BETTER IT GOVERNANCE FOR ORGANIZATIONS

A Model for Improving Flexibility and Capabilities of Strategic Information

Systems Planning (SISP) through EA and BPR under e-Business Environment

Jungho Yang

Caulfield School of Information Technology, Monash University, Caulfield East, Victoria, Australia

Keywords: IT Governance, Strategic Information Systems Planning (SISP), Enterprise Architecture (EA), Business

Process Reengineering (BPR).

Abstract: Within more turbulent, and increasingly globalized and digitalized environments, Strategic Information

Systems Planning (SISP) has been recognized as one of the most significant factors for effective and

efficient IT governance to improve organizations’ effectiveness and capabilities by changing the

characteristics or overall governance of organizations. Although organizations have been introduced,

various well-known methodologies for creating the SISP successfully to maximize their strategic

opportunities and values, the current literatures indicate that there is no perfect and fully comprehensive

methodology or model to make organizations satisfactory. The purpose of this paper is to propose a model

that can complement issues of the existing model and support improved flexibility and capabilities, and at

the same time minimize waste and systems inconsistency by incorporating EA, BPR and concurrent

approach. On-going research will be a case study to validate the proposed model in the government of

Korea and to seek for other potential issues and factors compared with other sectors.

1 INTRODUCTION

In the last few years, the rapid progress in

information technology capabilities, as well as both

internal and external environment of organizations

has continued to proceed and transform as the

remarkable degree and they are greatly increasing

environmental complexity and uncertainty.

Organizations are trying to change industry

structures, create strategic goals, performance and

competitive position, and spawn new businesses as

well as continuously shaping and reshaping the

business environment through a powerful

interdependency between business and IT that is a

specific focus on IT Governance (Porter, 2001; Chi

et al., 2005; Grover and Segars, 2005; Peterson,

2004).

To achieve more effective and efficient IT

Governance under the e-business environment,

several requirements should be positively considered

to all organizations that the top management’s

leadership, an establishment of strategic and

systematic planning, and rigid alignment and

integration of organizational structures and

processes that ensure that the organization’s IT

sustains and extends the organization’s strategy and

objectives, because it is the single most important

determinant of IT value realization (Peterson, 2004;

Van Grembergen et al., 2004). Hence, boards and

business executives of an organization have

recognized that Strategic information systems

planning (SISP) can be an indispensable application

for organizations to succeed both a proactive search

for competitive and value-adding opportunities, as

well as the development of broad policies and

procedures for integrating, coordinating, controlling

and implementing the IT resource in today’s e-

business environment (Grover and Segars, 2005;

Newkirk et al., 2003). They have also invested vast

amounts of time and capital in SISP projects to

introduced a number of well-defined, documented

planning models and methodologies, such as

Business Systems Planning, Information

Engineering and Critical Success Factors that can be

customized or develop in-house methodologies

suitable for the organization. In practice, SISP has

provided various advantages and benefits for

organizations and with the emergence of end-user

computing and client-server architectures, the

contemporary agenda of SISP has expanded even

Yang J. (2008).

BETTER IT GOVERNANCE FOR ORGANIZATIONS - A Model for Improving Flexibility and Capabilities of Strategic Information Systems Planning

(SISP) through EA and BPR under e-Business Environment.

In Proceedings of the Tenth International Conference on Enterprise Information Systems - ISAS, pages 30-41

DOI: 10.5220/0001683400300041

 SciTePress

further to include the development of organizational

and inter organizational architectures for the sharing

data and integration of technologies (Segars et al.,

1998).

However, even though organizations’ endeavour

and the advancement of SISP, many researchers

have pointed out that organizations have

experienced failures from the methodologies due to

several issues such as limiting planners’ knowledge,

involvement and commitment of senior

management, time and planning horizons, cost

budget overrun and poorly defined and integrated

business objectives (Chi et al., 2005; Griffiths and

Hackney, 2001; Hartono et al., 2003; Hevner et al.,

2000; Palanisamy, 2005; Pant and Hsu, 1999; Petel,

2004). Pant and Ravichandran (2001) emphasize that

these existing methodologies tend to be too detailed,

time-consuming, and expensive, so organizations

often find methodologies unsuitable for dealing with

the high unpredictability and diversity of the

environment change (Newkirk and Lederer, 2006) as

well, they are not appropriate to deal with integrated

views of the entire organization in current business

practice (Pant and Ravichandran, 2001; Jonkers et

al., 2006). In particular, IT Governance in current

dynamic and turbulent business environments cannot

only be accomplished with the traditional models of

aligning IT strategy with business strategy and needs

to deliberate to meet organizations’ impending and

forthcoming IT-business challenges and

requirements simultaneously (Newkirk et al., 2003;

Petel, 2004), so that the developed methodologies

are not sufficient to fulfil flexibility and capabilities

that are the latest IT issues.

