Strategic Grid: Useful guidelines for ERP Implementations

Prof. Tejal Shah

Strategic Grid
The strategic grid is a widely known model proposed by Mcfarlan, which allows the visualization of the relationship between IT strategy and the business strategy, considering both present and future situations. The axes of the IT strategic grid portray the current and future strategic importance of IS activities In the organization plotted on the yaxis and x-axis respectively.

Strategic (Quadrant 1):

Organizations in this Quadrant are critically dependent on the smooth functioning of the IT activity. This dependence relates to existing systems as well as to applications under development, i.e. to both the current and future portfolios.

Turnaround (Quadrant-2 )
While existing applications may provide operational support for organizations in this cell, they may not be critical to the organizations current operations. However, the impact of the applications under development is considered vital to achieving the organizations strategic objectives.

Factory (Quadrant 3):

These firms are heavily dependent on their existing, day-to-day IT operations and even a temporary disruption in service could have severe operational consequences. However, the applications under development for the future are not critical to the firms ability to compete successfully and are mostly maintenance projects.

Support (Quadrant 4):

In these firms, neither current nor future IT activities are critical to the smooth operation of the firm. IT is viewed as playing the traditional backoffice-support role without any potential for dramatically altering an organizations current or future operations and/or direction. According to the characteristics of each firm, they can be located in different cells.

Management concern for ERP Success

For management issues it can be divided into three categories: short-term, middle-term and long-term. There are two short-term issues Y2K and a single European currency. The second is shifting from legacy systems and avoiding implementation delays. The medium-term issue for management is smooth running of the system The long-term issue is return on investment.