MANAGEMENT INFORMATION SYSTEMS CHAPTER 12 PLANNING INFORMATION SYSTEM RESOURCES Copyright © 2011 Pearson Education, Inc publishing as Prentice Hall 12-1 PLANNING INFORMATION SYSTEMS RESOURCES • IS and business managers need to work together to guide their organization in the planning and management of IS resources - Chapter 12: Steps for effective IS resource planning to best position the IS organization to enable current and future business goals - Chapter 13: Roles, responsibilities, and some “best practices” for leading an IS organization Copyright © 2011 Pearson Education, Inc publishing as Prentice Hall 12-2 BENEFITS OF INFORMATION RESOURCES PLANNING • Creating a context for IS resource decision-making • Aligning IS and business goals • Balancing the tradeoffs between standardization and agility • Obtaining IT capital investment approvals This requires both a periodic strategic planning process, as well as an ongoing monitoring of the appropriateness of IS plans in response to changes in the business and its environment Copyright © 2011 Pearson Education, Inc publishing as Prentice Hall 12-3 MULTI-STEP PLANNING PROCESS ( from an Enterprise perspective) Assessment of current Information resources (the status quo) Establishment of an Information Vision Establishment of an IT Architecture for that vision Formulation of an IS Strategic Plan (roadmap) to evolve an organization’s information resources from their current status toward the desired vision and IT architecture Formulation of short-term Operational IS Plans based on the IS Strategic Plan Copyright © 2011 Pearson Education, Inc publishing as Prentice Hall 12-4 ALIGNING BUSINESS AND IS PLANNING • IS decisions should be tightly aligned with the direction of the business • IS steps ideally impact the next step in the business planning process, but in practice this is not yet typically found Fig 12.1 The Information Resources Planning Process Copyright © 2011 Pearson Education, Inc publishing as Prentice Hall 12-5 ASSESSING CURRENT INFORMATION RESOURCES Inventorying and critically evaluating an organization’s technical and human resources in terms of how well they are meeting the organization’s business needs • Current performance is compared to a previous plan, competitors, or a set of past objectives • Comparisons are made using: - Operational data (usage of IS resources) - Survey of client satisfaction with IS performance - Benchmarks of what is being achieved at other organizations Copyright © 2011 Pearson Education, Inc publishing as Prentice Hall 12-6 INFORMATION RESOURCES ASSESMENT: Examples of Assessment Statements Copyright © 2011 Pearson Education, Inc publishing as Prentice Hall 12-7 ASSESSING CURRENT INFORMATION RESOURCES Assessing IS Performance • Example: comparing actual performance to goals Copyright © 2011 Pearson Education, Inc publishing as Prentice Hall 12-8 ASSESSING CURRENT INFORMATION RESOURCES Measuring Attitudes of Users • IT managers should also consider assessing the attitudes of users about the performance of the IS organization in relation to the current needs & future direction of the business Copyright © 2011 Pearson Education, Inc publishing as Prentice Hall 12-9 ASSESSING CURRENT INFORMATION RESOURCES IS Organizational Mission Statement • Sets forth the fundamental rationale (or reason to exist) for activities of the IS organization • Can vary substantially from one organization to another because some IS departments play more “support” roles than “strategic” roles • The extent to which the IS organization plays a strategic role can be measured by: – – the degree to which the organization is dependent on IT for business operations the degree to which IT is enabling the current business strategy Copyright © 2011 Pearson Education, Inc publishing as Prentice Hall 12-10 STAGES OF ARCHITECTURE MATURITY Fig 12.5 Changing Resource Allocation across Architecture stages, Ross 2003 Copyright © 2011 Pearson Education, Inc publishing as Prentice Hall 12-15 IT CAPABILITIES AND BUSINESS METRICS FOR IT ARCHITECTURE STAGES Figure 12.6 IT Capabilities and Business Metrics for IT Architecture Stages (Based on Ross, 2003) Copyright © 2011 Pearson Education, Inc publishing as Prentice Hall 12-16 FORMULATING THE STRATEGIC IS PLAN Strategic IS Plan Long-term objectives (often three to five years) that represent measurable movement toward the Information Vision and IT Architecture and Major initiatives that must be undertaken to achieve these objectives Copyright © 2011 Pearson Education, Inc publishing as Prentice Hall 12-17 FORMULATING THE STRATEGIC IS PLAN Steps in Strategic IS Planning Process Setting objectives Conducting an external analysis Conducting an internal analysis Establishing strategic initiatives Most planning processes involve iterations through these steps Copyright © 2011 Pearson Education, Inc publishing as Prentice Hall 12-18 FORMULATING THE STRATEGIC IS PLAN Setting objectives – Measures are identified for each of the key result areas – IS objectives may be established for: - IS department service image - IS personnel productivity - The appropriateness of technology applications - Increased effectiveness - Access to external resources Copyright © 2011 Pearson Education, Inc publishing as Prentice Hall 12-19 FORMULATING THE STRATEGIC IS PLAN 2&3 Conducting internal and external analyses – – Review external environment and internal capabilities One approach: SWOT analysis (strengths, weaknesses, opportunities, and threats) – Identify leverage points or limiting factors for new strategic initiatives Copyright © 2011 Pearson Education, Inc publishing as Prentice Hall 12-20 FORMULATING THE STRATEGIC IS PLAN Establishing strategic initiatives – Establish high-level initiatives for IS organization – These initiatives will be translated into actual projects as part of the operational IS planning Copyright © 2011 Pearson Education, Inc publishing as Prentice Hall 12-21 FORMULATING THE STRATEGIC IS PLAN Example: Strategic IS Plan for mid-sized company Copyright © 2011 Pearson Education, Inc publishing as Prentice Hall 12-22 