Case 5

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School

Miami Dade College, Miami *

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Course

MISC

Subject

Information Systems

Date

Feb 20, 2024

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docx

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Uploaded by ShiniCoco

Case 5.3: Air Canada: Flying high with Information Technology Part 1: How did Air Canada change its IT Department structure and outsourcing strategy over time? Describe each phase. (1 point) Air Canada underwent several changes in its IT department structure and outsourcing strategy over time, with distinct phases marked by shifting approaches to addressing business needs and improving IT service delivery. The first phase of Air Canada's IT department operated in a centralized manner before 2003, wherein it was responsible for delivering IT services to all business branches through external suppliers. Within the IT department, each business department was represented by approximately 50 business analysts tasked with collecting and coordinating IT needs. However, this centralized approach led to perceived bottlenecks and sluggish response times, as all IT requirements, regardless of scope, were routed through the central IT department. The second phase was decentralization. In 2003, Air Canada decentralized its IT department to address the inefficiencies associated with the centralized model. Business representatives were relocated from the IT department to business departments to enhance proximity to actual needs. These representatives were granted autonomy to engage directly with vendors, although core systems remained under the control of Corporate IT. Despite these changes, challenges emerged due to inconsistencies in service quality among representatives and a lack of coordination between departments. The third and final phase of Air Canada’s IT department was a reorganization. This significant reorganization took place in 2010, reshaping Air Canada's IT department structure. Representatives were assigned to three main branches—Customer Service, Commercials, and Operations—with each residing within the branch they represented. Reporting both to the CIO and respective business vice-presidents, these representatives aimed to improve coordination and prioritization. Each branch had a single senior representative supported by business analysts, streamlining communication and decision-making. This reorganization emphasized linking business needs with IT solutions, with representatives tasked with developing comprehensive views of requirements and translating them into IT solutions. In this restructured framework, the three units collaborated closely to ensure alignment with corporate IT standards and overall strategic objectives. Efforts were made to hire individuals capable of bridging the gap between business and technology, facilitating communication and collaboration between teams. The physical layout of offices reflected this collaborative approach, with the offices of the CIO and IT units located together at corporate headquarters, while the offices of the new units were embedded within their respective business branches. This physical proximity likely facilitated communication and collaboration, further enhancing alignment and responsiveness to business needs.

Part 2: Describe Air Canada’s G7 Organizational Structure (1 point) The organizational structure of the Group of Seven (G7) within the IT department of Air Canada appears to be a collaborative and agile framework aimed at ensuring alignment between IT initiatives and business goals. The G7 consists of four senior directors from IT units and three senior directors from newly added units. This group fosters intense communication both formally and informally, with regular face-to-face interactions facilitated by the proximity of their offices. Formal monthly meetings are held by the G7 to discuss ongoing work, upcoming projects, and ways to support each other. These meetings serve to ensure synergy among the directors and enable them to speak with a single voice when communicating with upper management. Additionally, the G7 attends bi-weekly staff meetings with the Chief Information Officer (CIO), where they coordinate their needs and ideas beforehand to align with the organization's overarching goals and strategies. An annual budget meeting is conducted by the G7 and the CIO to allocate resources for IT projects. This process involves gathering input from the business side to prioritize initiatives for the upcoming year. The goal is to align IT investments with business priorities and ensure agility and responsiveness to the evolving needs of the organization. Part 3: How does Air Canada's Hybrid Structure serve the dual objectives of Operational Excellence and Customer Proximity (1 point) Evaluate them by the three pillars of the IT – Business Alignment concept of Air Canada: • Structure • Sourcing • Processes Air Canada's hybrid IT structure effectively serves the dual objectives of operational excellence and customer proximity through a combination of centralized oversight and decentralized execution. The centralized oversight provided by Corporate IT ensures consistency in IT policies, standards, and core system management, fostering operational excellence. This centralized approach enables efficient resource allocation, economies of scale, and standardized processes, contributing to operational efficiency and cost-effectiveness. On the other hand, decentralization within the IT structure places representatives within business branches, allowing them to closely align with the specific needs and priorities of each department or business unit. These representatives serve as liaisons between Corporate IT and business stakeholders, facilitating communication, understanding, and responsiveness to customer requirements. By directly engaging with vendors and prioritizing initiatives based on real-time feedback from business stakeholders, decentralized execution ensures that IT solutions are tailored to meet the unique needs of each business unit, fostering agility, innovation, and customer-centricity. This integration between centralized oversight and decentralized execution promotes collaboration, alignment of IT initiatives with strategic business objectives, and ultimately supports Air Canada's overarching goals of delivering superior service and value to its customers.

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