Chapter 4

Developing a strategy
ITS4223 Strategic Information
Systems Planning
Chapter Objectives

 Strategic Management Maturity Model.

 ICT Strategic Planning Process
 ICT Strategy Process Deliverables.
 Strategy Process Team Structure.
 Business Issues In ICT Planning.
Strategic Management Maturity Model
Strategic Management Maturity Model
Level 1: Ad Hoc and Static
 It is characteristic of organizations at this level that they currently
do not do any strategic planning or management in a formal
sense, tending to plan only on the tactical or operational level in an
ad hoc and uncontrolled manner, normally by senior management
behind closed doors.
 Leaders spend a majority of their time addressing operational
issues and “putting out fires” and never address long-term strategy.
Level 2: Reactive
 It is characteristic of organizations at this level that some elements
of effective planning and strategic performance management
are being applied, only in an inconsistent fashion and often
with poor results. Planning discipline is unlikely to be rigorous, and
only happens in reaction to events or to temporarily please an
individual leader.
 These organizations might measure performance or even use it to
punish underperformers, but often these activities are done by
individuals to meet a routine policy need and are not taken seriously.
Strategic Management Maturity Model
Level 3: Structured & Proactive
 It is characteristic of organizations at this level that there are
formal structures and processes in place to comprehensively
and proactively engage in strategic planning and management.
 These activities occur on a fairly regular basis and are subject to some
degree of improvement over time.
 Measurements are somewhat aligned with strategy and employee
accountability is taken seriously.
Level 4: Managed & Focused
 It is characteristic of organizations at this level that strategy drives
focus and decision making for the organization.
 Organization-wide standards and methods are broadly implemented
for strategy management.
 Leaders formally engage employees in the process and a
measurement & accountability work culture help drive strategic
success for the organization.
Strategic Management Maturity Model

Level 5: Continuous Improvement

 It is a characteristic of organizations at this level that the
strategic planning and management excellence are
embedded within the culture of the organization and are
continuously improved in a formal sense.
 This means that as performance is evaluated, the organization first
analyzes how it is performing towards its strategic goals and then
second studies how effective the strategic planning and
management processes are and adapts as necessary. Excellence in
strategic management drives the organization’s competitive edge
or performance success
 THINKING TIME

 Review the meaning of strategy

and strategy creating process
 What is the meaning of strategy?
 What is the process of creating
strategy?
Defining Strategy

 According to Porter, strategy can be defined as

an integrated set of actions aimed at increasing
the long-term well-being and strength of the
enterprise relative to competitors.
 Edwards et al describe strategy concerns
creating a vision of the future and the means
and policies which will enable the organisation
to reach that vision’. It involves the
interpretation of the environment. It helps
allocate an organisation’s resources.
Process to create strategy

There are three interrelated processes that

can contribute to the establishment of
strategy:
Strategic thinking- creative, entrepreneurial
insight into the ways the enterprise could
develop
Strategic planning- systematic, comprehensive
analysis to develop a plan of action
Opportunistic decision-making- effective
reaction to unexpected threats and opportunities
Strategic ICT Planning Process
Engineering
Approach, Pita
et. al, 2006)
 THINKING TIME

What are the input and output of

Strategic ICT Planning process?
 Strategic ICT Planning Input

Strategic ICT Planning Input:

Organisation/business internal environment
Organisation/business external environment
ICT internal environment
ICT external environment
Strategic Alignment Model (SAM)
Henderson and Venkatraman
 Strategic ICT Planning
Output/ Deliverables

 Strategic ICT Planning Output:

 Strategic ICT Plan Blueprint consist of
ICT strategies that support /drive organization
ICT management strategies
Relationship between business, IS
and IT Strategies
Business Strategy WHERE is the
• Business Decision business
• Objective and direction
going and
WHY
• Change

Support Business Direction for business

IS Strategy
• Business Based WHAT is
• Demand Oriented
required
• Application Focused
Infrastructure and Needs and priorities
service
IT Strategy
• Activity Based
HOW it can
• Supply Orientated be delivered
• Technology Focused
15
Strategic ICT Planning Approach
REVIEW OF PRESENT
STRATEGIC ICT PLANNING
METHODOLOGIES
 LUFTMAN
 WARD AND GRIFFITH
 MAMPU
 ISP-IPTA
Luftman IT Strategy Formulation
Framework
 Strategic ICT Planning Framework

