Tutorial 2

Case Study 2

QUESTION 2

How is the IT staff organised at American Airlines: centralised or dispersed? Why?

The IT staff organised at American Airlines is centralised.

In central IS organisation,

There will be a Chief Information Officer (CIO).

There is a CIO in American Airlines. The CIO is given unlimited authority to use information technology (IT) in every way to meet the company’s goals.

The CIO has to report to the Chief Executive Officer (CEO).

Even though the CIO has the power to use the IS but after the CIO has made any decision, he still has to report to the CEO in American Airlines.

There is only one CIO (Morte Ford) all other IT department staff should under the control or report to this CIO especially for important decision making like staffing or Implementing IT policy for American Airline .

The important systems of AA is engage scheduling, routing, reservations, and similar operations that must be centrally organized and maintained.The website should be managed and update centrally.

QUESTION 3

What is your impression: “ Does the CIO have much discretion in selecting the types of IT project?” Explain.

In my opinion for American Airline case, CIO does not have much discretion in choosing the types of IT project, especially the long term IT project.

In the case it is being mentioned that CEO pressures all the top executive including the CIO to invest only in project that can show profit or good result in short term period, any project promised good ROI return only in long term was either terminated or showed down.

Note ( student should focus on the CIO has only control on the short term projects although the case mentioned that the CEO gave Ford unlimited authority to use IT)

Question 4:

The CIO is pursuing only IT projects that can yield increased productivity and cost cutting for the company in the short term. If you were the CIO, would you limit yourself to such projects?

NO..

IT investment is a long term investment in any organization. So limiting to only short term projects is not worthwhile as benefits can only be seen in long term. As a CIO, you should not surrender to such approach. Investment in IT projects is too large and important to consider only the short term.