Determining the Business Information System Strategy

Prof. Rushen Chahal

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Agenda
Strategic planning factors Strategic planning approach An framework to use the models and techniques Portfolio management in a multi-business unit Organization

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Strategic Planning Model

External long term: external business environment External short term: external IS/IT environment Internal long term: internal business environment Internal short term: internal IS/IT environment + current application portfolio

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External Long Term External Business Environment

State of the industry in terms of profitability, growth, and structure Capability of IS/IT to change products, markets, and interrelationships of the industry

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External Short Term External IS/IT Environment

Actual competitor usage of IS/IT and others for competitive edge IS/IT opportunities to change the competitive factors and influences on industry (existing value chain, new entrants, or products and services)

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Internal Long Term Internal Business Environment

New IS/IT effectively support or enhance the business strategy IS/IT enable business to adopt a appropriate strategy to suit the future business environment

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Internal Short Term Internal IS/IT Environment

The degree of existing IS supporting the business strategy and sustaining the business advantages The appropriateness of IS/IT management to the business strategy and the development of IS/IT industry

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Strategic Planning Approach - I

Input
External and internal business environment External and internal IS/IT environment Current application portfolio Business portfolio analysis, competitive analysis, resource life cycles, value chain analysis, strategic option generator, organizational modeling

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Strategic Planning Approach - II

Input
Mission, objectives, CSFs, process and activities analysis, data flow analysis and modeling Informal/opportunistic creative thinking

Output
Strategies to achieve application portfolio The future application portfolio

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An Framework to Use the Models and Techniques

Objective
Identify the required applications and their priorities and resources to achieve the business goals and strategies

Three components
The existing application The required application The potential application

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The Existing Application

Appraisal of IS/IT for the business
Understand the industry structure and business position in terms of SWOT Analysis the external value chain and information flow implications Analysis the internal value chain and organizational relationships Assess the business of existing system in terms of SEOT

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The Required Application

Assessing the need for immediate investment: short/medium term, 1-2 years, analytical
Interpret business objectives and strategy Determine CSFs for the corporate and its competitors, etc. Identify critical business process and activities Determine short-term focus for investment

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The Potential Applications

Identifying potential future investment:long term, 1-5 years, creative
Consider potential IS/IT impact on product/market, etc. Consider the strategic potential of IS/IT and its effects on the value chain Identify options for long-term IS/IT investment and select most beneficial

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corporate and business units For each business unit

Portfolio Management in a Multi-Business Unit Coordination and coherent among Organization

High potential (communicate): share ideas and results of evaluations and prototypes Strategic (capitalize): evaluate how advantages gained in one SBU can be obtained in others

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Portfolio Management in a Multi-Business Unit For each business unit Organization

Key operational (control): transfer experience in use of applications and technology across units, and reduce duplication of IS/IT effort Support (constrain): achieve economies by sharing non-critical systems and standardizing on technologies and resources used

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Points to Remember
Strategic planning factors Strategic planning approach An framework to use the models and techniques Portfolio management in a multi-business unit Organization

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Question
How do you plan or justify an e-business as a required strategic information system?

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