Therefore, to set up better and more effective IT

Governance, the existing methodologies need to be

complemented as more comprehensive planning is

available to contain the following factors:

considering internal-external environments of

business and IT from the primary stage, aligning

business strategy with IT strategy, securing business

opportunity that can be proposed from IT strategy as

well as integrating and standardizing of processes

and systems which are already developed and

implementing in the future. Enterprise Architecture

(EA), Business Process Reengineering (BPR) and

concurrent approach can specifically be required to

supplement the issues mentioned above, to develop a

practical long-term approach or model based on

improving organization’s flexibility and capabilities

as well as to minimize duration of time. EA provides

the “blueprint” for systematically defining an

organisation’s current or future environment and a

long-term view of a company’s processes, systems,

and technologies through the integration and

standardization requirements of the company’s

operating model so that organizations can build

capabilities (Jonkers et al., 2006; Ross et al., 2006).

Also, implementing IT strategy based on BPR can

create more flexible, team-oriented, coordinative,

and communication-based work capabilities

(Attaran, 2004; Hammer and Stanton, 1995; Ward

and Peppard, 2002).

In this paper, we propose a model for SISP to

complement existing methodologies by

incorporating EA, BPR and concurrent approach.

We also review the theoretical perspective of IT

Governance and SISP, as well as its success and

relationship between IT Governance and SISP in

section 2. In the next section, we briefly analyze

existing methodologies for SISP and their key

problems, at the same time display what are EA and

BPR, and why should they need to implement the

long-term strategic planning for IT Governance.

Section 4 presents the proposed model which

incorporates EA, BPR and concurrent approach as

well as justifies its characteristics and compares it

with the existing methodologies. Finally a

conclusion and further work is presented in Section

2 LITERATURE REVIEW

2.1 IT Governance

Amidst the challenges and changes of the 21st

century, the pervasive use of information, systems,

and technology has created a critical dependency on

IT, so that IT governance has become a fundamental

business imperative (IT Governance Institute, 2005;

Peterson, 2004). IT Governance is all mainly

focused on the same issues, such as the link between

business and IT, and that specifying the decision

rights and accountability framework to encourage

desirable behaviour in the use of IT (Van

Grembergen et al., 2004; Weill and Ross, 2004).

Although IT Governance is a topic that has recently

been rediscovered, it is ill-defined and consequently

blurred at the edges as yet. Van Grembergen et al.

(2004) present that there are three IT Governance

definitions that have frequently mentioned in

literatures as follows:

• IT Governance is the responsibility of the board

of directors and executive management. It is an

integral part of Enterprise Governance and

consists of the leadership and organizational

structures and processes that ensure that the

BETTER IT GOVERNANCE FOR ORGANIZATIONS - A Model for Improving Flexibility and Capabilities of Strategic

Information Systems Planning (SISP) through EA and BPR under e-Business Environment

organization’s IT sustains and extends the

organization’s strategies and objectives (IT

Governance Institute, 2001);

• IT Governance is the organizational capacity

exercised by the board, executive management

and IT management to control the formulation

and implementation of IT strategy and in this

way ensure the fusion of business and IT (Van

Grembergen, 2002);

• IT Governance is the system by which an

organization’s IT portfolio is directed and

controlled. IT Governance describes (a) the

distribution of IT decision-making rights and

responsibilities among different stakeholders in

the organization, and (b) the rules and

procedures for making and monitoring decisions

on strategic IT concerns (Peterson, 2004).

Hence, IT Governance is a senior management

responsibility and specifies the structure and

processes through which the organization’s IT

objectives are set, and the means of attaining those

objectives and monitoring performance (Peterson,

2004; Weill and Ross, 2004). Contrary to IT

management is focused on the internal effective

supply of IT services and products and the

management of present IT operations, IT

Governance in turn is much broader. It concentrates

on performing and transforming IT to meet present

and future demands of the business (internal focus)

and the business’ customers (external focus) (Van

Grembergen et al., 2004). Also, Governance

determines who holds the decision rights for how

much the enterprise invests in IT, while management

is the process of making and implementing the

decisions and determines the actual amount of

money invested in a given year and the areas in

which the money is invested (Weill and Ross, 2004).

In particular, Peterson (2004) accentuates that “This

does not undermine the importance and complexity

of IT management,…, but whereas elements of IT

management and the supply of (commodity) IT

services and products can be commissioned to an

external provider, IT Governance is organization

specific, and direction and control over IT can not be

delegated to the marker.”

The purpose of IT governance is to direct IT

endeavours to ensure that performance meets the

objectives such as IT activities are aligned with the

business, value delivery of IT, IT resources

management, business and IT-related risks are being

managed appropriately and performance

measurement of IT. IT governance also plays an

important part in the total governance responsibility

of the board of directors and executive management,

and is an integral part of enterprise governance.

