strategic information systems planning

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© Gabriele Piccoli Strategic Information Systems Planning What do managers need to know about the strategic Information Systems planning process

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Page 1: Strategic Information Systems Planning

© Gabriele Piccoli

Strategic Information SystemsPlanning

What do managers need to know about the strategic Information Systems planning process

Page 2: Strategic Information Systems Planning

© Gabriele Piccoli

Course Roadmap

• Part I: Foundations• Part II: Competing in the Internet Age• Part III: The Strategic use of Information Systems

– Chapter 6: Strategic Information Systems Planning– Chapter 7: Value Creation and Strategic Information

Systems– Chapter 8: Value Creation with Information Systems– Chapter 9: Appropriating IT-Enabled Value over Time

• Part IV: Getting IT Done

Page 3: Strategic Information Systems Planning

© Gabriele Piccoli

Learning Objectives

1. Explain why general and functional managers must be involved in information systems planning decisions despite their lack of technical expertise.

2. Discuss the purpose that strategic information systems planning serves in modern organizations.

3. Identify the key components of the strategic information systems planning process and understand how to perform the information systems assessment.

4. Discuss how to decide what role information systems resources should play in your firm and what may be the appropriate information systems guidelines according to the information systems vision.

5. Evaluate how well positioned your organization is to achieve its information systems strategic plan, and what initiatives will help.

Page 4: Strategic Information Systems Planning

© Gabriele Piccoli

Strategic Alignment

• A high degree of fit and consonance between the priorities and activities of the IS function and the strategic direction of the firm

• Careful planning is critical for strategic alignments, especially for firms in highly competitive environments.

Page 5: Strategic Information Systems Planning

© Gabriele Piccoli

Six Key IS Decisions

1. How much should we spend on IT?– What the role of IS and technology should be

2. Which business processes should receive the IT dollars? – What business processes are most important

3. Which IT capabilities need to be companywide? – The cost/benefits of standardization and flexibility

4. How good do our IT services really need to be?– The degree of service the firm needs and are willing to pay for

5. What security and privacy risks will we accept? 6. Whom do we blame if an IT initiative fails?

– Allocate resources and assign responsibility for IS projects

Page 6: Strategic Information Systems Planning

© Gabriele Piccoli

Strategic IS Planning

• A partnership between – Those with technical skills– The information systems group– General and functional managers

• Objective:– Define how the firm plans to use and manage

IS resources to fulfill its strategic objectives

Page 7: Strategic Information Systems Planning

© Gabriele Piccoli

Advantages of IS Planning Process

• Plans enable communication– To enable and support intra-organizational

communication– To create a shared mental image of team members’

role

• Plans enable unity of purpose– To specify the objective of IS deployment – Clear responsibilities are agreed upon

• Plans simplify decision making over time– To create a context for decision making

Page 8: Strategic Information Systems Planning

© Gabriele Piccoli

Strategic IS Planning Process

• Gathering information about the current availability and performance of IS resources

• Providing a roadmap for decision-making about information systems

Page 9: Strategic Information Systems Planning

© Gabriele Piccoli

Strategic IS Planning Process

• Strategic business planning

• IS assessment

• IS vision

• IS Guidelines

• Strategic Initiatives

An Iterative Process

Page 10: Strategic Information Systems Planning

© Gabriele Piccoli

Strategic Business Planning

Know Who You Are• An organization's mission and future

direction, performance targets, and strategy.

• Effective IS planning can only occur when there is a clear understanding of the firm:– What makes it successful– The business strategy– Its future goals and objectives

Page 11: Strategic Information Systems Planning

© Gabriele Piccoli

Information Systems Assessment

Know Where You Start • The process of

– Taking stock of the firm’s current IS resources – Evaluating how well they are fulfilling the needs of the organization

• IS resources IT resources– Technical resources: hardware, software and networking

components of the IT infrastructure – Data and information resources: databases and other information

repositories – Human resources: skills, attitudes, preconceptions, reporting

structures and incentive systems of IS professionals and the user community

• Output: a snapshot of the current “state of IS resources” in the organization.