OTHER TOOLS FOR IDENTIFYING STRATEGIC IT OPPORTUNITIES • Critical Success Factors (CSFs) - • Information needs and processes critical to the success of an entire organization or a specific business function (e.g., sales) Analysis of Competitive Forces - Using Porter’s Forces model to analyze potential changes in competitive advantage due to changes in balance of power between a business, its competitors, and other key stakeholders in the industry - Examples of ways a company can create competitive advantage: - Raising the stakes for competition in the market - Providing difficult-to-duplicate product/service features - Providing unique product features or customer services - Making it easier for customers to business with the company and more difficult to switch to a competitor - More strongly linking with suppliers to obtain lower-cost, higher-quality materials Copyright © 2011 Pearson Education, Inc publishing as Prentice Hall 12-23 OTHER TOOLS FOR IDENTIFYING STRATEGIC IT OPPORTUNITIES • Value Chain Analysis - Based on the value chain of Porter and Millar, analysis of Primary and Support activities of the business - Examine how data can be captured, manipulated, and distributed to better support each activity and its linkages to other activities - Idea-generation and action-planning sessions with business and IT managers can be used to generate ideas for strategic applications of IT Copyright © 2011 Pearson Education, Inc publishing as Prentice Hall 12-24 TOOLS FOR IDENTIFYING STRATEGIC IT OPPORTUNITIES Strategic IT Application Opportunities in the Value Chain Copyright © 2011 Pearson Education, Inc publishing as Prentice Hall 12-25 OTHER TOOLS FOR IDENTIFYING STRATEGIC IT OPPORTUNITIES • Scenario Planning - Used by leaders to address an uncertain future - Alternative scenarios for what the future might look like are developed - Typically a few major drivers are identified to create a matrix based on different values (e.g., high, low) of the drivers - Characteristics of the scenarios are then used to help plan for the future Copyright © 2011 Pearson Education, Inc publishing as Prentice Hall 12-26 FORMULATING OPERATIONAL IS PLANS Operational IS Plan Details the major initiatives the organization needs to carry out in the short term to achieve its strategic initiatives Action plans for one or more years based on Strategic IS Plan, with a focus on prioritizing projects currently underway and new projects Specifies for current and newly defined IS projects: - Expected benefits and risks - Due dates - Responsibilities Copyright © 2011 Pearson Education, Inc publishing as Prentice Hall 12-27 FORMULATING OPERATIONAL IS PLANS Balancing the risks and returns of the Portfolio of IS Projects Copyright © 2011 Pearson Education, Inc publishing as Prentice Hall 12-28 GUIDELINES FOR EFFECTIVE IS PLANNING Early clarification of the purpose of the planning process is essential The information resources planning effort should be viewed as an iterative effort The plan should reflect realistic expectations A unified approach to delivering IT services should be used An effective IS plan will also take into consideration potential barriers and constraints Copyright © 2011 Pearson Education, Inc publishing as Prentice Hall 12-29 [...]...ASSESSING CURRENT INFORMATION RESOURCES Assessing the IS Mission involves reconciling any differences between IS manager and business manager views Copyright © 2011 Pearson Education, Inc publishing as Prentice Hall 12-11 CREATING AN INFORMATION VISION Information Vision A written expression of the desired future about how information will be used and managed in the organization... future direction of the business and an understanding of the role information can best play in enabling that future business strategy - Focus is on the long term Copyright © 2011 Pearson Education, Inc publishing as Prentice Hall 12-12 DESIGNING THE IT ARCHITECTURE Information Technology Architecture • • Depicts the way an organization’s information resources will be deployed to deliver its vision Specifies... application rationalization, resulting in enterprise-wide IT standardization 3 Rationalized Data – companies implement enterprise-wide business processes and data with tightly linked systems and processes (such as with ERP systems) 4 Modular – companies seek global flexibility with loosely coupled IT-enabled business process components, which enable local differences but also preserve enterprise-wide... the way an organization’s information resources will be deployed to deliver its vision Specifies how the Technological and Human assets of the IS organization will be deployed in the future to meet the information vision Copyright © 2011 Pearson Education, Inc publishing as Prentice Hall 12-13 DESIGNING THE IT ARCHITECTURE Four Stages of IT Architecture Maturity (Ross, 2003): 1 2 Application Silos –... Pearson Education, Inc publishing as Prentice Hall 12-16 FORMULATING THE STRATEGIC IS PLAN Strategic IS Plan Long-term objectives (often three to five years) that represent measurable movement toward the Information Vision and IT Architecture and Major initiatives that must be undertaken to achieve these objectives Copyright © 2011 Pearson Education, Inc publishing as Prentice Hall 12-17 FORMULATING THE... Strategic IS Plan for mid-sized company Copyright © 2011 Pearson Education, Inc publishing as Prentice Hall 12-22 OTHER TOOLS FOR IDENTIFYING STRATEGIC IT OPPORTUNITIES • Critical Success Factors (CSFs) - • Information needs and processes critical to the success of an entire organization or a specific business function (e.g., sales) Analysis of Competitive Forces - Using Porter’s 5 Forces model to analyze... Projects Copyright © 2011 Pearson Education, Inc publishing as Prentice Hall 12-28 GUIDELINES FOR EFFECTIVE IS PLANNING 1 Early clarification of the purpose of the planning process is essential 2 The information resources planning effort should be viewed as an iterative effort 3 The plan should reflect realistic expectations 4 A unified approach to delivering IT services should be used 5 An effective