The formulation stage culminates with the development of a strategic marketing plan. Marketing managers will undertake programmes and action that deliver strategic objectives.
Such actions, will often focus on individual elements of the marketing mix. Additionally, a process of monitoring and control needs to be put in place. This ensures compliance and aids decision making. Additionally, it provides a template to the structure of this text. The three components form a planning cycle analysis, formulation and implementation and are interactive in nature, with information being fed-back to enable objectives and strategy to be reviewed and amended. Normally, any strategic process has three distinct stages — analysis, formulation of plans and implementation.
Increasingly, the importance of implementation is recognised as an integral part of the strategic framework. Strategy aims to define core competencies, under- stand the external environment and offer an integrative, consistent approach to decision making. Any strategy is significantly influenced by environmental change. Political, economic, social and technological factors drive change and impact on the organisation. This results in a volatile, intensely competitive market place. Organisations need to ensure that they fully embrace the opportunities change brings and guard against complacency and strategic drift.
Marketing has a role to play within the strategic process. Namely, market- ing can be adopted as a business philosophy. This sees commercial success as stemming from a process of understanding and meeting customer needs. Marketing strategy involves achieving a superior competitive position within a defined market. Essentially, it involves segmentation, targeting and positioning.
This must address customers, competitors and internal corporate factors. Strategic marketing management is the process of ensuring our marketing strategy is relevant and sustainable. Cavazza, M. Johnson, G. Kaplan, R. Jobber, D. Porter, M. In this text strategic analysis is broken down into three constituent elements: external analysis, customer analysis and internal analysis. Undertaking the analysis is not however a linear process and there are areas of the analyses that overlap.
The aim of the process is to develop a detailed and all embracing view of the company and its external environment to permit the organisation to formulate informed strategic decisions. Chapter 2 explores the external analysis. This consists of an initial audit of the macro-environment. Chapter 3 explores the increasingly critical function of competitive intelligence and examines how organisations can employ such a practice to support and develop successful marketing strategies.
Chapter 4 examines the customer. Consumer behaviour is explored to illustrate what the effect of changes in the external environment can have on customers. Market segmentation techniques are then discussed. Chapter 5 describes the process of internal analysis.
These four chapters illustrate the groundwork that needs to be under- taken by an organisation before it can begin to form a view of the future. It creates the information and analysis necessary for an organisation to begin to identify the key issues it will need to address in order to develop a successful strategy.
The chapter explores the process of PEST analysis, industry analysis, competitor analysis and market analysis. A study by Diffenbach identified a number of positive consequences that stem from carrying out organised environmental analysis see Figure 2. Figure 2. The first step is an analysis of the macro-environmental influences that the organisation faces. This is followed by an examination of the competitive micro envir- onment the organisation operates within.
Finally a specific competitive analysis is undertaken. The process is normally referred to as scanning. There are four forms of scanning according to Aguilar They are as follows: 1 Undirected viewing: This activity concerns the viewer exploring infor- mation in general without carrying a specific agenda. The viewer is exposed to a large amount of varied information but this is not an active search looking for particular issues, just a broad attempt to be aware of factors or areas that may have changed.
There is of course an unlimited amount of information that can be scanned. Any organisation can only scan a certain amount of this information. A bal- ance has to be struck between the resources allocated to this activity and the potential benefits. More information also does not lead to better deci- sion making. Understanding the dynamics of the environment is the criti- cal aspect to this activity, not the volume of information reviewed see the section on Market sensing in Chapter 6.
Managers search for information in five broad areas Aguilar, see Figure 2. The importance placed on market intelligence was true across all functional areas.
The most significant categories of information within this area were market potential, accounting for 30 per cent alone and structural change, accounting for 10 per cent.
The only other category that reached double figures was for the category of new products, process and technology under technical intelligence. One crucial aspect of this activity, especially where it underpins futures forecasting, is to detect weak signals. This is obviously difficult especially as many organisations fail to recognise major signals in the environment. The aim of this analysis is to identify the critical issues in the external environment that may affect the organisation.
Before moving on to judge the impact they may have on the organisation. The structure of a political system defines the centres of political influence. In the UK there is a parliament for Scotland and an assembly for Wales. There are however be a number of decision areas that are still be the responsibility of the Westminster parliament. At the same time there is also an increasing range of decisions taking place both politically and legally within the framework of the European Union.
