Management Information System
MANAGEMENT INFORMATION SYSTEMS
CHAPTER 12
PLANNING INFORMATION SYSTEM
RESOURCES
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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
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Executive MBA PGSM
Management Information System
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.
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MULTI-STEP PLANNING PROCESS
( from an Enterprise perspective)
1. Assessment of current Information resources (the status quo)
2. Establishment of an Information Vision
3. Establishment of an IT Architecture for that vision
4. 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
5. Formulation of short-term Operational IS Plans based on the IS
Strategic Plan
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Executive MBA PGSM
Management Information System
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
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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
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Executive MBA PGSM
Management Information System
INFORMATION RESOURCES ASSESMENT:
Examples of Assessment Statements
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ASSESSING CURRENT INFORMATION RESOURCES
Assessing IS Performance
• Example: comparing actual performance to goals
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Executive MBA PGSM
Management Information System
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
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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
Executive MBA PGSM
Management Information System
ASSESSING CURRENT INFORMATION RESOURCES
Assessing the IS Mission involves reconciling any differences
between IS manager and business manager views
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CREATING AN INFORMATION VISION
Information Vision
A written expression of the desired future about how
information will be used and managed in the organization
- Specific enough to guide policy decisions
Developing a vision requires both an understanding of the 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
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Executive MBA PGSM
Management Information System
DESIGNING THE IT ARCHITECTURE
Information Technology Architecture
• Depicts 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
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DESIGNING THE IT ARCHITECTURE
Four Stages of IT Architecture Maturity (Ross, 2003):
1. Application Silos – companies seek to maximize individual business
unit or functional needs
2. Standardized Technology – companies seek to enable IT
efficiencies through shared services and 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 standards
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Executive MBA PGSM
Management Information System
4 STAGES OF ARCHITECTURE MATURITY
Fig 12.5 Changing Resource Allocation across Architecture stages, Ross 2003
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IT CAPABILITIES AND BUSINESS METRICS FOR
IT ARCHITECTURE STAGES
Figure 12.6 IT Capabilities and Business Metrics for 4 IT Architecture Stages (Based on Ross, 2003)
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Executive MBA PGSM
Management Information System
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
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FORMULATING THE STRATEGIC IS PLAN
4 Steps in Strategic IS Planning Process
1. Setting objectives
2. Conducting an external analysis
3. Conducting an internal analysis
4. Establishing strategic initiatives
Most planning processes involve iterations through these 4 steps
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Executive MBA PGSM
Management Information System
FORMULATING THE STRATEGIC IS PLAN
1. 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
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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
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Executive MBA PGSM
Management Information System
FORMULATING THE STRATEGIC IS PLAN
4. 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
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FORMULATING THE STRATEGIC IS PLAN
Example: Strategic IS Plan for mid-sized company
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Executive MBA PGSM
Management Information System
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 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 do business with the company
and more difficult to switch to a competitor
- More strongly linking with suppliers to obtain lower-cost, higher-
quality materials
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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
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Executive MBA PGSM
Management Information System
TOOLS FOR IDENTIFYING STRATEGIC IT
OPPORTUNITIES
Strategic IT Application Opportunities in the Value Chain
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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
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Executive MBA PGSM
Management Information System
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
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FORMULATING OPERATIONAL IS PLANS
Balancing the risks and returns of the Portfolio of IS Projects
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Executive MBA PGSM
Management Information System
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 IS plan will also take into consideration potential
barriers and constraints
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Executive MBA PGSM