Page 12: Strategic Information Systems Planning

© Gabriele Piccoli

Information Systems Vision

Know Where You Want To Go • Based on the role that information

systems should play in the organization • Defines the ideal state the firm should

strive for, in its use and management of its resources

– More IT-intensive firms: IS may play a strategic role

– Less IT-intensive firms: IS may be a “necessary evil”

Page 13: Strategic Information Systems Planning

© Gabriele Piccoli

Information Systems Vision

The Information Systems Vision

The Firm’s Business Strategy

• The IS vision is unique and highly specific to a given firm.

• Two analytical tools:– Critical Success Factors (CSF) methodology – Strategic impact grid

aligned and reflect

Page 14: Strategic Information Systems Planning

© Gabriele Piccoli

Critical Success Factors

• The limited number of areas which managers must effectively control to ensure that the firm will survive and thrive

• It ensures that the planning team is able to prioritize

• It focuses on business objectives, not on information systems

Page 15: Strategic Information Systems Planning

© Gabriele Piccoli

Turnaround Quadrant

• IS are not mission critical for current operations

• New IS or new functionalities of existing systems will be critical for the business’ future viability and success.

• The firm:– Is readying to change its information

systems posture– Needs to engage in some

reorganization

Page 16: Strategic Information Systems Planning

© Gabriele Piccoli

Information Systems Guidelines

Know How You Are Going To Get There • Information systems architecture• A set of statements specifying how the firm

should use its technical and organizational IS resources to achieve the IS vision

• Purposes– Enable communication– Establish responsibility– Guide future decision making

Page 17: Strategic Information Systems Planning

© Gabriele Piccoli

Purposes of IS Guidelines

• Communication– To simplify tactical and operational decision-making– To ensure that future decisions are aligned with the

information systems vision

• Identify responsibilities– To set expectations for behavior

• Long range decision support– Must be general enough to provide direction over a

number of years– Must be actionable

Page 18: Strategic Information Systems Planning

© Gabriele Piccoli

Technical IS Guidelines

• Address future decisions pertaining to – The hardware and software infrastructure– Networking services– The storage and protection of organizational

data and information

• Do not specify vendor, particular platforms or applications

• They are relatively general

Page 19: Strategic Information Systems Planning

© Gabriele Piccoli

Organizational IS Guidelines

• Address those decisions that pertain to– Human resources– The organization of the IS function– Reporting and hierarchical structures

• Focus on – IT governance issue– Outsourcing and vendors relationships– Human resource decisions

Page 20: Strategic Information Systems Planning

© Gabriele Piccoli

Information Systems SWOT

Know How Well Equipped You Are To Get There • SWOT analysis focused on the firm’s current IS

resources and capabilities• Remember IS planning is iterative

– The IS vision may need to be revised according to the result of the SWOT analysis.

• The firm should be clear about what to do during the current planning cycle after– Having read the SWOT analysis – Given the proposed vision and the guidelines

Page 21: Strategic Information Systems Planning

© Gabriele Piccoli

Proposed Strategic Initiatives

From Planning To Action • Long-term (three to five year) proposals that

identify new systems and new projects or new directions for the IS organization.

• These initiatives need to – Identify a set of future avenues for exploitation of

the IS resources– Be tightly aligned with the IS vision and the

proposed role of IS in the organization

Page 22: Strategic Information Systems Planning

© Gabriele Piccoli

What we Learned

1. Explain why general and functional managers must be involved in information systems planning decisions despite their lack of technical expertise.

2. Discuss the purpose that strategic information systems planning serves in modern organizations.

3. Identify the key components of the strategic information systems planning process and understand how to perform the information systems assessment.

4. Discuss how to decide what role information systems resources should play in your firm and what may be the appropriate information systems guidelines according to the information systems vision.

5. Evaluate how well positioned your organization is to achieve its information systems strategic plan, and what initiatives will help.