ISYS90049 Digital
Business Analysis
Week 8
Strategy Analysis (Future State)
Dr Winn Chow
School of Computing and Information Systems
1
Mid Semester Feedback from Students
Key feedback:
• Done well:
• Students liked the Miro boards by Justin and various class activities e.g. Q&A in lectures.
Lectures are very explanatory.
• Tutors are supportive and have encouraged students to actively participate in discussion.
• Improvement needed:
• Some lecture slides have too much highlighting. You don’t find it helpful? Noted and will
change it.
• Difficulty with group work. Have concerns about the unequal contribution of individual
students to group work. Noted and will provide more assistance. Discuss soon.
• More engagement with online students. Have been trying. Noted and will try more using
the Chat function of the LMS. 3
Assignment 2 Teams
You are expected to continue to work in the same team you worked in for assignment 1, as
this assignment builds on what you have already completed.
For special circumstances, please contact the teaching team or email me at
winn.chow1@unimelb.edu.au ASAP.
In cases that you face critical disputes in your teamwork,
• Please contact the teaching team ASAP.
• We may allow you to change teams if we are informed at least 2 weeks before the due
date.
• Otherwise, after the submission of the assignment, we will request each student in your
team to submit a Peer Rating to rate the contribution of each student with supporting
evidence. We will then review the rating and adjust the marks of individual students.
• Hence, Peer Rating is NOT required if your team works well. It is ONLY needed if your
team has critical disputes. 4
Assignment 1 Common Mistakes
• Average Mark: 42 out of 60 (70%)
• Background: Don’t just repeat the case scenario. Explain the business needs and
highlight the importance.
• Context: Justify your PEST and SWOT analysis. Who are the key stakeholders and why?
Perform your analysis with the business needs in mind.
• Scope: What will be included / excluded for the analysis (NOT the solution design)?
Justification?
• Activities: What elicitation activities? What information will be obtained and why?
• Overall: All sections of the report are generally well covered, but need to strengthen
your justification to make your argument convincing. Use high-quality references to
support your justification. Logical flow in the report can be further strengthened.
Highlight your key insights. 5
Future State
6
Where are we?
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Define future state
• The purpose of Define Future State is to determine the set of necessary conditions to
meet the business need.
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?
Business Need
What is this?
Solution
Scope
Change
Strategy
Solution
Potential Value
Define future state
• Determines the conditions to address the business needs.
• Serves to draw the lines within which alternative solutions (competing ways) can be
generated and evaluated.
• Stakeholders need to understand the potential value that can be realized from a
solution. Enable the assessment of the value associated to the future state.
• It can be used as part of the decision-making process regarding the change strategy.
• It has to be well defined, achievable and key stakeholders need to have a common
vision of the outcome. There is a clear definition of the outcomes that will satisfy the
business needs.
• Outline the scope of the solution space.
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How complex is the future state?
• Minor changes in existing processes or components
• Changes to an existing IT application
• Modifying, adding or removing significant parts of existing
solutions
• Organisational structures
• Entering or leaving markets
• Dealing with a combination of two or more solutions (such
as applications, data, and processes)
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Future state description
• A good practice is to include the same elements included in the current
state description:
– Organizational structure and culture
– Capabilities and processes
– Technology and infrastructure
– Policies
– Business architecture
– Internal assets
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Requirements classification scheme
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What is this?
From needs to objectives: a hierarchical view
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?
From needs to objectives: a hierarchical view
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?
What is the problem? Why we are doing this?
What is required to address the problem at the business level?
What is required (qualitative) for each part of the business?
What is required (quantitative) for each change?
Example: We want to produce a new type of car
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Need: Customers demand a more “green” car
Business: We need to develop an electric car for customers
Machinery: Improve the capability of the infrastructure
People: Acquire human resources with necessary skills
Process: Develop new processes to manufacture electric cars
Machinery: Install suitable machinery – Set-up the new
machinery by the end of the year
People: Hire high-skilled workers – Recruit 10 engineers by
June
Qualitative
Longer term
Quantitative
Specific
SMART objectives
• Business goals are qualitative statements expressing what the business wants to
achieve.
• In future state analysis, business goals are defined and decomposed into objectives
that are increasingly tangible.
• What is a SMART objective?
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SMART example
• “Our business processes will be fully compliant with the new government
regulations requiring data retention within six months.”
– Specific: It is clear what needs to be achieved in this goal.
– Measurable: Processes can be verified against the known regulations.
– Achievable: Presumably this hypothetical company is already storing data so this
should be achievable.
– Relevant: Government regulations are mandatory and adjusting processes is to be
expected.
– Time-bounded: The company has stated it will be completed within six months (this
may be a requirement of the regulation or not).
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SMART objectives
• SMART:
– Specific: the objective should describe a specific outcome.
– Measurable: the outcome should be measurable (to verify whether you have
reached your objective), and the data for measuring should be accessible.
– Achievable: the outcome should be possible to achieve using reasonable effort.
