IT Governance

8th Lecture – Diagnosis and Design of an IT

governance model in an organization
Agenda

8th Lecture goals

Enterprise planning and strategy

IT Strategic Alignment

Assignments
 8th Lecture goals

• Content Objectives:
• Understand how business strategies are designed and how to evaluate and manage the processes that involve ICT
management within the organization.

• Language Objectives:
• Get familiar and use non-technical (business related) concepts in class discussion.
Enterprise planning and strategy
Quotes
Strategy

• Business strategy seeks to relate the organization's

objectives with the means to achieve them in an
integrated framework.
• Strategy is formulated at levels:
• Corporate: business lines, growth, vertical or horizontal
integration, diversification, large projects.
• Division and functional: They develop their own strategies
aligned with and supporting the corporate ones.

• It is proactive but also adaptive/reactive.

 Environmental analysis

• It is the monitoring, evaluation and dissemination of

information from the external and internal
environments to the key personnel of the
organization.
• Its purpose is to identify strategic factors.
• It allows the identification of Strengths,
Weaknesses, Opportunities and Threats (SWOT).

Where
are we?
 Environmental variables analysis

PESTEL Analysis

Political Economic Sociological

Task Environment Analysis (Industrial)

Governments Shareholders Suppliers

Immediate level
General level

Special Internal environment Employees /

interest Labor unions
groups
Structure
Culture
Customers Resources Competitors

Trade
Creditors Community Associations

Technological Environmental Legal

(Source: Strategic Management and Business Policy. J. David

Hunger, Thomas L Wheelen
 PESTEL Analysis – Macro environment

https://andet5.com/
Strategic Planning

• A plan allows you to turn a vision into reality,

intentions into results and purposes into
performance.
• Strategic planning is a continuous process of
thinking, planning and acting on purpose.
• A strategic plan is a leadership tool used to plan a
course of action to manage unanticipated problems
or opportunities such as productivity, profitability,
revenues, management, market positioning, trends,
products and services.
• Business plans versus strategic plans.
• Business plan: a management tool.
• Strategic plan: a leadership tool.
 Strategic Objectives

• The main characteristics of the objectives are:

The Strategic Objectives are the way to
achieve the proposed goals, that is, they
respond to the need to know what result
should be obtained.
• Credible as long as they follow a line consistent with
the principles or mission of the company.
• Reachable, that can be reached in a reasonable
way.
• Balanced among themselves and with the different
strategies.
• Quantifiable and valued to the extent that it is more
feasible.
• Adaptable to each circumstance according to the
needs.
• Encouraging , so that their achievement requires a
certain amount of difficulty and work.
• Accepted by the people involved.

How will we
get there?
 Why define mission, vision and values?

• They help to motivate the members of the

organization.
• They allow the development of common
interests.
• They help to focus on challenges and
opportunities.
• During the process of its definition, it allows to
build consensus among the management.

Where are
we going?
 Mission

• It expresses the essential characteristics,

reason for existence, nature, groups served
and principles/values.
• It is a definition of the company and its
identity.

Questions:
• Who are we? Type, identity.
• What are we looking for? Objectives, purpose,
changes sought.
• Why do we do it? Reason for being, nature,
function to which it contributes.
• Who do we work for? Sectors served,
users/clients.
• What are our values? Values, principles,
motivations.
 Mission examples

• Uber: We ignite opportunity by setting the

world in motion.
• Google: To organize the world's information
and make it universally accessible and useful.
• Kickstarter: To help bring creative projects to
life.
• Tesla: To accelerate the world's transition to
sustainable energy.
• Life is Good: To spread the power of optimism.
 Vision

• It is a mental journey from the known to the

unknown, the creation of the future from an
assembly of real facts, hopes, dreams,
dangers and opportunities. Hickman and
Silva.
• It is intuition, what he believes should be the
future of the organization from the point of
view of customers, employees, owners and
other important stakeholders. Morrisey.
Questions:
• What is the desired image? Future situation of our users.
• How will we be in the future? Our situation, relative position in relation to
others.
• What will we do in the future? Distinctive contribution, products/services we
want to develop.
 Vision examples

• IKEA: “Our vision is to create a better everyday life for

many people.”
• Nike : “Bring inspiration and innovation to every athlete
in the world.”
• McDonald’s: “To be the best quick service restaurant
experience. Being the best means providing outstanding
quality, service, cleanliness and value, so that we make
every customer in every restaurant smile.”
• Patagonia: “Build the best product, cause no
unnecessary harm, use business to inspire and
implement solutions to the environmental crisis.”
• Oxfam: “A world without poverty.”
 Values

• They form the pattern that guides the

decision-making process in an organization.
• The values of an organization are the values
of its members.
• They allow for the positioning of a business
culture.
Questions:
• What do we believe in?
• In certain situations, how would we act?
• What would a former employee say about our
values?
Values examples
IT Strategic Alignment
 What is strategic IT alignment?

Ensure that IT activities and

functions are aligned with
business needs, objectives
and priorities
 IT Strategic Alignment Model (SAM)

Strategic
External

level
Strategic Adjustment

Operational
Internal

level
Functional Integration

Source: Strategic alignment model henderson and venkatraman

 Four IT Strategic Alignment Model (SAM)
Strategy Execution Technology Transformation

Competitive Potential Service Level

Source: Strategic alignment model henderson and venkatraman

CONCLUSIONS

Organizations define their business strategies by knowing the context in which they
01 are located.

The Strategic Objectives are the way to achieve the proposed goals, that is, they
02 respond to the need to know what result should be obtained.

Organizations needs to answer the questions: Where are we? How will we get there?
03 and Where are we going?

For IT there are several alignment strategies, each organization must know the one
04 that best applies to its context..
 REFERENCES

• Mastering the 7 Dimensions of Business-Technology Alignment. Ashish Pachory.

• The Impact of Organizational Characteristics on IT-Business Alignment: A Field Study
GRACIAS
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