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Information Systems Planning

Developing a view of the future that guides decision making today Strategy Stating the direction you want to go and how you intend to get there The result of strategy making is a plan
Planning

Three Types of Planning


Strategic

(3-5 years)

Vision. Architecture, business goals

Tactical

(1-2 years) (6 months 1 year)

Resource allocation, project selection


Project management, meeting time, budget targets

Operational

Why is Planning so Difficult?


Business

goals and systems plans need

to align Technologies are rapidly changing Companies need portfolios rather than projects Infrastructure development is difficult to fund Responsibility needs to be Joint Other planning issues

Traditional Strategy Making vs. Sense-and-Respond Approach

Traditional Strategy Making


Steps: 1. Business executives created a strategic business plan that described where the business wanted to go. 2. From that plan, IS executives created an IS strategic plan to describe how IT would support that business plan 3. An IT implementation plan was created to describe exactly how the IS strategic plan would be implemented

Traditional Strategy Making


Step 1: Where is the business going and why?
Supports business

Business strategy
Direction for IS

IT Impact

Step 2: What is required


Infrastructure and services

Systems strategy
Needs and priorities

Step 3: How can it be delivered

IT strategy

Traditional Strategy Making

Assumptions:

1.
2.

3. 4.

5.

The future can be predicted. Time is available to progress through this three-part sequence. IS supports and follows business. Top management knows best, because they have the broadest view of the firm. The company can be viewed as an army

Traditional Strategy Making

Reality today:

1.
2.

3.

4. 5.

The future canNOT be predicted. Time is NOT available to for the sequence. IS does NOT just support the business anymore Top management may NOT know best The organization is NOT like an Army

Sense-and-Respond Approach
Let

strategies unfold rather than plan them.


Sensing a new opportunity or possibility and quickly responding by testing it via an experiment. Traditional strategy making is risky because if top management predictions are wrong, it could be disastrous

Case: Microsoft
Bill

Gates announced that theyll focus on the Internet, security and web-services. Sense-and-respond approach in creating their Internet strategy.

Case: Microsoft
Microsoft

moved into variety of technologies:


Internet Explorer, web browser Slate, web-only magazine Xbox Live, Xbox and the multiplayer broadband gaming service .NET platform, web services Bing.com, search engine Zune, portable media player MSNBC, television station

Case: Microsoft
Microsoft

has been sensing and responding to the moves in several industries. The strategies have not always come from the top management.

Sense-and-Respond Approach
Old-era strategy: One big choice; long commitment

Time
New-era strategy: Many small choices, short commitments

Time

Sense-and-Respond Approach
Formulate

strategy closest to the action Stay in close contact with the marketplace Employees closest to the future should become prime strategizers

They take all the Internet, cellphones, etc for granted wear them like clothing

Case: Skandia Futures Center

3G teams:
25+,

35+, 45+, cross functional, chosen by peers or nominated by company Mandate was to focus on questions, rather than answers Five initial teams developed strategic questions on five subjects: Insurance industry in Europe, technology, world economics, demographics, leadership

Case: Skandia Futures Center

3G teams:
arrived

at a number of interesting contexts for the questions such as the evolution of financial world and IT These contexts were presented to 150 Skandia senior managers, through scenarios of these five future environments, not through documents

Case: Skandia Futures Center

Knowledge caf:
Created

by one of the 3G teams and a few executives 150 senior execs gathered for 1 hour around stand-up tables at different Skandia sites. Each table had a coffee and a laptop loaded with groupware software which were interconnected to form a virtual community

Case: Skandia Futures Center

Knowledge caf:
Execs

exchanged ideas Was videotaped and sent to larger community (along with the questions and video of the play) Showed the power of collective intelligence accelerated innovation

Case: Skandia Futures Center

Nurturing the Project Portfolio Center = garden Some projects are growing and some are not Created groups (50+, 40+, 30+, 20+) Different groups have different relationship with IT Learned that 35 to 45 year-olds have the lowest risk propensity Innovative behavior occurs amongst young people and seniors

Sense-and-Respond Approach
Guide

Strategy Making with a Strategic Envelope

Corporate strategies being tested in parallel could lead to anarchy without a central mechanism (see previous diagram) This mechanism is a strategic envelope Job of the top management

Sense-and-Respond Approach
Guide

Strategy Making with a Strategic Envelope

Rather than devise strategies, they define its context by setting parameters for the experiments (the strategic envelope) and then continually manage that context May perform management work by defining territories

i.e. similar to what Microsoft did!

Hold strategic conversations

Sense-and-Respond Approach
Be

at the table

Realities: IS executives have not always been involved in business strategizing IS function needs to be strategy oriented, not tactical and operational To become strategy-oriented, CIO must :
1.

2.

Make their departments credible Outsource most operational work to release remaining staff to help business partners strategize

Sense-and-Respond Approach
Test

the future

To get a running start, IS department need to test potential futures before the business is ready for them Mechanisms for tests

provide funding for experiments work with research organizations Have an emerging technology group

Sense-and-Respond Approach
Put

the infrastructure in Place

Most critical IT decision infrastructure decisions Recommended that IT experiments include those that test painful infrastructure issues

Comparison
Traditional

strategy making: one big choice, long commitment Sense-and-respond approach: many small choices, short commitments