If the CIO is to be valued as a strategic actor, how can he bring.docx

If the CIO is to be valued as a strategic actor, how can he bring
to the table the ethos of alignment, bound to the demands of
process strategic planning to move IT to the forefront of the
organization's future? Is there a lack of information on strategic
planning? Nope. I think the process of planning is poorly
understood, and rarely endorsed. The reasons are simple
enough. Planning requires a commitment of resources (time,
talent, money); it requires insight; it requires a total immersion
in the corporate culture. While organizations do plan, planning
is invariably attached to the budget process. It is typically here
that the CIO lays out his/her vision for the coming year Now a
few years ago authors began writing on the value of aligning IT
purpose to organizational purpose. They wrote at a time when
enterprise architectural planning was fairly new, and enterprise
resource management was on the lips of every executive. My
view is that alignment is a natural process driven by the
availability of the tools to accomplish it. Twenty years ago
making sense of IT was more about processing power, and
database management. We are in a new age of IT, and it is the
computer that is the network, not the network as an independent
self-contained exchange of information. If you will spend some
time reviewing the basic materials I provided on strategic
planning and alignment, we can begin our discussions for the
course. Again, here is the problem I would like for us to tackle:
If the CIO is to be valued as a strategic actor, how can he bring
to the table the ethos of alignment, bound to the demands of
process strategic planning to move IT to the forefront of the
organization's future? Most of the articles I bundled together for
this week are replete with tables and charts. These can be a
heavy read. Your approach should be to review these articles for
the "big ideas" or lessons that are take away. I think these
studies are significant enough that we will conclude our first
week with an understanding of the roles between executive
leaders, and how they see Information Technology playing a

role in shaping a business strategy.
Read the articles to answer the question. Please No Plagerism or
verbatim but you are allowed to quote from the article.
Achieving and Sustaining
Business-IT Alignment
Jerry Luftman
Tom Brier
I
n recent decades, billions of dollars have been invested in
intormation tech-
nology (IT). A key concern of business executives is
alignment—applying IT
in an appropriate and timely way and in harmony with business
strategies,
goals, and needs. This issue addresses both how IT is aligned
with the busi-

ness and how the business should be aligned with IT
Frustratingly, organizations
seem to find it difficult or impossible to harness the power of
information tech-
nology for their own long-term benefit, even though there is
worldwide evi-
dence that IT has the power to transform whole industries and
markets.' How
can companies achieve alignment? There are known enablers
and inhibitors
that help and hinder alignment. IT executives experience them
daily, anecdotes
describing them have been published,^ and research has
identified trends and
established benchmarks against exemplar organizations.'
The survey data on which our findings are based were obtained
from
executives attending classes at IBM's Advanced Business
Institute. They repre-
sented over 500 firms in 15 industries. In addition to the survey,
we used inter-
views and observations from consulting engagements. Analysis
of the survey
data shows that the six most important enablers and inhibitors,
in rank order
are:
Enablers Inhibitors
• Senior executive support for IT • IT/business lack close
relationships
• IT involved in strategy development • IT does not prioritize
well

• IT understands the business • IT feils t o meet its
commitments
• Bustness/n partnership • IT does not understand business
• Well-prioritized IT projects • Senior executives do not support
IT
• IT demonstrates leadership • IT management lacks leadership
CAUFORNIA MANAGEMENT REVIEW V O L 42, NO. I
FALL 1999 109
Achieving and Sustaining Business-IT Alignment
What is striking about these lists is that the satne set of topics
(executive
support, understanding the business, IT-business relations, and
leadership) show
up in both. In previous work, we have presented the detailed
findings of our
enablers-inhibitors study."* The purpose of this article is to
present the methodol-
ogy that we have applied that leverages the enahlers and
inliibitors.
The importance of alignment has been well known and
documented since
the late 1970s,' Alignment grows in importance as companies
strive to link husi-
ness and technology in light of dynamic husiness strategies and
continuously
evolving technologies.'' What is not clear is how to achieve and

sustain this har-
mony between business and IT and what the impacn of
misalignment might be
on the firm.'
The strategic alignment model, suggested by Henderson and
Venkatra-
man," was applied by the authors throughout this five-year
research project. The
components of our modifications of their model are shown in
Figure 1. It is the
relationships that exist among the twelve components of this
model that define
husiness-IT alignment.
Theoretical Perspectives and Previous Research
The alignment of information teclmology and business strategy
to lever-
age the capabilities of IT and to transform the business has
increased in impor-
tance over the past few years as firms strive for competitive
advantage in a
diverse and changing marketplace." In light of this, there has
been a great deal
of research and insight into the linkages between business and
IT,'° the role of
partnerships between IT and business management," as well as
the need to
understand the transformation of business strategies resulting
from the competi-
tive use of rr.'^ Firms have been able to change not only their
business scope,
but also their infrastruaure (see Figure 1) as a result of IT
innovation.' *

