<<

. 42
( 67 .)



>>



Critical Success Factors: Right Decisions/Right Results
Principles in Innovation Planning
Actionable Strategic Intentions. Innovation processes represent the oppor-
tunity for IT to influence and shape strategic intentions. Innovation in a nar-
row context reverses the “traditional” business and IT roles in the planning
process, using IT capabilities to create business opportunities to which busi-
ness can respond with new strategies and initiatives. By focusing business
193
The Innovation Planning Practice


on the things IT makes possible, innovation by its nature forces the busi-
ness to create strategic intentions that IT can act on.
Actions Tied to Strategy. The “actions” of IT in this case seem to precede
the “strategies” from business, as IT has developed capabilities that may be
in front of the business™s capacity to use them. Regardless, strategic inten-
tions that result from innovation by definition are driven by, and will drive,
IT actions in the future. See Exhibit 9.19.


EXHIBIT 9.19 Goals and Practice Principles
Goals Practice Principles
Actionable, 1. Actionable Strategic Intentions
Commonly 2. Actions Tied to Strategy
Understood Strategic
3. Common Understanding of
Intentions
Strategic Intentions
The Right Business 4. Business-Focused Outcomes
Results from IT 5. Value-Based Resource
Allocation
Management Culture 6. Role-Based Culture
and Consensus View Management
Portfolios and 7. Value/Portfolio-Based
Portfolio Management Resource Management
The Right Actions 8. Responsive to Change
and Results



Common Understanding of Strategic Intentions. Creativity and implemen-
tation require a broad view of the enterprise. Common understanding and
acceptance of common goals (strategic intentions) is a requirement for suc-
cess.
Value-Based Resource Allocation. Innovation is an important component of
value. The total pool of allocation opportunities is weakened without a
process that supports and encourages innovation.
Portfolio-Based Resource Management. Portfolios need to be balanced be-
tween innovation-based and enhancement-based resource allocations.
Business Outcomes. Paying closer attention to the cause-and-effect linkages
between IT and the business will change IT™s perspective from an inwardly-
directed “How did we do in supporting the business need?” to an out-
wardly-directed “What can we do to create new business opportunities?”
Responsive to Change. Innovation is all about being responsive (adaptable)
to change ” both external (environmental) and internal (organizational).
Role-Based Culture Management. As with the other practices, Planning fur-
ther defines the roles and responsibilities of IT and business managers in
identifying and developing IT-enabled innovations. The combination of
194 PLAN FOR THE RIGHT RESULTS


role definition and process definition around IT-enabled innovation will
establish a new cultural norm.

Summary ” Innovation Planning Practice
Processes alone cannot enhance an organization™s innovative capabilities. How-
ever, when processes, tools, and management actions work together, IT can
become an engine of innovation. Without this innovation infrastructure com-
bined with an innovation-receptive culture, great ideas can still happen, but
innovation will not.


CHAPTER SUMMARY: PLAN FOR THE RIGHT RESULTS
Where is Strategic Demand/Supply Planning applied?
The practice is embedded in company processes that produce the Business
Strategic Intentions and the Strategic IT Plan.
What outcomes does Strategic Demand/Supply Planning produce?
The outcomes from Strategic Demand/Supply Planning are detailed in Exhibit
9.20. These outcomes connect to the related business processes (e.g., cor-
porate budget, corporate annual business planning) that will carry out the
elements of the Plan.
Practice Description
–« Explicitly connects IT strategies and plans to business strategic inten-
tions.
–« Establishes the business strategic demand for IT, and then IT™s strategies
and plans for the supply of the necessary IT capabilities.
Desired Management Process Outcomes
–« Business and IT planning operate together.
–« Business planning explicitly considers IT innovations as input and IT
consequences as output.
–« IT planning explicitly considers, and is driven from, business strategic
intentions.
Desired Business Outcomes
–« The senior management team requires that IT activities directly support
business strategies and their strategic intentions, and encourages con-
nected planning. They do enforce it, and work to improve it.
–« As a result of connected planning, IT investments focus on important
business strategies.
–« Business strategies are dependent on IT contributions to carry them out.
The senior management team considers IT implications of their business
strategies.
195
Chapter Summary: Plan for the Right Results


EXHIBIT 9.20 Strategic Demand/Supply Planning and Innovation

Strategic
Demand/Supply Planning



Innovation

Strategic IT Planning Annual IT Planning
Business The Business Enterprise: Lines of Business, Departments
Strategic
Business
Intentions
Plan Projects
Strategic
(Strategic Budget
IT Agenda Strategic
Business Plan)
Proj- Projects
Action
IT Require-
ects Plan
ments
Assessed Strategic Lights-On
Portfolios IT Plan Budget
IT Plan
(Alignment,
Service/Quality,
The IT Enterprise: Four “Lights-On” Asset Pools
Technology)
Performance Measurement Metrics




–« IT managers plan based on business strategies.
–« The IT organization is known in the industry as a significant contribu-
tor to the company™s strategic and operational excellence.

