UNDERSTAND WHAT STRATEGY IS AND WHY IT IS IMPORTANT

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Strategic Analysis:

LEARNING OBJECTIVES

-Understand what strategy is and why it is important, the assumption being that strategy is important
-Exploring some ideas about how strategy is developed
-Implementing strategy
-Working out what all of this means for business analysis

WHAT IS A STRATEGY?

-Is it a plan?
-Is it a pattern of consistency in behaviour over time?
-Is it a position – for a product/service in a market?
-Is it a perspective – a leader’s vision?
-Is it a ploy to outwit an opponent or competitor?

The Context for Strategy

-Business environment becoming increasingly unpredictable
-Changing ways of employment: contract, part time and permanent
-Growth of knowledge based industrie
-Flattened organisational structures and decentralised decision making
-More autonomy given to knowledge workers

The business architecture

-Is the set of artefacts that comprise the attributes and characteristics of the business. It is a compilation of interrelated elements that depict information about the business: its operations, organizational structures and physical locations, the boundary of business processes, business rules, policies and procedures, and the lines of business used to flow value through to customers.

What is Strategy?

Strategy is the direction and scope of an organisation over the long term, gives advantage to the organisation through use of it resources in a changing environment and fulfils stakeholder expectations Johnson, Scholes and Wittington (2008), cited in Paul et al, Business Analysis (2010). (Kindle location 1457)

Levels of Strategy

Different business units within an organisation may have different strategies, and there are differing levels of strategy within an organisation:
-Corporate: involved with the overall purpose of the organisation and forms the basis for all other strategies within the organisation
-Business unit: Each unit will have a distinguishable market from other business units. Each unit’s strategy will be formed to leverage competitive advantage for the unit
-Operational: focuses on delivering the strategies through use of the units resources, processes and staff

Developing Strategies

Four perspectives of developing a strategy

-Design lens: deliberate positioning of an organisation following a detailed enterprise analysis. Strategy formulated by executive management
-Experience lens: organisational experience and culture transform the strategy over time, continually changing, each incremental change building on the last one
-Innovation (ideas) lens: new ways of approaching organisational problems, perhaps with the introduction of new staff members
-Politics: organisationss are discrete political systems and as such interest groups form to compete for organisational resources and power to achieve their own outcomes

Sources of Power

Dependency: departments are dependent on those who have control over organisational resources

-Financial resources: who allocates the funds to develop new ideas and/or projects
-Position: where are the actors positioned within the organisation? Are they generators of ideas or organisational revenue?
-Uniqueness: each group with special interests is unique and each group has power
-Uncertainty: power resides with people or groups and people are unpredictable. During times of change power holders often change

Using PESTLE

-Not a set of checklists
-Key tasks:
*Identify those few factors that will really affect the organisation
*Develop a real understanding of how they might evolve in the future

MOST Analysis Technique

Mission-A statement declaring what business the organisation is in and what it is intending to achieve
Objectives-The specific goals against which the organisation’s achievements can be measured
Strategy-The medium to long-term approach that is going to be taken by the organisation in order to achieve the objectives and mission
Tactics-The detailed means by which the strategy will be executed

Implementing Strategy

-Issues to consider when implementing a strategy
*How quickly does the strategy need to be implemented?
*How big is the change? Is it new to the business or is it incremental?
*How quickly can the organisation absorb the change? Do staff possess the necessary skills to lead the change?
*Is the organisation ready for the change? 
*Do senior management possess strategic leadership skills?

Business Analyst Strategic Roles

-The business analyst plays a key part in strategic planning
-Informing decision makers about project investments
-Involved in tactical activities
-Defines and manages project business requirements
-Validates that the solution meets business requirements

Strategic Planning (1)

-Strategic planning is the first step in creating a project
-Not normally considered as a project phase
-Phase where the current state of the enterprise is examined and the future state determined
-Describe a broad set of strategic goals

Strategic Planning (2)

-To ensure common understanding the future state is documented – what the organisation will look like once the strategy is achieved
-Enterprise analysts identify gaps in organisational capabilities to achieve a successful strategic outcome
-Converts future strategy to measurable objectives

Strategy-Execution Framework

-Called portfolio management
-Driven by strategy planning and goal-setting processes
-Critical business process between strategic planning and project execution
-Phase where projects are evaluated selected, prioritised, funded
-Phase where strategic goals are converted to actionable objectives, scope and approach

Enterprise Analyst Tasks

-Provide senior analysts with support by performing tasks such as
*Feasibility analysis
*Competitive analysis
*Problem analysis
*Opportunity analysis
*Financial analysis
*Benchmark studies
-Recommending innovative solutions to senior staff

A Road Map

-A strategic plan is a road map of how an organisation is going to move from the as-is state to the envisioned future
-Dynamic and changes depending on the environmental (competitive) climate
-Is a link to what needs updating in the project portfolio