Traditional methods for developing business strategies have
failed to take
full advantage of IT. Information technology is frequently
treated as a "cost cen-
ter" or viewed as an "expense" rather than an enabler or driver
of husiness
value.'" Strategic alignment sheds new light on IT and its role
in the develop-
ment of business strategies. It considers the strategic fit
between strategy and
infrastructure as well as the functional integration between
business and IT.
Several frameworks have been proposed to assess the strategic
issues
regarding the role of IT as a competitive weapon. They have
not, however,
yielded empirical evidence nor have they provided a roadmap to
carry out align-
ment. There have also been numerous studies that focus on
business process
redesign and reengineering as a means to achieve competitive
advantage with
IT.'' This advantage comes from the appropriate application of
IT as a driver or
enabler of business strategy.
Alignment of IT strategy with the organization's business
strategy is a
fundamental principle that has been advocated for over a
decade.'"* IT managers
10 CAUFORNIA MANAGEMENT REVIEW V O L 42. N Q I
FALL 1999

F I G U R E I . The Twelve Components of Alignment
Business Strategy
Business Scope—Includes the markets, products,
services.groups o( cuiloinet s/dietilb. dnd
where an enterprise competes as well as the competitors and
potential competitors that affect the ,
business environment.
Distinctive Competencies—The critical success factors and core
competencies that provide a firm
with a potential competitive edge.This includes brand, services,
research, manufacturing and product
development, cost and pricing structure, and sales and
distribution channels.
Business Governance—How companies set the roles and
relationship between management
stockholders, and the board of directors. Also included are how
the company is affeaed by government
regulations and how the firm manages its relationships and
alliances with strategic partners.
Organization Infrastructure and Processes
Administrative Structure—The way the firm organizes its
businesses. Examples include central,
decentralized, matrix, horizontal, vertical, geographic, federal,
and fijnctional.
Processes—How the firm's business activities (the work
performed by employees) operate or flow.

Major issues include value-added activities and process
improvement
Skiils—H/R considerations such as how to hire/fire, motivate,
train/educate, and culture.
IT Strategy
Technoiogy Scope- -The important infoiTnation applications
and technologies.
Systemic Competencies—Those capabilities (e.g., access to
information that is important to the
creation/achievement of a company's strategies) that
distinguishes the IT services.
i T Governance—How the authority for resources, risk, conflict
resolution, and responsibility for IT
IS shared among business partners. IT management and service
providers. Project selection and
priorrtization issues are included here.
IT Infrastructure and Processes
• Architecture—T he technology priorities, policies, and choices
that allow applications, software,
networks, hardware, and data management to be integrated into
a cohesive platform.
• Processes—Those practices and activities carried out t o
develop and maintain applications and
manage IT infrastructure.
• SIdils—!T human resource considerations, such as hovv to
hire/fire, motivate, train/educate, and cuttui"e.

Source: J, Luftman, Competing in the /njbrmat/on Age:
Sirowgic Ahgnmeni in Praaice (New Yoric, NY: Oxfonj
Universfty Press, 1996),
must be knowledgeable about how these new technologies can
be integrated
into the business (in addition to the integration among the
different technologies
and architectures) and must be privy to senior management's
tactical and strate-
gic plans. Both IT and business executives must be present
when corporate strat-
egies are discussed. IT executives must be able to delineate the
strengths and
weaknesses of the technologies in question and understand the
corporate-wide
implications.'^ While alignment is discussed extensively from a
theoretical
CAUFORNIA MANAGEMENT REVIEW VOL 42. NO. I F A a
1999 I I I
Standpoint in the literature, there is scant empirical evidence
regarding the
appropriate route to take for aligning business and IT strategies.
Study Design
In a multi-year study conduaed from 1992-1997, executives
representing
over 500 Fortune 1,000 U.S. organizations attended seminars
addressing align-

