Logistics strategy Logistics is not confined to tactical decisions about transportation and warehousing.

Longer-term decisions are needed to put in place the capabilities that ensure that logistics plays a full role in supporting a companys products in the market place.

As such capabilities increasingly involve partners in a supply chain; the implications of this full role extend far beyond the boundaries of the company itself. Logistics strategy is the set of guiding principles, driving forces and ingrained attitudes that help to coordinate goals, plans and policies between partners across a given supply chain. Example If the links in a supply chain are directed at different competitive priorities, then the chain will not be able to serve the end-customer as well as a chain in which the links are directed at the same priorities. This is the idea of focus, which is based on the view that you cannot be good at everything. Where links in a supply chain are directed at a common and consistent set of goals that are based on the priorities most valued by the end-customer, that supply chain will compete better in the market place than one in which the links have different, conflicting priorities. All too often, for example, a focus on cost cutting by the management of the day is at odds with the more fundamental priorities of reliability and speed. While profitability may be improved this financial year, long term damage may well have been caused to the supply chains ability to compete. It is difficult to handle high volume, low cost products in the same distribution channel as low volume, high variety products. Logistics processes for classic shirts (styles that last a long time and do not date) are sourced separately from fashion blouses. Classic shirts are sourced from low cost economies where price is key and delivery times are less important because the product life cycle is long. Fashion blouses (styles that are in season and may date quickly) are sources closer to the home market because response time is key, and cost is less important

Strategic human resource management Strategic human resource management is the process of linking the human resource function with the strategic objectives of the organization in order to improve performance. Strategic human resource management The SHRM literature is rooted in manpower (sic) planning, but it was the work of inuential management gurus (for example Ouchi, 1981; Peters & Waterman, 1982), affirming the importance of the effective management of people as a source of competitive advantage, that encouraged academics to develop frameworks emphasizing the strategic role of the HR function (for example Beer et al., 1985; Fombrun et al., 1984) and attaching the prex strategic to the term human resource management. Interest among academics and practitioners in linking the strategy concept to HRM can be explained from both the rational choice and the constituency-based perspective. There is a managerial logic in focusing attention on peoples skills and intellectual assets to provide a major competitive advantage when technological superiority, even once achieved, will quickly erode (Barney, 1991; Pfeffer, 1994, 1998a). From a constituency-based perspective, it is argued that HR academics and HR practitioners have embraced SHRM as a means of securing greater respect for HRM as a eld of study and, in the case of HR managers, of appearing more strategic, thereby enhancing their status within organizations (Bamberger & Meshoulam, 2000; Pfeffer & Salancik, 1977; Powell & DiMaggio, 1991; Purcell & Ahlstrand, 1994; Whipp, 1999). Concepts and models In spite of the increasing volume of research and scholarship, the precise meaning of strategic HRM and HR strategy remains problematic. It is unclear, for example, which one of these two terms relates to an outcome or a process (Bamberger & Meshoulam, 2000). For Snell et al., (1996, p. 1996) strategic HRM is an outcome: as organizational systems designed to achieve sustainable competitive advantage through people. For others, however, SHRM is viewed as a process, the process of linking HR practices to business strategy (Ulrich, 1997, p. 89). Similarly, Bamberger and Meshoulam (2000,

