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Technology has never been so fundamental, so strategic and so important as it is in the digital age. It is being used to create new business models, products, and services, enhance existing offerings, and create deeper, more rewarding customer experiences, and as such, businesses need to develop the right technology and IT strategy for success.

What is a tech strategy?

Technology strategy (information technology strategy or IT strategy) is the overall plan that consists of objective(s), principles, and tactics relating to usage of the technologies within a particular organization. Such strategies primarily focus on the technologies themselves and in some cases the people who directly manage those technologies. The strategy can be implied from the organization’s behaviors toward technology decisions and may be written down in a document.

In other words, technology strategy is the task of building, maintaining, and exploiting a company’s technological assets.

Why do I need a tech strategy?

To compete in the new world of dynamic and disrupted digital markets, organizations need to be able to operate at the speed of digital; they need to be able to respond quickly and easily to changing market conditions, customer preferences or competitor activity.

The traditional approach to IT strategy

The traditional approach to developing a new technology strategy involves a fairly structured, sequential process that produces a long-term view of the organization’s technology requirements together with a plan for meeting these needs. The main steps of the classic approach are:

  1. Identify the business capabilities that will be needed over the next 3–5 years to support the organization’s strategy and realize its vision.
  2. Assess the gap between the organization’s current maturity against each capability and the level required to realize the vision.
  3. Identify how technology can be used to address any gaps between the current and required maturity level of each business capability.
  4. Design the target technology architecture that will support the required business capabilities.
  5. Assess the gap between the organization’s current and target technology architecture.
  6. Develop a prioritized roadmap for building the target technology architecture.

The Agile approach to tech strategy

The agile approach to technology strategy is based on many of the same activities as the classic approach, but with some key differences that take into account the need for speed and flexibility.

Typical steps include:

  1. Identify the business capabilities that will be needed over the period covered by the organization’s current strategy and vision.
  2. Develop a high-level technology vision that describes the key features or characteristics that the organization’s technology platform will need in order to support the organization’s strategy.
  3. Agree the planning horizon to be covered by the technology strategy (organizations faced with fast changing markets may need to work on a 6–12-month horizon, whereas companies in more stable markets may select a 12–24 month planning period).
  4. Determine the business capabilities that will take priority during the agreed planning horizon and assess the gaps between the current and required level of each business capability.
  5. Identify and prioritize the technology initiatives required to address any gaps between the current and required level of the priority business capabilities.
  6. Develop a roadmap showing those initiatives that will be delivered during the agreed planning period.
  7. Repeat steps 3–6 towards the end of the current planning horizon. Repeat steps 1–6 whenever the organization’s vision and strategy is updated.

When the business is the tech strategy

In cases where technology is used as the starting point for a new business model or to create completely new products or services, the business strategy will itself be based on technology. There is an argument that, in such instances, there is no need for a separate technology strategy, as the technology initiatives, investments and priorities are an integral part of the business strategy. And the CIO and the IT function will be key players in the definition of that strategy.

As with the agile approach, the no strategy case is also dependent on the IT function developing and maintaining key architectural artifacts to support the business strategy, and to shape and guide technology decisions.

How you can develop an effective IT strategy

For a strategy to be effective, it should answer questions of how to create value, deliver value, and capture value:

  • In order to create value, one needs to trace back the technology and forecast on how the technology evolves, how the market penetration changes, and how to organize effectively.
  • To capture value, you should know how to compete to gain a competitive advantage and sustain it, and how to compete in case that standards of technology is important.
  • The final step is delivering the value, where firms define how to execute the strategy, make strategic decisions, and take decisive actions.

In short, whether it’s a pure IT business or IT-dependent business, tech strategy plays a key role in handcrafting the org’s future. It’s high time to craft your firm’s strategy if you don’t have one, using any of the methods.


Hari Vignesh Jayapalan is a Google Certified Android app developer, IDF Certified UI & UX Professional, street magician, fitness freak, technology enthusiast, and wannabe entrepreneur. He can be found on Twitter @HariofSpades.

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