In a global marketplace, information has emerged as an agent and enabler of new competitiveness for today’s enterprise. However the paradigm of strategic planning changes sufficiently to support the new role of information and technology. The question is, are changes can support the new role of information and technology and what is the relationship between strategic information system planning with the development database in an organization. Therefore, the development of strategic information system planning is importance in an organization. Strategic information systems planning (SISP) is the process of creating a portfolio based on the use of information system in order to achieve organizational goals and objectives. Within SISP, organizational can clearly define their organizational goals, the critical success factor (CSF) and the problem areas within the organization activity.
Introduction to Strategic Information Systems Planning (SISP)
There are two concepts of strategic information systems planning (SISP). The first one is SISP viewed as the process of identifying a portfolio of computer based applications that will assist an organization in achieving the business plan and at the same time achieve the business organization goals. Meanwhile the second one is SISP involved searching for application with a high impact and with the ability to create an advantage over competitors to gain competitive advantage. Based on the theory of SISP, it can be define that the process of identifying a portfolio of computer-based applications to be implemented aligned with the corporate strategy and has the ability to create an advantage over competitors.
Organization goals is analyze by defining what exactly organization hope in order to accomplish the goals. After organization goals have been analyzed, then critical success factor will evaluated so that it will affect the organization goals and objective in long term. Critical success factor is the element that organization should know and must work in order to survive in the business environmental. And lastly, identify the problem areas which are the weaknesses that organization already have.
Strategic information systems planning help organization in overall strategic planning process in effectively and efficiently. SISP participants include top business, functional area, and information system management. In an organization, the success of IS plan can be determined with the involvement and commitment of senior management. Involvement of senior management is very important to determine whether the success or failure of the project. Senior management was the backlog behind the success of the project. Within SISP also can be used to improve the communication between top management and users regarding IT. This actually gain top management commitment. Communication and commitment will also help in increasingly the visibility of IT in organization.
The purpose of SISP is to ensure that the IT organization align with the strategic goals of organization. Alignment of IT organization and business goals has been used to control and ensure that business goals will achieve and all the operation included the IT and IS that used in running the organization will keep in track. SISP alignment will also help in identifying strategic applications, identifying new and higher payback applications, and developing an information architecture. Organizations also use the SISP to help in forecasting and allocating IT resources. With SISP, also can avoid loss of control of IS/IT in an organization. SISP is needed for the system to ensure the system that used in the organization integrated with other system or not.
Without Strategic information systems planning in an organization, may lead to missed opportunity, duplicate system, incompatible system and wasted resources.
Importance of Strategic Information Systems Planning (SISP)
The importance of Strategic information systems planning in an organization has been well documented within the IS literature. Within SISP, the integration of IS function within organization can be facilitate. Besides, SISP supports the identification of opportunities to use information systems for strategic purpose. SISP also ensures that adequate resources or the use of scarce resources are allocated to critical application and the use of resources in properly manner. With SISP, can ensures that the IS function support the organizational goals and objectives and also the activities at every level.
Having a good strategic information system planning in organization, will determine whether the organization will success or failure. The reason why organization needs good strategic information system planning is that it can help organization to avoid misused of scarce resources. By planning, only projects that can generate good returns will get investors from the firm. A good planning is very important to avoid problem such as the misuse and wasted resources in form of system that nobody likes and used the system effectively. When a new system developed, pre-existing system can be used to communicate or interface properly and at the same time avoid the problem of “Islands of automation”. This can be happen if the organization has proper planning for their organization.
Before develop a new system, planning is very important to make sure the smooth of business operation. First of all, the organization should identify their needs. Development of system should be a response to need whether at the transaction processing level or at the more complex information and support system levels. Priorities, objectives and authorization for information system projects need to be formalized first. The system development plan should identify the project resources that needed the procedures, and constraints for each application area. Planning should be flexible to adjust the priorities if necessary. Furthermore, to facilitate understanding of each application the plan must be specific enough. A strategic capability architecture must flexible and continuously improving infrastructure of organizational capabilities and at the same time gain company’s sustainable competitive advantage.
It is important to have Strategic information systems planning to maximize the benefits of changing technology and to take account of the different viewpoints of business professionals and IT professionals. System investments are made to support business objectives and also to gain inadequate infrastructure. SISP is important because it emphasizes the need to bring IT to bear on and sometimes influence strategic direction of the corporation is widely accepted by researchers. This is particularly true in contemporary environments where harnessing the power of technology resources could be critical for competitiveness.
Relationship with Organizational Database Development
Data are the raw material from which information is produced. Therefore, it is not surprising that in today’s information-driven environment, data are a valuable asset that requires careful management. To access data’s monetary value, data that stored in company database are data about customers, suppliers, inventory, and operations and so on. Imagine that all the data in the database loss. What will happen if the situation like that happen? Data loss puts any company in a difficult position. The company might be unable to handle daily operation effectively; it might be faced with the loss of customers who require quick and efficient service, and it might lose the opportunity to gain new customers.
Data are a valuable resource that can translate into information. If the information is accurate and timely, it is likely to trigger action that enhance the company’s competitive position and generate wealth. In effect, an organization is subject to a data information decision cycle; that is the data user applies intelligence to data to produce information that is the basis of knowledge used in decision making by the user.
A critical success factor of an organization is efficient asset management. Critical success factor involve the management in an organization to know the current status of the organization in ICT. Based on the analysis of the business environment of the corporation, the critical success factors concerning the firm are identified. Critical success factor is refer to the limited number of area in which result, if satisfactory will ensure successful competitive performance for the organization. There are such area where thing’s must go right for the business to flourish. Thus, the factor that are critical for accomplishing the objectives are identified at this stage.
To manage data as a corporate asset, managers must understand the value of information that is processed data. Data are used by different people in different departments for different reasons. Therefore, data management must address the concept of shared data. Whatever the type of organization, the database predominant role is to support managerial decision making at all level in the organization. That’s why, Strategic information systems planning play a big role in organization. SISP is an important management function. It can help an organization use information technology (IT) more competitively, identify new, higher payback IT applications, and better forecast IT resources requirements.
An organization’s managerial structure might be divided into three levels which are top, middle and operational. Top level management makes strategic decisions; middle management makes tactical decisions and operational management make daily operational decisions. Operational decisions are short terms and affect only daily operations for example deciding to change the price of a product to clear it from inventory. Tactical decision involve a longer time frame and after larger scale operation; for example changing the price of a product in response to competitive pressures. Strategic decisions are those that affect the long term well-being of the company or even its survival; for example changing pricing strategy across product lines to capture market share. This shows that having a good SISP will lead the organization to achieve the goal and objective in short or long term in an organization.