By the early 1980s a third model was evolving. This new model sought to “improve competitiveness by changing the nature or conduct of business” - Ward and Peppard (2003). It flows from the notion that Information System (IS) / Information Technology (IT) investments can be a source of competitive advantage, hence it is referred to as the Strategic Information Systems (SIS) model.

From the research of  Ward and Peppard into those businesses which have successfully improved competitiveness by changing the nature and conduct of business, they identified various key factors that frequently recur and underpin success. It is particularly interesting to note that these factors are often at odds with traditional IS / IT approaches. Here are the seven key factors which they identify:

  • External, not internal, focus: Traditionally IS / IT was focused on internal processes and issues. SIS looks at customers, competitors, suppliers, other industries and the business’s relationships and similarities with outsiders.
  • Adding value, not cost reduction: The aim is for businesses to differentiate themselves with competitors; not the goal is to do it better, not cheaper.
  • Sharing the benefits: In the past systems benefits have not been shared between departments or functions. This new model addresses sharing within the organisation, with suppliers, customers, consumers and competitors.
  • Understanding customers: How do Customers use the product and obtain value from it? What problems do they encounter?
  • Business driven innovation, not technology-driven: System change must be driven by marketplace developments.
  • Incremental development: A stepped approach works better. Develop systems by experimentation, and building on success.
  • Using information gained from the systems to develop the business: Make information available where it is needed in ways which reach beyond traditional practice or format.

The three evolutionary models considered here were named by Ward and Peppard (2003) as the Data Processing (DP) era, the Management Information System (MIS) era, and the Strategic Information System (SIS) era. Andresen et al (2000) referred to them as Automate, Informate and Transformate; terms which precisely describe the focus of each model.

It is important to note that while it has became progressively evident that IS / IT in business has evolved, this does not mean that the newer models have superseded earlier models. In any given organisation it is not unusual to identify more than one type in use at the same time. For example, Banks have Automated Tellers and also provide management with instant information about their clients. Retailers have automated sales and inventory records, forged strategic relationships with suppliers and manufacturers, and by providing Courtesy Cards they attract customers away from competitors in the market. Airlines who were first to provide online booking facilities to their customers were able to gain a competitive advantage in the market. Transport and shipping businesses provide their customers with online access to information about the location of their goods and delivery programmes.

Ah, but perhaps you feel that this is all good for financial, retail and transport businesses, but, business in the Architecture, Engineering and Construction (AEC) industry is too complex to accomplish anything like that. Is this true? Can the AEC industry benefit from the lessons learnt in other industries?