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Information Services Amid Change and Uncertainty
Kirincich and Paul Minton
If a member of the Board of Directors of your company asks the CEO what contributions Information Services makes directly to the long-term success of the business, what would the CEO say?
of what he/she would say, the reality can be several different things:
all cases, what will your department need to look like tomorrow, and does
it resemble that today?
statement applies to your IS department?
scenarios described prevail in the best business environments.
As a result of the weakness and uncertainty in todayâ€™s economy,
the ground is soft and shifting. Even
best in class IS departments may find their activities falling out of
alignment with corporate goals. The
solution in all cases is to:
As a result, IS will become a more
strategic contributor, and make recognizable contributions to overcoming
competition. How is this
accomplished? Through a
simple internal strategic planning process at the departmental level that
borrows techniques from corporate strategic planning.
What Strategic Planning Will Do For IS
reexamine the scenarios we described above.
Basic Service Organization
If IS is a basic service
organization within your company, is that all it needs to be?
If that is the case, strategic planning can make it a more lean and
efficient organization by focusing on activities valued most highly by
internal customers. However,
IS is not strategic, itâ€™s probably not doing all it can to advance the
companyâ€™s prospects. Understanding
corporate goals and internal customers, IS can become strategic by
emphasizing activities that allow the business to be more competitive and
successful, and communicating its plan to executives and other internal
customers in terms that are consistent with the overall corporate plan.
When IS perceives itself to be strategic but is not seen that way by its customers, one of two conditions can prevail.
both cases, IS must understand its customers better.
Either it does not understand and as a result is not delivering the
right mix and quality of services, or it is not marketing its services
properly. As do corporations
and marketing departments, IS must analyze their customers in a systematic
way and incorporate the analysis into changes to what they do.
All that is often required is crisp communication of ISâ€™s role in
the company as expressed in the language of its core business.
More Than A Service Organization
Where IS is perceived as more than
a service organization but not as truly strategic, itâ€™s likely that
planning efforts are going in the right direction but partially missing
the mark. This can happen in
the best of times, but is more likely to occur during todayâ€™s downturn
when corporate priorities have changed, and budgets are reduced.
Planning is required to realign
activities and allocate reduced resources.
A fresh look at customer priorities that strategic planning brings
Best in Class
IS departments that are best in
class usually get that way through a thoughtful understanding of corporate
strategies and well-planned activities.
Unfortunately, a lot has changed in the last 18 months and it is
likely that corporate strategies have changed.
Has your IS department adapted
beyond reducing its
budget? Given that
fundamental changes have taken place at a corporate level, IS has to
reexamine its competitive position as well.
Most clients that we work with
have reduced IS spending. Formerly
very competent IS departments struggle to adapt to the change in
environment where the primary concern before was supporting the growth of
the business, and now it is reducing spending while maintaining consistent
service levels. Taking a
short break from day-to-day responsibilities with your team to plan your
activities will reap immense rewards.
The Process of Departmental Strategic Planning
How do you conduct a planning
process that minimizes the burden on your staff, while making
the best use of their knowledge and experience, and securing their
strongest commitment to execution?
The answer is through a simple,
well-conceived process involving your managers with two to three days of
commitment to group activities, and “homework” that they take away and
can complete with the assistance of their staffs.
While large IS consultants will come in and promise to deliver
results, the cost you bear for their services goes well beyond their fees.
They include the risks that they donâ€™t properly understand your
business, and that your people will not “buy-in” to their
recommendations and thus fail to successfully implement a new plan.
The road behind big consulting firms is littered with unexecuted
We recommend a simple process that
consists of team meetings that should yield a completed plan within 60
days. The steps are:
I. Business Role Determination
II. Services Scope
III. Customer Profiling
V. Strategy Formulation
VI. Budget and Action Plan Development
Developing The Plan
Process Leadership Designation and Team Selection
To succeed with a planning process
similar to what follows, you have to designate leadership.
The most obvious choice is the head of IS.
An alternative, which allows the head of the group to participate
more completely in the thinking needed the go through the planning
process, is to designate someone from outside to lead the process.
Two candidates are the overall head of the companyâ€™s strategic
planning effort, if such a person exists, or an outsider who has
familiarity with leading planning teams.
The team you choose should consist
of no more than four managers of the IS organizations and, if possible,
participation from the companyâ€™s head of strategic planning or some
equivalent who can represent the overall company strategy.
