CORPORATE STRATEGIC

INFORMATION SYSTEMS
PLANNING (ITS 582)

Lecture By:
Dr. Syaripah Ruzaini Syed Aris

1.0 STRATEGIC MANAGEMENT

•Definitions of Strategic Management
•The major elements of strategic management
•The history of Strategic planning and Management
•Components of Strategic Plan
Definitions of Strategy
Strategy is the pattern of resource allocation decisions made
throughout an organization. These encapsulate both desired
goals and beliefs about what are acceptable and, most critically,
unacceptable means for achieving them
(Robson, 1997)

Strategy is the direction and scope of an organization over the

long term; which achieves advantage for the organization through
its configuration of resources within a changing environment, to
meet the needs of markets and to fulfil stakeholder expectations
(Johnson & Scholes, 1999)
 The Vocabulary of Strategy
TERM DEFINITION A PERSONAL EXAMPLE
Mission Overriding purpose in line Be healthy and fit
with the values or
expectations of stakeholders
Vision or strategic Desired future state: the To run the London Marathon
intent aspiration of the organization
Goal General statement of aim or Lose weight and strengthen
purpose muscles
Objective Quantification (if possible) or Lose 10 pounds by 1 September
more precise statement of the and run the Marathon next year
goal
Core Resources, processes or skills Proximity to a fitness centre,
Competences which provide ‘Competitive supportive family and friends and
advantage’ past experience of successful diet.
 The Vocabulary of Strategy
TERM DEFINITION
Strategies Long-term direction
Strategic Combination of resources,
architecture processes and competences
to put strategy into effect
Control The monitoring of action
steps to:
•Assess effectiveness of
strategies and actions
•Modify strategies and/or
actions as necessary
A PERSONAL EXAMPLE
Associate with a collaborative
network (e.g. join running club),
exercise regularly, compete in
marathon locally, stick to
appropriate diet
Specific exercise and diet regime,
appropriate training facilities, etc.
Monitor weight, miles run and
measures times: if progress
satisfactory, do nothing; else,
consider other strategies and
actions
Why We Need Strategy?

THE FUTURE IS A PROBLEM

FOR EVERY BUSINESS

FAILING TO PLAN IS PLANNING

TO FAIL!
Why We Need Strategy?
Results from lack of a coherent strategy for IS/IT investment

•Business opportunities are missed – Systems and technology investment do

not support the business objectives
• Lack of integration os systems and ineffective information management –
produces duplication of effort, inaccurate and inadequate information for
managing the business.
•Priorities are not based on business needs, resource levels are not optimal,
project plans are consistently changed- Business performance is not improved,
cost are high, solutions are of poor quality and IS/IT productivity is low.
•Technology strategy is incoherent, incompatible options are selected and
large sums of money are wasted attempting to fit things together
retrorespectively.
•Lack of understanding and agreed direction between users, senior
management and the IS/IT specialists - leads to conflict, inappropriate
solutions and a misuse of resources.
The Characteristics of Strategic
Decisions

• Concern with or affect the long-term direction of an

organization
• Trying to achieve some advantage for the organization, for
example over competition.
• Concern with the scope of an organization’s activities; does
(and should) the organization concentrate on one area of
activity, or should it have many?
• Matching of the activities of an organization to the
environment in which it operates.
THE TYPES OF PLAN

•Plan covering a particular capital investment or marketing

operation. E.g – an investment in a new factory would be
Project supported by a detailed study of the expected results of
Plan that investment.
•Prepared on as a “required basis”

Strategi •Sets out the objectives of the company and the means
(strategy) by which the company intends to reach those
c objectives
Plan

Operati •Plan of an established areas of the company.

ng •E.g.- A division or a subsidiary
Plan
 GENERALISED PLANNING SYSTEM

Operating management Strategic management

New products for

Improvement
Existing products for new and existing
Plan
existing markets
Marketing Divestment markets
Plan
Plans
Operation Plan

Progress Plan
Facilities Diversi-

Personnel
Finance
Plan Strategic
Plan fication
Plan

Production Acquisition
Plan Plan
New markets for
Research and
existing products development
plan
CHARACTERISTICS OF STRATEGIC MANAGEMENT AND
OPERATIONAL MANAGEMENT

STRATEGIC OPERATIONAL
MANAGEMENT MANAGEMENT
Ambiguous Routinised
Complex
Organization-wide Operationally specific
Fundamental
Long-term implications Short-term implications
 What is Strategic Management

Strategic management is :
•Something to do with deriving and describing
the strategy.
•Applicable to all organizations whether large or
small, public or private, profit or non-profit
making.
•Encompasses the entire enterprise and looks
beyond day-to-day operating concerns in order
to focus upon the organization’s long-term
prospects and development.
What is Strategic Management

Strategic management is :
•Not a technique; it is a complete way of
running a business
•With strategic management, the future
implications of every decision are
evaluated in advance of implementation
•The shorter the period, the more accurate
the forecasting events
Definitions of Strategic
Management

Strategic management is a systematic approach to a major and

increasingly important responsibility of general management to position
and relate the firm to its environment in a way which will assure its
continued success and make it secure from surprises (Ansoff, 1990).

