In business, according to Earl’s levels of information strategy, Information system strategy (IS strategy) involves aligning information system development with business needs. It should be demand oriented and business focus. There are total three levels of Earl’s information strategy which are information system strategy, information management strategy, and information technology strategy.
Characteristics of Information System Strategy
- IS strategy considers what information is needed at strategic, tactical and operation levels of an organization to meet its objectives.
- It must be able to deliver tangible benefits like the effectiveness of operations, increased profit etc.
- It involves interconnecting of an organization’s activities that obtain, process data and finally provides information.
- This type of strategy highlights what information is needed to achieve business objectives.
- It may form to use informational resources for generating new business opportunities.
- An IS strategy must be able to meet the demand (demand-oriented) of an organization.
- This strategy is about either supporting existing strategies or development of new strategic choices.
- It must be functional-based (How can organization’s functions, divisions and strategic business units perform well?)
IS strategy is like:
- Expansion into e-business to meet customer demand.
- Use of website by local CD store to stay in the market (Technology becomes a threat when it is not adopted at the right time).
- An organization’s campaign to save costs for competitive advantage by adopting modern infrastructure.
- Using IT to minimize tough competition by building a strong relation with customer and supplier.
- Use of modern methods (computer aid) while new product development to enter the market first.
Why is it Important?
Information system strategy provides a link between organizational demand and information technology, this strategy enables an organization to stay in the market by using IT to meet its changing demands with respect to the continuously changing environment.