Strategic Information Systems Planning (SISP)
Strategic Information Systems Planning (SISP) is a critical process for businesses aiming to enhance growth through the effective use of computer-based applications aligned with their corporate strategy. The approach involves a thorough analysis of an organization’s data needs and requirements to ensure that information systems support strategic objectives, thus maximizing investment in information services and technology. SISP consists of five key phases: strategic awareness, situation analysis, strategy conception, strategy formulation, and strategy implementation, guiding companies in systematically aligning their information systems with their goals.
The methodologies employed in SISP fall into two categories: alignment and impact. Alignment methodologies, such as Business Systems Planning and Strategic Systems Planning, focus on ensuring that information services directly support business goals. In contrast, impact methodologies, like Value Chain Analysis and Critical Success Factor Analysis, explore innovative ways to leverage technology for strategic advantage. The evolution of SISP reflects a historical shift from viewing information systems merely as data processing tools to recognizing their potential for competitive differentiation in a rapidly changing digital landscape. As organizations continue to integrate advanced technology into their operations, SISP plays an essential role in shaping their strategic direction and enhancing overall efficiency.
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Subject Terms
Strategic Information Systems Planning (SISP)
In business and finance, strategic information systems planning (SISP) is the process of selecting or creating computer-based applications for a particular business to help it grow. A business analyzes its data needs and requirements to choose information systems that align with its corporate strategy. Through SISP, a company seeks to maximize its investment in information services and technology and gain a competitive advantage.
SISP involves five phases: strategic awareness, situation analysis, strategy conception, strategy formulation, and strategy implementation.
SISP methodologies are grouped into two categories: alignment, which includes business systems planning, strategic systems planning, information engineering, and Method/1; and impact, which includes value chain analysis and critical success factor analysis.
Background
Information systems refer to the information technology, hardware and software programs, and personnel a company uses to collect and store data. Companies depend upon their information systems to oversee operations, make decisions, and assist customers.
The rise of strategic information systems planning (SISP) began in the late twentieth century. During the 1960s, companies viewed information systems as little more than automated data processing. In the following decade, managers started using the data they gleaned from information systems to make decisions for the organization, known as management information systems.
In the 1980s, companies recognized that through innovations in technology, computer-based information systems could be used to gain a competitive advantage. They started linking their information systems to their corporate strategy, leading to the creation of SISP. Businesses explored the potential of information systems in the 1990s as the Internet and its applications rapidly spread. As organizations entered the digital age, the 2000s saw the further integration of technological activities with company resources in pursuit of strategic objectives.
Information systems are a key part of modern business plans and models. They are an essential component of customer service as companies strive to address customers' needs in a timely fashion. SISP helps companies adapt to uncertain business climates and fluctuating market conditions.
When a company embarks on SISP, it must identify its information needs. This includes transactions, support services, current and future projects, and available resources. The business evaluates not only its internal processes, but also its external factors, such as the information systems practices of its industry and competitors.
SISP encompasses five phases:
- Strategic awareness kicks off the planning process by determining planning goals and the members of the planning team.
- Situation analysis examines the internal and external environments where the information systems will be implemented.
- Strategy conception identifies alternative information systems.
- Strategy formulation concerns the prioritization and selection of a new information systems plan.
- Strategy implementation planning focuses on devising the new information systems plan and ensuring it is carried out accordingly.
Overview
The methodologies of strategic information systems planning (SISP) are divided into two categories: alignment and impact. Each SISP methodology involves techniques and tools to translate the data collected from analyzing a company's information services into a plan that supports the business's corporate strategy.
In the alignment category, information services strictly support the company's goals and objectives. The methodologies provide guidance for an information services framework. Alignment methods include the following:
- Business systems planning (BSP): BSP was developed by the computer and technology company IBM in 1975. The methodology analyzes the processes across an entire organization to determine its data needs. It merges top-down planning with bottom-up implementation to link the company's goals to the requirements for its information systems.
- Strategic systems planning (SSP): The approach, also called PRO Planner, was created by Robert Holland in 1986. SSP examines a company's top functions to devise a framework for information systems requirements. The requirements are reflected in the resulting databases of data, which guide the design of the new systems and their installation. SSP is similar to BSP, but it depends on the automated storage and handling of data.
- Information engineering (IE): The methodology was invented by James Martin in 1982. IE utilizes planning, data models, and design information to combine data processing and support systems. The methodology relies on structured techniques, supported by automated tools, to create an information systems framework.
- Method/1: The approach was devised by Arthur Anderson in the 1980s. Method/1 identifies the information needs of the business and pinpoints the hardware, software, and technology required to support the information services strategy. It involves techniques such as data flow diagramming, which traces how a system processes the input and output of information, as well as focus groups.
Under the impact approach, information services strive to develop new uses for technology. The methodologies provide a boost to the business's strategy but do not offer a framework for information systems requirements. Impact methods include the following:
- Value chain analysis: The approach was developed by Michael Porter in 1984. Value chain analysis evaluates a company in terms of its parts. This is called the value chain, the set of activities associated with producing a good or service that adds value to it, including information services. By altering how companies carry out their office activities, companies can incorporate an information services plan at a lower cost than their competitors, increasing their profits.
- Critical success factor analysis (CSF): The methodology was created by John F. Rockart in 1979. CSFs are the areas in which a company must excel in order to grow. CSFs are used to analyze a company's operations and objectives in terms of its data needs. They examine the advantages and disadvantages of the current information systems.
SISP can bolster a company's operations. As businesses link their information services to their strategic goals, they can allocate resources based on their data needs and requirements. This can help streamline the company's operating procedures and achieve efficiency. In turn, businesses can develop their information processes, mining advances in technology to build a competitive edge over their rivals.
As technology progresses and the workplace transforms, companies increasingly rely on SISP. Through SISP, a business's increased investment in its information systems significantly influences its chances for success. Modern companies use SISP to adapt to ever-evolving markets and accommodate a flexible, often remote, workforce. With advanced data analytics tools, companies can quickly and accurately devise data-driven strategies. By incorporating digital transformation initiatives, including cloud computing, machine learning, artificial intelligence, and big data analytics, SISP can enhance decision making in real-time and give companies a competitive advatage. However, these digital tools require companies to put security protocols in place to protect data from cybersecurity threats.
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