Information & Management 42 (2005) 761–779 www.elsevier.com/locate/dsw An empirical evaluation of stages of strategic information systems planning: patterns of process design and effectiveness Varun Grovera,*, Albert H. Segarsb a Department of Management, Clemson University, 101 Sirrine Hall, Clemson, SC 29634-1305, USA b Department of Management, The Kenan–Flagler Business School, The University of North Carolina at Chapel Hill, Chapel Hill, NC 27599-3490, USA Received 6 October 2003; received in revised form 11 May 2004; accepted 19 August 2004 Available online 30 September 2004Abstract While much has been written about strategic information systems planning (SISP), two important aspects have been under-emphasized. The ﬁrst is the planning process or how planning is accomplished. The second is planning evolution or howplanning evolves as a learning system. Both perspectives can provide practical guidance on how organizations will change theirplanning process over time in an attempt to improve their effectiveness as well as leverage their investment in SISP. This paperdraws on prior literature to identify key dimensions of SISP and its effectiveness. The evolution of these dimensions is studied asa three-stage model. The results provide an interesting insight into how planning evolves as organizations reconcile seeminglycontradictory ‘‘rational’’ and ‘‘adaptive’’ dimensions of planning. This balanced approach to planning is shown to be moreeffective, providing strong implications for both research and practice.# 2004 Elsevier B.V. All rights reserved.Keywords: Strategic information systems planning; Planning stages; Planning effectiveness; Empirical study; Planning maturity1. Introduction decade. While it has evolved in method and style, the thesis that SISP is important because it emphasizes the Strategic information systems planning (SISP) has need to bring IT to bear on and sometimes inﬂuencebeen the subject of much attention over the past strategic direction of the corporation is widely accepted by researchers. This is particularly true in contemporary environments where harnessing the * Corresponding author. Tel.: +1 864 656 3773;fax: +1 864 656 6768. power of technology resources could be critical for E-mail address: firstname.lastname@example.org (V. Grover), competitiveness . However, while there have beenAl_Segars@unc.edu (A.H. Segars). studies that examine the ‘‘what’’ questions of SISP,0378-7206/$ – see front matter # 2004 Elsevier B.V. All rights reserved.doi:10.1016/j.im.2004.08.002
762 V. Grover, A.H. Segars / Information & Management 42 (2005) 761–779particularly concerning the issue of IS–Business methods and measurement of alignment betweenalignment, there has been little on the ‘‘how’’ business and IS strategies [8,13,36,38,65]. However,questions, which include the process of planning these studies shed little light on the organizationaland whether this yields effective outcomes. Further- aspects of planning. Das et al.  distinguishedmore, is it reasonable to presume that organizations between content and process aspects of planning. Onwill change their planning processes over time in an the process side, some studies have attempted toattempt to improve their effectiveness as well as identify institutionalized planning dimensions,leverage their investment in SISP? Or, as planning actions, and behaviors by observing patterns throughmatures and processes are better deﬁned, does it ﬁeld study [9,18,59,71,74]. For instance, in an earlierbecome less effective? study Pyburn noted the existence of planning patterns It is useful to examine evolution and maturing of among his case ﬁrms. Speciﬁcally, within a written-planning processes as companies strive toward formal system, a rational (structured) process ofachieving more effective planning systems. This can written rules and procedures, top–down planning ﬂow,serve the purpose of delineating changes in process budgetary focus, and narrow participation proﬁles arecharacteristics that can lead to greater (or less) present. In contrast, he found evidence of a personal-planning effectiveness over time. We therefore informal system reﬂecting a more adaptable approachexamined the fundamental questions: How does SISP based on few guidelines or policies, bottom–upevolve? Is it then more effective? If yes, can planning ﬂow, creativity focus, and wide participationorganizations facilitate the maturity of these sys- proﬁles. Similarly, Earl distinguished SISPtems—particularly in a dynamic IT context? What approaches based on degree of rationality andadaptations do ﬁrms make in order to improve adaptability built into the planning system. Speciﬁ-planning in a rational context? If the process is not cally, his organizational approach reﬂected ISmore effective, why do ﬁrms invest in planning? strategies that seemed to emerge from ongoing organizational activities, such as trial and error changes to business practices, continuous enhance-2. Process characteristics of strategic planning ment of existing applications, and system experiments within the business. In essence, organizational themes The SISP concept has undergone signiﬁcant as well as polices, participation, and consistentevolution since the initial discussions of the 1970s planning exercises were used to formulate IS strategy.[26,40,41]. The changing technology and the recogni- In contrast, his administrative approach exhibitedtion of its importance as a corporate resource drove completely rational characteristics of rules andthis evolution. Speciﬁcally, the proliferation of procedures, budgetary control, narrow participationInternet based computing, outsourcing, personal proﬁles, and annual or semiannual planning activities.computers, and user applications tended to push Other approaches (method, business, and technologi-developmental activities outside the exclusive domain cal) also tended to follow a rational proﬁle. Consistentof professional IS groups, creating challenges that did with observations by Pyburn, Earl noted that thenot exist when SISP was ﬁrst conceived. Also, ﬁrms hybrid organizational system of planning seemed toare aggressively searching for new ways to leverage be a more effective form than the highly structured andinformation, knowledge, and IT in supporting strategic less-adaptable rational approaches. Studies by Sulli-goals and competitiveness. Hence, SISP in many ﬁrms van, and Sabherwal and King , also suggested thatrefers to both a proactive search for competitive and planning systems vary along a continuum fromvalue-adding opportunities, as well as the develop- completely rational to completely adaptive, whilement of broad policies and procedures for integrating, others (e.g., Wang and Tai ) found that thecoordinating, controlling and implementing the IT organizational context might play a role in determin-resource. ing planning characteristics. More recently, Segars The study of SISP has been primarily conducted and Grover [69,70] described and measured planningthrough exploratory analysis. Most studies focus on process dimensions and found that systems thatplanning content, with particular interest in the exhibit process characteristics of both rationality
