Component of a Strategic Plan

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Component of a Strategic Plan

Component of a Strategic Plan

Organizational Strategy and Information Systems

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2. Evaluation: IS facilitate the comparison of actual performance with the desired performance that is established as a result of planning.

3. Communication: IS speed the flow of information from where it is generated to where it is needed. This allows an analysis of the situation and a determination about what can be done to correct for problematic situations.

When managers need to control work, IS can play a crucial role. IS provide decision models for scenario planning and evaluation. For example, the airlines routinely use decision models to study the effects of changing routes or schedules. IS collect and analyze information from automated processes, and they can make automatic adjustments to the processes. For example, a paper mill uses IS to monitor the mixing of ingredients in a batch of paper and to add more ingredients or change the temperature of the boiler as necessary. IS collect, evaluate, and communicate information, leaving managers with time to make more strategic decisions.

Planning and Information Systems In the first chapter, the importance of aligning organizational strategy with the business strategy was discussed. An output of the strategizing process is a plan to guide in achieving the strategic objectives. IS can play a role in planning in four ways:

• IS can provide the necessary data to develop the strategic plan. They can be especially useful in collecting data from organizational units and integrating the data to transform those data into information for the stra- tegic decision makers.

• IS can provide scenario and sensitivity analysis through simulation and data analysis.

• IS can be a major component of the planning process.

• In some instances, an information system is a major component of a strategic plan. That is, as discussed in Chapters 1 and 2, information systems can be used to gain strategic advantage.


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