Leadership and their associated organizational

structures are needed to ensure that the

organization’s IT can sustain and extend the

organization’s strategies and objectives (IT

Governance Institute 2005), so it needs to involve

building professional IT capabilities that are able to

offer business strategic advantages.

Therefore, good IT governance harmonizes

decisions about the management and use of IT with

desired behaviours and business objectives. Without

carefully designed and implemented governance

structures, enterprises leave this harmony to chance

(Weill and Ross, 2004). The value contribution of IT

can be determined by considering facets of global IT

Governance, such as (1) develop an IT strategy, and

undertake critical strategic and operational reviews,

(2) develop and manage the distributed IT/IS

systems, (3) define methods, tools, and processes,

(4) define best practices and manage application

development, (5) manage outsourced providers and

multi-site procurement policies, (6) develop key

performance indicators, (7) critically review current

organization structures and capability and implement

cost savings to improve efficiency and effectiveness

(Petel, 2004).

2.2 SISP and SISP Success

As indicated above, organizations are aggressively

searching for new ways to leverage information,

knowledge and IT in supporting strategic goals and

competitiveness, the need for effective strategic

information systems planning (SISP) has become

more and more critical (Grover and Segars, 2005;

Hartono et al., 2003; Newkirk and Lederer, 2006).

SISP has been defined and studied empirically as the

process of identifying a portfolio of computer-based

applications to be implemented, which is both highly

aligned with corporate strategy and has the ability to

create an advantage over competitors (Doherty et al.,

1999) and the process of identifying a portfolio of

computer-based applications that will support an

organization’s business plans, thus enabling the

organization to align its IS with its business needs

and achieve its business goals (Reich and Benbasat,

2000).

SISP is, therefore, an exercise, or ongoing

activity, that enables organisations to develop

priorities for IS development and to help the

organization reach its goal of improved

competitiveness, operations, and resource

management (Chi et al., 2005; Newkirk and Lederer,

2006). SISP can contribute substantially to an

ICEIS 2008 - International Conference on Enterprise Information Systems

organization. It can help the organization develop

priorities for information systems development by

ranking such systems in terms of their efficiency,

effectiveness, and strategic value (Hartono et al.,

2003). SISP also can help organizations to perform

the planning as an organizational learning process in

order to anticipate environmental uncertainty and

dampen its detrimental effects. For such reason,

several researchers mention that SISP can be viewed

as having evolved into a knowledge management

(KM) activity (Hartono et al., 2003; Newkirk and

Lederer, 2006). Accordingly, SISP is an important

activity for information executives and top

management and becoming one of the most critical

issues facing them (Chi et al., 2005; Doherty et al.,

1999; Grover and Segars, 2005; Hartono et al., 2003;

Hevner et al, 2000; Newkirk et al., 2003; Newkirk

and Lederer, 2006; Palanisamy, 2005; Segar et al.,

1998; Teubner, 2007).

In general, SISP activities require substantial

resources in terms of managerial time and budgets,

and specific projects are chosen for their alignment

with business objectives or their capacity to create

significant impact on the organisation’s competitive

positioning (Segar and Grover, 1998). Therefore, the

process must deliver benefits to sustain and

contribute positively for organizational effectiveness

as well as must require considerable management

coordination to inspire creativity and innovation.

The primary objectives of SISP is to align the

organization’s business strategy with its IS/T

strategy, to achieve an organization’s business

objectives, to identify opportunities for exploiting

information and to utilize IS for creating and

sustaining competitive advantage by integrating,

coordinating, controlling and implementing the IT

resources (Doherty et al., 1999; NewKirk et al.,

2003; Ward and Peppard, 2002). The outcome of the

SISP process is a strategic IS plan containing the

technology architecture plan and the applications

architecture plan (Satzinger et al., 2007). The

technology plan includes the types of hardware,

software and communications networks required to

implement all of the planning systems, and the

applications architecture plan may contain Strategic

Information Management System (SIMS), Supply

Chain Management (SCM) and Customer Support

System (CSS) to carry out specific business

functions.

Accordingly, measuring how well SISP was

carried out and how planning has improved over

time is a complex exercise and must incorporate

consideration of these intangible process

contributions and in this context, SISP success can

be viewed as the degree of attainment of the

objectives of SISP (Segars and Grover, 1998). They

have also shown SISP success to be comprised of

four dimensions of objectives which they referred to

as alignment, analysis, cooperation, and

improvement in capabilities. Alignment refers to the

results of the linkage of the IS strategy and business

strategy, analysis concerns the results of the study of

the internal operations of the organization,

cooperation refers to the results of the general

agreement about development priorities,

implementation schedules and managerial

responsibilities, and the fourth dimension,

improvement in capabilities, represents the

enhancement of the potential of the planning system.

