Strategic Information System: Planning and Examples

A Strategic Information System (SIS) is a type of information system developed in response to corporate business initiatives. These systems play an integral role in an organization’s strategic planning, allowing it to gain a competitive advantage by effectively aggregating, processing, and managing data to inform decision-making.

Here are some key characteristics of SIS:

1. Support for Decision Making: SIS is specifically designed to support the decision-making process in an organization. It provides useful information to executives and managers who need data to make strategic decisions.
2. Competitive Advantage: SIS can give a company a competitive edge by providing unique and valuable insights. It can help identify opportunities and threats in the market, giving the company a strategic advantage over its competitors.
3. Alignment with Strategy: A strategic information system should be closely aligned with an organization’s business strategy. It should help in achieving the long-term goals and objectives of the company.
4. High-level Management: SIS is typically used by high-level management as it helps in strategic planning and decision-making.
5. Integration of Data: SIS can integrate data from various sources, both internal and external, to provide a holistic view of the organization’s performance and the market.

Strategic Control: Types | Examples | Systems

Strategic information system planning

Strategic Information System Planning (SISP) is the process of identifying a portfolio of computer-based applications that will assist an organization in executing its business plans and realizing its business goals. SISP is one of the most important IS practices, linking strategic business planning and IS planning.

The purpose of SISP is to ensure that technology and information systems are fully aligned with the strategic objectives and priorities of the organization. It involves analyzing the current state of the organization’s systems, defining the future state of these systems, and developing a plan to achieve this future state.

Here are the key steps often involved in SISP:

1. Identification of Strategic Business Objectives: The first step is to understand the business’s strategic goals. This involves discussions with senior leadership and analyzing the business’s strategic plan.
2. Current Systems Assessment: The organization’s existing information systems are evaluated to determine their effectiveness in meeting current and future business needs.
3. Information Requirements Analysis: The business’s information needs are analyzed. This step involves understanding what information is required, who needs it when they need it, and how it should be delivered.
4. Gap Analysis: The gap between the current state of the organization’s systems and the desired future state is identified.
5. Development of the SISP: The Strategic Information Systems Plan is developed, outlining the initiatives that will be taken to close the gap identified in the previous step.
6. Implementation of the SISP: The plan is put into action, often involving the acquisition of new systems, modification of existing systems, and changes to business processes.
7. Review and Update: The SISP is regularly reviewed and updated to ensure it remains aligned with the organization’s strategic objectives and to account for changes in technology and the business environment.

SISP can provide several benefits, including improved alignment between IT and business strategy, better communication and understanding between IT and business stakeholders, and a clear roadmap for developing and acquiring information systems.

Example of strategic information system planning

Let’s use the example of a manufacturing company implementing Strategic Information System Planning (SISP) to improve its operational efficiency and market competitiveness.

1. Identification of Strategic Business Objectives: The company’s strategic business objectives are to increase operational efficiency, reduce costs, and improve product quality to gain a larger market share.
2. Current Systems Assessment: The current information systems are assessed, and the company finds that its existing systems need to be updated, resulting in inefficiencies, high error rates, and a lack of real-time data for decision-making.
3. Information Requirements Analysis: The company determines that it needs real-time information on production, inventory, and sales data to improve decision-making. The organization also requires better quality control, forecasting, and strategic planning analytics.
4. Gap Analysis: There’s a significant gap between the company’s IT capabilities and needs. The outdated systems can’t provide real-time data or sophisticated analytics, and they’re not well integrated, leading to data silos and inefficiencies.
5. Development of the SISP: The company develops a Strategic Information Systems Plan to bridge the gap. This plan involves implementing an Enterprise Resource Planning (ERP) system to integrate different business processes, a Manufacturing Execution System (MES) for real-time production monitoring, and a Business Intelligence (BI) system for advanced analytics. The plan also includes data migration, system integration, staff training, and change management steps.
6. Implementation of the SISP: The company implements the SISP over a multi-year period, taking a phased approach to minimize disruption. The new systems are implemented, staff is trained, and changes are managed carefully to ensure a smooth transition.
7. Review and Update: Once the new systems are in place, they’re continually monitored to ensure they deliver the expected benefits. The SISP is also reviewed and updated regularly to accommodate changes in business strategy or technology trends.

In this scenario, the company has used SISP to align its IT systems with its strategic business objectives, giving it the tools it needs to achieve its goals of improved efficiency, cost reduction, and enhanced product quality. The company can now make real-time data-driven decisions, improve its production process, and understand market trends better with advanced analytics, thereby gaining a competitive advantage.

Strategic Alignment: Explained with Examples

Examples of strategic information system

Strategic Information Systems (SIS) help organizations gain a competitive advantage, improve performance, and achieve operational excellence. Here are a few examples of such systems:

1. Customer Relationship Management (CRM) Systems: CRMs manage an organization’s interactions with current and potential customers. They use customer history data analysis to improve business relationships, focusing specifically on customer retention and driving sales growth. Salesforce and HubSpot are common examples of CRM systems.
2. Enterprise Resource Planning (ERP) Systems: ERPs are comprehensive systems that manage and integrate the organization’s major business processes. They can streamline processes, provide real-time reporting and analytics, and help increase efficiency and productivity. Common examples of ERP systems are SAP and Oracle.
3. Supply Chain Management (SCM) Systems: These systems manage the flow of goods, data, and finances related to a product or service from the initial procurement of raw materials to the delivery of the product at its final destination. SCM systems like Oracle SCM Cloud and SAP SCM can provide a strategic edge by enhancing the efficiency of the supply chain and reducing costs.
4. Executive Information Systems (EIS): EIS, also known as Executive Support Systems (ESS), provide various internal and external information to top executives and decision-makers, allowing them to track business performance and make strategic decisions. EIS platforms can pull data from numerous sources, offering a comprehensive view of business operations.
5. Business Intelligence (BI) and Analytics Systems: These systems analyze business data to provide actionable insights, helping an organization make informed decisions. They allow for trend analysis, forecasting, and tracking key performance indicators (KPIs). Examples of these systems include Tableau, Power BI, and Looker.
6. Knowledge Management Systems (KMS): KMS help organizations capture, distribute, and effectively use their collective knowledge. They can enhance decision-making, foster innovation, and improve customer service. Examples include Atlassian Confluence and Microsoft SharePoint.

Remember, while these systems have strategic potential, their effectiveness depends on how well they align with the organization’s overall strategy and how well they’re implemented and used within the organization.