that the behaviour of theorganization / industry would affect them in some way, shape or form [29]. Thisway with the involvement of the top executives, the stakeholders would have theimpression that the change is in the best interest of everybody and that it wouldcreate the most profitable and competitive position for the organization [29].3.6.1.2 MovingThe second stage is driving the necessary change or moving it to a new level.The change agents have to play a major role in this stage [25]; they mustcapitalise on the acceptance for the need for change and generate complianceand support throughout all the stakeholders [25]. Basically, this involves everyphysical and non-physical aspect of the organisation, and this is commonlyknown as organisational development [25].Organisation development (OD) takes an open systems perspective and relies on

many organisational behaviour concepts, such as team dynamics, perceptions,job design and conflict management [25]. Most OD activities rely on actionresearch as the primary blueprint for planned change. Top executives andmanagement would need to determine whether the change in question shouldbe evolutionary (incremental change) or revolutionary (quantum change) [25].Important Cross-Cultural issues on Organisation development:

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CriticismsAccording to Easton (1988), the main criticism of the organization developmentincludes the following;

1. OD techniques mainly originate from the US and do not work as well in

other cultures such as Asia2. OD makes linear and open conflict assumptions about change; not held in

cultures with high power distance and collectivism3. OD needs a more contingency oriented perspective

Field TheoryThe field theory is about understanding the group behaviour in an organization

by understanding the field in which the behaviour takes place [19].Group DynamicGroup dynamic is about understanding the dynamic between group members inorder to change that dynamic [19].3.6.1.3 RefreezingThe third stage aims to lock in new behaviour through a process ofreinforcement and reward at the organization. During the refreezing stage, the

organisation may also ensure that the new behaviours have become theoperating norms at work, that the reward system actually reinforces thosebehaviours, or that a new, more participative management style predominates(Goodstein & Warner Burke: 1993)

Resistance to change may be minimised by keeping stakeholders and employeesinformed about what to expect from the change effort (communicating);teaching employees valuable skills for the desired future (training); involvingthem in the change process; helping employees cope with the stress of change;negotiating trade-offs with those who will clearly lose from the change effort and

using coercion [19]. I believe that organisational change should be a continuousprocess that is engaged continuously especially after the refreezing stage [19].Attitudes must always be flexible and responsive to the opportunity for newapproaches [19].

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3.7 IS Project Implementation activities Utilized3.7.1 Implementation PlanningPinto (1998) argued that it is vital to thoroughly plan an implementation process.Implementation planning refers to the process of translating the strategy into aseries of specific project tasks and when they are completed, the organisationwill have a functioning IS. Most planning tasks are non-routine andmultifunctional, often integrating various types and sources of data. Effectiveimplementation planning requires the ability to forecast different growthscenarios. System developers have to ensure that implementation planning andgoals are clear to all team members, e.g., senior managers and users [32].3.7.1.1 Implementation StrategiesOrganisations can adopt a variety of strategies by which essential changes canbe implemented. The implementation strategies can be loosely arranged on adimension from the revolutionary to the most evolutionary. The implementationteam needs to select the route that the organisation can best accommodate. Themore evolutionary the approach, the more time the users have to adjust but themore likely the momentum of the project is to be lost [22].Five strategies proposed from Eason (1988) are;

The Big Bang -One of the most difficult kinds of implementation iswhen an existing system is being discontinued in its entirety as the end ofone day and a new system replaces it on the following day. A highlypublicised example in recent years was the overnight switch of the LondonStock Market to electronic trading in 1986 [22].

Paral le l Com put ing - One popular way of minimising the risks to the on-going, work is to introduce the new system alongside the old one and torun them in parallel until everybody is confident that the new system willbe effective [22].

Phased Introduct ion -The problems of making massive changes can beeased by phasing in the changes over a period. There are two ways in

which large-scale changes can be subdivided to facilitate phasedintroduction. First, the functionality of the technical system can beintroduced in phases so that the basic task processes can be supported inthe early stages and subsequently facilities can be added which support,for example, decision-making tasks. Second, it may be possible tointroduce the system in different parts of the organisation at differenttimes [22]. A combination of these two approaches can also be used[22].

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Tria l and Disseminat ion -This strategy explicitly recognises that will beteething troubles when a new system is introduced. By holding anessential trial or pilot project before embarking upon full-scaleimplementation. This strategy provides a valuable opportunity to prepare

thoroughly for implementation before it is in the throes of full-scalechange. However, many organisations fail to make good use of theopportunities that the trial presents [22].