ment at IBM's Advanced Business Institute in Palisades, New
York. They asked
for assistance in assessing the positioning and contribution of
IT in their organi-
zations and identifying their personal role in aligning
organizations. They
wanted to know what steps were needed for successful
alignment and how to
enhance business performance and effectiveness through IT.
The seminars were
addressed to senior business executives from various functional
areas (e.g.,
finance, marketing, human resources) of private and public
sector organizations.
Representative titles included President, Chief Operating
Officer, Chief Financial
Officer, Chief Information Officer, Director of Human
Resources, General Man-
ager, Senior Vice President of Sales and Marketing, Physician
in Chief, Provost,
and State Senator. The industries represented included
insurance, health,
finance, education, government, utilities, transportation, and
manufacturing.'"
A computer-based assessment tool developed by the authors was
used to
address the alignment of business and IT in firms. The purpose
of the too! was
to help firms identify areas of strength and weakness related to
the business-IT
relationship as defined by the strategic alignment model
described in Figure 1.
Information provided by the tool suggests opportunities to
evaluate, achieve,
and maintain successful approaches to leveraging IT

investments. Results
showed that executives frequently do not recognize their firm's
true alignment
relationship. They perceive their firm to be following a certain
course of action
when they should be concentrating on an entirely different
area.'^
The study asked the respondents to identify the enablers and
inhibitors
to achieving harmony between business and IT in their
organizations. The
responses are shown in Figures 2 and 3. An important aspect of
the survey
is that we solicited the executives' free expression of their
opinions on factors
from their own experience within their firms. The executives
were asked to rate
the perceived strength of alignment within their companies.
Half believed that
their business and IT strategies were properly aligned, 42% said
they were not
aligned, and 8% were unsure or had no opinion. Within the
context of their
function (business or IT), the executives were then asked to
identify the key
enahlers and inhibitors to achieving alignment in their
organization. The notion
that the respondent's functional area (business or IT) would
influence the rank-
ing of enablers and inhibitors was a!so tested using the
questionnaire data.
Analysis of the data showed significant similarities over the
five-year span
of the study In the perceived importance and ranking of both
enahlers and

inhibitors. The activities identified as enablers and inhibitors
were comparable
across industry and job title.^"
112 CAUFORNIA MANAGEMENT REVIEW VOL 42. NO, I
FAU 1999
F I G U R E 2. Enablers to Alignment by Year
0%
Percentage
5% 10% 15% 20% 25%
Senior executives support IT
IT involved in strategy develop.
IT understands business
(T, non-lT have close relationship
IT shows stfxjng leadership
IT efforts are well prioritized
IT meets commitments
Other
IT plans linked to business plans

IT achieves its strategic goals
IT resources shared
Goats/vision are defirwd
IT applied for competitive advanuge
Good IT/Business communication
Partnerships/alliances
CALIFORNIA MANAGEMENT REVIEW VOL 42, NO. I FALL
1999
F I G U R E 3 . Inhibitors to Alignment by Year
0% 5%
IT, non-IT lack close relationship
IT does not prioritize well
IT liails to meet its commitments
IT does not understand business
Senior execs, do not support IT
rr management lacks leadership

IT fails to achieve strategic goals
Other
Budget & staffing problems
Antiquated IT infrastructure
Goats and visions are vague
IT does not communicate well
Resistance from senior execs.
IT, non-IT plans are not linked
Percentage
10% 20% 25%
14 CALIFORNIA MANAGEMENT REVIEW VOL 42, NO. I
FALL 1999
Strategic Alignment as a Process
How do we maximize alignment enablers and minimize
inhibitors? We
have used a six-step approach that is designed to make strategic
alignment work
in any organization.
• Set the goals and establish a team.

• Understand the business-IT linkage.
• Analyze and prioritize gaps.
• Specify the actions (project management).
• Choose and evaluate success criteria.
• Sustain alignment.
This process mirrors traditional strategic planning and
incorporates an
organizational assessment using the strategic alignment model.
It begins by set-
ting the organizational goals and establishing a team. The
importance of setting a
clear direction for the organization prior to selecting
leclinologies and how they
will be applied cannot be overlooked. Too often the tendency is
to seize upon a
new IT product or service without giving full consideration to
its strategic fit to
a business plan. The more appropriate approach is to initially
ask some questions
related to specific organizational goals, such as is the
organization trying to
improve its products and services, its customer relationships, or
its competitive
position?
For the Charles Schwab Corporation, the business focus for
many years
has been to lower its operational costs and offer superior
service at lower prices
to its investors. The company's traditional investor seeks