– Relevant: the outcome should be aligned with the vision, mission, and goals of the
company.
– Time-bounded: the outcome should be achieved within a defined time frame.
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Discuss with your peer
What part of SMART is missing from these objectives?
1. “I will improve my grade in this subject by the end of the
semester”
2. “I will reduce my weight by 5kg by exercising at the gym three
times a week”
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Scope of solution space
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? Out of scopeIn scope
• The scope or extent (what is in-scope and what is out-of-scope) of the
solution that will be pursued via the change. It describes the new
capabilities and how they meet the business needs.
Example: Scope of solution space
Solution scope:
• Process:
– “Redesign the Purchase Order Process to use an enterprise system purchasing
module.”
• People:
– “The purchasing department will need to be trained on the new process and the
system that support it.”
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Scope of solution space
• Future state is a description of the future without any specific solution.
• It is a description of “what” it will be, without detailed discussions about
“how” (solution).
• Scope of the solution clarifies what are the choices to consider when
generating alternative solutions.
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Solutions?
Solution scope
Constraints
• Budgetary (limited resources)
• Time (tight deadlines)
• Technology (new solutions need to be implemented in certain ways)
• Resources (limited resources for future maintenance)
• Rules and regulations (compliance with rules and regulations)
• Policies (compliance to company policies)
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Assess Risks
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Assess Risks
• Understands the uncertainties around the change, considers the effect
those uncertainties may have on the ability to deliver value through a
change, and recommends actions to address risks where appropriate.
• It concerns unexpected events that might reduce value.
• The aim is to be aware, prepared and able to manage risks if they
materialise.
• Examples:
– Shortage of materials while building a house
– Increase prices of materials
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Risk assessment process
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Prioritize Risks in Order of Importance
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Source: https://constructioncitizen.com/blog/construction-risk-management-guide-2019/1906191
Discuss with your peer
• How should we treat the risk of a falling tree?
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Source: https://constructioncitizen.com/blog/construction-risk-management-guide-2019/1906191
Some alternatives to treat risks
• Example: Shortage of materials while building a house, Increase of prices
• Avoid: prevent the risk from occurring
– E.g. stock up materials beforehand
• Transfer: transfer risk to a third party or shared with a partner
– E.g. get an insurance
• Mitigate: reduce the probability of a risk and/or reduce the impact if it occurs
– E.g. contact distributors and arrange prices beforehand
• Accept: no preventive action is taken, the risks are managed when they occur
– E.g. buy materials as needed
• Increase readiness: identify signals of impending risks and be prepared to avoid
actions, transfer or mitigate risks and be able to respond faster 29
Risk analysis documentation
• The risk analysis can be documented using a risk register.
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Define Change
Strategy
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What is change strategy?
• Develop and assess alternative approaches to the change and recommend
one.
• The key activities and the approach the change will be implemented.
– E.g. one-off or iterative implementation
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Strategy analysis tasks
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Analyze
Current State
Define Future
State
Assess Risks
Define Change
Strategy
1 2
3
4
Which approach? Is it the most efficient and effective?
Key
Activities
Change Strategy
• A high-level plan that describes the key activities to move the organization
from their current state to the future state.
• Do we wish to take a “big bang” approach?
– Meaning that all the required changes are included in one project
– If the project is small
– The value will not be realized until the end of the project
• Gradual implementation of concurrent or sequential set of projects?
– Breaking a large project into smaller manageable projects
– Projects will be limited in size and complexity
– e.g. “A CRM system can be implemented for the smallest customer
segment first to ensure that all things are working properly” 34
Elements of the change strategy
• Solution scope: What parts, capabilities, aspects will be added, removed,
modified, and/or created by the solution?
• Enterprise readiness assessment: is the whole organisation ready to make
the change? Able to sustain the solution and realize the value?
• Change strategy: key activities? one-off or iterative implementation? Why
is it the most efficient and effective way?
• Transition states and release planning: if the change is in stages, how will
it work? When and what will be released in stages?
• Gap analysis: What is the difference between our current and future
states?
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Gap Analysis
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Gaps?
Solution scope
Gap Analysis
What is the difference between our current and future states?
• Current state: A description of the current situation (may include numerical values)
• Future state: A description of the target state (may include numerical values)
• Gap description: A description of the difference between current/future state
• Example: An actual example that illustrates the gap
• Responsible unit: Stating which business unit “owns” the gap
• Actions: Alternative ways to fill the gap are listed
• Size estimate: Assessment of the size of the effort required to fill the gap (e.g. small,
medium or large)
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Gap analysis example
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Some areas where gaps occur
• Competencies, skills, and knowledge (training)
• Tools/equipment (including facilities and locations)
• Software, applications, and technology infrastructure
• Alliances, partnerships, and external cooperation
• Business and other processes
• Practice, policies
• Functions, lines of business, organisational structures
• Data and information
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References
IIBA (2015). BABOK A Guide to the Business Analysis Body of Knowledge (3rd ed.). IIBA.
Milani, F. (2019). Digital Business Analysis. Springer.
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