The foundations of IT strategyThe foundations of IT strategy

Jonny Holmström

Web: jonnyholmstrom.com

Email: jonny.holmstrom@informatik.umu.se

Twitter: jonnyholmstrom

OutlineOutline

Mintzberg again

Galliers & Leidner

Early assumptions about IT strategy

Assumptions change…

Peppard et al (2014)

Ad hoc

IS planning

SISP

Building an IS capability

IS Strategizing

Remember Mintzberg’s view of Strategy?

Source:H. Mintzberg and J. A. Waters, “Of Strategies, Deliberate and Emergent,” Strategic Management Journal 6 (1985), pp. 257-72.

Galliers & Leidner: Strategic Galliers & Leidner: Strategic Information ManagementInformation Management

IT management must not only be sensitive to the phase of a technology, but also its impact on the organization

As technology, environment and organization change, so too must the priorities which organizations give to their IS portfolios.

The strategic impact of IS/IT on an organization will vary over time

The early assumptions on IT The early assumptions on IT strategystrategy

The strategic alignment model (Henderson & Venkatraman, 1993)

Assumes that linkages/alignments between key components must be in place

Assumptions change over time…Assumptions change over time…1950s1950s 1980s1980s 2000s2000s

Practice and technology becomes Practice and technology becomes increasingly complexincreasingly complex

IT strategies in organizations (Peppard et al., IT strategies in organizations (Peppard et al., 2014)2014)

Ad hoc bottom-up approach to Ad hoc bottom-up approach to determining ISdetermining IS

Praxis: Ad hoc approach to determining EDP and computing requirements

Practitioners: IT staffs Practices: Most emphasis on building systems rather than

determining strategy. Illustrative tools: Systems development methodologies

Description: Ad hoc, bottom up, primarily driven by technology requirements. IS plan operational in focus, for the most part identifying individual applications (cf Galliers and Sutherland, 1991)

IS planningIS planning Praxis: Top down approach to determining IS needs to

meet business goals. Shared group understanding of a few key individuals (Ciborra, 1994)

Practitioners: IT staffs Practices: Planning based on an informal network of a few

key individuals (Pyburn, 1983; Earl, 1993)Illustrative tools: IBM Business Systems Planning Andersen Consulting Method 1 Critical success factors (Rockart, 1979)

Description: Formal top down planning for IS. IS plans reactive to business plans. Aligning to business goals (Kriebel, 1968; Zani, 1970; McFarlan, 1971; King and Cleland, 1975; Zachman, 1978; King, 1978)

Strategic planning for Strategic planning for information systemsinformation systems

Praxis: Team approach (Mentzas, 1997). Involving multiple stakeholders (Earl, 1993). Importance of feedback in assessing IS planning effectiveness (Baker, 1995)

Practitioners: IS strategy promoted as a business management issue (Earl, 1989). Senior management and IT staffs

Practices: Focus on themes (Earl, 1993). IS plans periodically reviewed to adapt to changing circumstances (Earl, 1993). Illustrative tools: Customer resource lifecycle, Strategic thrust analysis, Five forces analysis, etc

Description: Proactively seeking opportunities for competitive advantage from IT (McFarlan, 1984; Porter and Millar, 1985; Earl, 1989)

Building an IS capabilityBuilding an IS capability Praxis: IS capability embedded in fabric of the organization Practitioners: All employees Practices: Influenced by organizational culture; and

information orientation of organization (Marchand et al., 2000)

Description: Acknowledging that having a strategy is only part of what is required. Ability to continually identify opportunities, deploy technology, implement change and use information and IT (Peppard and Ward, 2004)

IS strategizingIS strategizing Praxis: Cognitive and intellectual dimensions. ‘‘The most

important direct predictor of alignment in this study was a high level of communication between IT and business executives’’ (Reich and Benbasat, 2000)

Practitioners: All employees Practices: Co-evolution of business and IT strategies

(Benbya and McKelvey, 2006; Breu and Peppard, 2003) Description: IS strategy something that organizations do

rather than have. Integrating IS considerations into the discourse on business and knowledge strategy (Galliers, 2011). Functional strategies having a digital component; fusion of IS and business strategies – the digital strategy (Bharadwaj et al., 2013)

SummarySummary

IT strategy has become a key concern for today’s organizations

The role and meaning of IT strategy depends heavily on the role and meaning of the character of IT

There are several distinct approaches to IT strategy – a firm must make informed decisions regarding what approach to pick