Sesi03 Developing IS and IT Strategy
Developing an IS/IT Strategy
By: Zainal A. Hasibuan
Faculty of Computer Science
University of Indonesia
Session ObjecEves
• Understand the process of developing IS/IT
Strategy
• Understand the components of IS/IT Strategic
Planning Model
• Understand how to evaluate IS/IT Strategic
Planning
IS/IT Strategy DefiniEon….
• IS strategy defines the organizaEon’s requirement
for informaEon systems to support the overall
strategy of the business
• The IT strategy is outlining the vision of how the
organizaEon’s demand for informaEon and
systems will be supported by IT
• “An IS strategy brings together the business aims
of the company, an understanding of the
informaEon needed to support those aims, and
the implementaEon of computer systems to
provide the informaEon.
IS/IT Strategy is part of IS/IT
Strategic Plan
• Planning for the effecEve long‐term management
and opEmal impact of informaEon—in all its
forms (IS, IT, manual and computer systems,
organizaEonal aspects of the management IS/IT
throughout the business).
• “The process of deciding the objecEves for
organizaEonal compuEng and idenEfying
potenEal computer applicaEons which the
organizaEon should implement” (Sethi, 88)
• It is a plan for the development of systems
towards some future vision of the role of IS in
the organizaEon
The ObjecEves of Developing IS/IT
Strategy
•
•
•
•
Alignment of IS/IT with the business
Gaining compeEEve advantage
Building cost effecEve
Developing the appropriate resources
IS/IT strategy process
IS/IT strategy
formulation
IS/IT planning
Tips to Develop IS/IT strategy
• IS/IT Strategy Process Should Become an
Integral Part of Business Strategy,
Business Plan, and Its ImplementaEon.
• The primary objecEve to develop IS
strategy is to idenEfy value‐added
porYolio of applicaEons that will have
strategic impact .
The EvoluEon of the IS/IT Strategy Process:
Technology Focus to Strategic Focus
Conform these stages with the evolution of IS/IT roles
IS/IT Planning Problems
• Fail to get top management support
• Value system does not go throughout
organizaEon
• Lack of proper person to the job
• Not having clear‐cut business strategy
• Fail to anEcipate new IT development
• Ignorance of environment‐economy,
poliEc, etc
The Model of Strategic IS/IT
Planning Processes
• Inputs
– Internal business environment
• Current business strategy, objecEves, resources, processes and
culture and values of business
– External business environment
• The economic, industrial and compeEEve climate
– Internal IS/IT environment
• Current IS/IT perspecEve in the business, its maturity, business
coverage and contribuEon, skills, resources and technological
infrastructure
– External IS/IT environment
• Technology trends and opportuniEes and the use made of IS/IT by
external bodies
The Model of Strategic IS/IT
Planning Processes
• Outputs
– IS/IT management strategy
• The common elements of the strategy that apply throughout
the organizaEon, ensuring consistent policies where needed
– Business IS/IT strategy
• How each unit or funcEon will deploy IS/IT in achieving its
business objecEves.
• Alongside each of these are applicaEon porYolios to be
developed for business unit and business models, describing
the informaEon architecture of each unit.
• The porYolios may include how IS/IT will be used at some
future date, to help the units to achieve their objecEves
– IT strategy
• Policies and strategies for management of technology and
specialist resources
Internal Business Environment
External Business Environment
Internal IS/IT environment
Current Applications Portfolio
Strategic IS/IT
Planning Process
External IS/IT Environment
Planning Approaches, Tools and Techniques
IS/IT Management Strategy
Business IS Strategies
Applications Portfolio
IT Strategy
Model & Matrices
Types of Deliverables from The IS/IT
Planning Processes
• Hard deliverables
– The current situaEon
– The vision and raEonale for what is being put into place—
informaEon, systems, technology, people, and so on.
– The plans for how it is going to be achieved, with the
milestones along the route
• So` deliverables
– Relate to human factors: skill, awareness and moEvaEon.
