MANAGING INFORMATION TECHNOLOGY FIFTH EDITION CHAPTER 14 SETTING

MANAGING INFORMATION TECHNOLOGY FIFTH EDITION CHAPTER 14 SETTING A DIRECTION FOR INFORMATION RESOURCES E. Wainright Martin Carol V. Brown Daniel W. De. Hayes Jeffrey A. Hoffer William C. Perkins

WHY SET A DIRECTION FOR INFORMATION RESOURCES? n To share information among diverse parts of the organization n To communicate the future to others n To provide a consistent rationale for making individual decisions n Planning discussions help business managers and IS professionals in making decisions about how the “business” of IS will be conducted © 2005 Pearson Prentice-Hall Chapter 14 - 2 2 Page 559

THE OUTPUTS OF THE DIRECTIONSETTING PROCESS Information Resources Assessment Information resources assessment – includes inventorying and critically evaluating these resources in terms of how well they are meeting the organization’s business needs © 2005 Pearson Prentice-Hall Chapter 14 - 3 3 Page 560

OUTPUTS OF THE DIRECTIONSETTING PROCESS Information Vision and Architecture n Is an ideal view of the future n Not the plan on how to get there n Must be flexible enough to provide policy guidelines for individual decisions n More than just fluff n Must focus on the long term © 2005 Pearson Prentice-Hall Chapter 14 - 4 4 Page 560

OUTPUTS OF THE DIRECTIONSETTING PROCESS Information Vision and Architecture Information vision – a written expression of the desired future about how information will be used and managed in the organization © 2005 Pearson Prentice-Hall Chapter 14 - 5 5 Page 560

OUTPUTS OF THE DIRECTIONSETTING PROCESS Information Vision and Architecture Information vision – a written expression of the desired future about how information will be used and managed in the organization Information technology architecture – depicts the way an organization’s information resources will be deployed to deliver that vision © 2005 Pearson Prentice-Hall Chapter 14 - 6 6 Page 560

OUTPUTS OF THE DIRECTIONSETTING PROCESS Information Resources Plans Strategic IS plan – contains a set of longer-term objectives that represent measurable movement toward the information vision and technology architecture and a set of associated major initiatives that must be undertaken to achieve these objectives © 2005 Pearson Prentice-Hall Chapter 14 - 7 7 Page 560

OUTPUTS OF THE DIRECTIONSETTING PROCESS Information Resources Plans Strategic IS plan – contains a set of longer-term objectives that represent measurable movement toward the information vision and technology architecture and a set of associated major initiatives that must be undertaken to achieve these objectives Operational IS plan – is a precise set of shorter-term goals and associated projects that will be executed by the IS department and by business managers in support of the strategic IS plan © 2005 Pearson Prentice-Hall Chapter 14 - 8 8 Page 560

THE PROCESS OF SETTING DIRECTION n Assessment n Vision n Strategic Planning n Operational Planning © 2005 Pearson Prentice-Hall Chapter 14 - 9 Figure 14. 1 The Information Resources Planning Process 9 Page 561

THE PROCESS OF SETTING DIRECTION n Strategic Planning – the process of constructing a viable fit between the organization’s objectives and resources and its changing market and technological opportunities © 2005 Pearson Prentice-Hall Chapter 14 - 10 Figure 14. 1 The Information Resources Planning Process 10 Page 561

THE PROCESS OF SETTING DIRECTION n Operational Planning – lays out the major actions the organization needs to carry out in the shorter term to activate its strategic initiatives © 2005 Pearson Prentice-Hall Chapter 14 - 11 Figure 14. 1 The Information Resources Planning Process 11 Page 561

THE PROCESS OF SETTING DIRECTION Traditional Planning in the IS Organization n Needs-based IS planning or project-oriented IS planning: Bottom-up, immediate approach to information resources planning Used when a specific, urgent business need called for a new system Emphasis on project planning rather than overall organizational planning © 2005 Pearson Prentice-Hall Chapter 14 - 12 12 Page 562

ASSESSING CURRENT INFORMATION RESOURCES Measuring IS Use and Attitudes n Information resources assessment: Must measure current levels of information resources use within the organization and compare it to a set of standards n Standards can come from: Past performance Technical benchmarks Industry norms “Best of class” estimates from other companies © 2005 Pearson Prentice-Hall Chapter 14 - 13 13 Page 563

ASSESSING CURRENT INFORMATION RESOURCES Reviewing the IS Organizational Mission n IS mission statement: Should set forth the fundamental rationale (or reason to exist) for activities of the IS department Can vary substantially from one organization to another © 2005 Pearson Prentice-Hall Chapter 14 - 14 14 Page 563

Reviewing the IS Organizational Mission Example IS Mission Statement © 2005 Pearson Prentice-Hall Chapter 14 - 15 Figure 14. 3 IS-Prepared Mission Statement 15 Example Page 565

