Lecture 1

MGMT 6180 - 2012 Houman Younessi

MGMT 6180 Strategic Information
Systems Management
Course Convenor:
Houman Younessi
Tel: 860-548-7880
Email: youneh@rpi.edu

Lecture 1
MGMT 6180 - 2012 Houman Younessi
Course objectives:

The major objective of this course is to construct a solid
foundation for understanding the role of information systems
in formulating and executing business strategy and
application of information systems principles, techniques and
technologies used by progressive organizations in the
development of effective business strategy.
Lecture 1
MGMT 6180 - 2012 Houman Younessi
Key textbook:

Applegate, Austin, and Soule; Corporate Information Strategy and
Management; 8
th
Edition; McGraw Hill

Lecture 1
MGMT 6180 - 2012 Houman Younessi
Teaching Method:
The principal teaching is through lectures and discussions. There will be
11 lectures during the semester. While formal attendance is not taken,
attending all lectures is expected of students and is deemed a critical
success factor.

Assessment:
Semester assignment and presentation 50 percent
Case presentations 40 percent
Class participation 10 percent
Lecture 1
MGMT 6180 - 2012 Houman Younessi
Syllabus:

Introduction, strategic management and planning
What are Information Systems?
Crafting strategy based business models
Strategic planning for IS and the IS strategy toolkit
Frameworks for cogenerating IS strategy within business strategy
Managing and IS organization
The IS profession

Lecture 1
MGMT 6180 - 2012 Houman Younessi
STRATEGIC Information Systems Management
Strategy:
A rule for making decision under conditions of partial ignorance. (Ansoff, 1965,
Corporate Strategy)

Formulation of basic organizational missions, purposes and objectives..(Steiner
and Miner, 1977, Management Policy and Strategy)

Interpretation of the environment and the development of consistent patterns in
streams of organizational decisions. (Mintzberg, 1979, The structuring of
Organizations)

A Broad-based formula for how business is going to compete. (Porter, 1980,
Competitive Startegy)
Lecture 1
MGMT 6180 - 2012 Houman Younessi
STRATEGIC Information Systems Management
Strategy:
Strategy comes from the Greek Stratos (camp), and Ago (to lead). In short it
means leading the camp. It is a military term and in leading the camp is
latent leading it to victory.
Business is often compared to war. But, perhaps similarly to war, it is not
very clear when victory is attained.
The first thing we have to do is to define victory

In other words

Where do we want to get from here?
Lecture 1
MGMT 6180 - 2012 Houman Younessi
STRATEGIC Information Systems Management
Strategy:
So, great strategists first identify their specific and measurable overall goals.
Only when the overall goal is identified, can we then decide how we are
going to get there.
Lecture 1
MGMT 6180 - 2012 Houman Younessi
STRATEGIC Information Systems Management
Strategy:
Great leaders are prepared for the challenges they have to face in order to get to
their objectives.
We need to know what resources we need for victory and how much of
those resources are available to us.
We then create the means of acquiring the additional resources we need
but lack
Lecture 1
MGMT 6180 - 2012 Houman Younessi
STRATEGIC Information Systems Management
Strategy:
So, very simply, strategy is: The Way to a Victorious Future.
Make sure you have a great future, you will be spending the
rest of your life there!
Make sure your business has a great
future, you will be responsible for where it
is in the market forever.
Lecture 1
MGMT 6180 - 2012 Houman Younessi
STRATEGIC Information Systems Management
Strategy:
So in terms of business and business leadership, strategy is:
The overall plan of how we will attain our overall business objectives given the
reality of our present resource set.
Lecture 1
MGMT 6180 - 2012 Houman Younessi
STRATEGIC Information Systems Management
Strategic Planning:
The project management of developing the strategy
We need to:
Set our overall goal
Make our goal
measurable
Determine the
best process
available to
achieve our
goal
Determine the
resources needed
for achieving our
goal
Determine what
resources are
currently available
Clearly formulate and
communicate the
strategy
Lecture 1
MGMT 6180 - 2012 Houman Younessi
STRATEGIC Information Systems Management
Strategic Planning:
Observations:
Strategic planning is:

1. Complex
2. Cyclical (evolving)
3. Itself just a phase (still must be implemented)
Do not confuse strategy with:
Strategic planning (strategizing),
The business model (process methodology), or
The implementation plan
Lecture 1
MGMT 6180 - 2012 Houman Younessi
STRATEGIC Information Systems Management
Strategic Planning:
Determine the
best process
available to
achieve our
goal
Business Model