discount brokerage
services and is unwilling to pay for investment advice. In the
late 1990s,
Schwab's direction shifted toward delivering customized
information to ihe
investor as quickly as possible. In so doing, Schwab was
converting to a full-
service brokerage firm. In the years since it was incorporated in
1971, the com-
pany has been a leader in using information technology as an
important tool in
meeting its changing, but well-defined business goals.
The steps taken to set the goals, market the objectives of the
assessment,
and negotiate for an executive sponsor, business champion, and
team are cru-
cial. Senior executive support must be obtained (the number one
enabler identi-
fied in our research). The highest-level business executive
representing the
organization being assessed should be the sponsor. Selecting a
cross-functional
team consisting of from six to twelve executives from the major
business units
and IT is the next step. The team would typically report to the
senior executives
that report to the sponsor. If the sponsor were the CEO, the
team would be com-
posed of Senior Vice Presidents. Their credibility and
knowledge of the business
are key. They must also be open to new ideas and be willing to
take a holistic
view of the organization. IT's involvement in the development
of the strategy
is essential (the second ranked enabler in our research). The

critical first step
in the planning process is to ensure that the right team is
committed and that
CAUFORNIA MANAGEMENT REVIEW V O L 42. NO. I
FALL 1999 115
they dearly understand and are in agreement with the goals of
the business.
Although there are times when IT is or should he the driver of
business strategy,
our experience indicates that business goals must be ciearly
specified and under-
stood before proceeding with the alignment analysis.
The second step in the process is to understand the linkage
between IT and the
business. The organization must understand the current and
future business and
IT environments by assessing the twelve strategic alignment
components (see
Figure 1). There should be no time constraints when discussing
the future.
Brainstorming techniques work well. Each individual team
member's point of
view and the discussions that ensue provide the dynamism that
results in a pow-
erful lisi of opportunities and problems. A skilled facilitator can
prove invaluable
during this brainstorming session. These discussions promote
IT'S understanding
of the business, while promoting the business's understanding of

IT (the third
ranked enabler in our research). This mutual understanding
results in greatly
improved relationships across the different parts of the
organization (the fourth
ranked enabler).
The third step, analyzing and prioritizing the gaps between the
current and
future states of each of the twelve alignment components, will
provide the
major content of the business and IT strategies. Team members
should be asked
to suggest opportunities and problems. A full day is usually
necessary to do this
part of the assessment. The discussion should be kept free
flowing. Most execu-
tives find it helpful to discuss the results with their staffs and
then return a week
later for another full day of brainstorming with the assessment
team. The gaps
(which are candidates for projects) and their value can then be
described in busi-
ness terms. Focusing on these gaps leads to a prioritized
identification of IT pro-
jects thai can leverage business opportunities (the fifth ranked
enabler). The
gaps that demand the highest priority are those that are mosi
likely to occur and
most likely to have a major impact on the business. The gaps
that have the low-
est priority are those that are least likely to occur and least
likely to have a major
impact on the business, and thus are not regarded as important
project candi-
dates. The prioritized list of projects is reviewed with the

sponsor and the senior
executives for approval. A business member from the team
should do the pre-
sentation. Approval is obtained for several of the highest
priority projects and
the executive team develops a much belter appreciation for IT
The presentation
should also be used to communicate with the rest of the
organization.
For most organizations, the main contribution that IT can make
to a
business strategy is to provide a distinctive competency in the
marketplace. The
computer-based assessment tool discussed earlier (or an
equivalent tool) should
be used to establish a base case for alignment. Attention should
then be focused
on potential breakthrough ideas for using information to achieve
competitive
advantage. It is possible that a new business scope (Figure 1)
can be developed
through the innovative use of information, but more likely it is
the enhance-
ment of distinctive capabilities through information that will
provide the most
value to the business.
16 CALIFORNIA MANAGEMENT REVIEW V O L 42, NO. 1
FALL 1999
For Charles Schwab, the step of examining how IT can enable

distinctive
competency is straightforward. Schwab has a history of relying
on technology to
provide top customer service and to lower costs. To meet the
customer need of
retrieving stock quotes and placing orders rapidly, Schwab
introduced TeleBro-
ker, a fully automated telephone system, in 1989. As newer IT
capabilities
became available through the years, Schwab analyzed how these
technologies
might help them meet their business goals. Some examples are
Equalizer, a soft-
ware product that allows personal computer users to trade
stocks online, and
StreetSmart, the first Windows-based software to provide online
trading of
bonds, equities, and mutual funds.
The fourth step is to specify the actions necessary to carry out
the recom-
mendations. Frequently, the focal areas for the actions to be
taken are in the
infrastruaure (Figure 1) domains of the strategic alignment
model. For eilher
business or IT, three areas to consider are the policies to be set,
the processes to
be developed or redesigned, and the skills to be acquired. After
this analysis has
been completed, the next questions pertaining to project
management that must
be answered include:
• What are the deliverables?
• What has to be done?

