IT Strategy and Planning Step 7: Analyze Scenarios and Strategic Options

🎯 Objective

To identify, evaluate, and compare multiple strategic paths for closing the IT capability gaps and achieving the envisioned future state—accounting for business alignment, value realization, risk management, and organizational feasibility.

📌 Why It Matters

Gap analysis reveals what must change—scenario and options analysis determines how to make that change effectively. This step enables you to:

Assess multiple transformation routes and their implications
Understand short-term vs. long-term trade-offs
Model different investment levels, resourcing strategies, and timelines
Build organizational consensus by offering clear, comparative choices

For a multinational snack retail chain, this is especially critical as the IT strategy must support complex global operations, real-time supply chains, and localized consumer experiences—all while remaining cost-efficient and scalable.

🧭 How to Analyze Scenarios and Strategic Options

Step 1: Define Strategic Scenarios (3–5 Year Horizon)

Develop 2–3 distinct but realistic scenarios that illustrate different paths to achieve the future IT state. These should differ by speed, sourcing strategy, investment appetite, and risk tolerance.

Example Strategic Scenarios:

Scenario	Description
Scenario A: Cloud-First Modernization	Aggressively move to cloud-native platforms, decouple legacy systems, adopt microservices, and invest in data-driven capabilities. High investment, high agility, high disruption.
Scenario B: Phased Hybrid Evolution	Gradual transformation of legacy systems to cloud, mixed delivery model, moderate agility. Balanced investment and change risk.
Scenario C: Vendor-Enabled IT-as-a-Service	Focus internal IT on governance; outsource application development, infrastructure, and platforms to strategic vendors. Fast implementation, lower control, potential lock-in.

Each scenario must detail:

Target outcomes and metrics (e.g., % systems in cloud, delivery speed, IT cost efficiency)
Required enablers (talent, platforms, vendors, governance)
Timeline and key milestones
Risks and mitigations

Step 2: Identify Strategic Options Within Each Scenario

Break each scenario into option sets aligned with core IT domains. Evaluate a combination of approaches to infrastructure, application modernization, data, talent, and operating model.

Domain	Options (Examples)
Infrastructure	Multi-cloud (AWS + Azure), hybrid with private DC, managed hosting
Application Strategy	Replatform ERP, rebuild core e-commerce as microservices, adopt SaaS CRM
Data Platform	Centralized data lake, distributed data mesh, cloud-native analytics
Talent & Sourcing	Hire cloud-native engineers, upskill current workforce, strategic vendor partners
Operating Model	Federated agile product teams, centralized DevOps COE, hybrid governance

Use option playbooks for each area, with implications for cost, complexity, flexibility, and vendor reliance.

Step 3: Evaluate Each Scenario and Option Set

Use a multi-criteria decision framework to compare scenarios/options across strategic and operational dimensions:

Criteria	Evaluation Questions
Strategic Fit	Does it align with business vision and growth strategy?
Business Value	What benefits will it enable (e.g., time-to-market, customer experience, revenue)?
Cost & Investment	What are the upfront and ongoing costs? Is ROI achievable?
Implementation Timeline	Can the scenario deliver impact within the strategic horizon (3–5 years)?
Organizational Readiness	Does the organization have the skills, culture, and leadership to execute?
Complexity & Risk	What are the dependencies, technology risks, or change management challenges?

Create a scoring model (e.g., 1–5 scale) for each criterion, supported by a weighted matrix and scenario comparison heatmap.

Step 4: Select and Recommend a Strategic Path

Present a final recommendation that balances ambition with feasibility. This may be:

A single scenario selected for execution
A hybrid roadmap that combines elements from multiple options
A phased approach, e.g., short-term stabilization (Scenario B), followed by long-term innovation (Scenario A)

Justify the recommendation with:

Business value estimates (e.g., NPV, IRR, efficiency gains)
Organizational readiness factors
Risk analysis and mitigation plans
Stakeholder alignment

🧩 Example: Snack Retailer – Scenario Comparison Summary

Criteria	Scenario A: Cloud-First	Scenario B: Hybrid Evolution	Scenario C: Vendor-Driven ITaaS
Strategic Fit	✅ High	✅ Medium	🔶 Medium
Business Agility	✅ High	🔶 Medium	🔶 Medium
IT Cost Reduction	🔶 Medium	✅ High	✅ High
Talent Demand	🔴 Very High (reskilling)	🔶 Medium	✅ Low (outsourced)
Time to Value	🔶 Medium	✅ Fast for low-hanging systems	✅ Fast
Risk Profile	🔴 High (legacy displacement)	🔶 Medium	🔶 Medium (vendor lock-in)
Long-term Control & IP	✅ High	✅ High	🔴 Low

Recommendation: Begin with Scenario B, establish agile pods, replatform key systems, and build internal cloud/data talent. Progressively shift toward Scenario A for innovation edge while maintaining vendor-managed components from Scenario C in non-core areas (e.g., HR, Finance).