Framework for the IS Planning Process
Business and
Technical
Environment
Previous
IS/IT
Strategy
Initiate
Planning
Process
Understand the
Current Situation
and Interpret
Business Needs
Define/Update
Information and
Systems
Architecture
Determine
Business IS
Strategy
Formulate IT
Strategy
Prepare
Migration
Plans and
Business Case
Business
Strategy and
Proposed
Development
Programmme
IS/IT Strategy
and Proposed
plans
Other
Planning
Activities
Ini$ate Planning Process
• The purpose, objecEves, scope and deliverables are confirmed
The approach determined and resourced acquired, such as
automated tools
• Business parEcipants idenEfied and team assembled and trained
ExpectaEons, such issues and problems addressed, and risk
management proposals put into gear
• Process steering and management mechanisms created
How the work will interface with and feed into business planning
• The people to be interviewed, or who are needed to parEcipate
in group sessions are idenEfied
Plan for the work, tasks, Eming, roles and responsibiliEes, and
checkpoints defined.
Understand the Current Situa$on and
Interpret Business Need
• Analysis of the business strategy, objecEves, criEcal
success factors (CSFs), criEcal problems, and processes, in
order to determine the current situaEon, and its
strengths and weaknesses, and the informaEon needs
and thus the focus for investment in systems to meet
these.
• EvaluaEon of the current IS/IT operaEon – its systems,
informaEon provision, resources, organizaEon, skills and
services, to determine coverage and contribuEon and
where improvements would be beneficial.
• InnovaEve analysis of the external and internal business
environment to idenEfy potenEal applicaEons of IS/IT.
Determine the Business IS
Strategy
The accumulated business IS demand is
turned into recommendations for the
deployment of IS/IT throughout the
organization and at SBU level.
Define Informa$on and System
Architecture
• This step takes the results of the analysis
of procedures and informaEon needs in
order to build a proposed business model
for the business.
• It represents the future “ideal” in process,
informaEon and system terms, and is
needed to plot a direcEon when
developing migraEon plans.
Formulated IT Supply Proposals
IS strategy and the IT supply proposals can be fed back into
the business strategy, for consideraEon and consolidaEon
to occur, and senior business management to decide on
the likely candidates for the investment programme for
the business.
For IS/IT management, it means that the strategy can be
firmed up to give a clearer direcEons for where IS is
aiming to go.
Outline plans can the be constructed to give a route map,
and milestone for the main iniEaEves.
Business IS Strategy
• It states how the business will deploy IS/IT in
achieving its objecEves.
• To link IS/IT firmly to the business strategy
• It states the applicaEons and services
requirements for the SBU
Give an example of Business IS Strategy??
IT Strategy: Management of Supply
• To define how resources and technologies will be
managed and developed to saEsfy business IS
strategies.
• It consists of:
– ApplicaEon porYolio management
– OrganizaEon of IS/IT
– Managing the info resources and provision of info
services
– Managing investment, prioriEzaEon and benefits
– Managing applicaEon development
– Managing technology
Give an example of IT Strategy??
IS/IT Management Strategy
• Apply throughout the organizaEon, ensuring
consistent policies where needed
• It covers:
– Scope and raEonale
– IS/IT organizaEon
– Investment and prioriEzaEon policies
– Vendor policies
– Human impact policies
– IS accounEng policies
Give an example of IS/IT Management Strategy??
Success Criteria in Developing IS/IT
Strategy
EvaluaEon of IS/IT Strategic Plan:
Success Criteria
•
•
•
•
•
•
•
Improve performance
Gaining compeEEve advantage
Align IT investment with business strategy
Becer communicaEon
Improve management commitment
Becer allocaEon of IT resources
Becer IT forecasEng requirement
Try to quantify the success criteria for old vs. new system??
Factors affecEng IS/IT Development
•
•
•
•
External business
External technology
Internal business
Internal technology
Give examples on how those factors affect IS/IT Development ??
Context of IS/IT Strategy
Objectives of IS/IT Strategy Formulation and Planning
Discussion on the end of Chapter 3
What is IS/IT Strategy?
Why Developing IS/IT Strategy?
How IS/IT Strategy fits in Business Strategy?
Who in charge developing IS/IT Strategy?
What are steps to develop IS/IT Strategy?