Incremental Implementat ion -The alternative to a revolutionarychange is gradual evolution. The growing sophistication and flexibility oftechnology is making the incremental implementation of system andincreasingly practical proposition. When users are discretionary andpowerful and their needs are varied, not to say idiosyncratic, the servicehas to be tailored to individuals [22].

3.7.1.2 Systems DevelopmentEvery systems / software project has its own process [33]. The projects plandocuments the process and provides a disciplined approach to organizing andmanaging an information systems project [33]. The existence of a plan does notguarantee project success [33]; the key to successful software management isgenerating and maintaining a realistic, usable plan and then followingit through[33, 34]. Following the plan involves not only maintaining the plan itself, butalso performing activities to measure progress and performance against the plan.Use the plan to assist in recognizing danger signals, and take early andappropriate actions to solve problems.

In terms of systems development, most studies are concerned aboutdevelopment procedures and activities (Bingi, et al., 1999). Fitzgerald, Philippidesand Probert (1999) argued that systems development was still a problematicarea despite the great attention devoted to improving techniques and methods.The great hopes of improvements based upon new approaches and tools such asmethodologies, object-oriented techniques and CASE, were not much seen inpractice so far [33, 34].3.7.1.2i. Life Cycle Models

All products follow some type of life cycle. Software / systems developmentprojects are just one subset of IS / IT projects. A life-cycle model comprises oneor more phases (for example, a requirements definition phase, a design phase, atest phase). Each phase is defined as the time interval between two scheduledevents [33, 34].i. Systems Development Lifecycle (SDLC)

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This is a framework for describing the phases involved in developing informationsystems [33]. It is essentially a once-through-do-each-step-once approach [33].Simplistically, determine user needs, define requirements, design the system,

implement the system, test, fix, and deliver the system. Some popular models ofthis framework include; waterfall model, spiral model, incremental build modeland rapid application development (RAD) [33]. These lifecycle models areexamples of predictive lifecycle, meaning the scope of the project can be clearlyarticulated [33]. For example, in the waterfall life-cycle model, the design phaseis defined as the period between the software specification review and the criticaldesign review (CDR) [33].Within each phase, one or more activities are executed. For example, during thewaterfall models design phase, the design activity is performed; the test

planning activity for qualification testing may be done at the same time. In mostcases, activities neither begin nor end precisely at the phase boundaries; rather,they overlap adjacent phases, as illustrated in figure 4 below.

EFFORT

TIME

Requirements Design Implementation

Qual & Sys Testing Acceptance Testing Other

IMPLEM & QUAL TEST SYS

TESTACCEPT.

TEST

RQTSDESIGN

SSR CDR QTRR ATRR ORR

Activities:

Phases:

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Figure 4: Phases and activities in systems / software development (Adoptedfrom Fitzgerald et al 1999) (Permission obtained from Journal distributor)

Advantages Well-studied, well-understood, and well-defined Easy to model and understand

Easy to plan and monitor

Many management tools exist to support this life-cycle model

Disadvantages Most if not all requirements must be known upfront

Does not readily accommodate requirementschanges

Product is not available for initial use until theproject is nearly done

Mostappropr iatewhen .. .

Project is similar to one done successfully before

Requirements are quite stable and well-understood

The design and technology are proven and mature

Total project duration is relatively short (less than ayear)

Customer does not need any interim releases

ii. Adaptive Software DevelopmentIn contrast to the predictive lifecycle models, the adaptive software development(ASD) lifecycle model develops a system in builds, but differs from the SDLC /Waterfall model in acknowledging that the user needs are not fully understoodand not all requirements can be defined up front [33, 34]. One of such models isthe evolutionary approach, agile software development, extreme programming,scrum [33, 34]. The user needs and system requirements are partially defined upfront, then are refined in each succeeding build. The system evolves as theunderstanding of user needs and the resolution of issues occurs. Prototyping isespecially useful in this life-cycle model. (The evolutionary development life-cyclemodel is sometimes referred to as a spiral development model, but it is not thesame as Boehms spiral.

Important attributes of this approach are that the projects are people driven,with emphasis on constant collaboration with the users to capture requirementall through the development process [33, 34].