Balanced Scorecard

Frames strategic goals

Financial goals: measurable goals focussing on organisational finance and accounting outcomes
Customer goals: a measure of customer satisfaction
Internal operations goals: measurable process and operational performance against industry benchmarks
Learning and innovation goals: measures how well an organisation applies learning, skills and product development in a competitive market

Corporate Scorecard (1)

-Decision criteria: for-profit organisations
-Tracks progress towards intended strategic outcome
-Strategic goals are ranked according to organisational priority
*Financial
*Customer
*Internal operations
*Learning and innovation

Corporate Scorecard (2)

-Decision criteria: not-for-profit organisations
-Tracks progress towards intended strategic outcome
-Strategic goals are ranked according to organisational priority
--Customer
--Financial
--Internal operations
--Learning and innovation

Note the change of perspective of the first two goals

Planning Cycles

-Volatile environments require evolving strategies, goals and organisational change
-Strategic goals and objectives are dynamic
-Requires iterative planning cycles
-Constant monitoring of progress towards goals and objectives requires ability to make changes as necessary
-Business value expectations are raised at each iteration
-Business analysts provide expertise to ensure that accurate information, analysis of business problems, creative and innovative solutions are provided

Enterprise Analysis

-Not a phase but a series of activities throughout the project
-Mature organisations use enterprise analysis to support strategy development
-Provides conceptual and creative business solutions for new business opportunities

Enterprise Analysis Activities

Core activities focus on:
-Identifying new business opportunities
-Research to determine most feasible solution
-Develop business case or project proposal recommending feasible projects to senior management
-Initiate new project planning activities
-Are carried out over the life of the project
-Continually validate project aligns with stated project outcomes
-Activities continue after project completion

Strategic Alignment

-Strategic plans and goals covert to portfolio of programs and projects
-Project leaders execute project plans to meet objectives
-roject outcomes are achieved

Enterprise Analysis in Practice (1)

-A significant role is played by enterprise analysts when translating strategies into innovative change initiatives Analysing the enterprise and competitive environment
-Experiments and brainstorming session to determine creative solutions
-The enterprise BA works with small groups of experts in discovery sessions to identify viable initiatives
-Documents requirements at a high level and ensures requirements are traceable to each source

Executing Strategy

-Executing new strategy involves risk because it involves change
-Contextual issues
-Role of the leader
-Tools used by the business analyst
--Balanced Business Scorecard
--McKinsey 7-S Model

Contextual Issues

-Time
-Scope
-Capability
-Readiness
-Strategic leadership

Role of the Leader

Challenge the status quo all the time and set new and demanding targets

-Establish and communicate a clear vision, new mission, set out objectives, strategies for achieving them and defining specific tactics ‘Walks the walk’ – demonstrates how to act and behave
-Empowers people to deliver their part of the strategic change
-Celebrate success with those who achieve it

Knowledge Management Standard

“The strategic intent of the organisation helps to answer the question of ‘where are we and where do we want to be’. By analysing the strategic context, you can begin to identify the relevant drivers for your knowledge efforts. Drivers act as pointers or indicators towards what knowledge should be developed or leveraged” (Standards Australia 2005, p.14).

What this Means for Business Analysis?

-Understanding what tools to use and what information and knowledge will be identified with each tool.
-Identifying knowledge management drivers that can indicate where development might occur next (eg. Knowledge gaps).

Planning and Requirements Elicitation (1)

-Involves customers, users, business managers, architects and developers
-Planned by the business analyst collaborating with a team
-Members are usually the project manager, business visionary, and technology experts
-Determine the approach (plan-based vs adaptive)
-Planning the activities to be undertaken
-Deciding which artefacts are to be produced

Planning and Requirements Elicitation (2)

-Establishes the communication strategy
-Defines the change management approach
-Conducts a stakeholder analysis
-Ensures the project is properly funded
-Ensures the requirements elicitation activities are valid

Elicitation Preparation

Activities include:

-Gain an understanding of the organisational needs and environment of internal and external stakeholders
-Reviewing or creating the business case and supporting documentation
-Gain an understanding of the expected outcomes of any change projects
-Create and ensure the team understand the organisational requirements
-Determine which elicitation activities and modelling requirements are appropriate for the project
-Continually check and refine the requirements activities, deliverables and schedule
-Plan for change throughout the project

Elicitation Goals (1)

Requirements are capabilities or conditions a solution must fulfil

-Requirements derive from business goals and objectives
-Solution success factor measured by the extent it supports business objectives

Goals include:

-Identifying the stakeholders who should be involved in requirements gathering process
-Identifying essential user tasks to support organisational goals and operations
-Identify and commence documenting requirements that meet the needs of stakeholders

Elicitation Goals (2)

-During the documentation of requirements the BA is not just a note taker for groups
-A collaborative environment must be created between the stakeholders

Elicitation Activities

-The major activity is to ensure that the correct and complete requirements are collected
-Iterative nature of elicitation for
--Requirements gathering
--Documenting
--Validating

Elicitation Techniques (1)

