Strategic Planning an Informal Affair in Most IT Organizations

December, 2018

Nearly all IT organizations have some sort of strategic plan. However, only about a third of them plan IT strategy formally and consistently. As a result, the IT strategic plan will be of little use in guiding day-to-day priorities, leaving the IT organization without a roadmap for the future.

IT organizations that lack a strategic plan become reactive, juggling and responding to business requests and unable to make longer term strategic investments to transform the business. At worst, without a strategic plan, an IT organization will be seen only as a support organization, without a seat at the table when strategic business decisions are made.

As shown in Figure 3 from our report, IT Strategic Planning Adoption and Best Practices, 86% of companies practice some form of IT strategic planning, but only 36% do so formally and consistently. Another 8% are implementing the practice, and only 6% report no activity.

Strategy fig 3 - Strategic Planning an Informal Affair in Most IT Organizations

Strategic planning is an IT management best practice when the economy is good, as well when we are facing headwinds. During a recession, a strategic plan, or an IT road map, helps prioritize which projects can be slowed or deferred. In times of growth, it provides a road map for investing in projects that span multiple years to meet long-term objectives. An IT strategic plan can be especially important for guiding IT organizations through periods of technological change. Typically, the process involves understanding the organization’s business strategy; assessing the gaps between IT capabilities and business needs; establishing overall objectives for IT; developing an action plan; monitoring and reporting the results; and revising the plan on a regular basis.

“It is hard to imagine a mature organization without IT strategic planning,” said David Wagner, vice president of research for Computer Economics, an IT analyst firm based in Irvine, Calif. “Without a vision and a mission for the IT organization, the plan might exist, but it is unlikely to continue to serve the business. Conflicting priorities could pull the organization in too many directions. But a plan that is consistently and formally reviewed and adhered to will allow organizations to make smart changes to evolve and stay on course.”

The faster pace of change these days might make the idea of a multi-year plan seem quaint, as CIOs are being asked to deliver everything yesterday. IT is being asked to be more agile and responsive than ever, and a strategic plan can often be looked at as etched in stone and a hindrance to being “agile.”

On the contrary, a strategic plan is the best defense against unrealistic expectations. An IT strategic plan that is developed in collaboration with the business side of the company is an important tool when evaluating new requests. It allows a CIO to say, in effect, “That is a great idea; let’s see where it falls on our road map.” Of course, the plan can always be revised, and business leaders may decide to go forward with an initiative that is not on the road map. But if there are resource constraints, it will probably mean de-prioritizing some other initiative. Without an IT strategic plan, it is too easy for the CIO to be the one who always says no. Having a strategic plan, on the other hand, forces business leaders to face trade-offs.

In the full report, we describe the fundamental components of an IT strategic plan, assess current adoption trends by organization size and sector, and provide recommendations to make IT strategic planning more effective.

This Research Byte is based on our report on this subject, IT Strategic Planning Adoption and Best Practices. The full report is available at no charge for Computer Economics clients, or it may be purchased by non-clients directly from our website (click for pricing).