IT STRATEGY INITIATION

IT STRATEGY INITIATION:

Khairlayana binti Abdul Rahman D20072030854 Noorsyafila binti Zulkafli D20072030864 Nurulsyamsinar binti Roslan D20072030865 Nurul Huda binti Kamis D20072030868 IT STRATEGY INITIATION

The Critical Strategic Role Of IT:

IT becomes increasingly important – according to the Director of IT Governance at America Region Volkswagen AG. Global economy is defined by innovate use of IT Ability to keep pace & respond to market opportunities worldwide by delivering appropriate products requires a global IT perspective and architecture. Companies must determine the use, value, and impact of IT to identify opportunities and create value which support strategic vision. CIO is key mover in the rank of upper management The Critical Strategic Role Of IT

Value Added By IT To Business:

IT can add value to business by two ways: Directly – by reducing cost and activities performed efficiently. Indirectly – by increasing revenues and produce more or service more without hire more employees Enabling temporary or sustained competitive advantage. Value Added By IT To Business

Competitive Advantage Through IT:

Gained by providing real or perceived value to customer The company should know its products and services, customers, competitors, industry & environment forces Have insight about how IT can enhance value for each of the areas (above). Competitive Advantage Through IT

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3 characteristics to create competitive advantage : Value -Resources must be considered valuable by customer (help the firm improve efficiency or effectiveness) Rarity - Resources must be considered as rare in order to confer competitive advantages. Appropriability -Resources must be appropriable (ability of the firm to create earnings through the resources) Continue..

The Value Of IT To Business:

IT has the capability to contribute to improvement in many domains of business activities. Presented in opportunity matrix of business improvement with IT. The Value Of IT To Business

Partnership Between The IT Division and Business Management:

Partnership Between The IT Division and Business Management Partnership between the IT division and business Management can extend to fuse with the business. Such a fusion could be achieved with new organizational structure. Where in the CIO become responsible for managing some core business function. CIO work directly with other top executive to influence strategic direction Suggest change in internal business process Lead a diversity of initiatives more than just technology project.

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The working relationship has fostered a rapport between the CIO and sales executive, building the necessary trust or the CIO to drive the it function and deliver business inovation.

How CIO Spend Their Time:

How CIO Spend Their Time 2/3 of a CIO time is spent on nontechnical duties. Including Relationship management with business Strategy related activities Non-IT Activities and other The largest percentage among non technical duties is 23% is spent to managing relationship with business functional areas and business unit. To realize the greatest potential from IT, the business strategy must include the IT strategy and the use of IT must support the business strategy

IT Strategic Planning:

IT S trategic Planning A good IT planning process can help ensure that It aligns and stays aligned within the organization. Because organizational goal change over time IT strategic planning in important to both planner and end user. do IT planning for their own units Understand the planning process

Focus of IT strategy:

Focus of IT strategy On how IT creates business value. Annual planning cycle are establish to identify potentially beneficial IT services to perform cost benefit analysis to subject the list of potential projects to resource allocation analysis

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Tools And Methodologi Of IT Strategic Planning Business Service Management Scenario Planning Critical Success Factors Balanced Scorecard The Business Systems Planning Model

TOOLS AND METHODOLOGIES OF IT STRATEGIC PLANNING:

To facilitate To help organizations align their business IT/IS strategy with : i . The organizational strategies ii. To identify opportunities to add value with IT/utilize IT for competitive advantage iii.To analyze internal processes Most of these methodology start with : i . Investigation of strategy that checks the industry ii.Competition and competitiveness iii.Relate to technology (alignment) Others : i . Help create ii. Justify new uses of IT (impact) TOOLS AND METHODOLOGIES OF IT STRATEGIC PLANNING

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Business Service Management - An approach for linking key performance indicators (KPIs) of IT to business goals to determine the impact on the business. - KPIs are metrics that measure the actual performance of critical aspects of IT. - Two types of KPIs : i. Real-time performance/predict future results ii.Results of past activity

Business Service Management:

Business Service Management

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b. The Business Systems Planning Model - Develop by IBM - Influenced other planning efforts - Top-down approach that starts with business strategies - Deals with 2 main building blocks i. Business process ii.Data classes

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c. Balanced Scorecard - Performance measurement approach that links business goals to performance metrics. - Goals and measures are derived from the vision and strategy of an organization. - Balanced scorecard framework supplements traditional tangible financial measures with criteria that measure four intangible perspectives and address important questions : 1. How do customers see the company? 2. At what must the company excel? 3. Can the company continue to improve and create value? 4. How does the company appear to shareholders?

IT Project Balanced Scorecard:

IT Projects Project’s Role in Strategic Business Plan Project’s Evolving versus Stable Knowledge Degree Of Change Needed In The Project Where The Project Gets Sourced Data’s Public or Proprietary Nature Projects Budget Infrastructure Efficiency Stable Low Outsourced Proprietary Small Application Services Customer Focus Evolving High ERP Software Proprietary High Data Services Innovation Evolving High Business Intelligence Software Proprietary High Security Services Compliance requirement Evolving Low Outsourced Proprietary Small IT Project Balanced Scorecard

CRITICAL SUCCESS FACTORS:

CRITICAL SUCCESS FACTORS The essential things that must go right in order to ensure the organization’s survival and success. CSF approach: to help identify the information needs of managers. Also exist in business units, departments and other organizational units.

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Continue... IT planners identify CSFs by interviewing managers in an initial session Then, refine CSFs in one or two additional sessions. Sample questions asked in the CSF approach are:- What objective are central to your organization? What are the critical factors that are essential to meeting these objective? What decisions or actions are key to these critical factors?

Step Of The Interviews:

Step Of The Interviews

SCENARIO PLANNING:

SCENARIO PLANNING Methodology in which planners first create several scenarios; then a team compiles as many future events as possible that may influence the outcome of each scenario. Used in planning situations that involve much uncertainly. Stauffer (2002) emphasized the need for scenario planning.

5 Reasons To Do Scenario Planning:

To ensure that you are not focusing on catastrophe to the exclusion of opportunity To help you allocate resources more prudently To preserve your options To ensure that you are not still “fighting the last war” To give you the opportunity to rehearse testing and training of people to go through the process 5 Reasons To Do Scenario Planning

Essential Steps Of Scenario Planning:

Essential Steps Of Scenario Planning

RESOURCE ALLOCATION:

Consist of developing the plans for hardware, software, data communications and networks, facilities, personnel and financial resources needed to execute the master development plan. Continues process in most organizations because opportunities and request for spending far exceed the available funds. RESOURCE ALLOCATION

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Continue ... Request for funding approval from the steering committee fall into two categories. First category: - consists of project and infrastructure that are critical for the organization to stay in business. Second category: - includes less-critical items, such as new projects, maintenance or upgrades to existing systems and infrastructure to support these system and future needs.