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Advantages Not all requirements need be known up front Addressing high risk issues (for example, new

technologies or unclear requirements) early may reducerisk

Like the incremental life-cycle model, interim builds ofthe product facilitate feeding back changes insubsequent builds

Users are actively involved in definition and evaluationof the system

Prototyping techniques enable developers todemonstrate functionality to users with minimal of

effort Even if time or money runs out, some amount of

operational capability is available

Disadvantages Because not all requirements are well-understood upfront, the total effort involved in the project is difficultto estimate early. Therefore, expect accurate estimatesonly for the next cycle, not for the entire developmenteffort.

Less experience on how to manage (progress is difficultto measure)

Risk of never-ending evolution (for example, continualgold plating)

May be difficult to manage when cost ceilings or fixeddelivery dates are specified

Will not be successful without user involvement

Mostappropr iatewhen .. .

Requirements or design are not well-defined, not well-understood, or likely to undergo significant changes

New or unproved technologies are being introduced

System capabilities can be demonstrated for evaluationby users

There are diverse user groups with potentiallyconflicting needs

iii. Problems Ascertaining Customer Requirements and ConstraintsGoing through the Standish Group, CHAOS 2001: A Recipe for success, [40]revealed that from 1999 till date, a total of $3 billion had been lost on failedinformation systems implementation and further investigation suggested that

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70% of the project failures were down to poor management of the requirementsand scope of a project [40]. User requirements are often not clear at the start,for a number of reasons: users may be unsure of what they want [40]; it maybe difficult to identify their tacit knowledge about day-to-day processes; they

may not have been consulted sufficiently; and they may be misunderstood [40].Arguing in the same line, Mahoney (2000) and Lytinen (1999) in reviewing 100failed IT projects states that most of the time at IS project inception, thecustomer may have only a general idea of the software requirements, suggestingthat determination of the detailed requirements may follow later or may even bepart of the ongoing process [43, 44]. Mahoney (2000) therefore suggests that itis imperative for systems / software developers to utilize an IS projectmethodology that would be flexible to get the end user involved throughout theproducts engineering life cycle [44], in that way the more likely the expectedproduct will result successful [43]. This involvement is particularly crucial duringthe requirements analysis and design activities early in the life cycle [44]. It isalso important to try to get end-user involvement at milestone reviews [44].iv. Implementation Strategy / Product ReleasesGreer (1999) has listed 14 key success principles for information systemsprojects, with an admonition for the use incremental and phased softwarereleases (as opposed to the big bang approach) either to satisfy earlyoperational needs of the customer or as a risk mitigation technique (for example,to ensure the feasibility of high-risk requirements). The author argues that a

phased approach would ensure the smooth running of the Business whilstimplementation is going on [45], in addition for projects where the requirementsare not very clear at the start integrating and testing the system in parts helps tolocalize errors and reduce debugging time. Early releases also help to build thecustomers confidence level, as well as that of management, that the project ison track[45].3.7.2 TrainingTraining, in the context of IS implementation, refers to the provision of hardware

and software skills sufficient to enable effective interaction with the systemunder consideration (Nah and Lau, 2001). They further argued that training playsa significant role in IS implementation success. Senior managers can allocate anon-site technical specialist in entertaining end-users queries during theimplementation process. According to Wilson et al (1990), the outcome of thisapproach to training employees, is that it ascribes a sense of ownership and end-users will become independent and successful through the transfer of expertiseand the company will in the process avoid a low morale build up which usually

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arises during post implementation projects [46]. This would also save thecompany huge cost as the users would be better prepared to handle problemswith the system [35, 46].3.7.3 Stakeholder Management / Project Sponsors

A recurring theme in the literature is the significance of integrating allstakeholders into the project (Pinto, 1998; Ang, et al., 2002; Kuruppuarachchi, etal., 2002). The list includes everyone who is connected with the IS project, theseinclude; project sponsors, project manager, project team, support staff, suppliersand opponents to the project [36].Glover, et al., (1992), found a lack of co-operation or commitment among thestakeholders to be the most common cause of an implementation failure. For

instance the project sponsor has to be organisationally powerful so that essentialdecisions about the implementation can be taken and they can become an activepromoter of the system amongst their peers [36]. They also have a crucial partto play in helping to derive needs analysis [36].Securing management support is crucial for IS implementation. Winning thesupport of the decision-makers and senior management are often mentioned ascritical prerequisites for initiating IS implementation (Ang, et al., 2002, Marble,2003). Budic (1994) found continuity as a significant aspect of political andmanagement support.