p. 6) describes SHRM as the process by which organizations seek to link the human, social, and intellectual capital of their members to the strategic needs of the rm. According to Ulrich (1997, p. 190) HR strategy is the outcome: the mission, vision and priorities of the HR function. Consistent with this view, Bamberger and Meshoulam (2000, p. 5) conceptualize HR strategy as an outcome: the pattern of decisions regarding the policies and practices associated with the HR system. The authors go on to make a useful distinction between senior managements espoused HR strategy and their emergent strategy. The espoused HR strategy refers to the pattern of HR-related decisions made but not necessarily implemented, whereas the emergent HR strategy refers to the pattern of HR-related decisions that have been applied in the workplace. Thus, espoused HR strategy is the road map and emergent HR strategy is the road actually traveled (Bamberger & Meshoulam, 2000, p. 6). Purcell (2001) has also portrayed HR strategy as emerging patterns of action that are likely to be much more intuitive and only visible after the event. We begin the discussion of SHRM and HR strategy with a focus on the link between organizational strategy formulation and strategic HR formulation. A range of business HRM links has been classied in terms of a proactivereactive continuum (Kydd & Oppenheim, 1990) and in terms of environmenthuman resource strategybusiness strategy linkages (Bamberger & Phillips, 1991). In the proactive orientation, the HR professional has a seat at the strategic table and is actively engaged in strategy formulation. In Figure 2.3 above, the two-way arrows on the right-hand side showing both downward and upward inuence on strategy depict this type of proactive model. At the other end of the continuum is the reactive orientation, which sees the HR function as being fully subservient to corporate and business-level strategy, and organizational-level strategies as ultimately determining HR policies and practices. Once the business strategy has been determined, an HR strategy is implemented to support the chosen competitive strategy. This type of reactive orientation would be depicted in Figure 2.3 above by a one-way downward arrow from business- to functionallevel strategy. In this sense, a HR strategy is concerned with the challenge of matching the philosophy, policies, programmes, practices and processes the ve Ps in a way that will stimulate and reinforce the different employee role behaviours appropriate for each competitive strategy (Schuler, 1989, 1992).

The importance of the environment as a determinant of HR strategy has been incorporated into some models. Extending strategic management concepts, Bamberger and Phillips (1991) model depicts links between three poles: the environment, human resource strategy and the business strategy (Figure 2.5). In the hierarchy of the strategic decision-making model (see Figure 2.3 above), the HR strategy is inuenced by contextual variables such as markets, technology, national government policies, European Union policies and trade unions. Purcell and Ahlstrand (1994) argue, however, that those models which incorporate contextual inuences as a mediating

SHRM TheoryA New Emphasis The field of HR strategy differs from traditional HR management research in two important ways. First, SHRM focuses on organizational performance rather than individual performance. Second, it also emphasizes the role of HR management systems as solutions to business problems (including positive and negative complementarities) rather than individual HR management practices in isolation. But strategic means more than a systems focus or even financial performance. Strategy is about building sustainable competitive advantage that in turn creates above-average financial performance. The simplest depiction of the SHRM model is a relationship between a firms HR architecture and firm performance. The HR architecture is composed of the systems, practices, competencies, and employee performance behaviors that reflect the development and management of the firms strategic human capital. Above-average firm performance associated with the HR architecture reflects the quasi rents associated with that strategic resource. Becker, Huselid / Strategic HR Management 899For the most part, prior SHRM theory has focused on the nature of the HR architecture. What is the nature of the appropriate HR system (i.e., single practices or systems)? What are the key mediating variables (i.e., commitment) within the HR architecture? The architectural metaphor (Becker & Gerhart, 1996; Becker & Huselid, 1998, Lepak & Snell, 1999; Wright, Dunford, & Snell, 2001) is important because it highlights the locus of value creation in SHRM. Although strategic human capital is reflected in the human assets in the organization, it is created and managed through the organizational system reflected in the HR architecture. The notion of the HR

architecture as a value-creating system raises the question of the appropriate locus of strategic value creation. Emphasis in the SHRM literature ranges from the HR system, the resulting workforce skills and competencies, employee commitment and engagement, to employee performance. Within this architectural framework, we would emphasize the importance of the HR system as the most important strategic asset. First, it is the source of value creation in the subsequent outcomes in the HR architecture. Second, it has the potential for greater inimitability based on how it is aligned with the firms strategy. Finally, unlike human capital, it is immobile. With a few exceptions (Becker & Huselid, 1998; Huselid, Beatty, & Becker, 2005; Huselid, Becker, & Beatty, 2005; Wright et al.), there has been little effort to extend SHRM theory in a way that formally integrates the mechanism through which the HR architecture actually influences firm performance. Gerhart (2005), for example, has recently suggested that SHRM move closer to the individual level by emphasizing HRs impact on employee relations and attitudes. The heavy focus on the character of the HR architecture is the natural comfort zone of HR scholars. Going forward, however, we need more theoretical work on the black box between the HR architecture and firm performance, and less emphasis on the black box within the HR architecture. The theoretical literature is out of balance. SHRM is an intermediate or mesotheory, and as such, it draws as much on the strategy literature as the HR literature. Recent developments in the strategy literature, however, suggest a particularly valuable direction for theoretical work in SHRM.

