Strategy and IT systems

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Strategy and IT systems

Business strategy is sometimes tough to implement. This article from DarwinMag discusses some strategy problems, particulary as they apply to IT.

In most organizations, planning, budgeting, forecasting and reporting are treated as separate, disconnected processes and supported by different technology solutions. In fact, these processes are all part of the much larger process of strategy implementation. The following analogy illustrates why this separation does not make sense.

The journey that a business takes over time is like traveling down a road. The road curves and changes direction, and its exact route often is hidden from view. In the same way, business direction continually varies because of changing customer requirements, competitors' actions, or other occurrences in the business environment. On this journey, the business objective rests on the horizon. This objective, based on current circumstances and assumptions, is the planned destination for the organization. It serves as a beacon, guiding the organization's actions and decisions.

The journey is divided into a number of shorter segments, each of which the organization will arrive at over time, allowing the organization to gauge its progress. To reach the point on the horizon, the traveler outlines a route. This plan identifies the main roads to be traveled and the major cities the traveler will pass through en route to the final destination.

In the same way, strategic plans outline the route an organization will travel to reach its objective. The journey may take months or years to complete. The key roads are analogous to the strategic plan's tactics that must be performed to achieve the objective. Cities are analogous to key performance indicators that will tell the organization if the tactics have been completed and if it is on target for success.

It's easy to get sidetracked, because it is so difficult to take in the whole picture of a large company. That is why I think static, hierachical organizations will die. The business of the future must be adaptable.

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