How do you evaluate the success of IS/IT strategy
By: Zainal A. Hasibuan
Faculty of Computer Science
University of Indonesia
Session ObjecEves
• Understand the process of developing IS/IT
Strategy
• Understand the components of IS/IT Strategic
Planning Model
• Understand how to evaluate IS/IT Strategic
Planning
IS/IT Strategy DefiniEon….
• IS strategy defines the organizaEon’s requirement
for informaEon systems to support the overall
strategy of the business
• The IT strategy is outlining the vision of how the
organizaEon’s demand for informaEon and
systems will be supported by IT
• “An IS strategy brings together the business aims
of the company, an understanding of the
informaEon needed to support those aims, and
the implementaEon of computer systems to
provide the informaEon.
IS/IT Strategy is part of IS/IT
Strategic Plan
• Planning for the effecEve long‐term management
and opEmal impact of informaEon—in all its
forms (IS, IT, manual and computer systems,
organizaEonal aspects of the management IS/IT
throughout the business).
• “The process of deciding the objecEves for
organizaEonal compuEng and idenEfying
potenEal computer applicaEons which the
organizaEon should implement” (Sethi, 88)
• It is a plan for the development of systems
towards some future vision of the role of IS in
the organizaEon
The ObjecEves of Developing IS/IT
Strategy
•
•
•
•
Alignment of IS/IT with the business
Gaining compeEEve advantage
Building cost effecEve
Developing the appropriate resources
IS/IT strategy process
IS/IT strategy
formulation
IS/IT planning
Tips to Develop IS/IT strategy
• IS/IT Strategy Process Should Become an
Integral Part of Business Strategy,
Business Plan, and Its ImplementaEon.
• The primary objecEve to develop IS
strategy is to idenEfy value‐added
porYolio of applicaEons that will have
strategic impact .
The EvoluEon of the IS/IT Strategy Process:
Technology Focus to Strategic Focus
Conform these stages with the evolution of IS/IT roles
IS/IT Planning Problems
• Fail to get top management support
• Value system does not go throughout
organizaEon
• Lack of proper person to the job
• Not having clear‐cut business strategy
• Fail to anEcipate new IT development
• Ignorance of environment‐economy,
poliEc, etc
The Model of Strategic IS/IT
Planning Processes
• Inputs
– Internal business environment
• Current business strategy, objecEves, resources, processes and
culture and values of business
– External business environment
• The economic, industrial and compeEEve climate
– Internal IS/IT environment
• Current IS/IT perspecEve in the business, its maturity, business
coverage and contribuEon, skills, resources and technological
infrastructure
– External IS/IT environment
• Technology trends and opportuniEes and the use made of IS/IT by
external bodies
The Model of Strategic IS/IT
Planning Processes
• Outputs
– IS/IT management strategy
• The common elements of the strategy that apply throughout
the organizaEon, ensuring consistent policies where needed
– Business IS/IT strategy
• How each unit or funcEon will deploy IS/IT in achieving its
business objecEves.
• Alongside each of these are applicaEon porYolios to be
developed for business unit and business models, describing
the informaEon architecture of each unit.
• The porYolios may include how IS/IT will be used at some
future date, to help the units to achieve their objecEves
– IT strategy
• Policies and strategies for management of technology and
specialist resources
Internal Business Environment
External Business Environment
Internal IS/IT environment
Current Applications Portfolio
Strategic IS/IT
Planning Process
External IS/IT Environment
Planning Approaches, Tools and Techniques
IS/IT Management Strategy
Business IS Strategies
Applications Portfolio
IT Strategy
Model & Matrices
Types of Deliverables from The IS/IT
Planning Processes
• Hard deliverables
– The current situaEon
– The vision and raEonale for what is being put into place—
informaEon, systems, technology, people, and so on.
– The plans for how it is going to be achieved, with the
milestones along the route
• So` deliverables
– Relate to human factors: skill, awareness and moEvaEon.