Business and Understand the

Initiate Other
Technical Current Situation
Planning Planning
Environments and interpret
Process Activities
Business Needs

Define/Update Determine
Info. And System Business IS
Architecture Strategy

Previous
Prepare Migration
IS/IT Formulate IT
Plans and
Strategy Strategy
Business Case

(Ward dan
Business Strategy
Peppard, 2002,
IS/IT Strategy
and Proposed
and Proposed
Ward and
Development
Programme
plans Griffiths 1998)
MAMPU Strategic ICT Planning
Framework
ISP-IPTA Strategic ICT Planning
Framework
Initial Phase

Assess internal and and

external business and
IS/IT environment

Assess internal and and Assess internal and and

external business external IS/IT environment
environment

Formulate SISP Strategy

Formulate IS/IT Formulate IS/IT

strategy Management Strategy

SISP Implementation
 Strategic ICT Planning Initiation
 Develop a proposal that state the purpose, objective scope and
deliverables of the SISP. Determined approach and resources acquired.
Identify business participant and assemble team members, and if
necessary, trained. Plan for works, tasks, roles and responsibilities and
defined checkpoints.
 Enables the sponsor to develop an understanding of the business needs
and drivers that prompted the IS/IT strategy process. It must be shown
that its conduct and resulting strategy will assist all levels of management
in achieving their objectives and resolving key problems.
 It is also important that management accept that the costs involved are
merited. The cost should be repaid by focusing future investment in IS/IT
more precisely on the achievement of corporate objectives, by
undertaking projects with clearer, deliverable benefit.
 TOR must be clear and acceptable to the senior management and key
participants, that adequate resources are allocated, and that
interdependencies and consolidation plans with the rest of the business
strategy and plans are achievable.
 Assess organisation and ICT
environment
Assess organisation environment
 Studying existing documents, interviewing users,
holding workshops and brainstorming sessions with
group of users
 Analyze the business strategy, not just the objectives
but the intended means of achieving them and critical
success factors.
 The current business processes, activities and the main
information entities and how they relate to other
entities, critical problems and processes.
 The organizational environment covering its structure,
assets and skills, and less tangible factors such as
knowledge, competencies, value, style, culture and
relationships.
 Assess ICT environment

Assess ICT environment

 Evaluate current application portfolio and the
applications under development to determine their
content, coverage and contribution
 Evaluate current/previous strategy and policies
 Evaluate IS organization and processes (IS function, IT
provision, sourcing strategy, IS/IT governance
structure, budget for IS/IT investment.
 Gain perspective on technology trends and
opportunities for using IS/IT in new and innovative
ways
 Looking at what competitors or other comparable
organizations are doing
 Formulate ICT Strategies
Formulate ICT strategy
 Define applications to meet current business needs
 Identify innovative potential applications of IS/IT
 List according to it priorities

Formulate ICT management strategy

 Define how resources and technologies will be acquired, manage and
develop to satisfy business IS strategies within the management strategy
framework.
 Review IT policies, methods and standards in place.
 Focus on the areas where change is necessary due to business
requirement, or when new option available due to changes in technology,
experience, capability that have not been previously recognized and
pursued.
 Address the IT supply factor –application portfolio management,
organization of IS/IT (resources management and administrative
matters), managing the information resources and provision of
information services, managing application development and managing
technology.
 Address IS/IT management factor- scope and rationale, IS function,
investment and prioritization policies, vendor policies, human impact
policies including education and IS accounting policies.
 Strategic ICT Plan
Implementation

Present draft of SISP blueprint to top

management to get the budget for SISP
implementation
Make sure that the SISP blueprint aligns with
business strategy in term of communication,
competency and value measurement,
governance, partnership, scope and
architecture and skills.
Make detail project proposal to implement the
SISP project based on the priority.
 Strategic ICT Planning
Evaluation and Monitoring
 Adoption of measurement criteria
 Periodic review
 THINKING TIME

How to generate strategies and

integrate data using ICTSP
techniques and tools?
ICT Strategic Planning Team
Structure

ICTSP Steering Committee

CIO
Head of ICT Department
Head of other Department
ICTSP Working Committee
ICT Executives
Business Issues in ICT
Planning

 Alignment
 Budget
 Implementable
 Top Management Support
 ICTSP expert
 ICT expert