V. Grover, A.H. Segars / Information & Management 42 (2005) 761–779 763and adaptability tended to be more successful. Their able descriptions of planning while complementingresults seemed to be generalizable to a variety of and further structuring general ‘‘approach’’ basedindustries. descriptions. The dimensions are: comprehensiveness, As noted, the variety of planning proﬁles uncovered formalization, focus, ﬂow, participation, and consis-reﬂected ‘‘structures’’ of process characteristics that tency. They are summarized in Table 1.described how the task was accomplished. Forinstance, Pyburn’s study reﬂected the extent offormalization. Earl’s typologies varied in the extent 3. Planning effectivenessof participation, frequency, and control. Similarstudies describe these structures as ‘‘planning sys- While many advocate strategic planning, the linktems’’ [11,16,22,23,43,44] with more fully developed between performance and planning has been found totheoretical and operational dimensions that reveal be inconsistent across organizations and studies .distinct proﬁles in planning. Through extensive Even in the SISP literature, the results at best suggest aanalysis of both the strategic management and SISP contingent relationship between them. For instance,research streams Segars et al.  identiﬁed six Raghunathan and Raghunathan  found no correla-important process dimensions of SISP; these are tion between SISP and user satisfaction. Premkumarrobust in describing SISP design—extending far and King [55,56] on the other hand found that ﬁrms inbeyond methodologically-based and less-generaliz- which IS plays a critical role have higher levels ofTable 1Process dimensions of SISPDimension Description Strategic management literature SISP literatureComprehensiveness The extent to which an organization Fredrickson ; Lederer and Sethi ; attempts to be exhaustive or inclusive Fredrickson ; Sabherwal and King ; in making and integrating strategic Fredrickson and Mitchell ; Sambamurthy et al. ; decisions (comprehensive vs. limited) Janis and Mann  Sambamurthy et al. ; Das et al. Formalization The existence of structures, techniques, Quinn ; Camillus ; Lederer and Sethi ; written procedures, and policies which Dutton and Duncan  Sabherwal and King ; guide the planning process (formal vs. informal) Premkumar and King ; Earl ; Das et al. ; Pyburn Focus Focus refers to the balance between Chakravarthy ; Lederer and Sethi ; creativity and control orientations Lorange and Vancil  Sabherwal and King ; inherent within the strategic planning Byrd et al.  system (creative vs. control oriented)Flow Planning ﬂow refers to the locus of Chakravarthy ; Byrd et al. ; Pyburn  authority or devolution of responsibilities Earl ; for strategic planning; in other words, the Dutton and Duncan  roles played by corporate and divisional managers in the initiation of the planning process (top–down vs. bottom–up)Participation Participation captures the breadth of Dyson and Foster ; Lederer and Sethi ; involvement in strategic planning Eisenhardt  Sabherwal and King ; (broad vs. narrow participation proﬁle) Byrd et al. ; Das et al. Consistency Consistency is concerned with the Kuicalis ; Lederer and Sethi ; frequency of planning activities or Judge and Miller ; Sabherwal and King ; cycles, and relatedly, the frequency of Chakravarthy ; Byrd et al.  evaluation/revision of strategic choices Eisenhardt  (high vs. low)
764 V. Grover, A.H. Segars / Information & Management 42 (2005) 761–779planning resources and are more effective. Lederer technologies, foster cooperation and partnershipand Sethi explain this relationship by identifying a among functional managers and user groups, antici-variety of inhibitors from failure to consider business pate relevant events and issues within the competitivestrategy to time span and resources. environment, and adapt to unexpected organizational However, the measurement of effectiveness has and environmental change.been too far downstream (e.g., ﬁnancial ratios),measured on a single item scale [62,63] or focusedon limited aspects of planning, such as alignment with 4. Planning stagesbusiness strategy. It is our belief that a broadmultidimensional conceptualization is required to Stages of growth or evolution models are popularcapture SISP Effectiveness, consistent with that of in organizational research and IS. These approachesSegars and Grover. Table 2 summarizes the deﬁnition have been applied to industry growth , businessand source of ﬁve key dimensions of SISP effective- growth , IS budgets , information centers,ness; it recognizes that (a) there are outcomes that can end-user computing , and technology assimila-be directly expected from a good planning system; (b) tion .SISP is a complex activity with a variety of beneﬁts; Perhaps the best known model in IS is Nolan’sand (c) capturing the contribution of SISP in terms of stages of growth, in which he proposed that the growthbottom line ﬁgures such as ROI, ROE, etc. may be of computing follows an S-shaped curve. Shifting thesigniﬁcantly confounded by many uncontrollable emphasis from ‘‘descriptive’’ to ‘‘prescriptive’’business, economic, and environmental factors. suggests that ﬁrms can more effectively plan for We argue that successful SISP should help achieve and organize the computing resource based onalignment between IS and business strategies, analyze predictable stages. While his hypothesis has beenand understand the business and its associated controversial and is dated for today’s technologicalTable 2Dimensions of SISP effectivenessDimension Description ReferencesAlignment One of the key factors for successful IS planning Baets ; is the close linkage of the IS strategy and business Henderson and Venkatraman ; strategy. Such a linkage or alignment helps facilitate Das et al. ; acquisition and deployment of information technology Lederer and Sethi ; that is congruent with the organization’s competitive Henderson et al. ; needs rather than existing patterns of usage within Bowman et al. ; King ; the organization Chan et al. Analysis When IS planners make a concerted effort to better Lederer and Sethi ; understand the internal operations of the organization Boynton and Zmud ; in terms of its processes, procedures, and technologies, Henderson and Venkatraman  a degree of analysis is realizedCooperation When general agreement concerning development Henderson  priorities, implementation schedules, and managerial responsibilities is reached, a degree of cooperation is attained. This level of cooperation is important in order to reduce potential conﬂict which may jeopardize the implementation of strategic IS plansImprovement in An effective planning system should improve over time Ramanujam and Venkatraman  capabilities (i.e., learn) in its basic capabilities to support the organizationContribution An effective SISP should contribute to the overall effectiveness Lederer and Sethi ; of the organization. Beyond the vagaries of ﬁnancial ratios, Chan and Huff ; effective SISP should have a high perceived level of King ; Chan et al.  contribution to various aspects of organizational effectiveness (e.g., proﬁtability, decision making, etc.)
