Chapter 26
The Role of the IT Department in Managing Business Change
26.1 INTRODUCTION
The IT department frequently manages, or plays a significant role in, business change activities. These activities vary considerably in terms of the reason why the change is needed as well as the scope, complexity, timeframe and cost of the change. It is helpful to classify business change activities into the following categories, each category having very different characteristics:
- Externally imposed, mandatory changes: MiFID in 2007, Y2K in 1999 and European Monetary Union in 1998 are examples of major changes that were imposed in the investment industry by governments and regulators. The characteristics of changes of this type are that:
– The individual firm has to take part. It cannot opt out.
– There is usually a “drop-dead” date for completion of the change – e.g. 1 November 2007 for MiFID.
– The changes need to be made by a large number of industry participants at the same time. This adds to risk, because there is a danger that, for example, our firm might be ready but a major counterparty or settlement agent may not be ready.
– Within the individual firm there may be a large number of individual applications and/or business processes that require amendment or complete replacement. These types of changes rarely affect just a single application, and at the beginning of the change programme it may not be clear which applications are affected or to what extent.
– Firms often have to base ...
