In their 2005 paper, A conceptual model for enterprise adoption of open source software , Kwan and West use as a starting point the “Strategic Grid” developed originally by McFarlan, McKenney and Pyburn (1983)  which divides firms or divisions of a company into four categories depending on how valuable IT is to the performance of the division:
However, Kwan and West contend that not all IT systems are of equal importance within a division or company – just because IT is “strategic” to a division doesn’t mean all of its IT systems are!
So Kwan and West adapt the model as a set of stages of business alignment for individual systems:
- Mission Critical
Strategic systems are those that provide actual competitive advantage over competitors; mission critical systems are those needed to support the operation of the business, and whose interruption can cause loss of revenue; support systems provide business value through internal efficiency; and finally laboratory systems are non-production systems used to pilot innovations and experiment with new technologies.
Why “stages” and not “categories”? Well, the authors point out that many IT systems in organisation exhibit strategic shifts over time – software originally deployed as a pilot at the laboratory stage may be implemented as a strategic system; then eventually the system becomes commodified in the market and downshifts to being mission critical.
It seems a pretty sensible model – but how does it look when applied to IT in the Higher Education sector? While the model seems reasonably straightforward, applying it to actual deployed systems is not. Some of the systems deployed in a typical HE institution include:
- Student information system
- Library management system
- Research management
- Learning management system (VLE)
- Network management system
- User and account management system
- Timetabling and enterprise resource management
- Human resources
- Finance information system
- Mail and groupware systems
- Content management system
- Institutional repository
- Business intelligence and analytics system
- Curriculum management system
… and thats before we get into the various blogs, wikis, specialized research tools and teaching tools.
What I find striking is that while some of these are undoubtedly mission critical (the student information system in particular), its difficult to make a case for any systems as being strategic using Kwan and West’s definition. Do any of these systems provide actual (not imagined) competitive advantage? I think business intelligence and analytics is frequently pitched as such, but in practice would support internal efficiencies in many institutions.
For some institutions that specialise in online delivery the VLE/LMS might be considered strategic; and for the Open University both the LMS and content management may have a more strategic role than for a typical university, but even there its not 100% clear.
So, is it true that “IT doesn’t matter”as Carr (2003) claimed ? Carr argues that information technologies, like previous technologies, become ubiquitous and commodified over time. Therefore, they are now strategically unimportant because individual organisations can no longer gain a competitive advantage from IT.
McCredie (2003) considered Carr’s views from a HE perspective  and concurred that IT in education is “strategically invisible”, being a requirement to stay in business but not offering competitive differentiation. However, he does contend that “If staying in business is not a strategic concern, I do not understand the meaning of the term” which is certainly true; though it does still place IT systems in the business critical rather than the strategic phase of the Kwan and West model.
However, McCredie also points out that, if current IT systems are not strategic, this doesn’t rule out the development of future systems that will provide competitive advantage.
(It may be argued that MOOCs are an attempt to elevate learning management to have strategic value within a modified higher education business model. If the business of the organisation — e.g. Coursera, Udacity, EdX — is fundamentally about the online delivery of teaching, then the system deployed may indeed be strategic.)
So what does this imply?
Well, Kwan and West go further than just identifying the phases of IT systems, they also look at the tradeoffs made in adoption between features, cost and risk as being dependent of the strategic positioning of the system.
For example, for business critical phase systems, organisations will trade off cost and features to minimise risks; for support systems organisations will trade off features and risk to minimise costs, and for strategic systems they are willing to trade off costs to maximise features. (Features being defined here as “everything that isn’t risk or cost”)
For laboratory systems its less clear cut as it depends on the prospective phase of the system being piloted.
This implies that most IT systems in Higher Education will be either mission-critical systems primarily selected for their relatively low levels of risk, and support systems selected for their low cost (in TCO terms). Or, to put it another way, the characteristics that institutions are looking for most in their IT systems are reliability and cost-effectiveness; so the key innovations will be those that enable lower costs or improved reliability – such as virtualisation and software-as-a-service – rather than new capabilities.
One could also put this the other way around and state that, as HE organisations are typically not interested in radically changing their business models, it is unlikely that they will be looking for IT to deliver strategic value, but instead to improve the reliability and costs associated with their operations. Instead, systems that offer new capabilities will be adopted by organisations that are looking to either disrupt the existing market, or operate within a niche where IT can offer strategic value. (The one potential exception is business intelligence and analytics, but we’ve yet to see examples of actual competitive advantage being realised; its also unclear how long such an advantage would persist before the technology is commodified).
Given this context, it would seem that the future of IT in higher education will be focussed on realising the benefits of commodification.
This includes migrating more support systems from expensive proprietary products, either to open source technologies with lower TCO (e.g. moving more content management to Drupal) or to commodity software-as-a-service offerings. It will also include realising reliability and cost improvements from moving more systems to take advantage of commodity cloud computing.
I’m about to embark on a PhD looking at adoption of open source technologies in Higher Education, so I’m catching up on my reading by doing some blog posts on interesting papers on the topic. So there’ll be more posts like this in the coming months.
The second half of Kwan and West’s paper deals with creating a model for open source adoption using this background, but I’ll leave that for another post.
 Kwan, S. K., & West, J. (2005). A conceptual model for enterprise adoption of open source software. The standards edge: Open season, 51-62.
 McFarlan, F. W., McKenney, J. L., & Pyburn, P. (1983). The information archipelago-plotting a course.
 Carr, N. G. (2003). IT doesn’t matter. Harvard Business Review, May 2003.
 McCredie, J. (2003). Does IT matter to higher education. Educause Review,38(6), 14-22.