Welcome » IT Booklets » Management » IT Risk Management Process » Planning IT Operations and Investment » Strategic IT Planning
Strategic IT planning focuses on a three to five year horizon
and helps ensure the institution's technology plans are consistent
or aligned with its business plans. If effective, strategic IT
planning can ensure delivery of IT services that balance cost and
efficiency while enabling the business units to meet the
competitive demands of the marketplace.
Strategic planning should address long-term goals and the
allocation of IT resources to achieve them. Tactical plans outline
specific steps and timetables to achieve the strategic goals. These
should include hardware and software architecture, end-user
computing resources, and any processing done by outside vendors.
The strategic plan should address the budget, periodic board
reporting, and the status of risk management controls.
The board of directors and management should consider a number
of factors when planning the institution's use of technology,
All of these factors should also align with the organization's
business plans. Well-implemented technology plans provide the
capability to deliver business value in terms of market share,
earnings, and capital growth to the organization. The information
technology steering committee's cross-functional membership makes
it well suited for balancing or aligning the organization's IT
investment with its strategic and operational objectives. In fact,
effective steering committees will constantly work to align the
organization's information technology, both strategically and
operationally with its business units. Typically, institutions that
are better at keeping IT aligned with changing business goals and
objectives are positioned to compete more effectively.
Some institutions will spend too aggressively on technology that
business lines cannot fully utilize. Also, IT departments or
business units can over invest in specific technology that provides
inadequate enterprise-wide value, introduces new incompatibilities,
or produces unnecessary excess capacity.
On the other hand, institutions can spend too conservatively and
delay investments in infrastructure or new products that business
lines need to compete and maintain market share and profits. In
addition, business units without a full understanding of the
available technology can fail to update processes and products or
to achieve productivity gains or increased revenues. The lack of
knowledge may also result in increased security risks. To create
the appropriate balance, institutions should link strategic and
operational plans between IT and the business units.
The four key factors of IT planning that management should
The board should oversee management's efforts to create and
maintain an alignment between IT and corporate-wide strategies