Strategic management is concerned with the overall long-range direction

of organizations … and consequently also provides a framework for
operational management (Greenley, 1989).
Definitions of Strategic
Management

Strategic management is concerned with decising on strategy and

planning how that strategy is to be put into effect via :
•Strategic analysis
•Strategic choice
•Strategic implementation
(Johnson and Scholes, 1993)
 The major elements of strategic
management
Concerned with understanding the
strategic position of the organizations in
terms of its external environment, internal
resources and competences, and the
expectations and influence of
Strategic stakeholders
Involves understanding the
underlying bases guiding future
Analysis
strategy, generating strategic options
for evaluation and selecting from
among them

Strategy
Strategic Implemen-ta
Choice tion

Concerned with the translation of strategy

into organizational action through
organizational structure and design,
resource planning and the management of
strategic change
 Expect-ation
s, objectives
and power :
culture
The
environ-men Resources
t

Strategic Organization
Bases of Analysis structure and
strategic design
choice

Strategy Resources
Strategic Implemen-ta allocation
Strategic and control
options Choice tion

Strategy Managing
evaluation strategic
and selection change
Strategic management in Different
Context

❖ The small business context

❖ The multinational corporation
❖ Manufacturing and service organizations
❖ The innovatory organization
❖ Strategy in the public sector
❖ Privatised utilities
❖ The voluntary and non-for-profit sectors
❖ Professional service organizations
Evolution of information and
information systems strategies
Expert
System and
Knowledge
Executive Management
Information System
Decision System
Support
Management
System
Information
Transaction System
Processing
System
Evolution of information and
information systems strategies
These process data resulting from business Expert
transactions, update operational databases, System and
and produce business documents. Examples: Knowledge
sales and inventory processing and Management
Executive
accounting systems. System
Information
Decision System
Support
Management
System
Information
Transaction System
Processing
System
Evolution of information and
information systems strategies
Provide information in the form of
pre-specified reports and displays to support
business decision-making.
Examples: sales analysis, production Expert
performance and cost System and
trend reporting systems. Knowledge
Executive Management
Information System
Decision System
Support
Management
System
Information
Transaction System
Processing
System
Evolution of information and
information systems strategies

Provide interactive ad hoc support for the

decision-making processes of managers
and other business professionals.
Examples: product pricing, profitability Expert
forecasting and risk analysis systems. System and
Knowledge
Executive Management
Information System
Decision System
Support
Management
System
Information
Transaction System
Processing
System
Evolution of information and
information systems strategies

Provide critical information from MIS, DSS

and other sources, tailored to the
information needs of executives.
Examples: systems for easy access to
Expert
analysis of business performance, actions of
all competitors, and economic
System and
developments to support strategic planning. Knowledge
Executive Management
Information System
Decision System
Support
Management
System
Information
Transaction System
Processing
System
 Evolution of information and
information systems strategies
Expert systems – knowledge-based systems that provide expert
advice and act as expert consultants to users.
Examples: credit application advisor, process monitor, and
diagnostic maintenance systems.
Knowledge management systems – knowledge-based systems
that support the creation, organization and dissemination of
business knowledge within the enterprise. Examples: intranet Expert
access to best business practices, sales proposal strategies and
System and
customer problem resolution systems.
Knowledge
Executive Management
Information System
Decision System
Support
Management
System
Information
Transaction System
Processing
System
Evolution of information and
information systems strategies
From MIS to e-Commerce:
• The rapid growth of the Internet, intranets, extranets and other
interconnected global networks in the 1990s dramatically changed the
capabilities of information systems in business.
• Higher level of integration of system functions across applications, greater
connectivity across both similar and dissimilar system components, and the
ability to reallocate critical computing tasks such as data storage,
processing, and presentation to take maximum advantage of business and
strategic opportunities.
• E-business is the use of Internet technologies to work and empower
business processes, electronic commerce and enterprise collaboration
within a company and with its customers, suppliers and other business
stakeholders.
• These companies rely on e-business applications to (i) reengineer internal
business processes, (ii) implement electronic commerce systems with their
customers and suppliers, and (iii) promote enterprise collaboration among
business teams and workgroups.
TRENDS IN THE EVOLUTION OF
BUSINESS IS/IT
Aspects Era
DP MIS SIS
Nature of the Computers Distributed process Networks
technology
Fragmented Interconnected Integrated
Hardware Software limitation People/Vision
limitation limitation
Nature of Remote from users Regulated by Available and
operations controlled by DP management supportive to users
services
Issues in systems Technical issues Support business Relate to business
development (programming/ users needs strategy?
project (information
management) management)
TRENDS IN THE EVOLUTION OF
BUSINESS IS/IT
Aspects Era
DP MIS SIS
Reasons for using Reducing costs Supporting the Enabling the
the technology (esp business (manager) business? (business
administrative) (user driven) driven)
(technology driven)

Characteristics of Regimented/ Accommodating/ Flexible/Strategic?

systems Operational Control (External)
(internal)
COMPONENTS OF STRATEGIC
PLAN
◼ Mission
▪ What business are we in?
▪ The purpose of the organization and what the
organization does not do
◼ Vision
▪ Central purpose for the existence
COMPONENTS OF STRATEGIC
PLAN
◼ Goals
▪ Desired future positions of the organizations
▪ Selected on the basis of the defined mission
▪ Broad and timeless statements of the end results
that the organization considers will achieve the
mission
◼ Objectives
▪ Specific and tangible measures of the goals to
achieve the mission
 COMPONENTS OF STRATEGIC
PLAN
◼ Strategy
▪ Definition of the general direction on which the
organization chooses to move in order to meet goals
to achieve the mission
▪ HOW to move towards the desirable WHAT
▪ Constrained by the nature of the organization
(resources, capabilities, culture, structure and the
environment within which it operates)
◼ Policy
▪ Provide a framework for the implementation of any
major changes needed to be made.
 Tutorial
◼ Group discussion
◼ Select ONE organization
◼ Find out:
▪ Vision
▪ Mission
▪ Goals
▪ Objectives
▪ Strategies