Strategic grid model

Strategic Grid Model

Strategic Grid Model is a contingency approach that can be used to determine the strategic relevance of IT to the organization. The model was proposed by F. Warren McFarlan and James L. McKenney in 1983, the model takes the impact of the information technology on the strategy in the future planning as the horizontal axis, and the current impact of the information technology on the corporate strategy as the vertical axis, which is divided into four types: Support, Turnaround, Factory, and Strategic.

Overview

Strategic Grid Model has four quadrants built around two straightforward questions:

• How important does management feel the current IT systems are to the company?
• How important does the company think future developments in IT will be for the company, ie the impact of future IT developments on its way of doing business?

Depending on the responses to these questions, a company can be placed in the four quadrants as follows:

Type	Comprise	Narrative
Support	Low existing, low future impact.	IT has little relevance and simply supports existing processes.
Turnaround	Low existing, high future impact.	IT feature more on the business agenda in the future. IT will be a key feature of future strategic planning, it may not have played such a role in the past.
Factory	High existing, low future impact.	It is important in terms of day-to-day operations but it is not felt that there are any major IT developments on the horizon that will fundamentally alter the nature of the business. Here, the key issue is the maintenance of existing systems.
Strategic	High existing, high future impact.	In this quadrant, IT plays a crucial role both in terms of its current role and in terms of how future IT developments are viewed as impacting on the organisation.