Chapter

1. Chapter 9 Developing Business/Information Technology Strategies

2. Learning Objectives • Discuss the role of planning in the business use of information technology, using the scenario approach and planning for competitive advantage. • Discuss the role of planning and business models in the development of e-business strategies, architectures, and applications.

3. Learning Objectives (continued) • Identify several change management solutions for end user resistance to the implementation of new e-business strategies and applications.

4. Section I Planning Fundamentals

5. Organizational Planning • The Planning Process • Team building, modeling, & consensus • Evaluating organizational accomplishments and the resources they have acquired • Analyzing the business, economic, political, and societal environment • Anticipating and evaluating the impact of future developments

6. Organizational Planning (continued) • The planning process (continued) • Building a shared vision and deciding on goals • Deciding what actions to take to achieve goals

7. Organizational Planning (continued) • Strategic Planning • Strategic Visioning • Tactical Planning • Operational Planning

8. The Scenario Approach to Planning • Teams participate in a “microworld” • A variety of business scenarios are created • Alternative scenarios are created by teams or by business simulation software based on.. • A variety of developments, trends, and environmental factors

9. The Scenario Approach to Planning (continued)

10. Planning for Competitive Advantage • Especially important in today’s competitive, complex environment • Involves an evaluation of potential benefits and risks • May include the competitive forces and competitive strategies models, as well as a value chain model of basic business activities • Use a strategic opportunities matrix to evaluate strategic potential

11. Planning for Competitive Advantage (continued)

12. Planning for Competitive Advantage (continued) • SWOT analysis • Strengths (internal) • Weaknesses (internal) • Opportunities (external) • Threats (external)

13. Business Models and Planning • 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.

14. Business Models and Planning (continued) • Specifies what value to offer customers, and which customers to provide this value to using which products and services at what prices.

15. Business Models and Planning (continued) • Specifies how the business will organize and operate • Focuses attention on how all the essential components fit into a complete system

16. e-Business Planning • The e-Business planning process has three major components • Strategy development • Resource management • Technology architecture

17. e-Business Planning (continued) • IT architecture major components • Technology platform • Data resources • Applications architecture • IT organization

18. Identifying e-Business Strategies • The Strategic Positioning Matrix • Cost and efficiency improvements • Low level of connectivity and use of IT • Strategy: use the Internet and Web to communicate and interact

19. Identifying e-Business Strategies (continued) • Strategic Positioning Matrix (continued) • Performance improvements in business effectiveness • High level of internal connectivity and pressures to substantially improve business processes, external connectivity is low • Strategy: making major improvements in business effectiveness. Use intranets and extranets to connect the organization with stakeholders

20. Identifying e-Business Strategies (continued) • Strategic Positioning Matrix (continued) • Global Market Penetration • Must capitalize on a high degree of customer and competitor connectivity and use of IT. • Strategy: develop e-business and e-commerce applications to optimize interaction with customers and build market share.

21. Identifying e-Business Strategies (continued) • Strategic Positioning Matrix (continued) • Product and Service Transformation • All stakeholders are extensively networked • Strategy: implement Internet-based technologies including e-commerce websites and e-business intranets and extranets.

22. Identifying e-Business Strategies (continued)

23. e-Business Application Planning • Begins after the strategic phase has occurred • Includes.. • Evaluation of proposals for using IT to accomplish the strategic priorities • Evaluation of the business case for investing in e-business development projects • Developing and implementing e-business applications and managing the development projects

24. e-Business Application Planning (continued) • Another alternative for planning – e-business architecture planning • Combines contemporary methods and alternative planning scenarios with methodologies such as component-based development

25. Section II Implementation Challenges

26. Implementation • A process of carrying out the plans for change in e-business strategies and applications that were developed during the planning process.

27. Implementing IT • Requires managing the effects of major changes in key organizational dimensions such as • business processes • organizational structure • Managerial roles • Employee work assignments • Stakeholder relationships

28. Implementing IT (continued)

29. End User Resistance and Involvement • Change can generate fear and resistance to change • Keys to countering end user resistance • Proper education and training • End user involvement in organizational changes

30. End User Resistance and Involvement (continued) • End user involvement in the development of new information systems • Involvement and commitment of top management and all business stakeholders

31. Change Management • People are a major focus of organizational change management • Developing innovative ways to measure, motivate, and reward performance • Designing programs to recruit and train employees in the core competencies • Also involves analyzing and defining all changes facing the organization

32. Change Management (continued) • Key tactics for change • Involve as many people as possible • Make constant change an expected part of the organizational culture • Tell everyone as much as possible about everything as often as possible, preferably in person

33. Change Management (continued) • Key tactics for change (continued) • Make liberal use of financial incentives and recognition • Work within the company culture

34. Change Management (continued)

35. Change Management (continued) • A change management process • Create a change vision • Define a change strategy • Develop leadership • Build commitment

36. Change Management (continued) • Change management process (continued) • Manage people performance • Deliver business benefits • Develop culture • Design organization

37. Discussion Questions • Planning is a useless endeavor, because developments in e-business and e-commerce, and in the political, economic, and social environments are moving too quickly nowadays. Do you agree with this statement? • “Planning and budgeting processes are notorious for their rigidity and irrelevance to management action.” How can planning be made relevant to the challenges facing an e-business enterprise?

38. Discussion Questions (continued) • What planning methods would you use to develop e-business and e-commerce strategies and applications for your own business? • What are several e-business and e-commerce strategies and applications that should be developed and implemented by many companies today?

39. Discussion Questions (continued) • How can a company use change management to minimize the resistance and maximize the acceptance of changes in business and technology? • “Many companies plan really well, yet few translate strategy into action.” Do you think this is true?

40. Discussion Questions (continued) • What major business changes beyond e-business and e-commerce do you think most companies should be planning for the next ten years?

41. Real World Case 1 – The Rowe Cos. & Merrill Lynch • What are the benefits and possible limitations of the Rowe Companies ROI methodologies for IT project planning? • What is the business value of the ROI evaluation methodology required for project planning by Merrill Lynch?

42. Real World Case 1 (continued) • Do you agree with the IT investment decisions being made by the Rowe Companies in response to changing economic conditions?

43. Real World Case 1 (continued) • How can a company identify, measure, and compare the business/IT innovation as well as the profitability of IT projects in their planning process?

44. Real World Case 2 – Verizon, F.X. Coughlin, & A-dec • Implementation challenges • What business benefits resulted from the integration projects of Verizon Wireless, F.X. Coughlin, and A-dec?

45. Real World Case 2 (continued) • What change management challenges surfaced in each project? • Where those challenges handled properly by the companies involved?

46. Real World Case 2 (continued) • What are several change management actions these companies could have taken to increase the acceptance of their IT integration challenges? • What other change management methods could be used to improve the acceptance of business/IT changes like those implemented at each company?

47. Real World Case 3 – PeopleFirst, Cessna, Allstate, & Sprint • Challenges of Implementing CRM Systems • What are several reasons for the high failure rate in implementing CRM systems?

48. Real World Case 3 (continued) • What could PeopleFirst and Cessna have done to avoid the failures in their first tries at implementing CRM systems?

49. Real World Case 3 (continued) • How have Allstate and Sprint Corp. helped to ensure their successful CRM implementations? • What are other things companies could do to help implement CRM systems?

50. Real World Case 4 – Corning Inc. • Business/IT Planning Strategies in Challenging Times • Do you agree with how CIO Richard Fishburn has defended Corning’s IT department from an economic downturn?