Political pressure groups such as Greenpeace can also affect the political agenda. Therefore when consider- ing this area of the environment a much wider view has to be taken than just the domestic national government or the legal process. In the global economy, domes- tic economic conditions are heavily influenced by events in other areas of the world. Economics is concerned with the allocation of resources. Therefore issues such as conservation of natural resources, costs of pollu- tion, energy consumption and the whole area of the management of nat- ural resources should be considered under this heading.
Technological developments There is a great danger in using a particular technology to define an industry. Illustrative Example 2. This represents a five-fold increase in on-line sales since Next Directory is the biggest single operator in this sector of the clothing market. A secondary factor was to avoid the high street retail experience. One on-line retailer is reported as saying sales in this sector have been growing at 50 per cent a year over the last few years.
Despite the general evidence of high growth in Internet sales and the specific evidence of growth in the on-line clothing market a number of fashion retailers currently have no on-line clothing operation these include Zara, Selfridges, Matalan, Bhs and Primark.
The central role of this PEST analysis is to identify the key factors that are likely to drive change in the environment. Then the aim is to establish how these key factors will affect the industry in general and the organisation in particular.
This analysis should be conducted at the level of the individual strategic business unit SBU rather than at the level of the organisation as a whole, otherwise the range of relationships facing a company with several divisions, causes the analysis to loose focus. For exam- ple grocery and electrical goods retailers in the UK dominate the mar- ket and are in a very strong position versus their suppliers as a result.
In the meat industry in the UK there are a large number of small farmers supplying a retail sector dominated by a small number of large supermarkets. They have had time to establish crucial aspects of their operation such as effective sources of supply, the best loca- tions, and customer franchises.
Insurance services delivered directly by producers over the phone or Internet are substitutes for the services of the independent insurance broker.
Cassette tapes replaced vinyl records, only to be replaced by compact discs. Consumers may choose to substitute buying a car in order to purchase an expensive holiday instead. Natural growth reaches a plateau once an industry reaches maturity; the only way a organisation can continue to grow in the industry is to take market share off its rivals.
In an indus- try where rivals are of similar size, competition is likely to be intense as they each strive for a dominant position. Industries that already have a clear dominant player tend to be less competitive.
This may be plant and machinery that is specialist in nature and therefore cannot be transferred to other uses. The work- force may have non-transferable specialist skills. If the industry is in maturity, moving towards decline, and rivals cannot easily leave the industry then competition inevitably will increase. This can be related to the critical factors that were identified by the PEST analysis. Are there ways of benefiting from these potential changes?
Can the company increase its power, relative to suppliers or buyers? Can actions be taken to reduce competitive rivalry, or are there ways of building bar- riers to dissuade companies from considering entering the industry?
Are there ways of making substitute products less attractive? Do conditions favour one particular operator? Consideration of relative competitive position of rivals is an important aspect of an audit and needs now to be considered in more detail. This is likely to be a rather broad definition of an industry and contains a number of com- panies that would not be direct competitors. Companies that are direct competitors in terms of products and customer profiles are seen as being in a strategic group.
The car industry would be made up of a num- ber of strategic groups. Strategic groups Strategic groups are made up of organisations within the same industry that are pursuing equivalent strategies targeting groups of customers that have similar profiles. All these companies are following simi- lar strategies and facing similar strategic questions. They are also aiming at very similar market segments.
In the airline industry there are at least three strategic groups. One group consists of airlines with regional oper- ations who offer scheduled flights and compete on cost. There is a group of major airlines who have global operations and offer scheduled flights with quality environments and service. The third group offer charter ser- vices to a range of holiday destinations see Figure 2.
There is a range of attributes that can be used to identify strategic groups. If not the competitor may initiate a change of strategy. Financial objectives may indicate this. Investment is more likely from companies that have objectives, which are long term in nature, such as market share and sales growth, rather than organisa- tions under pressure to produce short-term profitability. This also reveals potential trade-offs the competitor may be willing to take.
If short-term profitability is the key objective then the rival is likely to be willing to loose market share in the short term in order to achieve its profitability targets. The organ- isation may have non-financial objectives, such as gaining technol- ogy leadership. They are as follows: 1 Identification of the current markets, or market segments, within which the competitor currently operates.
