School of Information Sciences
and Technology
Strategic Alignment
IST 297A
www.ist.psu.edu
School of Information Sciences
and Technology
Critical strategy variables I
Five Forces
1. Threat of new entrants
2. Threat of substitutes
3. Bargaining power of suppliers
4. Bargaining power of buyers
5. Rivalry among firms
Value Chain
Generic Strategies
Cost
Leadership
Differentiation
Cost
Focus
Differentiation
Focus
Porter, Michael, Competitive Advantage, 1985
www.ist.psu.edu
School of Information Sciences
and Technology
Critical strategy variables II
Five Forces
1. Threat of new entrants
2. Threat of substitutes
3. Bargaining power of suppliers
4. Bargaining power of buyers
5. Rivalry among firms
Value Chain
Generic Strategies
Cost
Leadership
Differentiation
N. Venkatraman, 2000
Cost
Focus
Differentiation
Focus
www.ist.psu.edu
1. Vision
2. Governance
3. Resource allocation
4. Infrastructure
5. Management team
School of Information Sciences
and Technology
Key questions as strategist
1. How do I keep track of all the variables I need to address?
2. What drives what? Do I start with a particular area?
3. How do you plan for the transition from “brick to click”?
4. How do I justify the process?
www.ist.psu.edu
School of Information Sciences
and Technology
Strategic Alignment
Business Strategy
IT Strategy
Scope
Scope
Competency
Make/Buy
Structure
Processes
Make/Buy
Architecture
Skills
Org. Infrastructure
www.ist.psu.edu
Competency
Processes
Skills
IT Infrastructure
School of Information Sciences
and Technology
Planning Perspectives
Strategic Execution
IT
Strategy
Business
Strategy
Organization
Infrastructure
IT
Infrastructure
IT Service Level
IT
Strategy
Business
Strategy
Organization
Infrastructure
IT
Infrastructure
www.ist.psu.edu
Competitive Potential
Business
Strategy
Organization
Infrastructure
IT
Strategy
IT
Infrastructure
Technology Potential
Business
Strategy
Organization
Infrastructure
IT
Strategy
IT
Infrastructure
School of Information Sciences
and Technology
How do you plan for the transition?
IT
Strategy
Business
Strategy
Business
Strategy
.dot
Strategy
.dot
Strategy
Organization
Infrastructure
IT
Infrastructure
Organization
Infrastructure
.dot
Infrastructure
.dot
Infrastructure
.dot
Strategy
.dot
Infrastructure
www.ist.psu.edu
Five Forces
1. Threat of new entrants
2. Threat of substitutes
3. Bargaining power of suppliers
4. Bargaining power of buyers
5. Rivalry among firms
Cost
Leader
Differentiation
Cost
Focus
Differentiation
Focus
N. Venkatraman, 2000
1. Vision
2. Governance
3. Resource allocation
4. Infrastructure
5. Management team