Information systems strategy "An information systems strategy brings together the business aims of the company, an understanding of the information needed to support those aims, and the implementation of computer systems to provide that information. It is a plan for the development of systems towards some future vision of the role of information systems in the organisation."

"An IS strategy is something which is essentially a planing process in the minds of the decision makers, users and developers of the systems. It is supported with written reports and plans, but they are of secondary importance."

Information system strategy Presentation Transcript

1. Information Systems Strategy 2. Learning Objectives To understand The need for an IS

strategy Types of strategies that exist within an organisation, and how they interact with each other. In particular: Business strategy. Information systems strategy. Information technology strategy the process of strategic planning for information systems

3. Need for an information system strategy Due to the

multitude of technological developments over the past two decades many areas within an organisation can now take advantage of cheap user-friendly processing power. Information needs of users have increased and can be met in many different ways. To prevent the proliferation of unique independent information systems developing within an organisation, an overall information system strategy needs to be considered.

4. IS needs an effective strategic plan Because IS consumes a

portion of the organisations finite resources IS must accommodated rapid technological changes IS must enable the business to function effectively Therefore, IS strategy will ensure that IS will cost effectively deliver strategic systems.

5. Aims of the IS strategic plan Clearly identify where IS is

going within the organisation therefore avoiding the dangers of taking actions that do not contribute to the overall mission Provide a formalised set of benchmarks so that progress of the plan can be monitored.

6. The information system strategy The information system

strategy is derived from the business strategy which itself is evolved from the strategies of all the sub-systems. Once an information strategy has been decided upon EG. providing a better service or information to the customers about an organisations products, then a tactical plan for setting up the system can be devised. This will include, where it will be located, what hardware and software will be used, what training is required. Although it is necessary to consider

the information sub-system as an integral part of the overall business system, it is also important to consider it in its own right. That is, the information sub-system must be concerned with new techniques and technologies which could benefit the organisation. All business strategies must be responsive to the external environment

7. Strategies within an organisation Business Strategy IS

Strategy Information Management Strategy Information Technology Strategy Information Strategy Change Management Strategy IS Related Human Resource Strategy Business Strategy

8. Elements of a strategic plan A clear statement of IS

objectives where they want the business to be An inventory and assessment of both the current organisational capabilities and problems resulting from current practises where the business is now An implementation plan identifying long-term and short-term actions and allocation of resources how to get to where they want to be

9. Elements of IS strategy (Ward &Griffiths, 96) Business

information strategy . This defines how information and knowledge will be used to support the business objectives IS functionality strategy . Defines the requirements of the business from the systems. Defines how the resources will be used and the allocation of responsibility IS/IT strategy. This defines the hardware and the software standards and preferred suppliers.

10. IS/IT strategy Determines the technological infrastructure

of the organisation This ensures Appropriate technologies used Standards are set In terms of costs, efficiency and supporting business users, customers and others Determines how IT is applied within the organisation Ensures that IT supports the business strategy Ensures that the resources are made available

11. Organisation environment All organisations operate within

an environment Micro-environment immediate includes customers, suppliers and intermediaries Macro-environment wider environment of social, legal, economic, political and technology The environment influences the way in which the organisation works

12. Seven Rs of strategy (Lickert, 97) These are ways in

which organisations can compete, using information system strategy to respond to its external environment Reach Reaction Responsiveness Refinement Reconfiguration Redeployment Reputation

13. Strategy process model 1 Strategic analysis 2 Strategic

objectives 3 Strategic definition 4 Strategic implementation Monitor, evaluate and respond

14. Strategy process model features Continual internal and

external environment scanning to assess internal strengths and weaknesses and external opportunities and threats Clear statement of objectives Formulation of different strategic options and then selection Implementation and control of the strategy

15. Elements of information strategic management 16. Without Planning Financial losses Lower staff morale

Missed opportunities Management will be fire-fighting continuously Reduced customer satisfaction.