Workshops

-Requirements elicitation workshops link business users with developers
-Conflicting and inconsistent requirements can be resolved

Interviews

Can be with individual or small groups (ideal for finding out how a particular department operates)

Surveys

A amounts of data can be collected. Can be used to collect initial information to drive workshops or interviews (anonymous surveys ideal for collecting information that workshops or interviews may not elicit)

Elicitation Techniques (2)

Review existing system and documents
-Helpful to understand the current conditions and processes

Observation
-By observing users carrying out day-to-day operational functions these functions can be used to validate information collected through other techniques

Note-taking and feedback loops
-Regular feedback sessions with stakeholders allows continual validation of requirements

Elicitation Deliverables

-Reviewed and documented business requirements
-Documentation as approved by key stakeholders
-Project notes
-Risks and issues documentation
-Models and diagrams depicting the system as-is and to-be
-Other information pertaining to the project

Requirements Analysis & Specification

-Simple terms are used to first describe organisational requirements
-Requirements analysis is the phase where requirements are analysed, categorised and refined for clarity, accuracy and completeness
-Evaluating the requirements collected
-Representing the requirements in different forms to support analysis and decision makings
-Setting priorities for the project

Requirements Analysis Activities

-Organising and prioritising requirements
-Requirements specification and modelling requirements
-Determining assumptions and constraints
-Verifying and validating requirements with stakeholders
*Determine function and performance
*Context
*Stakeholder constraints
*Effectiveness measures
*Validation criteria

Requirements Analysis Techniques

-Are many and varied – refer to Hass text (Kindle locations 1180 – 1190)
-As a rule of thumb use those that encourage collaboration and innovation.

Requirements Specification Activities

-Production of detailed requirements derived from information elicited from stakeholders
-Production of models, graphs, statements
-Productions of complete attribute set of characteristics for each requirements
-Refer Hass text (Kindle location 1211)
-Identifying all precise attributes for each requirements

Requirements Specification Techniques

-Attributes are used to structure, group, explain, select and validate requirements
-Attributes enable the association of information with individual or groups of requirements
-Enables filtering and sorting in the requirements analysis phase
-Refer to Hass text for a list of typical attributes attached to requirements. These may be user or system defined (Kindle locations 1235 – 1253)

Requirements Analysis & Specification Deliverables

-Requirements must demonstrate the business value to be delivered
-Each must be traced back to business objectives as stated in the business case
-Must be structured to enable requirements to be traced through to design, construction and solution implementation

Requirements Documentation

-Documentation should be in clear, concise and natural language
-Overly technical language should be avoided as requirements will be used by all project stakeholders
-Technical language to describe requirements such as security, government regulations or other standard may be expressed in formal technical language but MUST be able to be traced back to business objectives
-Refer to Hass text for a list of the characteristics of good requirements (Kindle locations 1265- 1283)

Requirements Validation Techniques

-Prototyping: provides a visual model of the solution
-Test-driven requirements: can assist in defining requirements difficult to define as by defining the testing procedure the test will verify the requirement
-Business scenarios: scenarios based on actual usage
-Acceptance criteria: develop the criteria, performance metrics and business benefits tests that the requirement is complete
-Structured walkthroughs: validates that the requirements are clear, accurate, complete and accurate

Requirements Management

-Once requirements are defined to a stage when defining and designing the solution can commence ALL changes are noted
-Involves tracking and coordinating requirements allocation, status and any changes
-Requires requirements validation before each change to ensure business objectives are still being met
-Management techniques depend on the complexity of the project

Managing Changes to Requirements (1)

*Low to moderate complexity
-Refer to Hass Figure 2.3 (Kindle location 1359)
-Waterfall model effective for managing requirements for low to moderate projects
-Assumes events during the project are predicable, skilled team members and once the phase is complete there will be no need to return to it
-This approach focusses on the importance of accurate requirements
*Unfortunately, projects rarely follow a sequential pattern, and rarely are requirements not revisited

Managing Changes to Requirements (2)

Highly complex projects and programs
-Less predictable than low to moderate complexity projects
-Risk management plan developed with options for various high-risk scenarios
-Functions are prioritised depending on business value
-Highest value components should be delivered first
-Requires a change management system that is flexible
-Focuses on the current component being delivered
-Tools used for the category of project/program are sophisticated , not the basic spreadsheets or tables

Transitional Requirements

-Change needs to be planned when delivering new products or business solutions
-BA tasks undertaken at this phase include:
*Readiness assessment: evaluating organisational readiness for change
*Skills assessment: identifying any gaps in the skill set of employees and organising training to reduce those gaps
*Organisational assessment: does the current organisational structure meet the new business objectives and solutions?
*Communication assessment: develop a communication plan to support the organisational; initiatives
*Management support assessment: determine the support management has for the project

Maintaining and Enhancing the Solution

-BA contribution does not end when the solution has been delivered and is operational
-BA responsible for tracking and reporting actual business costs and benefits derived from the solution
-BA provides ongoing services to identify, prevent and correct errors that may arise

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