Richter case - Infrastructure Essay Example for Free

Richter case Infrastructure EssayLooking at the accepted (2007) IT governance of Richter, Szcs is the IT director and is working together with around 50 people in the head department in Hungary. Those 50 people argon focusing on four different areas IT operations (12), procurement and service (15), SAP support (12), IT strategy and projects (4) (Mitchell et al., 2007). Altogether they develop a strategic visualize which is expected to support the business processes at Richter. However, a protrude is not very flexible since it first has to be approved by the CFO of Richter and thence still has to be agreed on by the senior management. This process though takes place only once a family, namely each year in June. But there is not only the headquarter of Richter in Hungary besides different affiliates all over the world (e.g. Poland, India, Russia, Romania). Those affiliates feed their own IT departments and IT directors. Major grievous infrastructure/IT decisions and decisio ns regarding the SAP modules have to be coordinated and discussed with Szcs and the head office in Hungary. If the affiliates develop a plan they have to present them the likes of Szcs but to their respective CEOs.This structure shows the level of importance of IT to Richter and has rough strengths as well as weaknesses. As mentioned above IT has more of a financial backing role for Richters business processes and there are IT directors who develop plans with a team of different specialists but cannot implement them by themselves. Looking at Broadbent and Weill (1997), Richter has a dependent infrastructure view.Their IT as a percent of expenses are around the average relative to its competitors and they also want to achieve cost savings but still be relatively flexible. This has the advantage of staying competitive without that much risk. Due to top management requiring to approve the plans developed by the IT director they can prize the cost and risk exactly.However, since top management might not have the best IT knowledge it could happen that they do not approve a plan because they think it is too expensive and risky. But if they would have enough IT understanding they might see the value this plan will add to the company. Also, the meetings are only if once a year which let them lose some flexibility.Another infrastructure view is the enabling view. Having this view, Richter would have much higher IT expenses and their IT infrastructure would eternallybe on the edge. This view has its strengths and weaknesses as well They would be a lot more flexible and management of IT would probably be different.The IT directors would not have to get approval by the CFO and top management but rather work together with them looking for opportunities to be innovative and get a competitive advantage for some time. This view has its downsides, though Investing much money and being the first to invest in something new is always attached with a lot of risk. Also, if th e affiliates would be allowed to decide everything on their own failures might be discovered too late and increase the loss.Yet, another view is the utility(prenominal) view with which the firm has low IT expenses and focuses on cost savings. IT is clearly used as a supporting tool. The IT director (if there even is one) gets told what is needed and rightful(prenominal) tries to find the most cost-saving solution. The firm has low risk since it does not invest much money but is not very innovative and maybe loses some profits because it probably imitates competitors later on.