Information Requirements To Meet The Current Business Objectives

Information Requirements to Meet the Current Business Objectives: the Use of Critical Success Factors and Balanced Scorecards
In order to position critical success factor (CSF) analysis and the Balanced Scorecard, it is useful to develop the link between data, information and business results. Figure 4.4 illustrates such a model, the DIKAR model (Data, Information, Knowledge, Action, Results),derived from the work of Venkatraman. Viewing the model from left to right represents an IT perspective where the focus is on data processing and the provision of information to the business. Viewing it from right to left, the focus is on business results and the actions and knowledge required to achieve those results. (This model is used again in Chapter 10 when the concept of knowledge and itsmanagement is explored in detail.)

The Balanced Scorecard identifies the information required to measure performance against the business objectives. CSF analysis, on the other hand, identifies what has to be done, or changed, in order to achieve the objectives, including new information and/or systems needed. In combination, they provide a way of obtaining agreement as to the priority of ISinvestments relevant to achieving the explicit business objectives for the next 6–12 months.
Balanced Scorecard
The Balanced Scorecard has become a popular tool for managing the performance of organizations and, laterally, for the development of strategy itself. Developed by Harvard Business School academics Kaplan and Norton, it is based on the premise that financial measures only report theresults of past decisions and that, if performance measurement is to have any real meaningful impact, a more balanced set of objectives and measures is required. The Balanced Scorecard promotes the examination of performance from four interrelated perspectives, each seeking to address specific questions (see Figure 4.5):

* Financial: How do we look to our shareholders and those with a financialinterest in the organization?
* Internal business perspective: What do we have to excel at if we are to meet the expectations of our employees and trading partners?
* Customer perspective: How do our customers perceive us in term of products, services, relationships and value-added?
* Innovation and learning perspective: To achieve our future vision, how will we continue to improve andcreate future value for our stakeholders?
For each of the four perspectives, objectives can be established and relevant measures, often called key performance indicators (KPIs), assigned against each objective, leading to the information needed to measure performance.

Critical Success Factor Analysis
CSF analysis is a powerful and deservedly popular technique not only in developing an IS/ITstrategy but also for business strategy development.
Table 4.6 Uses of critical success factor (CSF) analysis
* It is a most effective technique in involving senior management in developing the IS strategy, because it is wholly rooted in business issues and in gaining their commitment to proposed IS actions that contribute to achievement in critical areas
* It enables linking of candidateIS projects through CSFs to objectives, and thus clearly demonstrates alignment with the business strategy, and provides a compelling basis for gaining wholesale agreement by the top-management team
* In individual interviews with senior management, it is a good catalyst in unearthing their own individual information needs
* By providing a link between objectives and informationrequirements, the CSFs play an important role in prioritizing potential investments
* It is particularly useful in IS planning when the business strategy has not progressed beyond objectives by focusing attention on the most critical aspects of the business that need action taken to improve their performance
* It is extremely powerful when used alongside value chain analysis in identifying the most...