In particular, Ward and Peppard (2002) note that

some of the key factors that seem to recur and

underpin success for SISP, such as (1) external, not

internal focus, (2) adding value, not cost reducing

(3) understanding customers, (4) Business-driven

innovation, rather than technology-driven. Chi et al.,

(2005) also describe that in the current study, SISP

success was defined as a combination of the extent

to which an organization achieved each of its

objectives such as aligning IT with business needs,

and forecasting and allocating IT resources.

Therefore, successful SISP should help achieve

alignment between IS and business strategies,

analyse and understand the business and its

associated technologies to compete via an

architecture of integrated applications and databases,

foster cooperation and partnerships among

functional managers and user groups. SISP also

should encourage organizations to anticipate

relevant events and issues within the competitive

environment to reduce the possible conflicts that

may put SISP implementation at risk, and adapt to

unexpected organizational and environmental

change.

3 METHODOLOGIES OF SISP,

EA AND BPR

3.1 Review of the Existing

Methodologies and its Issues

To perform SISP study, in general, organizations

typically conduct a major, intensive multi-phase

study with the highest level of an organization for a

longer time frame. Because the project involves

major changes for organizations such as (1) defining

new business strategies, technologies, policies and

BETTER IT GOVERNANCE FOR ORGANIZATIONS - A Model for Improving Flexibility and Capabilities of Strategic

Information Systems Planning (SISP) through EA and BPR under e-Business Environment

architectures, (2) improving adaptability to align IS

and business strategies, (3) the capabilities of

existing internal and external systems, (4) flexibility

of organizational and environmental changes as well

as cooperation among managers, other users and

systems developers (Chi et al, 2005; Hartono et al,

2003; Lederer and Salmela, 1996; Pant and Hsu,

1999). Accordingly, the choice of a SISP

methodology can be a critical issue on the IT

governance agenda (Doherty et al, 1999, Petal,

2004). Organizations follow one of several well-

defined and documented planning methodologies or

hire an IS consulting company to customize their

own methodology.

Ward and Peppard (2002) indicate that basic

approaches of many methodologies have much in

common, but they differ considerably in detail.

Many components of SISP methodologies are also

believed that more than one approach should be used

to derive business plans and goals, current IS

provision and use, and IT opportunities. In general,

there are a broad variety of governance mechanisms

for the two high level components to achieve the

business/IT fusion that are alignment and impact

(Vitale et al., 1986; Van Grembergen et al., 2004).

In addition, Earl (1989) proposed three approaches

for SISP formulation such as top-down, bottom-up

and inside-out. Consequently, based on considering

both alignment and impact, models, frameworks and

approaches have been developed to incorporate

these aspects such as Business Systems Planning

(IBM Corporation, 1975), Information Engineering

(Martin, 1989) for alignment model and Critical

Success Factors (Rockart, 1979) for impact model.

First, BSP combines top-down planning with

bottom-up implementation, and focus on

organizations’ business process to derive data needs.

In particular, information architecture is obtained

from BSP through functional area analysis.

Similarly, IE is more data-oriented and provides

techniques for building enterprise, data and process

models. These models are combined to form a

comprehensive knowledge base that is used to create

and maintain information systems. Also, CSF

methodology is used for identifying key information

requirements for the success of the organization and

its managers. Mainly, the methodology focuses on

key information needs of senior management and

builds information systems around those key needs

(Palanisamy, 2005; Pant and Hsu, 1999; Pant and

Ravichandran, 2001).

However, as technology continues to change,

grow and become more complex, the process for

SISP has become complex and difficult to handle.

Several researchers point out that BSP and IE tend to

be too detailed, expensive and time-consuming.

These alignment methodologies also fail to

explicitly address such integration issues, and

unsuitable for the highly compressed development

cycle times. Petal (2004) remarks that the

fundamental difference between the new models and

traditional view of aligning IT support or

transforming business is that in the new fused e-

businesses, IT is integrated into business activity. In

addition, CSFs methodology focuses more internal

sources and ignores value adding aspects of IS, so

not comprehensive and creative (Palanisamy, 2005;

Pant and Hsu, 1999; Pant and Ravichandran, 2001).

Accordingly, many times organizations face IS

failures because of IS rigidity and passiveness and

they perceive that there is no one methodology

superior to another in all situations regardless of

techniques or related products (Cerpa and Verner,

1998; Hartono et al., 2003; Palanisamy, 2005).

Griffiths and Hackney (2001) also claim that the

methodologies which are based on a structured and

inflexible method-oriented approach may not be the

most appropriate for exploiting SIS.