This will indicate the scope of the business. Is it based on quality of service, brand image or on price? This may be an indication of whether a low cost or differenti- ation strategy is being pursued see Chapter 8. Firstly it can illustrate the direction the competitor is mov- ing, in terms of product and market development, over time.
It can also highlight strategies that the organisation has tried in the past and have failed. The competitor is unlikely to attempt these approaches again without considerable reservations.
The level of centralisation or de-centralisation of management decisions will also affect decision making. Recruitment and promotion policies, along with the remuneration and rewards scheme, all give an indication as to the culture and style of the man- agement team. Do they have a strong brand image?
Is their advertising effective? How good are their distribution channels? How strong is their relationship with customers? Such factors could be geographic spread of plant, level of vertical inte- gration or level of capacity utilisation. Low-capacity utilisation can increase fixed costs, per unit of manufacture. The flexibil- ity of production staff is also an important issue to identify. In the ser- vice sector, capacity and staff flexibility are just as important.
Factors such as the ability to pull in additional staff on a temporary basis gives a service company an important capability. Competitors that have strong cash flows, or are a division of a major group, may have the ability to finance investment not avail- able to other competitors. The reactions of organisations can be categorised into four types of response Kotler et al. Market leaders, in particular, are likely to react in this manner against any threat to their dom- inant position.
Companies that have an aggressive culture may also fall into this category. In this situation companies can be extremely slow to react to a competitive move. The classic example is British motor- cycle companies failing to react to the entry of Japanese manufac- turers into the lower end of the market. For instance they may always react to any price reductions, or sales promotions, as they believe these will have an important impact on their business.
Actions that are less visible such as support material for the sales force or dealerships are less likely to face a response. They react aggressively on occasion but at other times ignore similar competitive challenges. Around three million people have experienced Second Life and visit it regularly.
The world has already created one US Dollar millionaire who made their money through buying blocks of land and building housing to sell to other avatars. Now commercial companies are beginning to see the potential of this virtual and other virtual realms and a number of companies have set up operations in Second Life including IBM, Nike, Adidas and Sony. The company felt the meeting was more interactive than holding a meeting through a conference call or video link.
The competitive analysis has allowed the organisation to establish its relative position versus its competitors on a range of important criteria. However the organisation has to judge itself and its competitors against the market it is operating within. At this stage in the external analysis it is useful to establish a range of information about the market. The customer and market segmentation would also be considered under a market analysis and this will be explored in detail in Chapter 4.
This can help to uncover the reasons for these changes and expose the critical drivers underlying a market. Information on where, when and how customers purchase the product, or service, allows an organisation to begin to understand the needs of the cus- tomer Chapter 4 will look at consumer behaviour in more detail. Identifying changing trends in consumer behaviour may begin to sig- nal potential market developments and opportunities see Chapter 6.
Establishing the key decision makers in a channel of distribution also helps to inform strategic decisions. The PEST analysis uncovered the critical areas in the external environment that the organisa- tion needed to consider.
The industry analysis revealed the structure and strengths of players in the industry that any strategy will be required to address. The competitor analysis disclosed the relative position of the direct competitors in the strategic group. Finally the market analysis began to explore current trends and areas of growth. More importantly it began to build a picture of the consumer. The external analysis is the initial step in the process of establishing the key issues facing an organisation.
The next stage is to examine the con- sumer, before establishing methods for segmenting markets. Diffenbach, J. Kotler, P. External analysis 35 Lehman, D. Davidson, H. Mudie, P. For example, the success of Coca-Cola is partly determined by the actions of Pepsi-Cola. Competitive intelligence CI has something of an image problem.
The term conjures up an image of elicit activities involving private detectives, telephoto lenses and hidden microphones. While such images are not completely unappealing, they are far removed from the truth.
The key to successful CI is the ability to turn basic raw data into actionable intelligence. Actionable intelligence involves providing deci- sion makers with timely, appropriate information which facilitates action. The need for CI has always been recognised. Know the enemy and know yourself, in a hundred battles you will never be defeated.
Given the established business trends of: a globalisation b rapid technological development and c merger and acquisition, CI is likely to be a strategic priority for most organisations. Currently management information tends to fall into two main categories. Firstly, reporting and control information.