According to Carr (2004), a proven strategy for getting commitment amongstakeholders, is the adoption of a top down approach. With this approach, topmanagement can communicate the strategy and commitment to all othermembers of staff to facilitate the change [28]. With the committed leadershipthey were more likely to commit the resources and be actively involved inmonitoring the change by talking to staff, investing sufficiently and propelling thedrive to introduce new initiatives [28].On the other hand, prolonged implementation and changes in political climatecan adversely affect the implementation of an IS [37]. Political and managementsupport appears to allow development of a system, perhaps by indirectlyinspiring financial and moral commitment to IS project as well as by increasingthe likelihood of adequate user support [38].3.8 Justification for Project TopicNo one could dispute that Information systems has become a forceful tool togain continuous competitive advantage [28]. According to Carr (2004), as the

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investment in the technology grows, so does the need to carefully realise thefactors of implementation process that are related to project success, or failure[28]. IS / IT projects are highly resource-intensive process often involving seniormanagers, system developers and end-users, thereby suggesting that analysis of

the organizational cultures which affect such projects should be analysed in orderto successfully implement the system.

3.9 ConclusionThis chapter has examined and covered the first three objectives of this project.I have utilized the relevant literature to investigate and discuss the concept ofculture, organizational culture and how this affects and influences informationsystem project implementation. A number of change management models werealso explored, thereby enunciating how these models and theories can be utilized

in reducing the risk an organizations culture might bring to an informationsystems project implementation. By carefully following a described methodology,I have divided this field into various sections, and I therefore believe that allmajor topics of this project have been covered in respect of my first threeobjectives. In total, this chapter covered 39 references in the area oforganizational culture. Of these, 15 were focused on the concept of culture andorganizational culture, 8 looked at the effects to a number of informationsystems project implementation such as the Daimler-Chrysler, Ford motorcompany and the Boeing company, while the rest were focused on changemanagement and its models.

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Chapter 4Case Study Findings

4. IntroductionThis chapter aims to complete objective four by looking at the primary researchand picking up on the key themes and opinions that was raised by it. Wherepossible it relates these back to the literature reviewed in the previous chapter.These findings will then be discussed and compared to the findings from thesecondary research, and draw on the key issues raised.4.1 Company Background and Problem SituationThe Waterfront UK Company of Birmingham is one of the largest exporters in theUK and one of two leading clutch producers in the world. In the 1990s itacquired new muscle in trucks and heavy-duty vehicle production when itpurchased its long time rival Cartrack International. A few years ago, companyprofits started to nosedive, but it intends to respond with two efforts, whichinvolves critical roles for information systems. These include the design processfor the double clutch plate lines of heavy goods vehicle, and the attempt tomodernize its single plate production.

For years, Waterfront UK had no serious competitors. Then EuropartsInternational entered the commercial clutch manufacturing business, and by2004 had already achieved a 28% market share. The competition between thetwo has increased in intensity. Both agree that demand for single and doubleclutch plates will triple over the next twenty years. Waterfront UK managementhave made automated design process a key focus for the future, because theybelieve this will be needed to produce the increased quantity of expecteddemand clients.

Waterfront UK also believes that operational costs are a key factor and a newlydesigned IT strategy will greatly reduce these costs. Unfortunately for Waterfront

UK, its production process has been very inefficient. By competing on price,Waterfront UKs profit margins have been cut very sharply. Why was WaterfrontUK so inefficient? Mainly because it has been making clutches with the samehierarchical manual productions process used to make its famous single plates.Over the following decades, Waterfront UK had no competition and met nopressure requiring it to become more efficient. All this changed with theexpansion of the EU, motor parts deregulation, and the emergence of Europarts.

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A major problem with Waterfront UK is its organization strategy, which is ahierarchical / distributed structure, whereby key decisions are made by a few attop management, almost all vice-presidents and departmental managers confer

with the president daily, usually regarding the progress of products, employmentand other key decisions. With different groups meeting at different times withthe president, the groups were not formal or even based on functional problemlines. If one individual felt that a daily printout indicated a particular change,regardless of whether or not it affected his or her department, he or she wouldgo to the president asking for the change to be effected. If another departmentmanager or even a vice-president were present and disagreed, inevitably a fierceargument would develop in the presidents office. Critics have pointed to thepresidents reputation as an "easy touch" for external suppliers, e.g. if a supplierhad some previous tie from the old days or was remotely related to someone in

his family, he would be assured of at least some orders, despite the fact that hisprices might be higher than those of competitors.