Furthermore, several researchers have noted that

organizations focus upon the role and effectiveness

of specific planning methodologies and frameworks,

rather than to consider the broader set of practices

which influence the application of planning within a

specific organization, so they often fail to take into

account other important aspects of the process of

SISP such as the level of participation, the

ownership of the project or the focus of the planning

exercise (Earl, 1993; Segars et al., 1998; Peppard

and Ward, 2004). Griffiths and Hackney (2001) also

assert based on some literatures that the high failure

rate of SIS applications in business is deemed to be

largely of a managerial rather than a technical

causation. Likewise a number of research studies

have examined the implementation approaches of

organizations to identify the main issues. The

research literatures present a number of specific

implementation issues can be identified and

implementation issues cannot be separated from the

strategic planning process (Cerpa and Verner, 1998;

Chi et al., 2005; Gottschalk, 1999; Griffiths and

Hackney, 2001; Hartono et al., 2003; Karimi, 1988;

Lederer and Sethi, 1991; Teo and Ang, 2001; Ward

and Peppard; 2002), as follows: (1) Lack of top

management commitment, (2) Lack of top

management support and understanding, (3) Lack of

user involvement to projects, (4) Poorly defined

business objectives caused by inadequate

appreciation of the business’s needs, (5) Poor level

ICEIS 2008 - International Conference on Enterprise Information Systems

of communication between users and IS staff, (6)

Serious cost budget overruns due to insufficient

understanding of the project, (7) Ignoring the IS plan

once it has been developed, and (8) SISP planning

time horizon.

Over the past few years, the approach for

enterprise governance has evolved towards a

balanced or reconciliation between competitive

positioning and resource or competence-based

strategy. As ‘strategic thinking’ that is opposed to

strategic analysis or planning, begins to emerge, it is

getting more difficult task for organizations to deal

with all status quo and issues mentioned above by

just introducing the alignment and impact

approaches in unpredictable business environmental

changes. Therefore, organizations need to develop

and implement better methodologies to complement

the existing one that can suggest the long-term

prosperity of the organization by a realignment of

the organization’s resources and capabilities to

match the demands of the environment including

assets, skills, knowledge processes and culture, etc.

The supplementary model for effective and efficient

IT Governance must also have the ability to pacify

intentional changes and adapt to environmental

changes in current strategic action, that is,

flexibility.

3.2 Enterprise Architecture (EA)

As mentioned earlier, with the rapid proliferation of

Internet and web-enabled technologies, global

connectivity and the changes it supports are perhaps

the most significant component of the current

paradigm realignment. Through connectivity with

the IT and Internet, an enterprise is able to conduct

business anywhere, anytime – eclipsing the

traditional constraints of time, distance, and location.

Many organizations are now also focusing on their

core competencies, or what they can do best, and

extending their business processes by teaming with

networks of similarly focused patterns and sharing

services (IT Governance Institute, 2005).

Accordingly, Enterprise Architecture (EA) can

be one of the hottest topics on the agenda of IT

organizations. Ross and Weill (2006) define the EA

as ‘the organizing logic for business processes and

IT infrastructure, reflecting the integration and

standardization requirements of the company’s

operating model.’ The EA provides a long-term

view of a company’s processes, systems, and

technologies in order to build capabilities – not just

fulfill immediate needs, as well as the framework for

ensuring that enterprise goals, objectives, and

policies are properly and accurately reflected in

decision making (IT Governance Institute, 2005;

Ross et al., 2006; Weill and Ross, 2004). Hence,

hard decisions regarding resources, investments,

information, applications and technology all require

EA. In addition, it has greatly changed the focus of

the chief information officers (CIOs), so senior

management views EA as a critical component for

making decisions that are consistent with the

strategic plan for their organization, because EA can

remove the boundaries between business and IT

planning, and the business architecture dictates the

shape of the IT environment and supports effective

IT governance. As a key planning discipline, it helps

guide and optimise an organisation’s IT investments

and translate business strategies into implementable

technology solutions. The most important

characteristic of EA is that it provides a holistic view

on the enterprise (Jonkers et al., 2006).

To shape IT capabilities, an operating model for

EA is mainly classified with two dimensions, such

as business process standardization and integration.

Standardization of business process and related

systems means defining exactly how a process or

where is it is completed, and it delivers efficiency

and predictability across the organization by a

reduction in variability. In addition, integration links

the efforts of organizational units through shared

data. This sharing of data can allow the organization

to present a single face to customers. The benefits of

integration include increased efficiency,

coordination, transparency, and agility. An

integrated set of business processes can improve

customer service, provide management with better

information to make decisions, and speed up the

overall flow of information and transactions through

a company. Currently, most EAs specify

infrastructure, data, and applications as a stable

platform supporting faster-changing applications to

build flexibility into their architectures (Ross et al.,

2006; Weill and Ross, 2004).

