Determining the Business Information System Strategy

1
Chapter 6

• Determining the Business Information System
  Strategy

2
Agenda

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

3
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

4
External Long TermExternal 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

5
External Short TermExternal 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)

6
Internal Long TermInternal 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

7
Internal Short TermInternal 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

8
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

9
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

10
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

11
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

12
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

13
The Potential Applications

• Identifying potential future investmentlong
  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

14
Portfolio Management in a Multi-Business Unit
Organization

• Coordination and coherent among corporate and
  business units
• For each business unit
• 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

15
Portfolio Management in a Multi-Business Unit
Organization

• For each business unit
• 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

16
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

17
Question

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