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CSF Approach for IT Strategic Planning

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Abstract

Although the purpose of strategic planning is straightforward - to outline where an organization wants to go and how it’s going to get there - its nature is complex and dynamic. Two techniques, the critical success factor (CSF) method and future scenario planning, can augment strategic planning efforts by illuminating an organization’s present situation and potential future. This paper explores the value of enhancing typical strategic planning techniques with the CSF method and presents an integrated framework for helping organizations understand the broad range of interrelated elements that influence strategy development for Information Technology (IT). Critical success factors are defined as the handful of key areas where an organization must perform well on a consistent basis to achieve its mission. CSFs can be derived through a document review, analysis of the goals, objectives of key management personnel and interviews with individuals about their specific domain and the barriers they encounter in achieving their goals and objectives. The paper synthesizes documented theory and research in strategic planning and CSFs and provides insights and lessons regarding the value and limitations of the integrated strategic planning framework in the context of IT. Through a method of in-depth literature review and contextual analysis, the paper incorporates suggestions for future work which include: exploring the use of IT in unit-level planning and organizational strategic planning, creating an integrated strategic planning process and connecting CSFs directly to one another in the monitoring stages to support the integrated framework, for an holistic strategic planning process.
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International Journal of Strategic Information Technology and Applications, 4(2), 35-47, April-June 2013 35
Copyright © 2013, IGI Global. Copying or distributing in print or electronic forms without written permission of IGI Global is prohibited.
ABSTRACT
Although the purpose of strategic planning is straightforward - to outline where an organization wants to go and
how it’s going to get there - its nature is complex and dynamic. Two techniques, the critical success factor (CSF)
method and future scenario planning, can augment strategic planning efforts by illuminating an organization’s
present situation and potential future. This paper explores the value of enhancing typical strategic planning
techniques with the CSF method and presents an integrated framework for helping organizations understand
the broad range of interrelated elements that inuence strategy development for Information Technology (IT).
Critical success factors are dened as the handful of key areas where an organization must perform well on
a consistent basis to achieve its mission. CSFs can be derived through a document review, analysis of the
goals, objectives of key management personnel and interviews with individuals about their specic domain
and the barriers they encounter in achieving their goals and objectives. The paper synthesizes documented
theory and research in strategic planning and CSFs and provides insights and lessons regarding the value and
limitations of the integrated strategic planning framework in the context of IT. Through a method of in-depth
literature review and contextual analysis, the paper incorporates suggestions for future work which include:
exploring the use of IT in unit-level planning and organizational strategic planning, creating an integrated
strategic planning process and connecting CSFs directly to one another in the monitoring stages to support
the integrated framework, for an holistic strategic planning process.
CSF Approach for IT
Strategic Planning
Neeta Baporikar, Ministry of Higher Education, CAS - Salalah, Sultanate of Oman
Keywords: Critical Success Factor (CSF), Framework, Information Technology, Organization, Planning,
Strategy
INTRODUCTION
So many important matters can compete for
one’s attention when framing strategies espe-
cially information technology strategies in this
ever changing and dynamic ICT world. This
makes it often difficult to see the “wood for
the trees”. What’s more, it can be extremely
difficult to get everyone in the team pulling
in the same direction and focusing on the true
essentials. That’s where CSFs can help.
CSFs are the essential areas of activity that
must be performed well if you are to achieve
the mission, objectives or goals. By identify-
ing CSFs, one can create a common point of
reference to help in directing and measuring the
success of any strategy, project or business. As
a common point of reference, CSFs help every-
DOI: 10.4018/jsita.2013040103
Copyright © 2013, IGI Global. Copying or distributing in print or electronic forms without written permission of IGI Global is prohibited.
36 International Journal of Strategic Information Technology and Applications, 4(2), 35-47, April-June 2013
one in the team to know exactly what’s most
important which then helps people perform their
own work in the right context and this creates to
heave together towards the same overall aims.
Thus in simple terms CSFs refer to identifying
the things that really matter for success.
The idea of CSFs was first presented by D.
Ronald Daniel in the 1960s. It was then built
on and popularized a decade later by John F.
Rockart, of MIT’s Sloan School of Manage-
ment, and has since been used extensively
to help businesses implement their strategies
and projects. Inevitably, the CSF concept has
evolved, and you may have seen it implemented
in different ways. This paper provides a simple
definition and approach based on Rockart’s
original ideas. Rockart defined CSFs as: ‘The
limited number of areas in which results, if
they are satisfactory, will ensure successful
competitive performance for the organization’.
They are the few key areas where things must
go right for the business to flourish. If results in
these areas are not adequate, the organization’s
efforts for the period will be less than desired.
