Information strategy

From CEOpedia | Management online

Discussing the information strategies J.I.Cash and others (1988, p. 630) distinguish two basic approaches to information technology in the company. In most cases, information technology has a role in helping the daily operative business, some companies, however, see it as a key factor of success and one of the basic elements of the strategy. This strategy is one of many functional strategies used by management to help develop and implement overall strategy of the corporation.

These two basic approaches to communication strategy are presented in the following table. Present role of information systems in enterprises, makes it difficult to imagine a successful company without functioning IT system, and in particular without managerial information system (MIS).

Determinants of IT strategy in companies

Determinant Technology as part of operating activities Information technology as an element of the strategy
IT Project steering committee Medium-level management. Its existence is not always necessary. The active participation of executive management. It is a key success factor.
Planning Errors in the allocation of resources does not cause big losses. It is necessary to link with the strategy of the Corporation. Much attention should be paid to the appropriate allocation of resources.
Risk profile of implementation projects Avoiding projects with a high level of risk. Some projects with high risk and high potential effects, in order to obtain a competitive advantage.
The management level responsible for information technology May be low Should be very high
Technological innovation Conservatism. Keeping 2-3 years behind technological innovations is justified. A critical element is the continuous improvement and financing of research and development, because competition can get an advantage.
User participation in the implementation of the system Small. High priority to the active participation of users in the implementation of the system.
Budgeting The information System seen as a cost center. The development of the budget does not cause problems and emotions. It is necessary to link planned spending with the strategic objectives of the company. Often, discussions on the budget can be

very emotional.

Expenditure control Expenditure on modernization and development of the system can be set aside in case of difficulty. Efficiency is most important Managers must keep applications modernized, and look for savings elsewhere.

Source: own elaboration.

See also:

Examples of Information strategy

  • Developing a comprehensive customer relationship management strategy:

This strategy involves leveraging technology to capture, store, and analyze customer data to identify customer needs, preferences, and behavior. It also involves leveraging customer data to develop targeted marketing campaigns, track customer interactions, and improve customer service.

An ERP system is a comprehensive software solution that integrates all of an organization’s business processes, from accounting to production and customer service. This type of information strategy enables companies to streamline their processes and gain greater visibility into their operations.

  • Implementing a cloud-based storage system:

Cloud-based storage systems allow companies to store data in the cloud, rather than on physical servers. This type of information strategy eliminates the need for physical storage and can help companies reduce costs.

AI can help companies make better decisions by providing insights into customer data and trends. This type of information strategy can help companies improve their operations and customer experience.

Advantages of Information strategy

One of the main advantages of Information strategy is that it enables companies to gain a competitive edge. The following are some of the key advantages of such a strategy:

  • Increased efficiency and productivity - Information strategy helps to reduce the time it takes to carry out tasks, allowing for faster decision-making and improved productivity. It also reduces the amount of manual labour required for processes, allowing for more efficient use of resources.
  • Improved customer service - Information strategy can help to improve customer service by automating processes and providing customers with access to accurate data and information. This helps to simplify customer interactions and improve customer satisfaction.
  • Improved decision-making - Information technology can provide managers with access to real-time data and analytics, allowing them to make more informed decisions. The use of sophisticated algorithms and predictive analytics can help to identify trends and patterns in data that can be used to anticipate and respond to customer needs.
  • Increased collaboration - Information strategy facilitates collaboration between departments, allowing for improved communication and information sharing. This can help to reduce redundancies and improve the overall efficiency of the organization.
  • Cost savings - By automating processes and introducing more efficient systems, companies can save on costs associated with manual labour, data storage and data retrieval. This can help to improve the bottom line.

Limitations of Information strategy

One of the limitations of information strategy is that it requires a lot of resources, such as time, money, and people, to implement and maintain. Additionally, there is the risk of failure due to inadequate training, lack of knowledge, or technical problems. Furthermore, information systems can be costly to maintain and upgrade due to compatibility issues and changes in technology. Lastly, information security is an important factor to consider, as a breach in security can result in loss of confidential data or disruption of operations. *Time, money and people resources* *Risk of failure* *Cost of maintenance and upgrade* *Information security*

Other approaches related to Information strategy

One way to discuss information strategies is to look at other approaches related to information strategy. These include:

  • Data Governance - Data governance involves the management and control of data across an organization, including the policies and procedures for how data is managed, shared, and used. It involves ensuring that data is accurate and consistent, in compliance with legal requirements, and meets the needs of the organization.
  • Data Management - Data management involves the collection, storage, and organization of data within an organization. It ensures data is secure and available as needed, and is often linked to data governance to ensure data is used in an effective and legal manner.
  • Business Intelligence - Business intelligence (BI) is the practice of using data to inform decision making. BI involves the analysis of data in order to gain insights and optimize performance.
  • Cloud Computing- Cloud computing is the use of remote computing resources, such as servers and software, to store and process data. It is often used to help organizations reduce costs and improve their agility.

In summary, information strategies involve a range of approaches, from data governance and management to business intelligence and cloud computing. Each approach is used to help organizations make the most of their data and ensure it is used responsibly and effectively.

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Author: Krzysztof Wozniak