This monitors what has happened internally within any given period. Such data is of course necessary, but managers increasingly need to be forward looking. CI serves this purpose. Competitious, an innovative web-based service, offers clients the opportunity to collabora- tively share and manage competitive knowledge. Co-founders Kris Rasmussen and Andrew Holt aim to provide tools which allow organisations to collectively build an on-going know- ledge base about competitive companies or products.
The effective use of such information allows users to identify threats, find opportunities and plan future strategy. Source: www. CI can provide a number of useful functions within any organisation. The various strengths and weaknesses of the opposition can be considered and frameworks established to anticipate and pre-empt competitor initiatives.
The process may also uncover potential com- petitors who are about to target your existing customer base or indus- try activities. CI forces managers to have an external focus. By constantly reviewing the opposition, we are better able to develop, adapt and innov- ate our own product offerings. These general concepts do much to enhance overall corporate communication and promote teamwork. Correctly applied CI concept enable staff to overcome many problems associ- ated with information overload.
Competitive intelligence 41 The reality is that most organisations have some form of CI. CI offers the opportunity to bring together the various stands of information which already exist into one cohesive, practical system. This basic concept is derived from government agency intelligence gathering oper- ations e. This phase requires a detailed understanding of what business decisions are being taken and how information will be used.
Targeted intelligence is used to resolve specific problems, while awareness intelligence is designed to monitor the competitive environ- ment on an on-going basis. The planning process is concerned with obtaining the correct balance between the two.
Pollard advocates translating key intelligence requirements into more specific key intelligence questions and then iden- tifying and monitoring intelligence indicators. These intelligence indica- tors are identifiable signals that are likely to precede particular competitor actions Table 3. Common sources of competitive information are considered later in this chapter. Table 3. Buying media advertising space Analysis Analysis is concerned with converting raw data into useful information.
The process involves classification, evaluation, collation and synthesis. The classification stage may involve tagging data as: a primary — facts directly from the source e. Data can then be prioritised in terms of importance. When neces- sary, triangulation can be used to confirm findings.
This involves cross checking an item against a number of sources. Competitive intelligence 43 History teaches us the importance of evaluation and classification. Most military, political and commercial intelligence failure has not been due to inadequate information collection, but due to poor evaluation of available information. Boston Matrix, Ansoff Matrix, etc.
Therefore, to some degree, future behaviour is likely to be predictable. Understanding the behav- iour and reactions of rival corporate leaders to given sets of circum- stances can be highly revealing of future intent.
Their responses are then analysed in a de-brief session. It is possible to electronically scan large amounts of text for key words e. Techniques such as word and pat- tern analysis can identify underlying themes and trends. Analysing how mission states have changed or been inter- preted over time is highly insightful.
Rumours of likely activity can be checked against a rival stated mission. Does the rumour seem to equate with overall corporate aims? Dissemination CI needs to be tailored to meet user needs. Effective dissemination is based on clarity, simplicity and appropriateness to need. CI should if merited form the basis of competitive action plans. A useful test is to con- sider what are the implications of the intelligence not being passed on?
If there are no real implications, it is questionable whether it is necessary. Research shows that many CI projects fail during this phase. Therefore, presentation of CI is critical. Competitive information comes from three general areas. Most industries are heavily regulated and any publicly listed company has legal obliga- tions to make certain information available. Additional promotional materials, product advertising, annual reports and recruitment activities are, by nature, publicly available.
It is often surprising just how much information organisations already hold on competitors. The problem is one of analysis and dissemination. The sales force and customer service staff are a primary source of CI. Organisations need to establish mechanisms, such as internal networks, to facilitate this process. It is also possible to set up internal sys- tems to monitor competitors e. Many electronic sources exist, providing powerful search engines enabling detailed inquires to be made.
The Internet provides a vast array of free and fee paying information services. Some commonly used Internet sites are listed in Table 3. However, the problem is often dealing with the sheer volume of information Internet searches generate.
Essentially, it operates as a specialist search engine. CI is based on a four-stage cycle. The cycle starts with planning and direction then moves on to collection, analysis and dissemination. Pollard, A. Taylor, J. This chapter explores both consumer and organisational segmentation. Initially both consumer and organisational behaviour is summarised to illustrate the areas from which segmentation criteria have developed.