ASSESSING CURRENT INFORMATION RESOURCES Assessing Performance versus Goals n Traditional goal: Reduce cost by increasing operating efficiencies n Scope of IS goals has expanded to include: Systems to assist in decision making Ways to help with competitive advantage © 2005 Pearson Prentice-Hall Chapter 14 - 16 16 Page 565

Assessing Performance versus Goals © 2005 Pearson Prentice-Hall Chapter 14 - 17 17 Table 14. 1 Objectives for the IS Department Page 565

CREATING AN INFORMATION VISION Information Vision: n Represents how senior management wants information to be used and managed in the future n Starts with speculation on how the business’s competitive environment will change and how the company should take advantage of it n Business vision is specified and written n Implications for information use are outlined © 2005 Pearson Prentice-Hall Chapter 14 - 18 18 Page 566

DESIGNING THE ARCHITECTURE IT architecture – specifies how the technological and human assets and the IS organization should be deployed in the future to meet the information vision © 2005 Pearson Prentice-Hall Chapter 14 - 19 19 Page 567

DESIGNING THE ARCHITECTURE Components of Architecture © 2005 Pearson Prentice-Hall Chapter 14 - 20 Figure 14. 5 Elements of an Information Technology Architecture 20 Page 568

THE STRATEGIC IS PLAN Strategic IS Plan – statement of the major objectives and initiatives that the IS organization and business managers must accomplish over some time period in order to: • move toward the information vision • fit the business strategic plan © 2005 Pearson Prentice-Hall Chapter 14 - 21 21 Page 569 -570

THE STRATEGIC IS PLAN The Strategic IS Planning Process The planning process includes: n Setting objectives n Conducting internal and external analyses n Establishing strategic initiatives © 2005 Pearson Prentice-Hall Chapter 14 - 22 22 Page 570

THE STRATEGIC IS PLAN Tools for Identifying IT Strategic Opportunities n Critical success factors n Analysis of Competitive Forces n Value Chain Analysis © 2005 Pearson Prentice-Hall Chapter 14 - 23 Page 572 -573 23

Value Chain Analysis © 2005 Pearson Prentice-Hall Chapter 14 - 24 Figure 14. 11 Strategic Information Systems 24 Opportunities in the Value Chain Page 575

THE OPERATIONAL IS PLAN n After the strategic plan, initiatives must be: Identified Translated into a set of defined IS projects with: ü ü © 2005 Pearson Prentice-Hall Precise expected results Due dates Priorities Responsibilities Chapter 14 - 25 25 Page 576

THE OPERATIONAL IS PLAN The Long-Term Operational IS Plan n Developed for a 3 -to-5 year time period n Focuses on project definition, selection, and prioritization © 2005 Pearson Prentice-Hall Chapter 14 - 26 26 Page 576

THE OPERATIONAL IS PLAN The Long-Term Operational IS Plan © 2005 Pearson Prentice-Hall Chapter 14 - 27 Table 14. 2 IS Long-Range Operational Plan 27 Project Portfolio Page 576

THE OPERATIONAL IS PLAN © 2005 Pearson Prentice-Hall Chapter 14 - 28 Table 14. 3 Sample 2004 Operational IS Plan 28 Page 576

THE OPERATIONAL IS PLAN The Short-Term Operational IS Plan n Developed for a 1 -year time period n Focuses on specific tasks to be completed on projects that are currently underway or ready to be started © 2005 Pearson Prentice-Hall Chapter 14 - 29 29 Page 577

GUIDELINES FOR EFFECTIVE PLANNING 1. Early clarification of the purpose of the planning process 2. Planning effort should be iterative 3. Plan should reflect realistic expectations 4. Process of setting expectations should involve business management 5. Plans should integrate all applications of IT 6. Plan will take into consideration the barriers and constraints facing all organizations © 2005 Pearson Prentice-Hall Chapter 14 - 30 Page 577 -578 30

BENEFITS OF INFORMATION RESOURCES PLANNING n Better IS resource allocation n Communicating with top management n Helping vendors n Creating a context for decisions n Achieving integration and decentralization n Evaluating options n Meeting expectations of management © 2005 Pearson Prentice-Hall Chapter 14 - 31 Page 578 -579 31

ROLES IN THE INFORMATION RESOURCES PLANNING PROCESS Role of the Business Manager n Active participation n Accept most of responsibility for identifying specific projects that contribute to vision n Stay involved in planning and system development activities n Regularly provide feedback and necessary input © 2005 Pearson Prentice-Hall Chapter 14 - 32 32 Page 579

ROLES IN THE INFORMATION RESOURCES PLANNING PROCESS Role of the IS Professional n Act more in consulting and planning role n Help business managers understand how their ideas for competitive advantage can get built into a new information system n Create a project plan n Combine technical and organizational skills © 2005 Pearson Prentice-Hall Chapter 14 - 33 Page 579 -580 33