Therefore, a specific focus on EA can be

required by CIOs to assume the governance

responsibility of ensuring that EA is used to identify

problems addressed by architecture and uses the

architecture to do the following: (1) make decisions

– to ensure that information systems are available to

enhance the enterprise’s ability to guide decision

making and inter-process communication, at the

same time ensure that information systems will be

consistently or appropriately applied across the

enterprise, (2) manage change – to ensure that IT is

able to deal with the high rate of change in today’s

complex information environment and to accurately

BETTER IT GOVERNANCE FOR ORGANIZATIONS - A Model for Improving Flexibility and Capabilities of Strategic

Information Systems Planning (SISP) through EA and BPR under e-Business Environment

represent the enterprise’s goals, objectives, and

policies, (3) improve communications – to ensure

information systems have a clear picture of the inter-

relationship among the systems and adequately

communicate linkages between the systems and (4)

ensure information systems and information

resources are managed to be consistent with business

planning – to maintain current with the capability of

new technologies, and support the business

strategies in rapidly changeable environments (IT

Governance Institute, 2005).

3.3 Business Process Reengineering

(BPR)

Organizations have also continued their

investigation of re-engineering that often begins by

looking for detailed methodologies and supporting

tools to govern them through the process. The term

“reengineering” first appeared in the information

Micheal Hammer and James Champy (1993)

defined BPR as the analysis and redesign of

workflow within and between enterprises, as well as

promoted the idea that sometimes radical redesign

and reorganization of an enterprise is necessary to

lower costs and increase quality of service and that

IT is the key enabler for that radical change.

Working together, BPR and IT have the potential to

create more flexible, team-oriented, coordinative,

and communication-based work capability.

IT is more than a collection of tools for

automating or mechanizing processes. It can

fundamentally reshape the way business is done and

enable the process design. In leading edge practices,

IT makes BPR possible and worthwhile (Attaran,

2004). The aim of BPR approach is quick and

substantial gains in organizational performance by

redesigning the core business process. The

motivation was usually the realization that there was

a need to speed up the process, reduce needed

resources, improve productivity and efficiency, and

improve competitiveness. Another reason for BPR

relates to the increasing emphasis placed on

integrating business web sites with backend legacy

and enterprise systems, as well as organizational

databases. Hence, BPR requires taking a broader

view of both IT and business activity, and of the

relationships between them. IT capabilities should

support business processes, and business processes

should be in terms of the capabilities IT can provide

(Broadbent et al, 1999; Hammer and Stanton, 1995).

BPR is not a strategy but a strategic action, and it

is the means of changing strategies in response to a

changing environment, where continuous or

incremental change is insufficient. It also requires a

clear understanding of customers, market, industry

and competitive directions. Furthermore, like any

other strategic action, it requires consistency

between the company’s business strategy and vision.

Defining business strategy and developing a

strategic vision requires understanding the

company’s strengths and weaknesses, and the

market structure and opportunities. In particular,

many organizations ignore IT capabilities until after

a process is designed. An awareness of IT

capabilities can and should influence process design

(Attaran, 2004; Ward and Peppard, 2002).

Therefore, the relationship between IS/IT

planning and BPR enables a reconciliation of the

fundamental questions of impact and alignment of

IS/IT strategy development with the rationale for

reengineering initiatives such as how can IS/IT be

exploited to provide business advantage (impact)

and how can IS/IT ensure the success of the business

strategy (alignment) (Attaran, 2004; Hammer and

Stanton, 1995; Ward and Peppard, 2002). The

redesign of business process through BPR is

pertinent to consider the topic alongside the

development of an IS strategy, for a number of

reasons:

• In developing the IS strategy, a thorough

understanding of the business strategy is

essential. Most re-engineering initiatives will

spring from, and be part of, the business

strategy;

• Most, if not all, re-engineering initiatives have a

significant IS/IT element, which will be

accommodated in the IS strategy, and need to be

allocated the same priority that the business

places on the change program;

• There is a common need in both IS strategy

development and business re-engineering to

build up a model of the business as it currently

exists and other potential of how it will look

following transformation or evolutionary

change;

• Success in re-engineering, as with the

development and implementation of an IS/IT

strategy, demands a strong business-IS function

partnership;

•

Designing or redesigning business processes to

take advantage of IS/IT capabilities is essential

if the traditional problems of automating poorly-

designed processes or inefficient work practices

through IT are to be avoided.

ICEIS 2008 - International Conference on Enterprise Information Systems

4 PROPOSE A MODEL TO

ENHANCE FLEXIBILITY AND

CAPABILITIES OF SISP

Although, models, frameworks and approaches for

the process of strategic IS/IT planning formulation

have been developed to incorporate both alignment

and impact, and the success factors for this process

have also been determined, problems of SISP

mentioned so far are closely related to

methodologies itself, planning process, managerial

and implementation issues. In addition,

technological aspect such as database, hardware,

application and systems can be equally important.