A full analysis of segmentation is then undertaken, to provide the foundation of the targeting and positioning activities that will be addressed in Chapter 9. It follows that decisions about the markets to be serviced are a critical step in strategy formulation. The segmentation process is there- fore central to strategy and it can be broken into three distinct elements: segmentation, targeting and positioning. This chapter will examine the seg- mentation aspect of both consumer and organisational markets.
Successful segmentation relies on a clear understanding of the market. Knowledge of consumer behaviour is the crucial foundation on which that market understanding is built. This chapter will briefly summarise both consumer and organisational buyer behaviour as an introduction to market segmentation criteria. Segmentation allows an organisation to gain the best price it can in every segment, effectively raising the average price and increasing profitability. Their market lead- ership gives them economies of scale, in marketing and production they will also have established access to distribution channels.
Small companies or new entrants in a market are unlikely to be able to gain leadership; they can however take a dominant share of a particular market segment. As an individual moves through life, their needs in financial services will change. For example, young single individuals may need a minimum of credit and banking facilities and car insurance, younger families, however, will need in addition life insurance policies and mortgages, in middle age these needs will turn to pension provi- sion.
If an organisation can provide all these services they may retain a customer who otherwise would transfer to another brand. An organisation may also be able to use segmentation as a way of moving a customer over time from entry level products or services to products at the premium end of the market. For example, young women interested in fashion are likely to read certain fashion magazines.
Rather than spending money on mass- market media that reach far wider than the target group, organisations can target their money and effort by using media, focused directly on their potential consumer group.
Recently a small company in the magazine market identified a group of customers that had clear needs. Overseas nationals living in the UK wished to buy magazines from their home country. This was a potential customer group that all responded in the same way to the proposed marketing mix. They clearly acted differently from other groups in the magazine market. This potential segment was large and potentially profitable however this was a difficult group to make operational.
The only way of pursuing this opportunity was to persuade overseas nationals to identify themselves. This could have been accomplished by attracting consumers to respond to a promotional campaign, allowing the organisation to build a customer database. However, for a small organisation this was likely to be a costly oper- ation and the idea was dropped in favour of other options. Given the fact that segments need to demonstrate these four characteris- tics, the next step is to examine the variables that can be used to usefully segment a market see section Consumer behaviour.
Comprehension of consumer buyer behaviour theory is central to the successful develop- ment and application of segmentation criteria.
This section of the chapter will summarise the main sources of influence on consumer buyer behaviour see Figure 4. These influences can be broken down into four major categories: social, personal, psycho- logical and situational.
Cultural norms form the codes that direct behaviour. Therefore in an informal culture such as the USA or the UK the use of first names in a formal business meeting may be acceptable. In other cultures, such as mainline China more formal behaviour would be the norm. Within a larger culture there are obviously some sub-cultures these may be based on religion, nationality, geographical areas or racial groups.
With individuals in lower social groups generally been seen to be more culture bound. Some societies are more hierarchical than others many have a few people in the top and bottom classes with the majority in the middle. However, some societies such as Scandinavia and Japan have much flatter struc- tures see Figure 4.
Some societies are more open than others, that is, individuals can move from one class to another in an open society; in a closed society this is not possible. In western societies social classification has been criticised as a predictor of purchasing behaviour. In the UK a household in the higher AB cat- egory, after paying for a mortgage and private school tuition for their chil- dren, may have less disposable income than a lower category C2 or D household.
There can also be wide discrepancies in purchasing patterns within social groups. Individuals are also influenced by smaller social groups, such as friends, co-workers and family. Individuals will tend to exhibit purchasing behaviour that is deemed to be acceptable by their reference group. Group norms and the role an individual plays within a group exert considerable influ- ence on their behaviour.
Recent research into the behaviour of first time mothers illustrated the power of reference groups in shaping their expectations of the quality of service they would experience dur- ing their stay in the maternity ward.
These reference groups influenced their subsequent behaviour in terms of length of stay and treatment Tinson, This also underlines the power of one key reference group, the family. Attitudes and beliefs in general and patterns of purchasing behaviour in particular are all learnt initially from the family into which an individual is born and raised the family of orientation.
There are moreover purchasing decisions that are taken by the household as a unit which reinforce the family as a key primary reference group.