V. Grover, A.H. Segars / Information & Management 42 (2005) 761–779 765context, there is a key implication that should be To gain insight into which process dimensions t-noted. Nolan suggested that the model can be viewed ended to be more effective, we can consider the rootsas a learning model where movement through the of adaptability and rationality. There have been manystages is inﬂuenced by the environment (i.e., debates on the relative advantages of the synoptic-changing technology) and the adaptation to that formal (comprehensive, formal, rational planning)environment by internal adjustments. Ultimately, in versus logical-incrementalism (adaptive, participativethe stage of ‘‘maturity,’’ systems naturally mirror planning). While they have not resolved the question,their context. the evidence suggests that elements of both ‘‘rational’’ Interestingly, the same lesson emerges from other and ‘‘adaptive’’ approaches might be better [49,50,-stage models. Porter used the life cycle concept to 76]. As organizations become technologically andillustrate how industries developed and how busi- geographically complex, the importance of planningnesses adapted to pressure. Greiner described a activities rises. Accordingly, a planning culture oftenmodel in which ﬁrms grew based on learning from emerges in the form of highly structured systems.crises. Applegate et al. described technology Rationality may be built into strategic planning sys-assimilation in ﬁrms that evolved through stages tems through higher levels of comprehensiveness [-of ‘‘slack’’ and ‘‘control’’ to learn how to use new 21,67], higher levels of formalization , a focus ontechnologies more effectively. Magal et al. indicated control  and top-down planning ﬂow. Adaptabilitythat Information Centers evolved by adapting and refers to the capability of the planning system to ‘‘-learning from their client base, ultimately being learn’’ . The planning system should contain d-treated as a major corporate resource. Henderson et esign characteristics that will alert managers toal. also described their stages of end-user computing changing organizational and environmental conditionsas a learning curve. that may require change in strategy. Adaptability may We argue that the concepts of adaptation and be designed into a system through wide participationlearning are invariant across phenomena, and there- proﬁles [4,17,68] and through higher levels of plan-fore that it is possible to observe stages of evolution in ning consistency [20,35]. Such characteristics reﬂectthe SISP. We propose that SISP systems are very much the importance of gathering information from a nu-like the processes and structures described above, in mber of sources and the importance of constantly r-that they go through a number of stages of rational econciling strategic decisions with environmentalevolution based on learning. In other words, SISP conditions. As implied in ﬁeld studies, high perform-systems will respond to changes in the environment ing systems for SISP seem to contain aspects of bothand changes in the technology base. This response will adaptation and rationality. Research by Boynton andfacilitate improved SISP in organizations through Zmud, Zmud et al. , as well as Lederer and Sethilearning over time and in doing so SISP will adapt its also implied that such systems may be necessary inprocess characteristics in order to be more effective. order to manage increasingly diverse and dispersedWhile the empirical evidence for such a proposition in technologies across the organization. Speciﬁcally,the planning context is sparse, King and Teo  did Zmud et al. developed a system of planning similar toﬁnd that as IS planning systems evolved, their that of the federal government. This information ec-effectiveness in terms of alignment of IS and business onomy relied on an overall structure of control andstrategies improved. coordination while dispersing many planning and managerial activities to organizational units close to business and environmental activity. Hence, the sys-5. Propositions tem was rational with respect to a structure of overall control but adaptable with respect to the participation Our fundamental proposition is that: of numerous entities in the planning process. Regarding planning evolution, Ginsberg (a) SISP will adapt over time through redesign of its argued that strategy development processes could process dimensions, and be characterized by an emphasis on comprehension(b) this redesign will result in more effective SISP. (accuracy of judgments and predictions), creativity
766 V. Grover, A.H. Segars / Information & Management 42 (2005) 761–779(novelty or uniqueness of ideas and solutions), and Proposition 1. As planning systems evolve they willconsensus (harmony and shared commitment): increase their level of formalization, comprehensive- ness, top-down ﬂow, control focus, participation, and‘‘Although each one of these attributes is required at consistency.one stage or the other to achieve successful strategicplanning, organizations might emphasize one at the As a learning system, we expect that the changesexpense of the other. Research suggests that it is the made through learning improves planning outcomes.ability to balance all three attributes that leads to This leads to:superior performance. For example, studies examiningﬁrm performance in mature businesses, have found Proposition 2. As planning systems evolve they willthat ﬁrms that are able to successfully reinvent and increase their level of planning effectiveness.rejuvenate themselves are those that sought tomaintain a judicious and delicate balance among Proposition 1 is descriptive, while Proposition 2competitive priorities.’’ has prescriptive implications. In addition to these, learning models exhibit adaptation to contextual changes. Therefore, we expect that more mature The six dimensions of the SISP process exhibit systems exist due to their response to contextualelements of both rationality (high comprehensiveness, changes in (a) the environment, and (b) the technologyhigh formalization, top–down ﬂow, control focus) and context. The environment can be characterized by theadaptability (wide participation, high consistency). widely used variable, environmental uncertainty We believe that the evolution of planning systems that describes the perception of complexity andfollows a learning model where ﬁrms adapt their dynamism present in the environment. The technolo-processes as they gain more experience, pushed by the gical context can be deﬁned in terms of its diffusion orchanging environment. Most planning systems are the spread of IT throughout the organization . Bothinitially devoid of structure; lack of experience results these variables are exogenous and we would expectin limited and possibly biased inputs. For instance, that they act as catalysts to stimulate evolution ofdiscovery of new strategic systems might involve planning. We propose:informal idea generation sessions using multipleorganization groups. Initial planning might be Proposition 3. More mature planning systems arerelegated to a few drivers and a handpicked team— characterized by higher levels of environmental uncer-but does not reﬂect broad organizational participation. tainty and IT diffusion.Planning activities are discrete events with constrictedagendas and no continuous evaluation and feedback Fig. 1 illustrates the basic premise of the studysystems in place. (stages of planning). As planning evolves, we expect companies torealize that formal structures can make planningprocesses more efﬁcient. Experience in dealing with 6. Methodologyuncertain technological options can yield morecomprehensive decision processes. The needs for The use of key informants has been a popularbudgetary realism increases the number of control approach within empirical IS studies. Huber andmechanisms. However, along with this, we believe Power  proposed several guidelines for improvingthat ﬁrms will realize that this can rapidly lead to the accuracy of reports gathered from key respon-rigidity that is incongruent with the need to change due dents.to the environment and diffusion of IT throughout the All tactics were considered in the development oforganization. Therefore, elements of adaptability must our survey instrument, selection of respondents, andbe incorporated into the process, including broader its administration, including its careful pre-testing,participation, with inputs from a variety of stake- targeting senior IS executives emotionally involved inholders. It also includes faster evaluation cycles and SISP, provision of a monetary incentive and a tailoredadjustments of strategic plans: research report, and the promise of anonymity.