The information systems within Waterfront UK were such that each existingbusiness units had its own information technology department responsible foreach unit operations. Engineers worked in separate domains, based on their fieldof specialization. Some designed the clutchs parts, others assembled them, andothers designed the packing crates. They rarely compared notes. If productionengineers found a part that didnt fit, they sent a complaint to the designerlocated in another plant. The designer then pulls out the drawings, reconfiguredthe part to make it match drawings of the surrounding parts, and sent the new

design back to plant. Warehouses were filled with paper.

This fragmentation of data across the separate systems in each departmentimplies that discrete business process from sales, production, finance, andlogistics cannot be integrated into the company wide business process that flowsacross organisational levels. And this will have a negative impact on theorganisational efficiency and business performance. Various departments will findit difficult to communicate and act on orders effectively worldwide.

4.2 Strategic OutlookA plan has been suggested that to develop the double clutch plate faster and ata lower cost. Waterfront UK should introduce a cross functional IT exchangeacross the organization. This is a centralized system whereby information systemfrom all its functions / departments are integrated across the organizationeliminating complex links between the company systems in different units.Discrete business / operations process and information from all the departments

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can be integrated and stored in a single comprehensive system, where they canbe used easily by all employees.

Working from a single source for product data would eliminate unnecessary

inventory, ensure that duplicated resources are eliminated and reducedoperations cost. This would enable everyone to work from the same data source,thereby reducing order processing time and downsized operations process.Through cross functional IT, electronic data interface which links with externalsuppliers is created, whereby customers can log onto the company system toplace orders and alert management on levels of replenishment. This would leadto efficient customer service, customer satisfaction and retention, thus givingWaterfront UK an edge over its competitors.

These proposed changes would suggest that IT would support organizations

goals, whereby top management can keep an eye on company operations acrossgeographical or business unit boundaries. This system unifies operationsreleasing information flows across the organization to support business goals.Functional boundaries are thus de-emphasised in favour of cross- functional co-ordination requiring that the manual manufacturing process will be replaced byan automated process thereby ensuring savings on overhead and high businessturn over.

4.3 IS Implementation: Cross Functional Business ProgrammeThe Cross functional business programme is a Global Web-based Intranet

Marketing Decision Support System. The system serves more than 35 marketingteams across Europe, offering customised views of market intelligence data. Inaddition, the new software was supposed to reduce paperwork, consolidate some35 disparate purchasing and procurement systems into one Web-based systemthat would serve multiple tiers of suppliers, thereby speeding orders and clashingcosts.

The project supported the move to unify the separate marketing groups throughencouraging a far more open communication system. The CFBP project leaderhas worked closely with Information Services International (ISI) built around ERP

software, its main goals included; - unify dozens of legacy procurement systems,- standardize procurement methodology across its feudally, -run, fiercelyindependent plants, - take on direct, indirect, and MRO at the same time, -rationalize its supply base while putting in the new system.

4.3.1 Systems Objectives

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Cost Control - Top management had projected that reduced costs were possiblefrom rationalizing the supply chain and moving to guided sourcing. Guidedsourcing, which their suppliers had to use, according to Paul Wood, Fordsspokesman, saves money by cutting out expensive, off-contract maverick

purchasing, and is one example of the kind of tighter rigour that now appliesacross the company. Such is the way the new system would work that nosupplier can deliver if they cant quote an order number. This number has to beentered into the system in an authorized fashion.

System efficiency One of the objectives is to use SAP ERP systems as itssingle front end systems to provide a consistent picture of production, financeand sales reporting. The software also includes EDI links with external suppliersand database links for internal suppliers, covering the core five processes:finance, sales and operations planning, procurement, customer order fulfilment,

that way around 80 per cent of the corporate back office goes on R/3 all thefinances, all order processing, all the production ordering, stores and logistics aswell.

4.3.2 Implementation PlanningMost of the implementation planning tasks were usually initiated and developedby the project leader. Prior to the implementation, there was no proper planningstructure in existence. It was a one-man vision in charge of the department.