They are areas of activity that should receive
constant and careful attention from management
(Rockart, 1979). CSFs are strongly related to
the mission and strategic goals of any business
or project. Whereas the mission and goals focus
on the aims and what is to be achieved, CSFs
focus on the most important areas and get to
the very heart of both what and how to achieve.
BACKGROUND
Industry executives and analysts often mistak-
enly talk about strategy as if it were a chess game,
but in a game there are just two opponents, each
with identical resources, and with luck playing
a minimal role. But the real world business and
competition is different and certainly it is not
a chess game – it is more than that. According
to Moschella, D (1999), the real world is much
more like a poker game, with multiple play-
ers trying to make the best of whatever hand
fortune has dealt them. This paper explores the
value of enhancing typical strategic planning
with the critical success factor (CSF) method.
It synthesizes documented theory and research
in strategic planning, CSFs and proposes an
information framework for enhanced strategic
planning. The paper does not advocate or ar-
ticulate a specific strategic planning approach,
though theories are discussed and pointers to
published methods are provided. Nor does the
paper aim to document the CSF as a method;
these are published elsewhere. (Caralli, 2004,
van der Heijden, 1996)
The Strategic Planning Landscape
Strategic plans outline an organization’s in-
tended approach for achieving its mission.
There are many ways to conduct strategic
planning, most of which result in a plan or set
of plans that articulate organizational goals and
a high-level strategy for achieving them. CSFs
have extensive histories with operational and
strategic planning. The CSF method results in an
identified set of organizational critical success
factors that represent key performance areas that
are essential for the organization to accomplish
its mission. Further, scenario planning explores
multiple potential futures and generates multiple
robust strategies (not complete strategic plans)
and a set of early-warning signs that help an orga-
nization understand how the future is unfolding.
In addition, both CSFs and scenarios provide
processes that help an organization establish
strong ways of thinking, communicating, and
making decisions. Neither method, however,
constitutes a strategic planning effort, results
in a strategy or strategic plan per se, or has a
direct, explicit interface with strategic planning.
Strategic Planning
According to Miyamoto (2009) samurai warrior,
‘in strategy it is important to see distant things as
if they were close and to take a distanced view of
close things’. Strategic planning is the process
of defining an organization’s plans for achiev-
ing its mission. An organizational strategy is a
derived approach to achieving that mission. The
product of a strategic planning effort is typically
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... Thus, though the purpose of strategic planning is straightforward -to outline where an organization wants to go and how it's going to get there is complex and dynamic. The, critical success factor (CSF) method, can augment strategic planning efforts by illuminating an organization's present situation and potential future (Baporikar, 2013). This chapter explores the value of enhancing typical strategic planning techniques with the CSF method and presents an integrated framework for helping modern organizations to understand the broad range of interrelated elements that influence strategy development for Information Technology (IT). ...
... This chapter explores the value of enhancing typical strategic planning techniques with the CSF method and presents an integrated framework for helping modern organizations to understand the broad range of interrelated elements that influence strategy development for Information Technology (IT). Critical success factors are defined as the handful of key areas where an organization must perform well on a consistent basis to achieve its mission (Baporikar, 2013). CSFs can be derived through a document review, analysis of the goals, objectives of key management personnel and interviews with individuals about their specific domain and the barriers they encounter in achieving their goals and objectives. ...
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... Thus, though the purpose of strategic planning is straightforward -to outline where an organization wants to go and how it's going to get there is complex and dynamic. The, critical success factor (CSF) method, can augment strategic planning efforts by illuminating an organization's present situation and potential future (Baporikar, 2013). This chapter explores the value of enhancing typical strategic planning techniques with the CSF method and presents an integrated framework for helping modern organizations to understand the broad range of interrelated elements that influence strategy development for Information Technology (IT). ...
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The calculation of trends for measures with quantitative units is based on the cumulative annual growth rate for the 5 years period. The study was carried out using elements of the method of analyzing the influence of trends in the formation of strategic scenarios in the event of unpredictable situations (in conditions of wartime uncertainty), to assess changes in the probability of occurrence of a given set of events due to the actual occurrence of one of them, which made it possible to identify trends, justify scenarios and take them into account when analyzing the prospects for industrial development to strengthen the defense capabilities and economic growth of Ukraine. Results and discussion. Strategic scenarios for the industrial development of Ukraine will be adjusted as needed for post-war industry recovery in case of an long-term military external threat to preserve the state sovereignty of our country. It stresses the importance of ensuring a consistently high level of state defense capability. This additionally prioritizes the need to develop a developed industrial complex in creating available resources to meet the needs of not only the civilian population, but also the army. Achieving the set strategic goals depends on the driving forces that determine the industrial development in our country. As the main indicators characterizing the tendencies of industrial development in Ukraine, the indicators reflecting the efficiency of the use of productive forces were chosen: indicators of the industrial production`s efficiency; labor productivity; indicators characterizing innovative development; performance indicators of foreign economic activity and investment development. This choice is due to the fact that a strong industrial base should generate productive and stable employment, and, as a result, an increasing in the average level of wages. 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View
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Article
  • Aug 2003
Examining some of the new and emerging issues in strategic management, Loizos Heracleous presents an original approach to the established ideas of strategy. He emphasizes the importance of organizational culture in realizing strategy and applies this concept to such important new areas as corporate governance and the impact of the Internet on business organization and activity. Combining original research with thorough surveys of the literature, the book is intended for MBA level students, researchers and professionals.