V. Grover, A.H. Segars / Information & Management 42 (2005) 761–779 767 Fig. 1. Strategic IS planning stages. Purposive sampling was employed. This approach respondents remaining in the frame were examined toobtained an overall frame of potential respondents and determine their level of planning activity. Firms whosethen created a sub-frame of respondents with desired senior IS manager had the job title of: Chiefcharacteristics. Such designs are considered entirely Information Ofﬁcer, Vice President, Director ofappropriate in explanatory studies that examine Strategic Planning, or Director of MIS were retained.unique or complex phenomena . The sampling The resultant sub-frame consisted of 1100 businessframe adopted was the East Edition of The Directory entities. From this, 600 ﬁrms were chosen at random.of Top Computer Executives . This contains thenames, titles, addresses, and phone numbers of top 6.1. Measurement methodscomputer executives in the Eastern half of the UnitedStates. The entities within the directory include Here, six planning process variables and ﬁveFortune 2000 ﬁrms (manufacturing and service), effectiveness dimensions of SISP were assessed. Aseducational institutions, hospitals, and governmental noted by Churchill , the researcher should use oragencies. In developing the desired sub-frame, all adapt existing measurement scales, and when scaleshospitals, educational institutions, and governmental have yet to be developed, literature may be used toagencies were eliminated because they have entirely determine how the variable has been deﬁned and howdifferent success factors. Next, the job titles of many dimensions or components it contains. Then, a
768 V. Grover, A.H. Segars / Information & Management 42 (2005) 761–779panel of experts (i.e., those knowledgeable in the area) These criteria are not tied to the ﬂuctuations inshould offer valuable ideas and insights into the ﬁnancial ratios but they provide a foundation forphenomenon. Within our study, each of these determining SISP’s relative contribution to organiza-mechanisms was employed in developing construct tional effectiveness.measures. In addition, the Q-sort technique , in Finally, the contextual variables of environmentalwhich experts and typical respondents group items uncertainty and IT diffusion were measured usingaccording to their similarity, was used to establish guidelines from the literature. Environmental uncer-construct validity. It was conducted among a panel of tainty involved ﬁve sub-scales [47,48] that capturedsenior IS executives and academics as a means of item elements of both the number of factors (complexity)puriﬁcation. Correct classiﬁcation rates of over 90% and their rate of change (dynamism). These scaleswere realized for 80% of the initial items; these were have been widely validated in empirical studies in bothretained for further analysis. strategic management and IS. IT diffusion represents the dispersion of technology and it has been used in6.2. Variable measurement studies relating it to organizational structure  and strategy . Indicators drawn from these sources Measurement of planning stages was performed by were used in the measure.using a nominal variable that captured the ﬁrm’sexperience with SISP, the experience of the participat- 6.3. Pre-testing and validation of measuresing managers, and the extent to which procedures forplanning were well deﬁned. Three stages were All items and the survey instrument were pre-testedconstructed in a way to be consistent with prior with the help of 23 senior IS executives. Each of thesestudies: a Preliminary Stage, where planning proce- managers was actively involved in strategic ISdures were beginning to be deﬁned and participants planning and each had signiﬁcant experience in IShad little experience; an Evolving Stage, where management. All organizations were visited by one ofplanning activities had been tested but the process the researchers and face-to-face interviews conductedwas still being reﬁned and the participants had some with each manager. Assessments were made of theexperience; and a Mature Stage, where the ﬁrm had a items, constructs, and completeness of the instrument.history of planning activities, participants had much Some items were slightly reﬁned and a preliminaryexperience, and the procedures were in place. No assessment indicated that there was a high degree ofattributes of the speciﬁc planning process were internal consistency.reﬂected in this measure. The complete set of measures for the six SISP Measures for planning process dimensions of variables, the four effectiveness dimensions, and thecomprehensiveness, formalization, focus, ﬂow, parti- two contextual variables is described in Appendix Acipation, and consistency were operationalized as with a description of the conﬁrmatory procedures anddescribed by Segars et al. Also, planning effectiveness results of testing the psychometric properties. Inused the four dimensions operationalized by Segars general, the high factor loadings and resulting strengthand Grover. Three of these represented ‘‘goal in measures of factor reliability suggested that eachfulﬁllment factors’’ and the fourth ‘‘improvement in scale exhibited strong characteristics of unidimen-capabilities’’ reﬂected the ability of the planning sionality. Further evidence of unidimensional mea-system to improve in its support of organizational surement was found in the signiﬁcance of chi-squarefunctioning. Raghunathan and Raghunathan empiri- values obtained in paired testing among constructs.cally validated measures of this planning success Items dropped due to large errors or equivocality weremeasure within the context of general planning. noted. As shown, only single items from the scales ofFinally, planning contribution represented the overall ﬂow, focus, and consistency were lost due to error.contribution to the organization. Representations from Upon establishing the measurement efﬁcacy, thethis criterion domain were adopted from the works of resultant factor loadings of each construct were usedLederer and Sethi, King, Premkumar and King , to compute a factor score that represented a compositeMcLean and Soden , as well as King and Zmud. measure free from random sources of error.
V. Grover, A.H. Segars / Information & Management 42 (2005) 761–779 7696.4. Response proﬁle Table 3 Three stages of SISP evolution: means and standard deviations of planning process dimensions The response rate of the sampled ﬁrms was 43.5%. Preliminary Evolving MatureOf the returned responses, nine contained incomplete (n = 93) (n = 108) (n = 52)data or were otherwise unsuitable for analysis; these Comprehensivenesssurveys were dropped from further consideration Mean 7.93 10.16 13.85yielding an effective response rate of 42.1% and a S.D. 3.79 3.11 3.12sample size of 253. The majority of respondents Formalizationwere from manufacturers; representing 48.2% of the Mean 11.17 14.94 18.17sample. The next highest were from ﬁnance and S.D. 4.89 3.62 3.13insurance entities, representing 17.4% of the sample. FocusThe remaining categories exhibit a modest range of Mean 7.43 9.02 10.54representation from a minimum of 0.8% (agriculture) S.D. 2.21 2.37 2.35to a maximum of 7.5% (wholesale). The sample was Flowalmost evenly split between sales levels of 0–500 Mean 7.31 7.56 10.05million dollars (45.3%) and greater than 501 million S.D. 2.14 2.17 2.32dollars (53.70%). The overwhelming majority of Participationrespondents (72.20%) were either one or two levels Mean 8.56 11.44 15.42below the Chief Executive Ofﬁcer (CEO). Therefore, S.D. 2.49 3.31 3.93it seems that the collected data was provided by Consistencyrespondents of larger business entities knowledgeable Mean 7.99 10.32 14.74about the issues of interest here. S.D. 3.32 3.66 4.83 Table 4 illustrates the effectiveness. Here too, ﬁrms7. Results with more mature SISP tend to have greater alignment between IS and business strategy, better analysis of A signiﬁcant number of respondents classiﬁed their the processes, procedures, and technologies of theSISP system as being in one of the three stages: 37% (n= 93) in the Preliminary Stage, 42% in the Evolving Table 4Stage, and the rest in the Mature Stage. This indicated Three stages of SISP evolution: means and standard deviations ofthat the majority of the organizations are still reﬁning planning effectiveness dimensionsthe processes and only one-ﬁfth consider themselves Preliminary Evolving Maturemature. (n = 93) (n = 108) (n = 52) Tables 3 and 4 provide the means and standard Alignmentdeviations for each of the six planning process Mean 19.14 24.75 28.37variables and the ﬁve effectiveness dimensions across S.D. 5.26 5.76 4.41the three stages. These illustrate a clear pattern for Analysisboth sets of variables consistent with the propositions. Mean 17.51 23.42 26.24As planning evolves it tends to become more S.D. 5.08 4.29 3.91comprehensive, more formal, have a greater emphasis Cooperationon control rather than creativity, and greater emphasis Mean 22.57 23.39 27.85on top–down ﬂow. These are complemented by an S.D. 6.73 5.75 5.40increase in participation and greater consistency Improvement(frequency) of planning activities. Table 5 shows Mean 23.39 26.06 29.82the statistical signiﬁcance of these results over the S.D. 2.08 4.27 5.07three stages. The unambiguous monotonically Contributionincreasing trend provides what we believe to be Mean 11.97 16.54 22.57 Std. Dev 5.29 4.83 5.61substantial support for Proposition 1.
