Lecture 4

Frameworks for Integrating IS

strategies with Business strategies

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 Information Systems Planning
• Information Systems Planning (ISP) is an important
activity for helping organization to identify strategic
applications and to align an organization’s strategy
with effective information systems to achieve
organization’s objectives
• In MIS information is recognized as major resource like
capital and time. If this resource has to be managed
well, it calls upon the management to plan for it and
control it, so that the information becomes a vital
resource for the system.
• ISP is “the process of determining an organization’s
portfolio of computer-based applications that will
help it achieve its business objectives”
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IS planning is a set of activities directed toward achieving
three objectives:
• Recognizing organizational opportunities and
problems where IS might be applied successfully;
• Identifying the resources needed to allow IS to be
applied successfully to these opportunities and
problems; and
• Developing strategies and procedures to allow IS to be
applied successfully to these opportunities and
problems

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• The opportunities can be classified into four:

1. To gain competitive advantage.

2. To improve productivity and performance.
3. To enable new ways of managing and organizing.
4. To develop new businesses

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Business Planning and IS Planning

• Information systems planning should be an integral

part of business planning

• Business planning – the process of identifying the

firm’s goals, objectives and priorities and developing
action plans for accomplishing them.

• Information systems planning – the part of business

planning concerned with developing the firm’s
information systems resources

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The critical factor in planning for IT infrastructure is the
impact of IT on business operations. Thus, it is
necessary to link IT planning with business planning.

One of the common mistakes in planning IT

infrastructure is neglecting the linkage of IT
infrastructure planning with the overall business
planning

While identifying the areas of applications and deciding

about the roles and priorities of different applications,
it must be recognised that IT infrastructure can have
impact on basic aspects of business; namely, the
product, productivity and management.
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It is essential to shift the focus of IT infrastructure
planning from automation of operations to the thrust
of business.

This shift can be effected with the help of integration of

information system plan with the business planning at
all levels of planning.

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IS/IT STRATEGY FORMULATION –
• Strategy can be formulated on three different
levels:
a) Corporate level - selection of businesses in
which the company should compete and with
the development and coordination of that
portfolio of businesses.

b) Business unit level - A strategic business unit

may be a division, product line, or other profit
center that can be planned independently from
the other business units of the firm.
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Strategic issues are about developing and
sustaining a competitive advantage for the goods
and services that are produced
c) Functional or departmental level - The level of
the operating divisions and departments. The
strategic issues at the functional level are related
to business processes and the value chain.

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STRATEGY FORMULATION - EARL’S MULTIPLE
METHODOLOGY

• Earl proposes that a firm’s management has to

tackle three important issues to succeed in the
strategy formulation.
1. Clarification of the business needs and
strategy in information systems terms
2. Evaluation of current information systems
provision and use
3. Innovation of new strategic opportunities
afforded by IT
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EARL’S MULTIPLE METHODOLOGY
• According to Earl, the process of developing a
strategy has three activities led by different
groups / people
1. Analytical activity – Led from TOP downwards
• A participatory process (involves all staff) but driven by
top management
• The process should help clarify the 5Ws and 1H i.e.
• Who are we? – Vision, Mission, Core Values
• What – Identify overall business goals/purposes, resources
needed, Critical success factors
• Where?
• When? NB: The deliverable is the overall business strategy
• Why?
• How?

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EARL’S MULTIPLE METHODOLOGY

ii. Evaluative activity – A bottom - up exercise

• Staff should help evaluate business environment, both
internal and external; in addition, identify what
information resources are available; evaluate their
value to business; their technical quality – this makes
it possible to identify existing gaps e.g. skills, training
required
• The deliverable is an IT resource requirement
definition

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EARL’S MULTIPLE METHODOLOGY

iii. Creative activity – Inside – Out

• Led by the IT experts in the organization or consultants in
the area
• Purpose of the activity: to marry the two deliverables (in (i)
and (ii) above) – the overall business strategy and the IT
resource requirement definition
• They polish up the requirement definition (identify gaps
and recommend solutions e.g. identifying new ways of
using IT for competitive advantage
• They provide advise on the available technology in the
industry – and what can be useful to the firm
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EARL’S MULTIPLE METHODOLOGY

• Plan for the acquisition of resources through

defining;
• Technical specifications plans
• Financial plans – budgets
• Time schedules – prioritizing systems and time frame for
implementation
• The deliverable of this activity is;
• A refined requirements definition
• Project plans
• The overall deliverable is an IT/IS strategy (a
summary of the 3 activities)
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