Accordingly, we need to look into several issues that

haven’t been considered in the existing methodology

to develop an improved model as follows:

(1) Insufficient consideration of both

alignment and impact: most methodologies only

focus on alignment, so does not consider the

potential impact of IS/IT on organizational tasks and

processes as well as not fitting into an integrated

business plan. It means that it is somewhat hard for

organizations to harmonize both alignment and

impact in the methodologies. As more organizations

are transforming into e-businesses, it has been a

challenge for them to understand how businesses

create and sustain competitive value from their IT

investments (Peterson, 2004). Hence, it is needed for

organizations to consider the interaction of

alignment and impact simultaneously for more

comprehensive approach. In essence, a

comprehensive methodology for SISP should be

able to incorporate both the impact and the

alignment views. Method/1 incorporates Value

Chain Analysis, IE supports Critical Success Factors

Analysis and even BSP also incorporates CSF to

complement their one-way approach (Pant and Hsu,

1999).

(2) Lack of sufficient analysis of external

business-IT environments: By focussing mainly on

analysing the internal environment and data

processing, it can be difficult for organizations to

adapt to rapidly changing or emerging

circumstances. To respond to environmental

fluctuations, organizations need to realize the change

in information requirements. Presence of flexibility

in IS that handles special situations in organizational

information requirements and enables organizations

to tackle these fluctuations successfully by adapting

to the environmental forces (Pananisamy, 2005). To

develop effective and competitive strategic IS

planning, therefore, both internal and external

business-IT environment should be considered

together in stages from the early stage of planning

until the planning process is implemented;

(3) Deficiency of effort for increasing of IS

and organizational capabilities through EA and

BPR: most existing methodologies that use top-

down approaches have a fixed structure.

Accordingly, making it difficult to change a process,

to implement organization-wide policies and

minimize redundancy and system inconsistencies

once the project is completed. However, lack of

support for EA is apparent in existing methodologies

such as BSP, IE and CSFs, this may accelerate

future difficulties of inconsistencies and confusion

and hinder an organization’s ability to meet

customer needs efficiently if SISP is carried out

without the prior benefit of an EA (Hartono et al.,

2003). Thus, EA and BPR are essential for

establishing a long-term view of a company’s

processes, systems, and technologies in order to

build and strengthen capabilities and flexibility;

(4) Difficulty of a reduction of excessive

duration for developing SISP: to implement SISP

projects, in general, BSP takes 8-21 months, IE

needs 10-12 months to finish and sometimes it takes

over 2 years to complete, according to the scale of

the project. Accordingly, an organization’s concerns

and priorities may have changed enough to render

the activities outdated (Flynn and Arce, 1995;

Lederer and Salmela, 1996). Present methodologies,

however, do not consider whether the stages can be

accomplished concurrently. They may also have a

step for creating a workout plan and are designed in

a sequential form. If a methodology is formulated as

a concurrent way to utilize related or similar

processes at the same time, the duration of the SISP

process can be significantly reduced contrary to

other methodologies (Min et al., 1999). Thus, this

model introduces a concurrent approach as a way to

minimize duration of time.

Therefore, we propose an overall SISP model as

shown in Figure 1 which can provide a structure for

sorting out the interrelationships of strategic issues

and at the same time maintain the advantages of

existing methodologies by addressing the problems

mentioned above. The approach of the model will be

both alignment and impact based, focusing on IS as

a way to assist business goals as well as identify

strategic opportunities enabled by IT. This model

attempts to focus on amplifying strategic

compatibilities, flexibility and effectiveness but

reducing the development period of time through

introducing EA, BPR and the concurrent approach.

Accordingly, this proposed model enables

organizations to comprehend four dimensions of

BETTER IT GOVERNANCE FOR ORGANIZATIONS - A Model for Improving Flexibility and Capabilities of Strategic

Information Systems Planning (SISP) through EA and BPR under e-Business Environment

Figure 1: The proposed model for integrated SISP model.

objectives for SISP success from Segars and

Grover (1998) and six process dimensions to

accomplish effective strategic governance from

Segars et al., (1998) such as comprehensiveness,

formalization, focus, flow, participation, and

consistency.

Above all, the proposed model provides the

following advantages for organizations unlike other

SISP methodologies:

• Consider and emphasize SISP formulation in

both IS/IT and business point of view by

carrying out strategic business-IT/IS planning

and opportunities concurrently (consider both

alignment and impact of organizational process

simultaneously);

• Possible to consider internal/external business

and IT/IS environment at the same time and

summarise overlooked important factors from

the first stage of the framework until

commencing the SISP implementation.

Therefore, organizations are available to secure

the degree of organizational flexibility to have a

variety of actual and potential procedures and to

increase the control capability of the

management and improve the controllability of

the organization and environment;

• Possible to align, integrate and standardize the

SISP model and to maintain effective

organizational capabilities and flexibility by

utilizing EA as well as possibly design or

redesign business processes to take advantage of

IT/IS capabilities and to improve performance if

processes are poorly-designed or inefficient

through BPR;

• Contrary to the existing methodologies, possible

to implement the stable planning and minimize

extra cost, reduction of implementation time and

trial and error through analysing and

accomplishing several processes concurrently.