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Strategic Thinking: Can it be Taught?
Article
  • Feb 1998
  • LONG RANGE PLANN
In the wake of the generally accepted demise of traditional strategic planning approaches, strategic thinking has been heralded as the panacea to much of what has been seen as wrong with previous work in the strategy field. Scant attention has been paid in the literature, however, to describing specifically what the process of strategic thinking entails, the means through which it produces the benefits it is seen as creating, or how it can be incorporated into current planning practices. This article seeks to address these important issues by arguing that strategic thinking includes five elements: it incorporates a systems perspective, it is intent-focused, involves thinking in time, is hypothesis-driven, and is intelligently opportunistic. Taken together, these elements are capable of creating superior value, in hard to initiate ways, that make organizations more adaptable to change. In order to incorporate strategic thinking into planning processes, however, we must recognize three discrete aspects of the process: repertoire-building, managing the strategic issues agenda, and programming.
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The Critical Success Factor Method: Establishing a Foundation for Enterprise Security Management
Article
  • Jul 2004
Every organization has a mission that describes why it exists (its purpose) and where it intends to go (its direction). The mission reflects the organization's unique values and vision. Achieving the mission takes the participation and skill of the entire organization. The goals and objectives of every staff member must be aimed toward the mission. However, achieving goals and objectives is not enough. The organization must perform well in key areas on a consistent basis to achieve the mission. These key areas unique to the organization and the industry in which it competes can be defined as the organization's critical success factors. The critical success factor (CSF) method is a means for identifying these important elements of success. It was originally developed to align information technology planning with the strategic direction of an organization. However, in research and fieldwork undertaken by members of the Survivable Enterprise Management (SEM) team at the Software Engineering Institute, it has shown promise in helping organizations guide, direct, and prioritize their activities for developing security strategies and managing security across their enterprises. This report describes the critical success factor method and presents the SEM team's theories and experience in applying it to enterprise security management.
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Strategy as revolution
Article
  • Jul 1996
  • HARVARD BUS REV
How often does the strategic-planning process start with senior executives asking what the rest of the organization can teach them about the future? Not often enough, argues Gary Hamel. In many companies, strategy making is an elitist procedure and ¿strategy¿ consists of nothing more than following the industry's rules. But more and more companies, intent on overturning the industrial order, are rewriting those rules. What can industry incumbents do? Either surrender the future to revolutionary challengers or revolutionize the way their companies create strategy. What is needed is not a tweak to the traditional strategic-planning process, Hamel says, but a new philosophical foundation: strategy is revolution. Hamel offers ten principles to help a company think about the challenge of creating truly revolutionary strategies. Perhaps the most fundamental principle is that so-called strategic planning doesn't produce true strategic innovation. The traditional planning process is little more than a rote procedure in which deeply held assumptions and industry conventions are reinforced rather than challenged. Such a process harnesses only a tiny proportion of an organization's creative potential. If there is to be any hope of industry revolution, senior managers must give up their monopoly on the creation of strategy. They must embrace a truly democratic process that can give voice to the revolutionaries that exist in every company. If senior managers are unwilling to do this, employees must become strategy activists. The opportunities for industry revolution are mostly unexplored. One thing is certain: if you don't let the revolutionaries challenge you from within, they will eventually challenge you from without--in the marketplace.
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Chief Executives Define Their Own Data Needs
Article
  • Mar 1979
  • HARVARD BUS REV
Identification of information needs of top management is discussed in this article by comparing four methods now in use with a new approach, "identification of critical success factors," developed at the Sloan School of Management. The author argues that the CSF method, implemented through a series of two to three interview sessions, helps top management define its own current information needs. Critical success factors are those performance factors which must receive the on-going attention of management if the company is to remain competitive. While not intended for strategic planning purposes, the identification of critical success factors can help top management by: (1) determining where management attention should be directed; (2) developing measures for critical success factors; and (3) determining the amount of information required and thus limiting gathering unnecessary data. The author concludes that the CSF method is both effective and efficient and should be seriously considered by top management as an important tool in assessing data needs.
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