Review of It Strategy at World Bank
The World Bank is a multi-national organization that operates in over 180 countries. Barriers such as connectivity, cultural differences, time zones, knowledge levels, and resources available exist for World Bank because they have clients in so many different locations around the world. World Bank has a hierarchal structure with a centralized headquarters in Washington, D. C and several more independent branches.
Due to the operations limited by independent branches, client interactions were limited, communications needed improvement, and important business meetings were limited by the difficulties and expenses of worldwide travel. Mohamed Muhsin, World Bank’s CIO had two key questions he wanted to address: how could IT help the core business serve its clients better, and how could World Bank measure and communicate the value that IT contributes to the business (McFarlan & Delacey, 2003). The overall solution was decentralization, the creation of a knowledge bank, and to establish a matrix of regions and networks (Musin, 2003).
Finally, as with all organizational change, an underlying challenge that World Bank also faced was the bank personnel’s resistance to all of the new policies and operational vicissitude. Background World Bank provides more than just financing, it also provides knowledge services that include investments in education, health, public administration, infrastructure, financial and private sector development, agriculture and environmental and natural resource management (The World Bank Group, 2012).
The organization’s most important goal is to reduce worldwide poverty through a diversified employee base and a staff that is committed to helping less fortunate nations through resources and knowledge sharing. To begin, World Bank supported their mission by providing three IT services. First, they provided a basic-service package that included the standard network infrastructure, to include enterprise software, email, file storage and intranet. Next, they provided corporate information services, to expand enterprise functions.
Finally and most recently, World Bank provided optional IT services to its employees including notebook PCs, videoconferencing, remote access, and wireless devices. Five Forces Analysis •Supplier Power – Very high because of World Bank’s unique mission. It is different in that it is willing to accept minimal profit to meet its philanthropic objectives; this enables the bank to offer loans and assistance at rates no other bank will. •Buyer Power – Very low because World Bank is the only organization offering loans and services at such a low rate. There are also strict requirements to meet for the World Bank to consider a loan.
The World Bank’s low rate loans are not available to everyone. •Threat of Substitutes – Very low since existing banks are not willing to compete with a bank supported by so many countries, and huge capital would be required with low return on investment. •Threat of New Entrants – Very low since existing banks are not willing to compete with a bank supported by so many countries, and huge capital would be required with low return on investment. Past/Present Performance World Bank significantly increased its performance throughout the case presented.
The Information Solutions Group (ISG) reorganized and enhanced administrative and operational processes, by enabling voice, data, and videoconferencing services to greater areas. The authors of the case McFarlan and Delacey (2003) noted that World Bank experienced about half the cost per gigabyte of transmission as compared to the peer average in the industry. This speaks volumes about the efficiencies and safeguards built into their system. Additionally, World Bank enjoyed time and cost saving by conducting several thousand videoconferences per year.