770 V. Grover, A.H. Segars / Information & Management 42 (2005) 761–779Table 5 Table 6Multiple analysis of variance SISP design dimensions across stages Multiple analysis of variance SISP effectiveness measures acrossof planning maturity stages of planning maturitySource d.f. Sum of Mean F value R2 Source d.f. Sum of Mean F value R2 squares square squares squareComprehensiveness Alignment Stage 2 606.80 303.40 29.41 (0.0001) 0.19 Stage 2 1677.78 838.89 36.60 (0.0001) 0.22 Error 250 2578.63 10.31 Error 250 5732.79 22.92 252 3185.43 252 7410.58Formalization Analysis Stage 2 1086.72 543.36 41.45 (0.0001) 0.25 Stage 2 1339.05 669.52 47.51 (0.0001) 0.27 Error 250 3277.46 13.10 Error 250 3524.71 14.09 252 4364.18 252 4863.77Focus Cooperation Stage 2 273.63 136.81 24.79 (0.0001) 0.17 Stage 2 1694.25 847.12 29.15 (0.0001) 0.19 Error 250 1379.84 5.51 Error 250 7266.75 29.06 252 1653.48 252 8961.00Flow Improvement Stage 2 174.30 87.15 18.98 (0.0001) 0.15 Stage 2 838.67 419.33 20.92 (0.0001) 0.14 Error 250 1149.14 4.59 Error 250 5010.39 20.04 252 1323.44 252 5849.06Participation Contribution Stage 2 620.64 310.32 25.36 (0.0001) 0.17 Stage 2 1721.68 860.84 31.56 (0.0001) 0.20 Error 250 3059.64 12.23 Error 250 6819.96 27.27 252 3680.29 252 8541.64Consistency Stage 2 654.09 327.04 19.04 (0.0001) 0.13 Error 250 4293.48 17.17 252 4947.57 stages however were mixed. Focus did not exhibit differences between adjacent stages, while ﬂow did not exhibit differences between the Preliminary andorganization, improved cooperation between stake- Evolving Stages. While it is difﬁcult to interpret theseholders regarding development and implementation ﬁndings, we think that the changes in focus (frompriorities, a capacity to improve over time, and a creativity to control) are more gradual as planningcontribution to the overall effectiveness of the evolves through the stages. This might be because oforganization. Table 6 provides strong statistical the importance of keeping a good balance between thesupport for the signiﬁcance of these differences— orientations. Creative use of IT is very important inthereby supporting Proposition 2. It should be noted, an era where the technology itself can be a source ofhowever, that the standardized variances in the competitive advantage. At the same time thedimensions of effectiveness are higher than those in proliferation of technological alternatives and man-the process dimensions. This could reﬂect various dates to keep IT costs in check can create a strong needorganizational contingencies that inhibit or facilitate for a control/budgetary orientation.planning effectiveness. Table 8 illustrates the results related to the Planning Tables 7 and 8 use Tukey’s Studentized range to test Effectiveness dimensions. These clearly indicate that,for the differences in individual stages. With respect to even across temporally adjacent stages, planningthe SISP process (Table 7), signiﬁcant differences (at p effectiveness statistically improves. The only excep-< 0.05) were obtained for all the variables between the tion is cooperation where the improvement seems toPreliminary and Mature stages. Results for adjacent manifest itself during the latter stages. In general,
V. Grover, A.H. Segars / Information & Management 42 (2005) 761–779 771Table 7Three stages of SISP evolution: Tukey’s Studentized range (HSD) tests for planning process dimensionsDimension Mean differences between stages Preliminary À Evolving Preliminary À Mature Evolving À Mature *** ***Comprehensiveness 2.23 5.92 3.69***Formalization 3.77*** 7.0*** 3.23***Focus 1.59 3.11*** 1.52Flow 0.25 2.74*** 2.49***Participation 2.88*** 6.86*** 3.98***Consistency 2.33*** 6.75*** 4.42*** *** Signiﬁcant at the 0.05 level.however, a clear pattern of improvement in effective- their SISP system into the three categories, theness exists. signiﬁcant numbers of ﬁrms within each of the Table 9 illustrates the differences in contextual three stages, and the qualitative differences invariables across the three stages. Both environmental process, outcome, and context in each of the threeuncertainty and IT diffusion are signiﬁcantly different stages.across the three stages. This supports Proposition 3. It 2. Firms have different processes in each SISP stage.also supports our contention that SISP should be an While we cannot assert that every ﬁrm evolvesadaptive system that responds to increasing environ- through the stages, given the cross sectional naturemental uncertainty and increasing IT diffusion. Both of the sample, we found that ﬁrms in each of thethese contextual stimuli require process adaptation. stages followed a certain (predictable) pattern withThis adds credence to the thesis of SISP stages as a respect to the SISP process dimensions.model of organizational learning. 3. Firms have different outcomes in each SISP stage. Here, the trend was clear. Firms that had greater experience with SISP and in a more ‘‘mature’’ stage8. Discussion had better outcomes. 4. Firms in each SISP stage had a different context. The results support all three of our propositions. The perceived environmental uncertainty and theGiven the care taken in variable measurement and IT diffusion variables strongly suggested thatvalidation, this would imply that the theoretical basis ﬁrms that were in more mature stages of SISPof the propositions is sound. The major ﬁndings can be experienced both greater uncertainty and highersummarized as: levels of diffusion.1. There are stages of SISP. Conﬁdence in this These stages reﬂect a learning model of SISP. Most assertion is enhanced by the ease at which prior models suggest learning implications as ﬁrms respondents in the pilot study were able to classify evolve and adapt to changes in their context. Indeed,Table 8Three stages of SISP evolution: Tukey’s Studentized range (HSD) tests for planning effectiveness dimensionsDimension Mean differences between stages Preliminary À Evolving Preliminary À Mature Evolving À MatureAlignment 5.61*** 9.23*** 3.62***Analysis 5.91*** 8.73*** 2.82***Cooperation 0.72 5.28*** 4.46***Improvement 2.67*** 6.43*** 3.76*** *** Signiﬁcant at the 0.05 level.