Framework for the IS Planning Process
Business and
Technical
Environment
Previous
IS/IT
Strategy
Initiate
Planning
Process
Understand the
Current Situation
and Interpret
Business Needs
Define/Update
Information and
Systems
Architecture
Determine
Business IS
Strategy
Formulate IT
Strategy
Prepare
Migration
Plans and
Business Case
Business
Strategy and
Proposed
Development
Programmme
IS/IT Strategy
and Proposed
plans
Other
Planning
Activities
Ini$ate Planning Process
• The purpose, objecEves, scope and deliverables are confirmed
The approach determined and resourced acquired, such as
automated tools
• Business parEcipants idenEfied and team assembled and trained
ExpectaEons, such issues and problems addressed, and risk
management proposals put into gear
• Process steering and management mechanisms created
How the work will interface with and feed into business planning
• The people to be interviewed, or who are needed to parEcipate
in group sessions are idenEfied
Plan for the work, tasks, Eming, roles and responsibiliEes, and
checkpoints defined.
Understand the Current Situa$on and
Interpret Business Need
• Analysis of the business strategy, objecEves, criEcal
success factors (CSFs), criEcal problems, and processes, in
order to determine the current situaEon, and its
strengths and weaknesses, and the informaEon needs
and thus the focus for investment in systems to meet
these.
• EvaluaEon of the current IS/IT operaEon – its systems,
informaEon provision, resources, organizaEon, skills and
services, to determine coverage and contribuEon and
where improvements would be beneficial.
• InnovaEve analysis of the external and internal business
environment to idenEfy potenEal applicaEons of IS/IT.
Determine the Business IS
Strategy
The accumulated business IS demand is
turned into recommendations for the
deployment of IS/IT throughout the
organization and at SBU level.
Define Informa$on and System
Architecture
• This step takes the results of the analysis
of procedures and informaEon needs in
order to build a proposed business model
for the business.
• It represents the future “ideal” in process,
informaEon and system terms, and is
needed to plot a direcEon when
developing migraEon plans.
Formulated IT Supply Proposals
IS strategy and the IT supply proposals can be fed back into
the business strategy, for consideraEon and consolidaEon
to occur, and senior business management to decide on
the likely candidates for the investment programme for
the business.
For IS/IT management, it means that the strategy can be
firmed up to give a clearer direcEons for where IS is
aiming to go.
Outline plans can the be constructed to give a route map,
and milestone for the main iniEaEves.
Business IS Strategy
• It states how the business will deploy IS/IT in
achieving its objecEves.
• To link IS/IT firmly to the business strategy
• It states the applicaEons and services
requirements for the SBU
Give an example of Business IS Strategy??
IT Strategy: Management of Supply
• To define how resources and technologies will be
managed and developed to saEsfy business IS
strategies.
• It consists of:
– ApplicaEon porYolio management
– OrganizaEon of IS/IT
– Managing the info resources and provision of info
services
– Managing investment, prioriEzaEon and benefits
– Managing applicaEon development
– Managing technology
Give an example of IT Strategy??
IS/IT Management Strategy
• Apply throughout the organizaEon, ensuring
consistent policies where needed
• It covers:
– Scope and raEonale
– IS/IT organizaEon
– Investment and prioriEzaEon policies
– Vendor policies
– Human impact policies
– IS accounEng policies
Give an example of IS/IT Management Strategy??
Success Criteria in Developing IS/IT
Strategy
EvaluaEon of IS/IT Strategic Plan:
Success Criteria
•
•
•
•
•
•
•
Improve performance
Gaining compeEEve advantage
Align IT investment with business strategy
Becer communicaEon
Improve management commitment
Becer allocaEon of IT resources
Becer IT forecasEng requirement
Try to quantify the success criteria for old vs. new system??
Factors affecEng IS/IT Development
•
•
•
•
External business
External technology
Internal business
Internal technology
Give examples on how those factors affect IS/IT Development ??
Context of IS/IT Strategy
Objectives of IS/IT Strategy Formulation and Planning
Discussion on the end of Chapter 3
What is IS/IT Strategy?
Why Developing IS/IT Strategy?
How IS/IT Strategy fits in Business Strategy?
Who in charge developing IS/IT Strategy?
What are steps to develop IS/IT Strategy?
How do you evaluate the success of IS/IT strategy