Execution of the Business Strategy and True Enterprise Architecture as Keys to Success - Literature review Example

Strategic Analysis and Selection of Information Systems Introduction Many companies analyze their strategic initiatives after it is too late to do any good for the current fiscal period. If the analysis shows good results, meaning the initiatives were a success, then the companies try to find out what to attribute that success to. In contrast, however, if the initiatives fail, companies then utilize that information in order to learn from their mistakes. It is natural for managers to look back on what they have done in the past and wish they would have done something differently, but important lessons can be learned when one analyzes strategies that failed once they were implemented. For the purpose of this assignment, two articles will be reviewed for inclusion into the essay. The first is Collaborative Computing and True Enterprise Architecture is Still Two Years Away, by Worthen and the second is B2B: Execution of the Concept is Key to Success by M. Sawhney. The purpose of this assignment is to explain the relationship between business strategy in IT strategy, determine any problems that occurred with strategy formulation, determine if there were problems with strategy implementation, and determine if there were problems with the strategic process. Strategy, Strategy Formulation, and Strategic Process In order to fully understand the concepts presented in this assignment, it is first essential to know the definition of the words that will be discussed herein. Strategy can be defined as "a long term plan of action designed to achieve a particular goal, most often "winning". Strategy is differentiated from tactics or immediate actions with resources at hand by its nature of being extensively premeditated, and often practically rehearsed. Strategies are used to make the problem or problems easier to understand and solve" (Wikipedia, 2008). Strategy formulation then can be defined as "the process of determining appropriate courses of action for achieving organizational objectives and thereby accomplishing organizational purpose" (Kotelnikov, 2008). Strategic processes are made up of macro processes within an organization. "All organizational work is part of one or more processes. At their very broadest, macro processes can span an entire organization and cut across all major functions or departments. Examples of macro processes include the design and development of new products/services; producing products or delivering services; product order or service request fulfillment; invoicing/accounting, and collecting money; inventory management and logistics; information management; admitting, discharging, and transferring patients; or generating leads and making sales" (Clemmer 2008). Article 1 B2B: Execution of the Concept is Key to Success, by Mohanbir Sawhney Problems with Strategy Formulation When forming their strategy, "Their logic seemed elegant: create marketplaces that would match buyers and sellers, bringing improved liquidity, efficiency and transparency to B2B transactions, and make money through transaction fees from the trades, Once the buyers and sellers were on board to conduct transactions, the exchanges could augment that core functionality with value-added services such as logistics management, credit and settlement, and supplier verification" (Sawhney, 2002, p. 1). Yet, the B2B boom that was supposed to happen did not. This happened when investors started to question the business model upon with the new B2B concept was based. In other words, it was not the strategy formulation that was the problem; it was the strategy implementation. Problems with Strategy Implementation The article says itself, "One might conclude from the evidence that the idea of a B2B exchange is fundamentally flawed. However, it's not the concept of the exchange that is flawed but the execution of that concept" (Sawhney, 2002, p. 1). The article cites the chicken-and-the-egg concept as the reason for the failure of the B2B concept; i.e. it is hard to get buyers without suppliers and it is hard to get suppliers without buyers. B2B exchanges never made it past that first step. "But the struggle for liquidity is merely a symptom of the real problem, which is that the creation of exchanges to match buyers and sellers preceded the creation of software and services that would make exchanges truly useful. That amounted to putting the cart before the horse. B2B exchanges should have begun by solving a focused business problem one customer at a time" (Sawhney, 2002, p.1) That leads to problems with the strategic process. Problems with the Strategic Process If a company makes the decision to take the approach described above, that means that doing business goes far beyond simply facilitating business transactions. These transactions, after all, are more than just purchases and/or sales. Finding suppliers and buyers is not the real problem that organizations face; rather, it goes deep into strategic processes. "It is improving the efficiency and effectiveness of the processes by which they interact with existing suppliers and partners. Those processes start deep within the enterprise and extend outward to customers, suppliers and channel partners" (Sawhney, 2002, p. 1). Article 2 Collaborative Computing and True Enterprise Architecture is Still Two Years Away, by Ben Worthen Problems with Strategy Formulation Lowry's strategy may not be far-fetched for a company who regularly invests in information technology. His strategy states, "Jack Lowry has a dream: a manufacturing company where integrated, enterprisewide information systems reduce costs, cut cycle times and allow different companies to collaborate on product design and production. Lowry imagines a level of collaboration that goes well beyond the simple sharing of blueprints and computer-aided design (CAD) files; he dreams of linking ERP, product data management and whatever other systems contain critical manufacturing data, thereby granting collaborators real-time access to everything from inventory to financials to last-minute product changes" (Worthen, 2001, p. 1). Problems with Strategy Implementation The company's partners and the members of its supply chain are not ready to launch the system. They are afraid. After all, the company has not made a significant information technology investment in 25 years and now they are wanting the best out there. Problems with the Strategic Process Lowry's process will take time to catch on. He is operating about two years ahead of the curve. Once his practice becomes more widespread among other companies, suppliers and partners are likely to grasp on to the idea. For now, they are afraid because they could end up losing their jobs. Conclusion Even though a company may not be able to change its bad fortune in hindsight, it can learn from its mistakes. All the company has to do is utilize the information that they learned from making the incorrect decision in the past. Important lessons can be learned when a manager takes the time to go back and thoroughly analyze strategies that failed once the company decided to implement them. The articles discussed herein have provided two examples of this. References Clemmer, Jim. "Strategic Process Management." (2008). Clemmer Consulting. Online. http://www.clemmer.net/consulting/consulting_strategic.aspx Kotelnikov, Vadim. "Strategy Formulation: Selecting and Implementing the Best Suited Strateg." (2008). 1000 Ventures. Online. http://www.1000ventures.com/business_guide/strategy_formulation.html Sawhney, Mohanbir. "B2B: Execution of the Concept is Key to Success." (2002). CIO. Online. http://www.cio.com/archive/051502/netgains.html "Strategy." Wikipedia. (2008). Online. http://en.wikipedia.org/wiki/Strategy Worthen, Ben. "Collaborative Computing and True Enterprise Architecture is Still Two Years Away. (2001). CIO. Online. http://www.cio.com/archive/101501/nobody.html Read More