772 V. Grover, A.H. Segars / Information & Management 42 (2005) 761–779Table 9Three stages of SISP evolution: contextual variables across stages of SISP Preliminary (n = 93) Evolving (n = 108) Mature (n = 52) Multiple analysis of varianceEnvironmental uncertainty Mean 10.94 12.23 14.42 F(2,250) = 40.73, P = 0.0001, R2 = 0.25 S.D. 3.12 2.57 2.49IT Diffusion Mean 8.83 11.86 13.39 F(2,250) = 19.04, P = 0.0001, R2 = 0.26 S.D. 4.13 4.46 4.42the changes were based on expectations and prior pressure to change, bring new technologies, andtheory. Below, we describe possible manifestations of provide better information.these three stages. 8.2. Stage 2: Evolving Stage8.1. Stage 1: Preliminary Stage A level of frustration has set in that provides the These ﬁrms are just beginning to undertake SISP. internal impetus for change. Often the source of thisProcedures are neither well deﬁned, nor do managers frustration includes questions like: ‘‘What are wehave any signiﬁcant experience, with planning tending accomplishing?’’ ‘‘Is anyone listening to us?’’to be ad hoc and opportunistic. Top management ‘‘Don’t I need to get back to real work?’’ ‘‘Whatallows SISP but provides little or no input into the does top management really want?’’ Externally, ITprocess. IS managers form planning committees to diffusion is higher and top management starts takingdeal with strategic issues. There is limited information a more active interest (and involvement) in SISP,gathering since formal planning roles are not yet particularly in the context of higher uncertainty. Indeﬁned and people are involved in planning while still some cases, it could be a mandate that is issued to getactively pursuing their original job. Occasionally corporate planners and IS planners together. Parti-formal methods are brought into the process, but they cipants are formally deﬁned in SISP roles (e.g.,are usually partially adopted or fail to gather Strategic Planning for Technology). The frequencyintegrated support from the committees. The process of planning is tested and reﬁned. More organiza-is more creative than control oriented, as one of the tional participation in SISP is nurtured, as ﬁrms tryobjectives is to build strategic thinking and new ideas to incorporate SISP as a corporate-wide activity. Inin an area that has typically had only tactical thinking. some cases, SISP is elevated to the level of CorporateMeetings occur relatively infrequently since the IS Planning and functions as a sub-process of thatgroup is not fully vested in the idea of strategic endeavor. Elements of keeping control of the processplanning, given the day-to-day ﬁre ﬁghting that gets start entering the picture in order to get somethingtop priority due to immediacy effects. IS-centric accomplished. Formal procedures for planning arethinking often predominates the strategic context. No put into place and documented. In some cases,formal evaluation of planning takes place. The process formal methodologies are adopted or adapted.yields limited alignment since business goals are not However, these processes have to be reﬁned to ﬁtwell understood. This leads to frustration among the the culture of the organization. SISP is taken muchplanners. There are some beneﬁts in terms of building more seriously among a wider group of IS anda culture of analysis and cooperation, but contribution organizational personnel. Top management alsoof the process to organizational effectiveness is expects a deliverable from the process. Organiza-ambivalent at best. Most ﬁrms in this stage experience tional analysis is more complex and detailed as theuncertainty in product, market, and technological process attempts to fully incorporate the improve-environments, which stimulates the need for planning. ment of organizational processes and structures. TheThe IT base of these ﬁrms is usually stable but there is IS-centric thinking prevalent earlier slowly gives
V. Grover, A.H. Segars / Information & Management 42 (2005) 761–779 773way to organizational thinking as cooperation sions of process and dimensions of effectiveness.between various units is achieved. As the process The evolution of SISP leads ﬁrms to a desirableis improved it does a better job of identifying (more effective) state that has attributes of ration-problems and opportunities, and evaluating organi- ality and adaptability. Therefore, ﬁrms that canzational needs. assess their current state of SISP can gain insight into the direction of change needed. The most effective8.3. Stage 3: Mature Stage SISP requires rational elements of comprehensive- ness and formalization, focus on control and top– This is a steady state in which SISP works and can down planning ﬂow. Exhaustive information gather-effectively adapt to change. This process works ing and consideration of alternatives, structuredtowards managing a highly pervasive and diffused methods and procedures, written guidelines, exten-IT as a resource that can improve organizational sive budgeting, tight integration with ﬁnancialeffectiveness in a highly uncertain environment. There systems, top management initiation and top manage-is a realization that to be effective contradictory forces ment involvements are characteristics of suchwill have to be balanced. The planning process has systems. However, SISP also requires adaptableelements of rationality—it is comprehensive in its elements of participation and consistency. Diversesearch for strengths, weaknesses, threats and oppor- participation across hierarchical levels and func-tunities, problems and solutions. It is formal in its tions, large numbers of participants, frequentdeﬁnition of procedures and methods. It gradually assessment and adjustment of plans, open feedbackreverts to elements of control. And it is very much systems, and frequent SISP related meetings areintegrated with the business planning to promote a attributes of adaptability. Forward thinking ﬁrms cantwo-way ﬂow of information and involvement. assess their stage of evolution and work towardHowever, it does not go to the point where rationality adjusting the culture of the ﬁrm so that the desirablestagnates the process or even institutionalizes it in systems can be accepted. Doing so would catalyzestone. A delicate balance is achieved between this the evolutionary trend toward maturity.rationality and adaptability—or the ability to work in It should be noted that the degree of rationalsmaller steps rather than one large rational plan. This versus adaptive elements in planning systems mightrequires widespread participation of all stakeholders vary with the organization and environmentaleither directly or through their representatives. context. For instance, ﬁrms in hypercompetitiveProblems are viewed from various vantage points and information intensive environments where ITand frequently, through mechanisms that allow the has high visibility and importance might requireprocess can adapt to change. Everyone is encouraged more of the adaptive elements. On the other hand,to be involved in strategic thinking. stable industries where IT is playing an important but utilitarian role might tend to emphasize rationality. The path taken from ‘‘preliminary’’ to ‘‘mature’’9. Implications could be inﬂuenced by the environment. In some ﬁrms, adaptive