These factors are commonly used as criteria to segment consumer markets and will be explored in greater detail in section Consumer behaviour of this chapter. Psychological influences Four key psychological factors: those of motivation, perception, learning, beliefs and attitudes are further influences on consumer behaviour. These needs may lie dormant at any particular time but once aroused to a high enough level of intensity they become a motiv- ational force. A motive is a need that has reached a level that drives an individual to search for ways to alleviate its demands.
Moreover as an individ- ual grows up they conform to social norms which requires them to repress a range of desires and passions urges. An indi- vidual proposing to purchase an executive car may claim that this decision is based on the need for quality and reliability, whereas the unconscious desire may be for status.
At the lowest level individuals are driven by basic physiological needs. When individuals are able to satisfy the needs at one level they will be motivated by the needs at the next level in the hierarchy see Figure 4. The implication of the theory for marketers is that individuals will seek different products and services as they move up this hierarchy.
This theory is not universal and is biased towards Anglo-Saxon cultural values, in particular individualism and need for self-development. These needs would not have the same prominence in Japan or Germany were the need for personal security and conformity take a higher priority. These motivation theories therefore have influenced approaches to market segmentation. Segmentation 55 Self-actualisation needs self-development Esteem needs self-esteem, recognition Social needs sense of belonging Safety needs security, protection Physiological needs hunger, thirst Figure 4.
Individuals can have different perceptions of the same stimulus due to the process of selective attention, selective distortion and selective retention: — Selective attention: Individuals cannot observe all the potential stim- uli in the external environment.
Selective attention refers to the ten- dency of individuals to screen out the majority of stimulants to which they are exposed. The tendency to adjust perceptions to conform to their current mindset is called select- ive distortion. Information that reinforces their attitudes and beliefs is more likely to be retained. Perceptual behaviour is relevant to the segmentation process because of its links with learning, attitudes and beliefs.
There are various ways in which learning can take place including conditioning, social learning theory and cognitive learning theory: — Conditioning learning theories: Propose that reinforcement is neces- sary for individuals to develop attitudes and beliefs.
If the experience is negative it is unlikely the consumer will buy the prod- uct again. Individuals may remember the slogan associated with a brand name and form an attitude about its attrib- utes without any direct reinforcement. The study focused on one SME which had undertaken a series of e-business initiatives over a period of 10 years.
The analysis revealed that the firm used e-business in two different ways: e-business for innovation, and e-business for integrating business processes. The study provides a detailed understanding of how the firm used e-business to gain value and how its IT competences influenced its e-business developments.
Abstract : Background of this study was based on the argument that there were correlation between organizational commitment and quality of accounting information system. This study aims to examine: the influence of organizational commitment on the quality of accounting information system. This stud Abstract - Add to MetaCart Abstract : Background of this study was based on the argument that there were correlation between organizational commitment and quality of accounting information system.
This study is theorities study. The hypotheses are: there are significant organizational commitment on the qualityof accounting information system. The results of this study are as follows organizational commitment of information systems significant positive effect on the quality of accounting information systems. Puskesmas is a public health center, that is the most basic health care and cutting edge services in Indonesia. Public health development in Indonesia needs to get more serious attention, especially on the quality of services through Puskesmas.
This study assess the ICT empowerment and provides reco Abstract - Add to MetaCart Puskesmas is a public health center, that is the most basic health care and cutting edge services in Indonesia. Most large enterprises are facing numerous challenges concerning their information systems, IS, and information and communication technology, ICT. Today, many enterprises employ a considerable number of applications that often have redundant functionality.
There is also a large diversification in th Abstract - Add to MetaCart Most large enterprises are facing numerous challenges concerning their information systems, IS, and information and communication technology, ICT. In general, many of the definitions presented in the literature tend to describe SISP as a management practice and process that helps organizations identify as well as select suitable computer-based applications for developing strategic plans and for improving their organizational performance.
Accordingly, the section below presents the development stages of SISP as recorded form the literature. This role has changed significantly over time.
Evolution of IS in organizations are based during the era of the four models [51]. According to this model there are four distinct, though overlapping, IS era, dating back to the 60's. While the initial implementation of a clear focus on the automation of IT tasks and repetitive scholar, a proactive search was conducted on the opportunity to use IT to gain business from the end of the s until s.
