Chapter 5 - Information Strategy Flashcards
A critical success factor (CSF) for a business is something that must go right if the objectives are to be achieved. It has been suggested that there are four sources of CSFs. List them down and explain each.
- The industry that the business is in - each business or industry has CSFs that are relevant to any company within it.
- The company itself and its situation within the industry - for example, competitive strategy and its geographic location. CSFs could be to develop new products, create new markets or to support the field sales force. Actions taken by a few large dominant companies in an industry will provide one or more CSFs for small companies in that industry.
- The environment - such as the economy, the political factors and consumer trends in the country or countries that the organisation operates in.
- Temporal (short-term) organisational factors - These are areas of company activity that are unusually causing concern in the short-term because they are unacceptable and need attention. For example, cases of too little or too much inventory might classify as a CSF for a short time during recession.
A performance indicator (PI) is an objective stated in such a way that progress towards the achievement of a CSF can be measured. PI should be:
Specific - Expressed clearly and precisely
Measurable - capable of quantification
Achievable - Realistically achievable by the organisation
Relevant - To the CSF that is being measured
Time-constrained -by when?
The company needs to develop a plan to link its business and information strategies, and the model is as follows:
Mission statement -> Corporate strategy -> Business objectives -> CSF -> KPI -> Information to measure performance and Proposal for new systems and modification -> Information needs -> Information strategy
In the correct order, the stages in developing an information strategy are:
A Mission statement; objectives; KPIs; Information strategy
B IS; Objective; Mission statement; KPI
A
Difference between IS, IT and IM are? Explain each
- IS strategy - looks at the way in which information systems in various parts of the organisation are organised
- IT strategy - looks at the technology infrastructure of the systems
- IM strategy - considers how the system support management processes
IS strategy must ensure that the information required by the organisation, to help it achieve its strategic objectives, is:
Acquired, retained, shared and made available for use.
IM strategy is concerned with the management of the information that is gathered by the organisation, and how it is stored and made available for access by users. It is therefore concerned with matters such as:
- The use of databases, and the type of databases used
- data warehousing
- back up facilities for data storage
- data security issues
- archiving
IM is also concerned more broadly with planning, organisation, control and technology. Explain each
- Planning - ensuring that the IS and IT strategies are integrated with the other strategic plans and objectives of the organisation
- organisation - this involves issues such as decentralisation or centralisation of the IT function, the formation of steering committees, management education and training, IT reporting procedures and the responsibilities of IT managers
- control - control issues relate to the assessment of the performance of IT systems and controls over IT costs (and benefits). Key aspects are performance measurement and investment appraisal of IT
- technology - is related to managing the priorities for IT strategy, e.g. the design and development of new methodologies for IT, security practices and data management techniques.
During the production of the information strategy at P pls several questions were asked regarding where the information is needed would come from and what information was required. This is part of the:
A Information system strategy
B Information technology strategy
C Information management strategy
A
The benefits of an information strategy include:
- achievement of ‘goal congruence’ between the information systems objectives and the corporate objectives. Failure of computer systems to work can result in the failure of some organisations to function at all e.g. amazon and eBay
- The organisation is more likely to be able to create and sustain ‘competitive advantage’. The company’s computer systems will likely impact on the customer these days, if they order over the internet or rely on order information for a delivery date.
- The high levels of expenditure on information systems will be more focused on ‘supporting’ key aspects of the business.
- ‘Developments in IT can be exploited’ at the most appropriate time - which is not always when they are first available.
- Computers are often of strategic importance in a company. Having an information strategy is a ‘costly’ business and unmanaged development can lead to costly mistakes.
- IT affects all levels of ‘employees and management’. Having a plan that can be communicated to these employees should ensure that they ‘buy-in’ to the ideas within it and efficiency will be increased more quickly.
Each level of management will be involved in specific activities (Anthony’s triangle) and will take different types of decision and will require different information to take those decisions. The information systems of the organisation must meet the information needs of all of these different levels. List and Explain those 3 levels.
- Strategic - Involved with monitoring and controlling the organisation as a whole, making decisions on areas such as opening of new shops and factories or investment in new product line.
- Tactical - Responsible for implementing the decisions of strategic managers and ensuring that the different divisions or departments within the organisation are operating correctly.
- Operational - Controlling day-to-day operations of the organisation, reporting queries or problems back to tactical management for decision as necessary.
The two key activities of management are therefore:
- Planning
2. Control
The information received by management needs to be of a certain standard to be useful in internal control, risk management and monitoring. The information should meet the criteria of ‘good’ information (ACCURATE). List them down
Accurate Complete Cost-beneficial User-targeted Relevant Authoritative Timely Easy to use
Explain Transaction Processing System
This is the system that records historic information an it represents the simple automation of manual systems. The TPS routinely captures, processes, stores and outputs the low level transaction data. This system is very important - data input incorrectly will effect every report produced using it, giving management mis-information and hence they will make poor decisions
Explain Management Information system
A MIS is defined as a system to convert data from internal and external sources into information, and to communicate that information in an appropriate form to managers at all levels and in all areas of the business to enable them to make timely and effective decisions.