elements might dominate before With the pervasiveness of IT and increasing rational elements are inculcated, while in others thepressure on ﬁrms to leverage their IT assets, the opposite might be true. The balance betweenimportance of SISP has never been stronger. SISP is rationality and adaptability allows the process tomore than a narrow methodology or sequence of steps. be effective in its ability to both manage today’sIt is complex set of organizational activities that can be business while simultaneously creating tomorrow’scharacterized by a number of process characteristics, technology and markets. Such ‘‘ambidexterous’’which form an evolutionary pattern as they change as a ﬁrms, also protect internal organizational skills/ﬁrm’s experience grows in adapting to a changing capabilities while simultaneously infusing newenvironment and technological base. knowledge from the outside. Of course, as discussed The results of our analysis suggest that stages of above, the balance points might vary with the natureevolution are clearly distinguishable across dimen- of organization or industry. However, companies like
774 V. Grover, A.H. Segars / Information & Management 42 (2005) 761–779IBM, British Petroleum, Intel, Microsoft, Sonoco, can be made. Instead, these ﬁndings can only beDupont, Pﬁzer, and Delta Airlines have had a long generalized to the population of ﬁrms within thetradition of SISP and are fairly mature in effectively sampling frame.balancing these needs. Other potential limitations are response bias A good example of effective planning is the case of associated with a ‘‘single informant’’ and lack ofmedical device maker Medtronic—a $5.5 billion model reﬁnement through independent sample testing.global company based in Minneapolis . The CIO, Multiple informants and structured methods ofJeff Balagna, indicates, ‘‘The strategic plan is a high- triangulation are a better method of obtaining accuratelevel document. It has the business imperatives, the data regarding organizational properties.problems we’re trying to solve.’’ That plan involveswidespread participation and goes into a ‘‘summit’’meeting of business unit IT leaders, who break the 11. Conclusionplan into projects with owners, teams and deadlines.The plan reﬂects a comprehensive and formal process, This strength of support for the three propositionsbut also incorporates the ability to respond quickly to adds credence to the theoretical basis of our study.changes of fortune such as mergers or industry We believe that it strongly supports the contention ofupheaval. The organizational model includes a global an SISP learning model in which ﬁrms evolvetechnology council, made up of the IT leaders from through stages and adapt to contextual changes byeach of Medtronic’s business units around the world. changing the SISP process so that it is moreThe council meets roughly every two months to review effective. Our results suggest that organizationsthe appropriateness of the company’s ongoing evolve in a direction of increasing rational-adap-strategy, make adjustments if necessary and make tively in their strategic planning processes. Thissure current projects are being executed as planned. allows them to cope with increasing uncertainty andBalagna can also call emergency meetings if complexity of the IT resource. The parallel relation-necessary. Balagna says that plans cannot be changed ship between this evolution and all aspects ofinstantaneously, ‘‘but we can reprioritize very quickly planning effectiveness suggests that rational-adap-with this model,’’ he says. tively represents a ‘‘best practice’’ for which organizations should strive. While ﬁrms might take different paths to get there, successful planning10. Study limitations systems have aspects of both. The quality of our work was predicated on thequality of the data and the measures. We attempted to Appendix A. Construct operationalization andbring a theoretical and operational deﬁnition to a validationcomplex concept. Such endeavors are ambitious andtherefore contain some inherent limitations. Perhaps A general procedure for assessing the efﬁcacy ofthe most signiﬁcant is the range of developed measurement within the realm of conﬁrmatoryconstructs for the process of SISP. In general, no ¨ analysis is suggested by Joreskog  as well asclaim is (or can be) made to have captured every Anderson and Gerbing . In essence, each of theaspect of this complex phenomenon. Therefore, it is item scales represents an a priori measurementpossible that other process dimensions exist that were model of the theoretical construct space. To test theirnot considered here. efﬁcacy with respect to strength of measurement and A second potential limitation concerns the sample. solution stability, each of these models wasThe survey was targeted at organizations likely to have estimated in isolation, in pairs, and as a collectivedeﬁned processes for SISP and the senior executives network for evidence of validity and reliabilitywith vested interest in its outcomes. Although the [2,33]. This analysis was accomplished through theutilized sampling frame has been widely used in analytic framework of LISREL . Two underlyingsimilar studies, no general claim of external validity assumptions of conﬁrmatory factor modeling within
V. Grover, A.H. Segars / Information & Management 42 (2005) 761–779 775LISREL are model determinacy (or identiﬁcation) to determine optimal courses of action from identiﬁedand multivariate normality. Checks of these statistics alternatives; There is little trial-and-error in ourfor the variables of this study revealed no serious strategic decision process; We will delay decisionsdepartures from multivariate normality or excessive until we are sure that all alternatives have beenkurtosis. If the model is identiﬁed, the solution of evaluated. ML estimates for items were 0.64, 0.89,each model should converge at the same point each 0.65, 0.43, and 0.60, all signiﬁcant at p < 0.001.time. Such an approach was undertaken in each of Model estimates: x2 (5) = 9.97 (p = 0.08); GF = 0.97;the estimated models of this analysis. In all cases, AGF = 0.92; Factor Reliability = 0.78.solutions converged at the same point and were Planning formalization: Policies and proceduresidentical; providing strong evidence of model greatly inﬂuence the process of SISP within our ﬁrm;identiﬁcation . Model ﬁt measures, in particular We utilize formalized planning techniques (e.g., BSP)x2, provide direct statistical evidence of unidimen- in our SISP process; Our process for strategic planningsionality and convergent validity. Further evidence is very structured; Written guidelines exist to structureof these properties is gained through high and strategic IS planning in our organization; The processsigniﬁcant factor loadings as well as low residuals and outputs of strategic IS planning are formallybetween the observed and implied covariance documented. ML estimates were 0.42, 0.83, 0.87,matrices. 