What is it?
Is it:
Business and IT alignment?
Reducing IT budget, cost of IT?
Improving return on investment?
Taking advantage of new development in IT?
When we see discussions or writings on strategy of IT strategy we often see some of these definitions. IT strategy can try to achieve some or all of these above objectives but it is not only to get one of them. IT strategy is to identify what should be the shape of IT and its activities to achieve long term future objectives which are aligned with business objectives.
How to make IT strategy?
Process of making IT strategy starts with understanding the business context. Following points cover main activities of making IT strategy:
Business context
IT strategy should be aligned to business so know about business. It is important to know what are business priorities and what is business strategy to define right strategy for IT which can support business. Following things should be assessed:
- Corporate strategy
- Mission, vision and values
- Future goals
- Corporate programs
As is versus to be analysis
Picture of "as is" state of IT is important to know where it is. This covers an inventory of IT infrastructure (hardware/network), applications and the business processes they support. Challenges faced by IT in fulfilling existing business requirement is also important to know shortcomings in current IT environment. As is analysis can be presented in the form of a SWOT:
Strengths- Existing capabilities, portfolio of applications and infrastructure.
Weakness - Shortcomings, weaknesses of existing IT setup. Problems in current IT environment.
Opportunities- Availability of new technology, new products which can make IT better cost effective and efficient
Threats or challenges (due to technology advancement in the market) - External factors either from competition or in the industry which can impact the organization of IT is not prepared to tackle them. As an example if competition is using better and efficient online presence, organization have to come-up with better online presence to fight the competition. Another example- If mobile applications are technology of future, organization will have to come-up with mobile enabled applications and interfaces for its customers and IT should consider upgrade of existing applications and also will have to come up with new applications, change in infrastructure etc.
After having a correct picture of as is IT environment, to be state or future state of IT should be determined. This "to be" state is derived from existing challenges and how to overcome them as well as future business strategy and accordingly increasing or changing requirement from business to IT. As per future business plan an organization may be entering in to acquisition and merger, it may be going in to global production and manufacturing or may be many other countries to find its new customers, it may have plans to grow its business rapidly by opening new channels of sales, marketing, order, delivery and payment. In all these situations IT has to be prepared for new requirements and challenges. There can be more demand for IT resources or enabling new applications to cater to new requirements.
Gap analysis is to be done to find out what needs to be done to reach out to "to be" state of IT.
Set IT objectives and areas to focus upon
Based on as is/to be state identification and gap analysis, objectives (for IT) should be identified. Areas to focus upon to reach out to future state of IT should be determined.
Identify projects and programs
Objectives set for IT are achieved through identification, planning and implementation of some projects and programs. These projects may be implementation of a CRM system or refreshing hardware or may be enabling business processes through a new channels like mobile.
Estimate and plan
After identification of objectives, projects etc estimation of resources, effort and cost is to be determined. Execution planning for implementing IT strategy is to be done this must include major milestones and their reviews planned.
Tuning
One important point is optimization of IT resources. Even if there is a need to have new infrastructure, there is a need to have new application or new channels, IT strategy should consider how IT objectives can be achieved optimally. Taking an example, for infrastructure, it can be infrastructure on demand, visualization, services on cloud etc. For new applications it can be software as a service too.
Governance process is to be defined and setup for review of the IT strategy periodically. This ensures IT strategy is on track to achieve objectives and the strategy is working/relevant. As part of governance process, review of following can be considered:
Based on review, required changes, alignment can be done on strategy and objectives.