Where is the Innovation Planning practice applied?
The practice is embedded in company processes that produce the Business
Strategic Intentions and the Strategic IT Plan.

What outcomes does the Innovation Planning practice produce?
Practice Description
–« Translates IT opportunities into new business strategic intentions, and
new ways for IT to support existing strategic intentions
Desired Management Process Outcomes
–« Business innovations are considered, and occur, based on new IT oppor-
tunities.
–« New IT opportunities are translated into possible business innovations
and strategic intentions, and considered seriously by management.
–« New IT opportunities are proposed and considered, in order to support
existing strategic intentions.
Desired Business Outcomes
–« Management expects, as part of its duties, to develop new ideas as a
routine part of being in business.
–« Business plans focus on innovation and are continuously refreshed with
new ideas.
196 PLAN FOR THE RIGHT RESULTS


PLAN FOR THE RIGHT RESULTS: MANAGEMENT AGENDA

If No, What Is
Yes or Our Plan for
Management Question No? Correcting This?

Business and IT planning operate together.

Business planning explicitly considers IT innovations as
input and IT consequences as output.

IT planning explicitly considers, and is driven from,
business strategic intention.

The senior management team requires that IT activities
directly suppor t business strategies and their strategic
intentions, and encourages connected planning. The team
enforces this and works to improve it.

As a result of connected planning, IT investments focus on
impor tant business strategies.

Business strategies are dependent on IT contributions to
carry them out. The senior management team considers
IT implications of its business strategies.

IT managers plan based on business strategies.

The IT organization is known in the industry as a
significant contributor to the company™s strategic and
operational excellence.

Business innovations are considered, and occur, based
on new IT oppor tunities.

New IT oppor tunities are translated into possible business
innovations and strategic intentions, and considered
seriously by management.

New IT oppor tunities are proposed and considered, in order
to suppor t existing strategic intentions.

Management expects, as par t of its duties, to develop new
ideas as a routine par t of being in business.

Business plans focus on innovation and are continuously
refreshed with new ideas.
197
Plan for the Right Results: Management Agenda


ADDITIONAL READING
This book™s website contains additional information for Chapter 9:
Note 3: IT, Bottom-Line Impact, and Government
Note 16: What About IT™s Performance?

The appendices at the back of the book also contain related information for
Chapter 9:
Appendix A: The Role of Enterprise Architecture in Right Decisions/Right
Results
Appendix C: The Development of Strategic Intentions, with Examples


NOTES

1. Adapted from the EwIM (Enterprise-wide Information Management) “Impact
and Alignment” concepts. See, for example, Marilyn M. Parker and Robert J.
Benson, “Enterprise-wide Information Management: State of the Art Strategic
Planning,” in Robert E. Umbaugh, ed., Handbook of MIS Management 1990-91
Yearbook (New York, Auerbach, 1990), pp. S-3 “ S-15.
2. See Appendix A, “The Role of Enterprise Architecture in Right Decisions/Right
Results,” for a further discussion of Enterprise Architecture and its role in Right
Decisions/Right Results and NIE practices.
3. Warren McFarlan, quoted in Abbie Lundberg, “Survival Strategies,” CIO Maga-
zine, March 15, 1995.
4. Exhibit 9.16 is adapted from Information Economics, p. 59.
10
CHAPTER

Keep Score



T he Performance Measurement prac- Control Spending and Maximize
tice is based on three fundamental Impact on the Bottom Line
ideas: 1 Define the Goals

2 Ask the Right Questions
1. IT managers need to manage
3 Connect to the Bottom Line
their resources and investments
4 Understand Costs and Resources
to improve their contribution to
company strategies and goals, and 5 Focus on the Right Things
thereby to the bottom line 6 Adopt Effective Process to Produce Action
2. To accomplish this, IT managers 7 Tackle the Practical Problems
need a measurement capability 8 Make the Right Decisions
that brings attention and focus to 9 Plan for the Right Results
the activities and behaviors that
best support IT™s contribution, and ¤

<<

. 42
( 67 .)



>>