The best process available to
achieve our goal.
A business model defines how and organization
(should) interact with its environment to
(execute) a unique (approach/set of tactics),
attract the resources and build the capabilities
required to execute the (model and therefore the
overall) strategy, and create value for all
stakeholders
(page 43 of Applegate et al)
Lecture 1
MGMT 6180 - 2012 Houman Younessi
A business model defines how and organization
(should) interact with its environment to
(execute) a unique (approach/set of tactics),
attract the resources and build the capabilities
required to execute the (model and therefore the
overall) strategy, and create value for all
stakeholders
(page 43 of Applegate et al)
STRATEGIC Information Systems Management
Strategic Planning:
Do you buy it?
Does it have to be unique?

Sometimes established
ways are as good if not
better
Do we/should we create value
for ALL stakeholders?

Sometimes we intentionally do
not create value or actually
create dis-value for some
stakeholders (think of war
strategy)
Overall, not a bad definition and the one we more or
less use (with the provisos here) for the rest of the
course
Lecture 1
MGMT 6180 - 2012 Houman Younessi
STRATEGIC Information Systems Management
Strategic Planning:
We must first analyze where we are. We must analyze our:
Current goal
Current environment
Current resources
These each have several
dimensions
Lecture 1
MGMT 6180 - 2012 Houman Younessi
STRATEGIC Information Systems Management
Strategic Planning:
GOAL
Market Positioning (Determine whom to serve)
Product Positioning (Determine what to offer)
Boundary Positioning (Determine what not to
offer, whom not to serve)
Value Positioning (Determine what added value
to deliver to what internal stakeholder)
Each positioning implies doing some
analysis to determine the correct positioning
Lecture 1
MGMT 6180 - 2012 Houman Younessi
STRATEGIC Information Systems Management
Strategic Planning:
ENVIRONMENT
Socio-cultural Positioning
Economic Positioning
Technological Positioning
Political and legal Positioning
Competitive Positioning
with respect to forces that impact our goal from these perspectives
Lecture 1
MGMT 6180 - 2012 Houman Younessi
STRATEGIC Information Systems Management
Strategic Planning:
Socio-cultural Positioning:

Life-style changes
Career expectations
Rate of family formation
Population growth rates
Regional shifts in population and
taste
Life expectancies
Race
Party and organizational affiliation
Etc.
Economic Positioning:

GNP trends
Interest rates
Money supply
Inflation rates
Wealth profile
Unemployment levels
Wage/price controls
Devaluation/revaluations
Energy availability
Etc.
Technological Positioning:

Total organization R&D spending
Total Industry R&D spending
Patent protection
New product innovation programs
Technology transfer programs
Productivity improvement programs
Industry technology base (how sophisticated)
Organization technology base
Level of technology and likely change
Cost structure, economies of scale
Dependence on particular raw materials
Etc.
Lecture 1
MGMT 6180 - 2012 Houman Younessi
STRATEGIC Information Systems Management
Strategic Planning:
Political and Legal Positioning:

Antitrust regulations
Environmental protection laws
Tax laws
Technology specific special incentives
Foreign trade regulations
FDI special incentives
Attitude towards global/foreign/your company(ies)
HR laws and regulations
Government stability
Stability of special incentives
Etc.
Competitive Positioning:

Number of competitors
Size of competitors
Distribution of competitors
Barriers to entry
Barriers to exit (cost of exit)
Your products unique characteristics
Marketing incentives possible
Segmenting and sealing potential
Size and growth of existing market
Product demand elasticities
Number, potential and distribution of customers
Market structure (monopolistic/perfect competition)
Etc.
Lecture 1
MGMT 6180 - 2012 Houman Younessi
STRATEGIC Information Systems Management
Strategic Planning: RESOURCES
Marketing and Sales Capability Positioning
Production Capability Positioning
Financial Capability Positioning
Technological Capability Positioning (our technology)
Organizational and Human Resource Capability Positioning
Leadership Capability Positioning
NOW:
Marketing and Sales Capability Positioning
Production Capability Positioning
Financial Capability Positioning
Technological Capability Positioning (our technology)
Organizational and Human Resource Capability Positioning
Leadership Capability Positioning
NEEDED
TO
ATTAIN
GOAL
And then we need a GAP ANALYSIS