Information Systems Planning & Evaluation

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1. Discuss the role of planning in the business use of information technology, using the scenario approach and planning for competitive advantage as examples.

2. Discuss the role of planning and business models in the development of business/IT strategies, architectures, and applications.

3. Change management for end user resistance to the implementation of new IT-based business strategies and applications.

Learning Objectives

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Organizational Planning Process

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Strategic Planning

Definition: Development of an organization’s mission,

goals, strategies, and policies Involves Strategic Visioning: Understanding Customer;

customer value; competition;value chain

Techniques Used: Team building; scenario modeling; Consensus creating exercises.

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Operational Planning

Definition: Planning done on a short-term basis to

implement and control day-to-day operations

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Scenario Approach

Definition: Teams of managers and other planners

participate in what management author Peter Senge calls microworld, or virtual world, exercises

Microworld - simulation exercise that is a microcosm of the real world

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Trends Shaping Strategic Planning

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Planning for Competitive Advantage using IT

Betting on new IT innovations can mean betting the future of the company.

Evaluation of potential benefits.

Possible risks of failure OR likelihood of not achieving full potential.

Technique used: SWOT Analysis;Strategic opportunity Matrix

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Strategic Opportunities Matrix

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Business Model

Definition:

A conceptual framework that expresses the underlying economic logic and system that prove how a business can deliver value to customers at an appropriate cost and make money

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Business Model Components Customer Value – Is the firm offering its customers something

distinctive or at a lower cost than its competitors?

Scope – To which customers is the firm offering this value? What is the range of products/services offered that embody this value?

Pricing – How does the firm price the value?

Revenue Source – Where do the dollars come from? Who pays for what value and when? What are the margins in each market and what drives them? What drives value in each source?

Connected Activities – Implementation – Capabilities – Sustainability –

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Business/IT Planning Process

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Business/IT Planning Process Components Strategy Development – developing business

strategies that support a company’s business vision

Resource Management – developing strategic plans for managing or out-sourcing a company’s IT resources

Technology Architecture – making strategic IT choices that reflect an information technology architecture designed to support a company’s e-business and other business/IT initiatives

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Strategic Positioning Matrix

Strategic Role of Internet

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Business/IT Strategies

Cost and Efficiency Improvements – use Internet as a fast, low-cost way to communicate and interact with customers, suppliers, and business partners

Performance Improvement in Business Effectiveness – widespread internal use of Internet-based technologies to improve information sharing and collaboration within the business and with trading partners

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Business/IT Strategies

Global Market Penetration – build e-commerce websites with value-added information services and extensive online customer support

Product and Service Transformation – use the Internet for electronic commerce transaction processing with customers at company websites, and e-commerce auctions and exchanges for suppliers

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What is IT Architecture?

A conceptual design that includes:

Technology Platform – networks, computer systems, system software and integrated enterprise application software

Data Resources – databases Applications Architecture – business

applications IT Organization – organizational structure of

the IS function and distribution of IS specialists

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Business Application Planning

Definition: Includes the evaluation of proposals made by

the IT management of a company for using information technology to accomplish the strategic business priorities developed earlier in the planning process.

Business case of investment; building the application; implementing the application of IT; etc.

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Business Application Planning

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E-business Architecture Planning

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Implementation

Definition: A process that carries out the plans for

changes in business/IT strategies and applications that were developed in the planning process

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Nolan Stage Model

Stage1Initiation

Stage2Expansion

Stage3Formalization

Stage 4Maturity

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THE NOLAN STAGE MODEL

Stage 1-initiation stage-in this, the technology is placed in the organization's few applications in the organization are computerized; minimum planning; small number of users;

Stage-2 expansion stage-rapid and uncontrolled growth in the number; variety of IT applications take place

Stage-3 formalization or control stage because in this stage organizations gain control over the technology’s resources by implementing formal control processes and standards. Controls also lead to barriers in attaining potential benefits.

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Stage-4

Nolan has described this growth stage as maturity or integration stage as by this stage organizations gain sufficient experience and maturity in IS/IT applications.

In this stage, applications are integrated ,controls are adjusted.

Planning is well established and so, we call this stage as the stage of perfection also.

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Improved Nolan Model

In 1979, Modified model divided Maturity stage in three stages named 4,5 &6.

Stage 4:Integration In this the use of new technology increases rapidly, providing new benefits.

Stage 5- Data administration In this controls are further lowered to encourage development of systems which contribute to strategic advantage of the organization.

Stage 6- Maturity In the enhanced growth model this stage is termed as the maturity stage which indicates the application portfolio is complete and matches the objectives of the org.

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Applications of Nolan Stage Model

A manager can do IS planning. The manager can find in which stage the

organization is & accordingly apply the right strategy.

The manager can speed-up the process of rollout of MIS by planning the stages.

Leads to risk management associated with IS planning.

It is proactive approach to IS planning.

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Scope and Level of Business Change

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Dimensions of Change Management

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Change Management Process

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MIS Evaluation

A highly researched & yet complex area in IT

Approaches to MIS Evaluation: Cost Benefit Analysis; User Attitude Survey; Service –Level Monitoring; Computer Performance Evaluation; Compliance Audits; Quality Assurance Review; MIS Personnel Productivity Review;

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Evaluation Models for CB Analysis

Net Benefit Analysis Present value Analysis Net Present Value; Payback Methods Cash-flow Analysis; Break-even Analysis;

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End of Session

Any Qs

Exercise: Analyze a company on the Nolan Stage Model 1. Identify the stage in which the company is placed. 2. What are the parameters that you have considered for IS adoption. 3. What are recommended strategies for the IS plan for the company.