Developing a Holistic Strategic Plan. Dagmar Cole
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1 Developing a Holistic Strategic Plan Dagmar Cole
2 Abstract Too often the IT plan and the business strategy are decoupled. IT planning is selfcentered, and decisions do not support the business too frequently resulting in "why did they do that?" IT strategic planning too often is lengthy with little benefit to the organization. How does IT planning better support the business? One solution is to perform holistic planning, by coupling the IT planning with business strategy. We are all familiar with the typical business case process of the company identifying strategic initiatives, and handing these cases off piecemeal to IT to estimate. Rather than approaching IT as these individual products, this presentation proposes a holistic, integrated approach so both the IT strategic initiatives leverage the business strategy. Anyone involved in the business case process knows the difficulty of prioritization, and too often, the decisions are made in silos, only to discover later than one project defeats the other. By using a methodology based on a publication of Ron Ross, Information Strategic Planning, identifying gaps and opportunities, and integrating this with the business, what results is a surprising identification of the true priorities for IT to include architecture expenditures. This presentation provides a high level overview of the fundamental concepts, how to integrate, and results from an actual organization.
3 Business Analyst Role The BABOK defines Enterprise Analysis activities necessary to identify a business need, problem, or opportunity Analyze the business situation in order to fully understand business problems and opportunities. Assess the capabilities of the enterprise in order to understand the change needed to meet business needs and achieve strategic goals The business analyst is becoming the change agent and strategist
4 Business Case Process Business Implement global outsourcing Implement a mobile app to support sales Create an integrated engineering platform Bring your presentation to life. IT Select ERP system Develop mobile app Perform proof of concept to test new tool Buy more servers Upgrade servers Upgrade database Expand network Migrate application Perform process re-engineering Sunset application Investigate new technology Yo
5 Business and IT Business Cases are: Decoupled: Little or no connection between the business and IT Poorly Communicated: The inability of IT to communicate their needs to business Disjointed: The inability of IT to identify the enterprise application architecture of how the systems link together.
6 Consequences Boeing Dreamliner: $6.4B loss Airbus: $6.1B loss JP Morgan Chase: $6B loss Los Angeles Unified School System: $1.3B loss Air Force: ESS project, $1.1B loss Hong Kong Airport: $600M loss Levi-Strauss: $192M loss Avon: $125M and 16,000 reps lost Hershey: $100M loss, stock fell 18% State of Oregon: $78M fix Many others
7 Holistic Planning Integrated Plan
8 Business Strategic Plan Shape business strategy based on customers Understand business models Link processes to the business strategic needs
9 Information Strategic Plan Document all processes Catalog hardware, software, and volumetrics Map applications to processes
10 Holistic Plan Business understands IT risks: Data cleansing / ETL Acquisition of hardware / software Acquisition of skillsets IT understands business impact: Ability to weigh alternatives Result should be prioritization of projects to support the business
11 ISP Challenges Traditional IS Planning techniques are: Time consuming Expensive Unrelated to the business And the biggest challenge
12 Where to start?
13 RCLA to the Rescue Identify the enterprise resources: Basic: must be in place for the enterprise to exist Complex: requires management Valuable: must be protected Structured: must be able to be described and organized Identify the value chain Functions: an activity or task necessary to accomplish the mission Function must be a value-added task Identify the precedent functions in enablement order The previous function must exist for the current function The precedent functions may be from different Resources Once the value chain is completed, associate the information systems to identify processes that may yield opportunities
14 EMPLOYEES Resource Recruit employee Hire employee Assign organization Provide goods and services Assign work Compensate the employee Track work performance Promote employee Award employee Grant privileges Settle disputes Release employee
15 Precedence for Recruit Resource Function Predecessor Resource EMPLOYEES Recruit Employee COMPENSATION FIXED ASSETS PAYABLES WORKFORCE Predecessor Function Administer the plan Assign to custodian Pay the payable Plan hiring
16 RCLA Results Alignment between the business and IT: Use to prioritize resources to scope business process reengineering effort identify candidate redundant applications and data management issues Identify hidden applications Identify downstream impact of application changes Identifies explicit or implicit interfaces
17 Real Metrics Total hours to complete RCLA for the entire enterprise HR application for organization with >7,500 employees, >$1B revenues: 800 man hours (4 FTEs for five weeks) What the executives thought is not what was discovered: High number of redundant systems clustered around low priority functions: HR resource has more supporting applications than any other resource in the entire organization 32 applications supported WORKFORCE resource 126 applications supported EMPLOYEES resource Identified functions without any visible IS support (Excel spreadsheets on desktop)
18 A Final Thought Building a visionary company requires one percent vision and 99 percent alignment. Jim Collins and Jerry Porras, Built to Last
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