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Strategic Planning

This document provides an overview of information system planning techniques. It discusses that planning involves developing a future vision to guide today's decisions, and strategic planning defines the desired direction and how to get there. Several types of planning are described based on their horizon and focus, including strategic 3-5 year planning led by senior management. Why planning is difficult is also outlined, such as how business and IT plans need alignment. The document then summarizes seven key planning techniques: stages of growth, critical success factors, competitive forces models, value chain analysis, e-business value matrix, linkage planning analysis, and scenario planning.

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55 views4 pages

Strategic Planning

This document provides an overview of information system planning techniques. It discusses that planning involves developing a future vision to guide today's decisions, and strategic planning defines the desired direction and how to get there. Several types of planning are described based on their horizon and focus, including strategic 3-5 year planning led by senior management. Why planning is difficult is also outlined, such as how business and IT plans need alignment. The document then summarizes seven key planning techniques: stages of growth, critical success factors, competitive forces models, value chain analysis, e-business value matrix, linkage planning analysis, and scenario planning.

Uploaded by

kopomus
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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Information System Planning

Planning means:
Developing of the future that guide decision making today.
Strategy means:
Stating the direction you want to go and how you inted to get there
The result of strategy-making is plan.
Strategic Management Strategic Planning
Tradition view of planning turn into strategic system planning, that is, strategic-making.
Type of planning
Horizon
3-5 year

Focus
Strategic

1-2 year

Tactical

6 months 1 year

Operational

Tactical
Project Selection
Building infrstructure as a project
Steering Comittes

Issues
Vision Architecture,
Business Goal
Resource Allocation,
Project Selection
Project Management,
Meeting Time and
budget target

Primary responsilbility
Senior Management,
CIO
Middle Manager
IS line partners
Steering Comitte
IS Professional
Line Managers
Partner

Strategic
Project Integration
Building infrastructure as a process
CIO/Senior Executive

Why Planning is So Difficult:


1. Business Goal and System Plans Need to Align
(How is CIO is not member of top management team?)
2. Technology are rapidly changing
(How can executives plan when IT is changing so rapidly?)
3. Companies need portfolios rather than project
(Internet Value Matrix)
4. Instructures Development is Difficult to Fund
(FE + BE): It is extrmely difficult to get funding just to develop and improve infrastructure. Often
such funding must be done under the auspices of large app. Project)
5. Responsibility Need to be Joint
(IT, It is not just a technological issue! CEO, CIO, CFO, COO)
6. Other Planning Issue
(Top-Down & Bottom-up approaches)

Strategic business plans have come first, followed by strategic IS plans, followed by implementation
plans
Assumption of Traditional Strategy Planning (EXP Gratner Executive Program) Tactical
Strategy.
1. The Future can be predicted
2. Time is available to progress through this three-part sequence
3. IS Support and follow the business
4. Top management knows best because they have the broadest view of the firms
5. The Company can be viewed as an army: Leaders issue the orders and the troops follow

Today:
1. The Future cannot be predict
Internet caused discountinuity change and unexpected way. Example Amazon and ebay
2. Time is not available in squence
Due to the internet, time is of the essence.
3. IS Does Not Suppport the Business Anymore.
(IT has become the platform of business, it makes e-business possible)
4. Top Management may not know best
(Change occurs rapidly, top management is distant from the front line)
5. As Organization is Not like an Army
(Industrial Era is over. Business Process Reengineering failure in early 1990s)
Sense-and-Respond Approach as an answer.
The new approach that some are taking is to let strategy unfold step-by-step, rather than be
planned.
Strategy is formulated closest to the action, and strategy-making is guided by a strategic envelope
that defines the realm.
IS is at the table, the future is tested continually, and the most important IS decision is the
infrastructure put in place.

Due tue the importance and the difficulty of system planning, it is valuablt to have a framework and
methology to use in the process.
Seven Planning techniques:
1. Stage of Growth
2. Critical Success Factors
3. Competitive Force Models
4. Value Chain Analysis
5. Internet Value Matrix
6. Linkage Analysis Planning

7. Scenario Planning

Richard Nolan and Chuck Gibson (1974): Managing the Four Stages of EDP Growth.
1. Stages of Growth
Organizations go through four stages in the introduction and assimilation of new technologies:
1. early success,
2. contagion,
3. control, and
4. integration.
More recently, three eras have been identified (data processing, micro, and network), which overlap
slightly at points of technological discontinuity.
Its important for IS management to understand where a technology lies at the moment because the
management principles differ from one stage to another.

2. Critical Success Factors


For each executive, critical success factors are the few key areas of the job where things must go right
for the organization to flourish.
Executives usually have fewer than 10 of these factors.
The CSF method has become a popular planning approach and can be used to help companies identify
information systems they need to develop.
CSFs are both time-sensitive and time-dependent.
These key areas should receive constant attention from executives, yet most managers have not
explicitly identified these crucial factors.

3. Competitive Forces Model


Companies must contend with five forces:
1) the threat of new entrants,
2) the bargaining power of buyers,
3) the bargaining power of suppliers,
4) substitute products and services, and
5) intensity of rivalry among competitors.
There are three strategies for dealing with these forces: 1) differentiate your products and services, 2)
be the lowest-cost producer and 3) focus on a niche.
Framework Example: Five Forces Analysis of the Internet The Internet tends to dampen the
profitability of industries and reduce firms ability to create sustainable operational advantages because
it:

increases the bargaining power of buyers,

decreases barriers to entry,

increases the bargaining power of suppliers,

increases the threat of substitute products and services, and

intensifies rivalry among competitors.


4. Value Chain Analysis
A value chain for a product or service consists of major activities that add value during its creation,
development, sale, and after-sales service.
There are five primary activities that deal with creating a product or service, that get it to buyers, and
also service it afterward: inbound logistics, operations, outbound logistics, marketing and sales, and
service.
Four supporting activities underlie the entire value chain organizational infrastructure, HR
management, technology development, and procurement.
By studying how a firm performs the primary and support activities for a product or service, a firm can
explore how it might add more value at every activity.
Alternatively, it could determine where another company could add more value, and team up with that
firm, outsourcing that activity to that partner.
5. E-Business Value Matrix
IT projects can be categorized in four ways as a way to better manage a firms e-business portfolio:
1) New fundamentals are projects to provide a fundamentally new way of working in overhead
areas, not business-critical areas.
2) Operational excellence projects revolve around providing faster access to information.
3) Rational experimentation projects test new technologies and new ideas, and thus are risky.
4) Breakthrough strategy projects, if successful, have the potential to impact the entire company, and
perhaps even the industry.
6. Linkage Planning Analysis
To create a strategy for utilizing electronic channels, the power relationships among the players and
stakeholders must first be defined. Then the extended enterprise must be mapped out to include
suppliers, buyers, and strategic partners. Finally, electronic channels should plan to deliver the
information component of products and services.
7. Scenario Planning
Scenarios are stories about the way the world might be in the future.
The goal of scenario planning is not to predict the future, but to explore the forces that could cause
different futures to take place, and then decide on actions to take if those forces begin to materialize.

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