Post date: May 16, 2013 7:34:25 PM
What 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:
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:
Mission, vision and values
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.
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:
Projects and programs progress
Effectiveness of strategy
Based on review, required changes, alignment can be done on strategy and objectives.
For success of IT strategy it should be properly communicated to various stakeholders. Without stakeholders involvement and engagement no strategy can succeed. To engage and involve various stakeholders, they should be communicated and their concerns/feedback should be taken in to account.
Different type of audience may require different level of detail and different information so communication plan should consider this. Type of audience may have: Executive committee, IT management, IT team, Business community etc.
Medium of communication should be identified looking at type of audience. There can be communication to stakeholders in a meeting or it can be through a teleconference call and in some cases it can be a town-hall meeting.
Frequency of communication should also be identified. Some communications can be introduction communications but some communications may be periodic (monthly, quarterly or half yearly to different type of audience).
Elements of IT strategy
Following can be elements of IT strategy along with others:
Strategy to meet various objectives (what to do and how)
Advantages of a program
Plan for a program or project
As is, to be architecture: functional and physical
There are some common mistakes done while making or considering IT strategy due to which sometimes IT strategies fail, here are some of them:
1. IT strategy is made without considering long terms business strategy and vision
2. Planning is considered as strategy
3. Strategy is made only to make a strategy (paper work to present to management and other audience)
4. Unrealistic goals (due to lack of reality know to people who are responsible for making strategy)
5. Considering strategy (piece of paper) can solve all the problems (skills, culture, accountability etc)
6. Absence of proper time boxed planning and measurable success criteria.
7. Owners and their accountability is not identified.
8. Strategy is considered a final word or document (not updated and reviewed in changing environment)