Absent such a person, the head of IS should represent the
Building the right team requires balancing inclusiveness and thus commitment to execution and adequate input, with the risk of bureaucratizing the process. If you include too many participants you will slow proceedings down to a point where participants get frustrated, and work is not completed on a timely basis or at all. No matter whom you choose to include, make sure they are:
I. Business Role Determination
The first planning activity
requires that the leader of IS determine answers to the following
questions to set the direction for the process:
If ISâ€™s role is not
perceived as strategic, does IS seek to become strategic through this
process? The alternative is
to maintain the current role as a service organization but to become more
lean and effective. Alternatively,
if IS is current seen as strategic, the objective is to perpetuate this
role. The outcome of role
determination sets the course for the planning process.
What services do you provide?
The first step, which can be accomplished in a first team meeting,
is to list all the services you provide to the organization, either
directly or indirectly through third parties.
Take that list and determine for each item the extent to which they
After you have listed and rated
each service, you may find it useful to place them in a two axis matrix
similar to the one used above for examples.
III. Customer Profiling
Who are your internal customers?
Just as the business has to understand its customers, you must
understand yours. The first
step is to categorize them so that they can be properly analyzed.
Here, the classic concept of market segmentation can be simplified and applied. The ideal outcome of this exercise is a two-axis matrix that yields 4 to 8 truly unique customer groups. We suggest the process of listing all the different ways that your internal customers can be differentiated which can include the following.
After you have a list, test them
against each other in matrices until you identify one or two categories
that yield the best differentiation.
What you are looking for are identifiable groups of customers with
different requirements. If
with such criteria you have segments that appear very similar or
identical, you can either collapse together the similar categories or
choose other criteria.
Once you have identified your
categories, describe each in terms of the following characteristics:
In addition to defining each
category of internal customers, perform an evaluation of the quality and
importance of services. For
each service, using short surveys and/or interviews, determine:
How you perform this evaluation
depends on the creativity and resources within your organization.
We have developed and used email, web and paper forms to gather
V. Strategy Formulation
Here you put to use, in what we
recommend be a second team session 3-4 weeks from the first session, all
the information and analysis done in the first 3 phases of the process.
We strongly recommend that the work done in those phases be
circulated and thoroughly digested by the team prior to the next planning
A series of steps should be
employed to determine what initiatives should underlie your strategies:
Define from these and other
questions that come up a series of initiatives to be evaluated which
Evaluations of initiatives may
require analysis of costs and benefits prior to making commitments.
VI. Budget and Action Plan Development
When new strategies and
initiatives are developed, define a goal and assign ownership to each new
service or initiative. Have
the owner develop an action plan that spells out each step in successful
fulfillment of the goal associated with at least the following information
for each step:
A separate review of action plans
is essential to assure that your teams are aligned on what your overall
plan will entail. You may
need to cycle back to the Strategies section and reevaluate new projects
in the event that unforeseen complications, effort or investment
requirements or other issues arise during the action plan development
From the action plans develop a
budget for new activities and tabulate savings associated with outsourcing
and changes to existing services. You
should find that you can do more, and be more strategic, with the same
investment that you were making before.
We have seen some of the best
strategic plans fail as a result inadequate implementation, and key to
successful implementation is proper monitoring of action plans.
If your IS department sees plan implementation as a high priority
and knows it will be held accountable, it will have the best chance of
We recommend monthly or quarterly sessions at which members of your team review the progress of their action plans, with reporting of status against date commitments. Delegate to someone in your organization the task of keeping the “master plan” and periodically updating it with a progress report. Meetings to review action plans should be devoted to helping the action plan owners resolve issues.
When you have completed the
process we have laid out, you should have a more efficient, better-focused
IS organization that understands its customer needs and thus is in better
alignment with corporate strategies.
How you communicate the outcome of your plan depends on the
dynamics of your organization but we suggest some means of informing them
of what you are committing to do for them.
You should be able to communicate that you understand their
priorities, and what you are doing to meet those priorities.
Through our process IS will become a more strategic contributor, and will chart a course that is viable in troubled or still waters. While crisis and change make planning imperative, IS is served in all environments by a planning process that looks at what is done, what should be done and for whom on a regular basis. As markets and businesses change today at rapid rates, priorities change. IS must adapt to those changes to optimize their contribution to company success. We suggest reopening your plan to new initiatives and services on an annual basis.
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