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EWC SAD Level 3 Study notes for 2020

Topic 4: Information systems Planning and strategy

(Page 89)
Module 9: Organisational factors influencing information
systems planning and strategy
SO:

z a
LO:
o Identify and describe different company and systems portfolio

o.
o Distinguish between planning for simple and complex environment
o Identify factors that influence the complexity of IS planning

.c
o Explain how properties of an organisation influence the strategic
planning for IS
o Explain how using IS in organisations can lead to a competitive
advantage
s
er
o Explain positional analysis
o Explain stages of development in terms of management control
p

Introduction:
pa

o We will look at the relationship between organisational planning and IS

planning
o Organisational planning is the way in which organisations plan for future
et

Organisational planning (determining) -> A shared vision (where it should be

going) -> The goals (it wants to achieve) - >A plan (that will enable it to achieve
tv

these goals)

Organisational planning considers:

o Current level of success – leading, new, losing or struggling
o Resources – people, assets
o Environment – opportunities, economic, political, and social
environment
o Cohesion and consensus – how staff and management work together
and share the same vision.

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Levels of organisational planning:

o Strategic planning – where do we want to go

o Tactical planning – how do we get there?
o Operational planning – what are the directions for our chosen route

Company Portfolios –
- it is the mix of products, brands and services it offers to its clients

a
- it can also be defined in terms of its major business functions like
research and development, production, sales and marketing.

z
- A company can do SWOT analysis -

o.
Systems/Application Portfolio:
- it is the set of IS applications that support key business areas in the
s .c
organisation as well as well as cross-functional business operations e.g.
HRM.
- System portfolio includes the software applications that support
o End -users collaboration
er
o Organisational communication
o Decision making
p

The IS Planning environment:

• The IS planning takes place in more simple or complex environment
pa

o Positive environmental factors that support the vision vs Negative

Factors that influence the complexity of IS planning:

et

Factors Description Effect on planning

• Internal business factors Strength and weaknesses/ Directly affect
tv

available resources organisational

planning,
• External business factors competitors, customers, Which in turn
suppliers, the economy, define what
political and social issues strategy the Is plan
must support, also
affect boundaries of
the IS plan
• Internal IS Factors Include the system
portfolio and IS resources.
e.g. infrastructure,

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applications, staff,
experience and
management attitude.
• External IS factors Include change in
technology, cost of
technology and availability
of skills

a
Theoretical Frameworks for organisational and IS planning:

z
o.
• SWOT analysis

.c
S - Strength – Internal factors - Business factors – Internal IS factors
W- Weaknesses -> s
O – Opportunities - External Factors – business environment – External IS
er
factors
T- Threats ->
p

• BCG growth share matrix

BCG – stands for Boston Consulting Group, they developed the Growth share
pa

matrix (GSM) to help companies analyse portfolios or products in terms of

their market share and the level of growth in the market.

o A cash flow – a product in a low growth area

et

o A star – a product in a high growth market with a high market

share
o A dog – a product in a low growth market with low market share
tv

o A problem child – a product in a high growth market but has a low

market share
HIGH

Cash Flow Star

Market share

LOW

Dog Problem child

LOW HIGH

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Market growth

• Michael Porter’s Five Forces model that affect the organisation’s

competitive environment

1. Rivalry among current competitors

2. Threat of new entrant
3. Threat of substitute products

a
4. Bargaining power of customers
5. Bargaining power of suppliers

z
o.
Competitive strategies – how companies use IS to implement it

1. Cost leadership- IS can be used to create links to customers and

via websites.
s .c
suppliers to reduce cost of doing business.
2. Differentiation strategy – IS can be used to target a specific market e.g.

3. Innovation strategy – Is ca be used to re-engineer business processes

er
4. Growth strategy – IS can be used to expand into new markets using
technology
5. Alliance strategy – uses technology to benefit and support suppliers and
p

customers which lock them in.

pa

Positional analysis
- This is examining the position of an organisation in terms of its state.
et

How positional analysis is done?

-it is made by looking at the positional measures such as:
tv

o Market position
o Financial position
o Sales position
o Operational position
o Distribution position
o Research and development position
o Production position
o Technology or IS position

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Various positions for each sub-position are measured:

o Current position -where do we believe we are
o Strategic intent position – where would the company be for each
measurement?
o Competitors positions – where do we believe our major competitors are
now and where they are heading to in future…?
o Supplier and customer position – where do we think they are now?

a
o Desired position- where do we want to aim now?

z
o.
Example: if you want to measure the production position you would do like
this:

Measure: Production position

Current position – slow

s .c
Strategic intent position – we want to double the production
er
Competitive position – others are producing as the customers need
Supplier and customer position – suppliers are at good state, customers
Very much loyal
p

Desired position – we want to aim for 100% turnaround of stock

Production.
pa

Stages of development in terms of management control – (Study Page 104)

et

Level 1: Control

Level 2: Cost justified

tv

Level 3: Defensive

Level 4: Offensive

Level 5: Strategic

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