Indeed, it was widely accepted that the evolution of IT in the organization to date can be categorized as; data processing DP , management information systems MIS , and strategic information systems SIS [45]. Each era displays different characteristics of the IT and has a different purpose although the purpose of the DP era and MIS is part of the SIS for the purpose of improving competitiveness. Even now, many investments are made in the IT sector for competitive advantage, but not for reasons of efficiency and effectiveness.
While the three perspectives are easy to criticize as an era of over-simple, it has not only proved popular amongst the researchers, but the theory and practice of the frame itself [21, 33, 37]. The 1st Period s The first is data processing DP era, dated back to the s, in which the main emphasis is on automating the basic business transaction and therefore the achievement of efficiency gains for the organization.
Typically, the process automation functions take place by the functions, and thus the idea of planning is based primarily on the basis of the project [50], the system was based on economic criteria with some of the other related systems [45].
During this early period of computerization, the preoccupation was with managing the activity-operations, programming, and data collection. It has been suggested that the early writings of SISP principally focused attention on improving the efficiency of computers and computer management problems in general.
SISP is seen as a problem for the IS function, are relatively isolated from direct business organization [11]. The relationship of IT and strategic planning is essentially developed from the two tendencies, which occurred in the s and the s. The first of these trends began in the early s by pushing a single integrated approach to MIS, which can be used throughout the organization. The 2nd Period s The SISP models developed during this period [13, 35] were based on hierarchical application portfolio model introduced by Anthony, The model was deficient in guidelines for identifying or explaining SISP opportunities and concentrated too much on the issues of the day, rather than on future goals or concerns.
These approaches develop into a second trend, which still exists in organizations today, that is the information system which is interwoven into the management processes of the organization. The 3rd Period s and s Researchers agreed that the s were the beginning of what is widely defined as the strategic information system SIS era, which was characterized by use of desktop computing and SISP that promoted delivery of competitive advantage [51].
However, IT planning activities remained somewhat reactive with regards to organizational strategic determination processes. The internet and globalization have far-reaching effects on the way entrepreneurs think, plan and execute business. Thus, SIS era has completed the links between computer system and the business strategy [48].
In that sense, SISP has become the most critical element in meeting short-to-medium-term needs [50]. The IS capability is expressed in three dimensions: working in harmony, being flexible and reusable IT platform, and an effective use process and fusing business knowledge and IS knowledge.
Concerns have been caused by reactive IS planning and focus on top-down planning [31]. The review of the literature indicates that from a concept, SISP has evolved into a discipline of study and has become an important field of practice. The literature also reveals that there is no one universally accepted definition of strategic information systems planning SISP. Different practitioners, consultants and scholars used different definitions to describe SISP.
In general, however, many of the definitions presented in the literature tend to describe SISP as a management practice and process that helps organizations to identify as well as select suitable computer-based applications for the purpose of developing their strategic plan and for improving their organizational performance. With regard to the development of SISP, the literature indicates that since SISP was introduced in the s, it has evolved through four different stages.
In conclusion, SISP need to be defined precisely and appropriately. A precise and appropriate definition help the Business, government and educational organizations identify the requirement of planning and implementation the SISP. A definition that is accurate and applicable is vital and beneficial to improve not only their performance but also their effectiveness, efficiency and productivity.
It is hoped that this paper has provided some insights and contributions towards the development and advancement of more useful and rigorous research on SISP. Aali, M. March Abu Bakar, F. Bechor, T. A contingency model for estimating success of strategic information systems planning. Information Management, 47, Boynton, A. MIS Quarterly, Collins, R.
Effective Management. Doherthy, N. The relative success of alternative approaches to strategic information systems planning: an empirical analysis. Journal of Strategic Information Systems, 8, Earl, M. Experiences in Strategic Information Systems Planning.
MIS Quarterly, 13 1 , Fitzgerald, E. Success measures for information systems strategic planning. Journal of Strategic Information Systems, 2 4 , Galliers, R. Journal of Information System, 3 3 , Gufroni, A. Information systems strategic planning at the Siliwangi University Tasikmalaya. Gibson, R. Managing the four stages of EDP growth. Harvard Business Review, 52 1 , January—February.
Hammer, M.
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