System Development Waterfront adopted the traditional waterfallmethodology in the design of the system. This included the six major phases inthe waterfall lifecycle of the development of the software, these were;

-Requirements gathering phase & Requirement definition-Design & coding phase-Testing phase-Live running phase

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Figure 5: Stages in the waterfall model

Summarydescription anddiscussionThe waterfall (single-build) life-cycle model is essentiallya once-through-do-each-step-once approach.Simplistically, determine user needs, definerequirements, design the system, implement the system,test, fix, and deliver the system.

This model is illustrated in figure 5.

Advantages Well-studied, well-understood, and well-defined Easy to model and understand

Easy to plan and monitor

Many management tools exist to support this life-

cycle model

Table 1.1 Summary of Waterfall Development Life-Cycle Model

By using this methodology, discussion between the users and the developers wasvery limited.

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IS Implementation: Cultural Issues & Changing RequirementsIn between pre and post implementation, the company had made six changes to

the project team and four weeks after project kick off, the president fired theproject manager after this person had been on the job only four weeks anddespite the fact that she held a three-year management contract for $100,000per year, and as a result when the initial system was released, it was noted thatthe requirement for the front end to produce reports for management purposeswas not adequately specified at the start of the project, nor was a subsequentrequirement from the marketing team to develop standard reports usingspecialist software, known as GQL, which extracts data from databases.

This was also due to the fact that the company received an unprecedented order

for 6million clutch plates, this order needed to be mass produced and thecompany therefore had to change its requirement frequently even thoughdevelopment had progressed rapidly, the company had to invest extra resourcesto make the GQL software work satisfactorily as the initial release failed to meetthis new requirement. There were other instances of poor specification ofexpected outputs, weaknesses in service monitoring and inadequate control bythe company over the issue of purchase orders contributed to the higher thanexpected cost of the programme.

IS Implementation: Cultural issues & Scope EscalationThe project leader at the project inception left the organisation before thesystem was launched, leaving no standard and recognised process for thedissemination of information amongst the manufacturing and projectimplementation teams. The post implementation scenario started when thescope of the project was termed risky by then CEO Barbara Fletcher. WaterfrontUK was an early adopter of SAP R/3. After the project began, Waterfront UKsigned a large contract to supply 6million clutch plates to the Peugeot

Automobile of Nigeria. This event exacerbated the need for an unprecedentedvolume of R/3 transactions. Although, prior to the contract, testing seemed toindicate that R/3 on HP9000 servers would be able to cope with the volume of

transactions, however in 1997 R/3 could process only 10,000 worth of orderscustomer orders per night, compared with 420,000 under Waterfront UK'soriginal mainframe system.

4.3.3 Implementation StrategyThe Consumer Understanding Department has adopted the big bangintroduction strategy in implementing the system. In this case, phasing in the

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changes over a period would have been the right choice as that would ease theproblems of making massive changes. Nonetheless, the functionality of thetechnical system was not introduced in phases.

Implementation Strategy: EventsThe decision to adopt the big bang approach backfired as the pre-implementation testing was inadequate, partly because the requirement for thefront end to produce reports for management purposes was not adequatelyspecified at the start and lots of transactions not specified were addedafterwards. As a result the company lost about $25million in sales as its systemwas down for six days.

4.3.4 Stakeholder ManagementSenior Management - It was revealed that prior to the inauguration of theproject, a top-down approach was adopted in order to secure the support of topmanagement. Nigel Taylor was appointed as CEO and champion of the project,with the objective of first of all communicate the strategy and secure thecommitment of all senior managers all other members of staff to facilitate thechange. Prior to the commencement of the project, with the assistance of theproject leader, support was secured and this in turn suggested the support of theother teams within the organisations who would be required to assist in theproject. Although senior managers were supportive and committed (to committhe required financial resources to the project), pressures from them alone were

not sufficient to boost the lack of awareness amongst the end-users.

Employees - Although senior management commitment was high, reports revealthat some users were not as committed. In fact, there was a definite moraleproblem among the warehouse employees. This was not surprising, since theproject's Horizons warehouse automation integrated with SAP R/3 threatenedtheir jobs. With the closing of three warehouses, the transition to the firstautomated warehouse was a disaster. Disgruntled workers damaged inventory,and orders were not filled, and mistakes occurred as the new system struggledwith the volume of transactions. $34 million worth of inventory were lost.

Regional Managers - On the professional level, the regional marketingmanagers would welcome the cross-functional change, as it potentially wouldgive them the opportunity to monitor sales representatives and obt

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