Setting direction Introduction

An Overview

Purpose: to ensure strategic alignment of the business and its change initiatives. As a result of setting direction you should have:

• a business strategy and vision for the future
• a strategic direction that aligns the business strategy and vision with its plans for change to enable it to achieve outcomes such as improved service delivery, flexibility to cope with change and value for money
• a governance framework for integrated decision-taking
• policies and standards for consistent approaches to the management of change
• an IT architecture that supports business objectives.

Key documents:

• a strategy or strategies setting the direction of business change
• high level plans for realising that strategy
• a governance framework underpinned by management and technical policies
• principal skills required for setting direction:
• business strategy and management
• Information Systems strategy and management
• workspace strategy and management
• Support for business strategy and planning
• Technical strategy and planning

 

What you have to do

Senior management sets the strategic direction for the business as part of business planning, through regular review of the external environment (such as policy initiatives and changes in the business environment). Key features of the strategic direction include:

• the ability to exploit opportunities and respond to external change by taking ongoing strategic decisions
• a mechanism for accountability (to the citizen in meeting their expectations, as well as to the centre in meeting policy targets)
• a coherent framework for managing risk - whether it is balancing the risks and rewards of a business direction, coping with the uncertainties of project risk or ensuring business continuity.

Strategic decisions are not taken in isolation; they are an integrated response to the wider context of the business and its key stakeholders, with a clear understanding of the interdependencies between current and planned programmes of change. The strategic direction positions the organisation to achieve its desired outcomes. It is continually updated through strategic management; this is a continuous activity of setting and maintaining the strategic direction of the organisation and its business, and making decisions on a day-to-day basis to deal with changing circumstances and the challenges of the business environment.

See also the Strategy Management workbook for a more detailed step-by-step approach to this subject.

The figure below shows the main components of setting and managing strategic direction, with the following activities:

• understand the business areas, analysing business needs and how they might be addressed
• establish a clear business strategy and vision for the future
• establish supporting strategies such as IS, HR and workspace and ensure that they are integrated with the business strategy, making business managers aware of their contribution towards business outcome
• understand the potential of new technology developments and how the organisation might benefit from them
• establish a corporate policy on risk management and ensure that risk management is incorporated into planning and decision making processes
• undertake a review of the vulnerability of assets and services and establish a security policy that reflects business objectives
• develop an approach that leads to good governance of information as a corporate asset
• develop a framework for governance that can accommodate multiple goals and changes in priority and facilitates effective strategic management
• focus on the design of policy around outcomes and ensure the organisation derives the maximum benefit from its investment in business change
• recognise the implementation of new ways of working as a business issue; assess the readiness of the organisation and the impact on existing business processes and supporting infrastructure such as the existing workspace provision.

Figure 0:4 Setting and managing strategic direction

Key factors for success:

• new ways of working (such as e-business) are on the board agenda, not relegated as a technology concern only; commitment to sustaining investment in infrastructure, including workspace
• vision and leadership in setting and maintaining strategic direction
• cultural receptiveness to innovation and new ways of working
• thorough understanding of the business, its stakeholders and its environment
• the skills and competencies in place for successful development and delivery of new ways of working staff able to exploit IS and deliver new services
• front and back office technology fully integrated to support service delivery
• information and communication available and accessible to everyone who needs it
• continuous tracking of technologies to identify opportunities for the business.

Roles and process capability for setting direction

Figure 0:5 shows a team model for the roles to support setting direction. It is made up of:

• Business analysis role: development of effective skills and expertise in business thinking
• Risk management role: embedding risk management into the everyday planning and key decision making processes
• Strategic management: creation of a business strategy that sets the direction for change to support the business
• Information management: definition of information strategies for management and business information in consultation with key stakeholders.
• IS governance role: ensuring that the governance of IS/IT fits coherently with the wider organisational governance and that the management and technical policies for governance of IS are designed around the outcomes to ensure that the organisation derives maximum business benefit from its investment in IS/IT.

Figure 0:5 Team model for setting direction

The team model to achieve strategic alignment with business, policy and service goals indicates that the basic or fundamental role required for implementation is one of 'business analysis'. This role is responsible primarily for the development and application of effective skills and expertise in business thinking - that is, to understand the business areas, analyse business needs and how they might be addressed. Competencies in risk management are required to support this analytical role, and the planning and decision making processes. There is a basic requirement for skills in risk assessment to understand the risks associated with a particular course of action. This role is broader than simply analysing business risks; the 'risk management' role is responsible for establishing a corporate policy on risk management and ensuring that risks are considered as an integral part of all planning and decision making processes.

The next level of organisational competencies necessary in 'setting direction' are in the areas of 'information management' and 'strategic planning'. The role of 'information management' is to ensure that information is recognised as a business asset and is managed as a business resource. There are a number of technical management aspects associated with this role including those of security and data privacy. The 'strategic planning' role is a precursor to strategic management. The role is responsible primarily for establishing and maintaining a strategic vision and the agenda for change.