What were Encanas challenges in the marketplace? How did the digital infrastructure address these challenges? In drawing upon IT Governance, pick at least two of Encanas 10 guiding principles (Table 1) and show how they influenced its digital infrastructure. Critique Encanas approach to IT outsourcing. What would you do differently to overcome resistance to outsourcing?

T BUILDING THE DIGITIZATION INFRASTRUCTURE Figure 4: Architecture of Encana's Data Integration Visualization of Cost Structures KohW and Johnson / Digital Transformation in Latecomer industries Digitization in Action: Two IT Applications at Encana Digital Oil Platform (DOP) Gas exploration and drilling involves a large number of contractors and service providers that submit invoices to Encana. The CIO collaborated with partners to develop an integrated DOP through which contractors and service providers could digitally submit invoices. Rules built into the DOP system verify billed services against purchased service orders and establish norms to process invoices. Vendors and service providers are paid within seven days compared with the 60 to 90 days previously. Encana gained efficiencies by reducing the effort required to process invoices and by negotiating discounts for early payments. Furthermore, after the DOP system was developed and deployed, it was then hosted by an application service provider, which freed Encana IS staff from maintenance work and eased resource constraints. In addition to the efficiency gains, rapid invoice processing earned Encana the loyalty of service providers, many of which are small business owners for whom cash flow is important. Electronic Lease Purchase Report (eLPR) Encana's continuous search for new and productive sources of natural gas requires that it solicit, process and quickly decide on proposals to lease land for exploration. In a competitive marketplace, Encana's competitiveness depends on securing land leases for gas exploration, which consequently determines its profitability and market share. Traditionally, leasing land required a Land Administration team to gather and process land formation data, geological test results and court records, often using disparate systems. Until the lease is evaluated, Encana cannot negotiate the lease terms, map and scan the land, or initiate regulatory compliance activities-each of which delays exploration and gas deliveries. eLPR integrated various systems, created a single database, implemented a high level of security and connected historical data with the PVM system. Additionally, data analysis and business intelligence tools are used to analyze historical data about the geological characteristics of a region to predict the natural gas prospects in future lease purchase evaluations. These analyses provide agility for Encana in negotiating and processing leases in the future. \begin{tabular}{|l|l|l|} \hline \multicolumn{2}{|c|}{ Digital Transformation in Latecomer Industries: CIO and CEO Leadership Lessons from Encana Oir \& Gas (USA) Inc. } \\ \hline \multicolumn{1}{|l|}{ Table 2: CIO Toolsmith and Orchestrator Roles in Latecomer Industry Firms } \\ \hline & \multicolumn{2}{|c|}{ CIO Orchestrator Role } \\ \hline Primary Role & Provide reliable, cost-effective IT and network infrastructure for uninternupted IS operations. & Orchestrate organizational resources-IT, operational technologies, people, processes, and policies-to provide solutions that achieve business goals. \\ \hline Corporate IS Role & Mandate uniformity in systems and applications for ease of troubleshooting and lower business costs. & Establish hardware, data, and integration standards and allow business units to innovate through flexible IS. \\ \hline Performance Metrics & Up time of information systems, volume of calls to help desk, ROI of system implementation. & Achieve business goals of enabling processes, electronic collaboration with partners, total cost of ownership of business solutions. \\ \hline Learning Focus & Seek expertise in emerging IT to lower IT operations costs. & Seek expertise in designing business solutions through emerging IT, business processes, skills and governance, within and outside the industry. \\ \hline \end{tabular} KohW and Jahnson / Digital Transformation in Latecomer industries \begin{tabular}{|c|l|} \hline \multicolumn{5}{|c|}{ Table 3: Lessons Learned for ClOs and CEOs } \\ \hline \multirow{5}{*}{ CIO } & \multicolumn{1}{|c|}{ Lessons Learned } \\ \cline { 2 - 3 } & Don't focus on position in the organization chart \\ \cline { 2 - 3 } & Embed digital technologies first in operational processes \\ \cline { 2 - 3 } & Seek high revenue opportunities or a business "pain point" \\ \cline { 2 - 3 } & Establish IS guiding principles \\ \cline { 2 - 3 } & Run a tight IS ship \\ \hline \multirow{5}{*}{ CEO } & Take ownership of IS implementation \\ \cline { 2 - 3 } & Digitization success requires a close CEO-CIO working relationship \\ \cline { 2 - 3 } & Good Times and Bad Times: "This too shall pass" \\ \hline \end{tabular} (summarized in Table 3). Although some lessons are digitized laboratory and pharmacy operations. In the applicable to firms in industries where digitization natural gas industry, digitization embedded at the is already the norm, latecomer firms have unique wellhead through SCADA systems was given a high challenges resulting from the extensive investment in priority because it provides visibility into the supply industrial equipment that must be digitized because chain. rather than through a grand architecture to transform CHALLENGES AND LESSONS LEARNED it is critical to the business. This situation contrasts sharply with, for example, the banking industry, 3. Seek High Revenue Opportunities or a Business the organization. The success of Encana's digitization initiatives was where digitized customer-facing processes such as "Pain Point." Latecomer CIOs must earn the trust Even though Encana's CIO does not report to the CEO, he serves as a trusted advisor and is called on to participate in formulating business strategy. As implied by IS guiding principle No. 8 , justification ofIT/ISisnolongertheCIOsresponsibility;itnowresidesjointlywithISandBUleaders.IfanISprojectskillsbaseandhighercoordinationcost.Greaterprocessdigitizationislikelytocreateaskillsgap not without challenges. Outsourcing non-core IT online bill payments and loan applications still run on of business leaders by focusing on high revenue mainframe-eratechnologiesinthebackoffice.businessstrategy,ratherthanrespondtoa"squeakyopportunitiesor"painpoints"intheexecutionof