0.68, and 0.59 all signiﬁcant at p < 0.001. Model Discriminant validity is achieved when the estimates: x2 (5) = 9.22 (p = 0.10); GF = 0.96; AGF =correlations between any two dimensions are sig- 0.88; Factor Reliability = 0.82.niﬁcantly different from unity [2,69]. Empirically, Planning focus: The primary focus of IS planning isthis property can be established through the compar- controlling cost through extensive budgeting; In ourison of an unconstrained model, which estimates (or IS planning process we encourage creativity and idea‘‘frees’’) the correlation (f) between a pair of generation over control; Strategic IS planning isconstructs and a constrained model, which ﬁxes the viewed as a means of controlling the growth ofvalue of the construct correlation to unity. The technology; Control systems are used to monitordifference in x2 between these models is also a x2 variances between planned actions and outcomes;with degrees of freedom equal to one. A signiﬁcant x2 Our IS planning process is tightly integrated withdifference implies that the unconstrained model is a the ﬁrm’s normal ﬁnancial planning or capitalbetter ﬁt for the data thereby supporting the existence budgeting routine. ML estimates are 0.51, 0.71,of discriminant validity [2,69]. Such tests were 0.75, 0.48, 0.16. All but the last item were signiﬁcantconducted between all possible pairs of constructs at p < 0.001. This item was dropped and the four-within the theoretical system. A more reﬁned item model was estimated. Model estimates: x2 (2) =indication of the ‘‘extent of discrimination’’ between 4.22 (p = 0.07); GF = 0.92; AGF = 0.80; Factorconstruct pairs can be gained through comparison of Reliability = 0.71.the AVE for each construct with the estimated Planning ﬂow: Strategic planning for IS is initiated atcorrelation between constructs. Discriminant validity the highest levels of the organization; The planningis strongly inferred when AVE for each construct ﬂow within our organization can be characterized asis greater than the squared correlation between ‘‘top–down’’; Planning for IS is initiated byconstructs. requests/proposals from operational/functional man- agers; Those who formulate strategic IS plans areA.1. Planning system measures and analysis most responsible for their implementation; The(on a 7-point Likert type scale ranging from primary role of upper management is to endorse‘‘strongly disagree’’ to ‘‘strongly agree’’) rather than formulate IS plans. ML estimates were 0.83, 0.49, 0.52, 0.17, and 0.59. All but the fourthPlanning comprehensiveness: We attempt to be item were signiﬁcant at p < 0.001. The respeciﬁedexhaustive in gathering information relevant for IS four-item model had estimates of x2 (2) = 5.85planning; Before a decision is made, each possible (p = 0.07); GF = 0.98; AGF = 0.89; Factor Reliabilitycourse of action is thoroughly evaluated; We attempt = 0.71.
776 V. Grover, A.H. Segars / Information & Management 42 (2005) 761–779Planning participation: Top-management is actively IT (X1); Improved understanding of how theinvolved in strategic IS planning; A variety of organization actually operates; Development of afunctional area managers participate in the process ‘‘blueprint’’ which structures organizational pro-of IS planning; Our process for strategic IS planning cesses; Monitoring of internal business needs and theincludes numerous participants; Strategic IS planning capability of IS to meet those needs (X5); Main-is a relatively isolated organizational activity; The taining an understanding of changing organizationallevel of participation in SISP by diverse interests of the processes and procedures; Generating new ideas toorganization is high. ML estimates were 0.74, 0.87, reengineer business processes through IT; Under-0.85, 0.66, and 0.75 all signiﬁcant at p < 0.001. standing the dispersion of data, applications, andModel estimates: x2 (5) = 9.66 (p = 0.10); GF = 0.96; other technologies throughout the ﬁrm. ModelAGF = 0.88; Factor Reliability = 0.88. estimates: x2 (9) = 15.68 (p = 0.09); GF = 0.94;Planning consistency: We constantly evaluate and AGF = 0.88; Factor Reliability = 0.86. X1 deletedreview conformance to strategic plans; We fre- due to inadequate reliability. X5 deleted due toquently adjust strategic plans to better adapt them to signiﬁcant cross loading with alignment.changing conditions; Strategic IS planning is a Planning cooperation (7-point scale anchored bycontinuous process; We frequently schedule face-to- ‘‘entirely unfulﬁlled’’ and ‘‘entirely fulﬁlled’’):face meetings to discuss strategic planning issues; Avoiding the overlapping development of majorWe formally plan for information systems as the systems; Achieve a general level of agreementneed arises. ML estimates were 0.58, 0.81, 0.85, regarding the risks/tradeoffs among system projects;0.83, and 0.14, all but the last item signiﬁcant at Establish a uniform basis for prioritizing projects;p < 0.001. The reduced four item model had Maintaining open lines of communication with otherestimates of x2 (2) = 4.73 (p = 0.07); GF = 0.98; departments; Coordinating the development efforts ofAGF = 0.89; Factor Reliability = 0.86. various organizational sub-units; Identifying and resolving potential sources of resistance to IS plans;A.2. Measures and analysis for SISP Developing clear guidelines of managerial responsi-effectiveness bility for plan implementation. Model estimates: x2 (14) = 23.25 (p = 0.05); GF = 0.96; AGF = 0.92; FactorPlanning alignment (7-point scale anchored by Reliability = 0.91.‘‘entirely unfulﬁlled’’ and ‘‘entirely fulﬁlled’’): Planning capabilities (7-point scale anchored byUnderstanding the strategic priorities of top-manage- ‘‘much deterioration’’ and ‘‘much improvement’’):ment (X); Aligning IS strategies with the strategic plan Ability to identify key problem areas; Ability to identifyof the organization (X); Adapting the goals/objectives new business opportunities; Ability to align IS strategyof IS to changing goals/objectives of the organization; with organizational strategy; Ability to anticipateMaintaining a mutual understanding with top-man- surprises and crises; Ability to understand the businessagement on the role of IS in supporting strategy; and its information needs; Flexibility to adapt toIdentifying IT-related opportunities to support the unanticipated changes; Ability to gain cooperationstrategic direction of the ﬁrm; Educating top-manage- among user groups for IS plans. Model estimates: x2 (14)ment on the importance of IT; Adapting technology to = 23.40 (p = 0.10); GF = 0.94; AGF = 0.88; Factorstrategic change; Assessing the strategic importance Reliability = 0.90.of emerging technologies. Model estimates: x2 (9) = Planning contribution (7-point scale anchored by16.90 (p = 0.05); GF = 0.92; AGF = 0.83; Factor ‘‘strongly disagree’’ to ‘‘strongly agree’’): SISPReliability = 0.91. X deleted due to inadequate contributes signiﬁcantly to the ﬁnancial performancereliability. of the ﬁrm; SISP enables us to make better managerialPlanning analysis (7-point scale anchored by decisions; We are able to identify new IT-based‘‘entirely unfulﬁlled’’ and ‘‘entirely fulﬁlled’’): opportunities before our competition; The time,Understanding the information needs of organi- money, and effort devoted to SISP is more thanzational sub-units; Identifying opportunities for justiﬁed by its beneﬁts; SISP provides valuable inputinternal improvement in business processes through into the planning process of top-management; SISP
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