As a whole, the proposed SISP model consists of

supplementary processes with a different overall

structure contrary to other conventional SISP

methodologies. It consists of eight main processes

and one supplementary process. The proposed model

and the processes can be differentiated from the

existing methodologies. Basically, the model is

implemented sequentially which commences from

Stage 1 through to Stage 6 and several processes are

completed concurrently at the same level. Although

some processes are carried out at the same time, it

does not mean the processes of the same stage are

achieved independently. The information completed

in stage 1 is supplied to the next stage at the same

time to verify the forwarded information. In Stage 2,

two processes work together to consider strategies,

opportunities and critical factors with the received

information and external business-IS/IT

environment. At this time, Critical Success Factors

(CSF) and Key Performance Indicator (KPI) can be

introduced to identify and analyse business strategy

and organisational IT/IS opportunities for measuring

the current and future success of the organisation. In

this way, the six stages can produce the overall base

for implementing effective and comprehensive SISP.

The tasks and characteristics of each stage are given

below.

Firstly, the basic direction and formal definition

of SISP project is established by considering the

business mission and objectives as well as top

management involvement and commitment with

setting up project team and a basic process in stage

1. In stage 2, by complementing the shortcoming of

the existing methodologies, perceiving business

ICEIS 2008 - International Conference on Enterprise Information Systems

environment, and identifying CSF and KPI, it is

possible to align and integrate concurrently both data

and systems appropriate for organizations through

understanding business strategies and opportunities

of IS/IT as well as potential factors. Stage 3 can help

organizations set up the structure of processes more

consistently and efficiently by synthesizing and

formulating the requirements considered in the

previous stage.

In the next stage, before the implementation of

SISP, it is available to improve organization’s

performance and capability by integrating,

standardizing and redesigning added requirements or

overlooked factors through EA and BPR. To

accomplish this stage, top management’s

commitment and responsibility is more required,

because, the same as developing SISP, managers

have the authority to provide organization goals,

objectives and policies for exploiting EA and BPR.

Organizations also need to comprehend and compare

both existing processes and newly developed or

added processes. In particular, it is very important

for organizations to create a solid IT/IS architecture,

because it enables modification and upgrade of the

system easily despite the change of business

appropriateness or management policies in the

future. In stage 5, two processes are accomplished

such as implantation, and reporting and

documentation. It can provide a clear guide as to

contents, form of deliverables and supporting

appendices to the whole staff of an organization. It is

also required to confirm organization’s standards,

policy and overall system equipments based on

created strategic IS plan. Finally, in the last process,

stage 6 focuses on learning and maintenance of the

developed SISP project. More recently,

organizations have recognized the importance of

continuous learning for the completed project. Since

SISP generate an enormous amount of information

about an organization, and its internal and external

environment, the information on the project must be

understood and managed by all staff of the

organizations. Besides, continuous management of

the planning system enable them to cope with

alteration of management circumstances promptly.

5 CONCLUSIONS AND FUTURE

WORKS

As a development of IT, related technologies and

both internal and external environments of

organizations has continued to proceed and

transform as the remarkable degree, SISP has been

regarded as one of the most important determinants

to achieve effective and efficient IT Governance and

to innovate and create a long-term value. Several

well known methodologies have been introduced to

implement SISP or in some cases companies

develop their own in-house methodologies.

However, these methodologies contain problems

such as lack of consideration on the impact of the

external environment, deficiency of architecture to

improve organizations’ capabilities and flexibility

and the duration of SISP planning and others.

Hence, there is a need to develop more effective

SISP to maximize capabilities and flexibility as well

as to minimize cost, time and inconsistency through

integrating, standardizing and reengineering the

business process.

It is widely recognised that business strategies

and IS strategies need to be aligned with the SISP

process to strengthen the effectiveness and

sustainability of the organization employment. In

this paper, therefore, we proposed a model which

can overcome the drawbacks of existing

methodologies to achieve more effective and

efficient SISP for better IT Governance. The model

provides organizations with various opportunities to

verify and clarify business-IT processes. It also

allows the implementation of consistent and efficient

SISP by inducing the commitment and responsibility

of top management through EA and BPR based on

long-term information architecture. Furthermore,

performing several processes concurrently can

prevent organizations from ineffective use of time

and cost.

Next, we will conduct a case study to

demonstrate that the proposed model can manage

flexibility and capabilities to adjust in response to

new circumstances and demands by focusing on the

Government of Korea. In fact, with the continuous

diffusion of e-business and globalization, the

Government in Korea has introduced information

systems planning aggressively in the past two

decades as a strategic way to strengthen their

governance through enhancing credibility of the

governance and intimacy of customers, at the same

time improving their service quality. Therefore, this

case study will be used to verify the proposed model

as well as identifying other potential issues and

factors that compare with other sectors.

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