Harvard Business School
November 7, 2003
Enabling Business Strategy with IT at World Bank
In the spring of 2003 Mohamed Muhsin had prepared for his annual review of IT strategy and performance with Management Committee of the World Bank.
He had constituted his presentation around two key questions: How could IT help the core business serve clients better? How to measure and communicate the value that IT contributed to the business
During his tenure as the President of the World Bank, Wolfensohn drew attention to the importance of involving young people and the need to expand the development dialog to include civil society, indigenous peoples, faith-based groups and other non-government stakeholders. He made a strategic impact with his Board of Directors to implement broad reforms based on what he observed to be two powerful trends: A dramatic change in development business and a powerful technological revolution in facilitating access to knowledge. His assessment had been translated into a business strategy leveraging IT.
The two fundamental shifts that had taken place were: Decentralization and Creation of a Knowledge Bank.
Muhsin who was then the newly appointed CIO was asked to revamp the information systems and build a global network.
The Business of International Economic Development.
The World Bank Group includes the IBRD and IDA that provide loans at preferential rates to member countries, as well as grants to the poorest countries, the IFC and MIGA include investment in the private sector and providing insurance respectively and the ICSID, which works with governments to reduce investment risk.
Transforming the Banks Business.
ln March 1997 the Bank’s Executive Board voted in favor of the Strategic Compact ,”to lower the institution’s costs, raise productivity, and improve the quality of the projects and programs it supports.” Part of this initiative included a major information systems renewal effort to streamline administrative and operational processes including Y2K compatibility.
Key Objectives of the Strategic Compact included:
- Creation of Knowledge Bank.
- A Matrix of Regions and Networks.
Aligning IT to Enable the Bank’s New Business Strategy.
When Muhsin became CIO, his high priority IT issues included Y2K, delivering round-the clock global support, and building a foundation for global knowledge sharing.
He substantially simplified the funding and strengthened the governance process so that it became more transparent. There was clearer accountability for the IT function for service delivery and clear accountability for the governance groups as they made investment decisions with long term impacts.
Mentioned are three main categories of services available to all Bank offices:
- Basic Service Package.
- Corporate information Service.
- Optional IT services
IT Framework 1995-2002
With strong support from senior management ISG established a “Five-Point Program ” as the Banks IT Strategy, the foundation of this strategy ,global connectivity was built on standards to provide global customer base a high degree of reliability and service. Muhsin’s team standardized and integrated the IT infrastructure.
A Unique Network Solution
Although all aspects of the Five Point program became critical to delivering on the Presidents vision, the Global Communications Network was clearly the essential highway on which everything else rode. As such, it continued to be a critical lever in transforming the organization.
The banks network integrated capacity from three satellites that-together with a few dedicated terrestrial link-covered all World Bank offices worldwide. The network made use of a number of different technologies to optimize utilization.
Standardized and Streamlined Global Business Processes.
With the deployment of the Global Communications Network the Bank was able to standardize and centralize the World Banks information systems which also brought about standardized business processes to each country office.
The Global Communications Network and systems enabled the World Bank to make its decentralization strategy work-enabling improved client responsiveness and improved project success indicators.
The offshore model provided rapid delivery of business systems leveraging a cadre of highly skilled resources quick project ramp up and taking advantage of a 24-hour development cycle-all enabled by the World Banks Global Communications Network.
Responding in Crisis
The global network proved indispensable immediately after the events of September 11, 2001 Staff restrictions had made reliance on the voice, data, and video traffic over the network critical in order to continue operations.
Spurring the Knowledge Revolution in Developing Countries.
WBIs overall vision was to “spur the knowledge revolution in developing countries to be a global catalyst for creating & sharing, and applying cutting-edge knowledge necessary for poverty reduction and economic development.”
Through his experience as a CIO Muhsin had been instrumental in a lot of changes in IT and from which there are lessons that he shares:
- Keep the business leaders fully engaged on major change initiatives leveraged ,in IT.
- Managing expectations can save your program.
- Sustained support from the top makes all the difference.
- Assemble a first –rate IT team.
- Building on foundation and meeting the new challenges.
- Strategy for Customer Relationship Management Portals.
- IT & Frontline Business.
He quotes Shengman Zhang (former Managing Director of the World Bank Group) who commented that :
“Decentralization continues. Internally we are working on building capability and capacity.We are also focusing more on the client side to make it easier to become integrated with clients (for disbursements, payments, and status of project implementation.) A key part of our client
relationship is knowledge sharing. Sometimes knowledge is embedded in the relationship.Sometimes it comes in the form of a loan. Other times it is in the form of a study of simply a conversation. A challenge is how to capture, package, and disseminate this to all parties.”
Muhsin always believed that creative and production utilization of IT by staff have presented numerous opportunities to support clients and have directly assisted developing countries to use IT to accelerate development. He reminisced on Wolfensohn’s view point that, “ “IT is the key to scale: our clients and especially the world’s poor are depending on us to scale up our impact.”Download PDF enabling_business_strategy_with_IT_at_the_world_bank by mohamed muhsin