17. To Summarise Before the tactical planning of information

systems is carried out, the overall information system strategy must be agreed upon and communication to all other sub-systems. This strategy will identify areas within the business strategy that would benefit from new or improved information systems. It will map out a plan for the development of these systems based on strategic importance and availability of resources. It will incorporate new developments in technology and future needs. It will also decide between a policy of centrally-controlled development of systems or a strategy of local development to meet local needs

Overview Strategic systems are information systems that are developed in response to corporate business initiative. They are intended to give competitive advantage to the organization. They may deliver a product or service that is at a lower cost, that is differentiated, that focuses on a particular market segment, or is innovative. Strategic information management is a salient feature in the world of information technology (IT). In a nutshell, strategic information management helps businesses and organizations categorize, store, process and transfer the information they create and receive. It also offers tools for helping companies apply metrics and analytical tools to their information repositories, allowing them to recognize opportunities for growth and pinpoint ways to improve operational efficiency. Some of the key ideas of storefront writers are summarized. These include Michael Porter's Competitive Advantage and the Value Chain, Charles Wisemans Strategic Perspective

View and the Strategic Planning Process, F. Warren McFarlans Competitive Strategy with examples of Information Services Roles, and Gregory Parsons Information Technology Management at the industry level, at the firm level, and at the strategy level. General Definition Strategic information systems are those computer systems that implement business strategies; They are those systems where information services resources are applied to strategic business opportunities in such a way that the computer systems have an impact on the organizations products and business operations. Strategic information systems are always systems that are developed in response to corporate business initiative. The ideas in several well-known cases came from information Services people, but they were directed at specific corporate business thrusts. In other cases, the ideas came from business operational people, and Information Services supplied the technological capabilities to realize profitable results. Most information systems are looked on as support activities to the business. They mechanize operations for better efficiency, control, and effectiveness, but they do not, in themselves, increase corporate profitability. They are simply used to provide management with sufficient dependable information to keep the business running smoothly, and they are used for analysis to plan new directions. Strategic information systems, on the other hand, become an integral and necessary part of the business, and they affect the profitability and growth of a company. They open up new markets and new businesses. They directly affect the competitive stance of the organization, giving it an advantage against the competitors. Most literature on strategic information systems emphasizes the dramatic breakthroughs in computer systems, such as American Airlines' Sabre System and American Hospital Supplys terminals in customer offices. These, and many other highly successful approaches are most attractive to think about, and it is always possible that an equivalent success may be attained in your organization. There are many possibilities for strategic information systems, however, which may not be dramatic breakthroughs, but which will certainly become a part of corporate decision making and will, increase corporate profitability. The development of any strategic information systems always enhances the

image of information Services in the organization, and leads to information management having a more participatory role in the operation of the organization. The three general types of information systems that are developed and in general use are financial systems, operational systems, and strategic systems. These categories are not mutually exclusive and, in fact, they always overlap to some. Well-directed financial systems and operational systems may well become the strategic systems for a particular organization.

The Information Strategy The information strategy acts as the linchpin between the academic strategy and the IS strategy. It answers the questions: what information is required? and where is the information required to support the primary tasks, or key goals, of the academic strategy. It also questions the appropriateness of the critical assumptions behind the academic strategy in light of the changing environment and changing perceptions. This assessment and review process is one of the core concepts behind this model. Thus, for Galliers, strategy should have both deterministic and emergent elements.

Information Systems Strategy Triangle The relationship among business strategy, organizational strategy, and information strategy.

Business strategy: Where a business wants to go and how its going to get there. Derived from market forces, customer demand, and organizational capabilities. Organizational strategies How will the business organize itself to implement its business strategy? Consists of: (See Figure 1.7 in text) Organization Business processes Formal reporting relationships (structure) Informal networks/communication Decision processes/authority Control Decision processes/authority Data (availability and use) Planning processes Performance measurement and evaluation

Culture Values Incentives and rewards Informal networks/communication

Information Systems strategy What IS capabilities would assist the organization in implementing its business strategy and fit with the organization strategy? Alternative view - IT-oriented business strategy approach: What business strategy would allow the business to use a unique implementation of IT to gain competitive advantage (e.g., the Amazon approach). Specifically, what IT architecture (hardware, software, network capabilities, and data) will allow the implementation of the chosen business strategy?

Understanding business strategys relationship to information systems: 1. What are the business goals and objectives? 2. What are the plans for achieving these goals? What is the role of IS in the plans? 3. Who are the crucial competitors and partners? What is required to be a successful member of the value chain? Understanding organizational strategys relationship to information systems: 1. What are the important structures and reporting relationships within the organization? 2. What are the characteristics, experiences, and skill levels of the people within the organization? 3. What are the key business processes? 4. What control systems are in place?

5. What is the culture of the organization?