Planning for Business Change with Information Technology

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Planning for Business Change with Information
Technology

• Chapter 7

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Objectives

• Understand some of the key issues facing managers
  in the planning and implementation of business
  changes supported by information technology

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Introduction- Planning

• Planning
• Focuses effort and resources on long term,
  general objective and yet provides a foundation
  for short term activities.
• Provides framework for action

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Introduction- strategic planning

• Continuous and systematic process where people
  make decisions about intended future outcomes
• A systematic cycle of events that help an
  organization understand fundamental issues,
  define policy choices and establish priorities
  for action.

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Benefits form strategic planning process

• Integrated development of consistent goals,
  objectives, strategies, policies and functions
  throughout the org.
• Provide a process for deciding in advance
  what/when/how it is to be done, and who is going
  to do it
• Clarifies future direction
• Focuses resources on the highest prioroties

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Benefits form strategic planning process - cont

• Help make todays decisions in light of the
  future consequences
• Facilitate strategic thinking and acting
  throughout the org.
• Help manage in a turbulent environment
• Resolve important issues
• Maintains continuity
• Gets the whole org. moving in the same direction

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Organization Planning

• Planning Deciding what to do before we do it
• Plan a result of the planning process and a
  basic for action

Planning?
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Organization planning process

• Evaluating what they have accomplished and the
  resources they have acquired
• Analyzing the environment
• Anticipating future development
• Deciding on what goals they want to achieve
• Deciding what action to be taken to achieve the
  goal.

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Planning Terminology

• Mission
• Goals
• Tactics
• Policies

• Objectives
• Strategies
• Rules and procedure

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Type of Planning

• STRATEGIC
• Deals with the development of an org. mission,
  goals, strategies and policies
• TACTICAL
• Involves the design of tactics, setting of
  objectives and development of procedures, rules
  schedules and budgets
• OPERATIONAL
• Planning on a short-term basis to implement and
  control day-to-day operations

• LONG RANGE
• Involves looking 3-5 years into future
• SHORT RANGE
• Daily, weekly or monthly planning to a ½ year
  tme frame

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Objectives of Strategic Information Systems
Planning

• Business Alignment
• Aligning investment in IT with a companys
  business vision and strategic
• Competitive Advantage
• Exploiting IT to create innovative and strategic
  business information systems for competitive
  advantage

• Resource Management
• Developing plans for the efficient and effective
  management of a companys IS resources including
  IS personnel, h/w, s/w, data and network
  resources
• Technology Architecture
• Developing technology policies and designing IT
  architecture for the org.

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IS PLANNING
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Type of IS Planning

• Tactical
• Operational
• Project

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Tactical IS Planning

• Specific assessment of an organizations current
  and projected information requirements
• Requirements are sub-divided into individual
  project proposal for the development of new or
  improved IS
• Projects are evaluated, ranked and fitted into a
  multi year development plan
• Resource allocation plan are developed to specify
  h/w, s/w and personnel resources, telecom.
• Facilities and financial commitment needed to
  implement the master development plan

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Operational IS Planning

• Preparation of annual operating budget
• Planning for individual IS development project

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Project IS Planning

• Development of plan. Procedures and schedules for
  an IS project.
• Techniques GANT chart, PERT chart

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IS Planning Methodologies

• Business System Planning (BSP)
• Structured approach that assist an org. in
  developing IS plan to satisfy its short and long
  term requirements

• Critical Success Factor (CSF)
• Base on the premise that the information
  requirements of an org. should be determined by
  its CSF

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BSP - Objectives

• Translate the business mission, strategies,
  objectives and structure into IS mission,
  strategies, objectives and structure
• Determine IS priority and allocate resources to
  high return project that support business goals
• Plan long-lived IS based on enduring business
  processes

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BSP - Approach

• Top Down Planning

• Bottom Up Implementation

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Critical Success Factors

• Four sources industry the business is in,
  company itself within industry, environment
  (consumer trends), and temporal organizational
  factors (inventory)

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Critical Success Factors

• Used to determine factors critical to accomplish
  corporate objectives and corresponding measures
• Can be used to identify IS that need to be
  developed

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CSF - example

• Market Share
• Earn per share
• Return on Investment
• New Product Success

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Planning for Competitive Advantage

• Planning IS that will improve the org.
  performance and competitive position
• 3 models
• Competitive force
• Competitive strategies
• Value chain

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Competitive Forces Model

• Companies must contend with five competitive
  forces
• Threat of new entrants
• Bargaining power of customers and buyers
• Bargaining power of suppliers
• Substitute products or services
• The intensity of rivalry among competitors
• by Michael Porter

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• Competitive Strategies
• Cost leadership
• Innovation
• Value chain
• Adding value to a product
• Strategic Threats
• Add growth by acquisitions and alliance with
  other organizations
• SWOT analysis is used to evaluate the impact that
  each possible strategic thrusts or target can
  have on the business.

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4. Value Chain Analysis

• Five primary activities that form the sequence of
  the value chain
• Inbound logistics receiving and handling inputs
• Operations converting inputs to the
  product/service
• Outbound logistics collect, store, and
  distribute the product/service to buyers
• Marketing and sales the means/incentives for
  buyers to buy the product/service
• Service enhancements/maintenance of the value of
  the product/service

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4. Value Chain Analysis

• Four supporting activities that underlie the
  entire value chain
• Organizational infrastructure
• Human resources management
• Technology development
• Procurement (of products/services)

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Additional

• Scenario Approach
• Reach and analysis

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Computer Aided Planning Tools

• Help ease the burden of IS planning
• Example PC Prism
• Define a planning environment( strategic,
  tactical, etc) and planning structure (CSF, org.
  unit, business processes, etc.)

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Example

• http//www.mampu.gov.my/ICT/ISPlan/?Framewrok.htm
• http//www.mampu.gov.my/mampu/bm/program/ICT/ISPla
  n/Main.htm

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Conclusion

• IS plans must look towards the future
• IS planning must be intrinsic to business
  planning
• IS plans typically use a combination of planning
  techniques presented

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Activity

• Which of the following IS Planning methodologies
  that you and your group prefer, give reasons
• BSP
• CSF