• What is the completion date?
• Who is responsible?
• What are the risks?
Schwab was able to capitalize on previous technological
capabilities
as new technology initiatives were introduced. The Schwab
Mutual Fund
OneSource program, introduced in 1992, enabled customers to
purchase mutual
funds much more easily than was possible previously.
Customers could now
purchase from their own brokerage account using any of
Schwab's trading inter-
faces, inciuding TeleBroker and StreetSmart.
After the strategy has been set and the action plan has been
specified,
the next step is to choose atid evaluate success aiteria. This
necessitates revisiting tlie
strategic goals and selecting the measurement criteria to apply
in assessing the
implementation of the project plans. Some frequently used
criteria are: sustain-
ability—the ability to preserve an advantageous market
position; flexibility—the
potential for revision in strategic choices; and economics—the
financial analysis
of the tradeoffs among varying dimensions of value.
Having established a sound business strategy through the years,
Schwab
had to evaluate their strategic choices. In 1995, when the

Internet began to
have a profound effect on the economics of the brokerage
industry, they decided
to introduce e.Schwab. This new service allowed investors to
obtain account
information through the Internet, fin 1998. e.Schwab was
replaced by
www.schwab.com.) During the last four years, Schwab's
embrace of ihis tech-
nology has resulted in a transformation of their business. They
have become an
CAUFORNIA MANAGEMENT REVIEW VOL 42. NO. I FALL
1999 117
Achieving and Sustaining Business-IT ^ i g n m e n t
information provider in addition to a transaction processor. In
so doing, the "no-
frills" discount broker is becoming a full-service brokerage
finn.
Obtaining IT-business alignment is a difficult task. The last step
in the
process, sustaining IT-business alignment is even more
difficult. To sustain the ben-
efit from IT, an "alignment behavior" must be developed and
cultivated. There
are several significant behavioral traits that are characteristic of
organizations
that have linked IT and business strategies (see Figure 4). By
adopting these
behaviors, companies can increase their potential for complete
alignment and

improve their ability to gain business value from invest-
FIGURE 4 mentsinrr.
^ ^ ^ ^ ^ ^ ^ _ ^ ^ ^ ^ ^ _ As is true for all functions of a
business (e.g.,
finance, marketing, human resources), the strategy for IT
Successfully aligned should be a major component of the
business strategy. At
organizations are those United Services Automobile Association
in San Antonio,
that concentrate on: Texas, strategic alignment is critical to
success. According
• allowing for IT and business to CEO Robert Herres,
"Technology forces us to think
capabilities to be weighed ^^^^^^ 1^^^ ,̂̂̂̂ j ^^^^^ ^ ^ j .
processes intersect. Alignment
equally . , r , , .
across busmesses is critical for us because our goal is to
necessarŷ forsuccis exploit the efficiencies of centralized
information manage-
, ment while we decentralize service delivery."^^
• empowering workers in a '
team-based environment An unrelenting focus on customer
needs has never
• gaining agreement on been more critical than it is today. IT
can play an impor-
outcomes required from ^^^^ ^^1^ ^^ attracting and keeping
customers, and t h e
ttie business processes i . . . o • i_ v -r-u ^ i _ l

results should flow to the bottom line. The Charles
• inst-llingasense cjfur̂̂ ency in j ^ Corporation story is one of
transforming a n
managing ITenabled pnojects f i o
^ , , industry. The effect of schwab.com has been to make
• leading m the deployment of , , , r 11 . i i ^^t r
IT to create customer value Schwab a player in full-service
brokerage. The transform-
. nurturing a culture of open "^8 *^v^"t'" according to co-CEO
David Pottruck, "is t h e
human communication ability to deliver personalized
information to the customer
in real time, at virtually n o *̂̂
Frequently, the latest technology instinctively becomes
the solution. Successful firms resist this trend. Instead, they
begin by deciding
what results they must have from the business strategy and
business processes.
It is then that technologies are weighed along with other
resources as possible
solutions. Much of the potential for success has to do with
governance. IT gover-
nance plays a significant role in prioritizing IT initiatives as
well as sustaining
aligned business-IT organizations.
For alignment to succeed, a climate of clear communication is
an absolute
necessity. The building of effeaive relationships with line
managers is imperative
for successful IT organizations. IT personnel at all levels must

develop strong,
ongoing partnerships with line managers. Only through these
relationships can
the necessary communications occur to ensure that both
business and technol-
ogy capabilities are integrated into effective solutions for each
level of the
business.^*'
18 CALIFORNIA MANAGEMENT REVIEV
̂̂ VOL 42. NO. I
FALL 1999
F I G U R E 5, IT Governance AlternativesSkills in project
management are
always important for success in IT imple-
mentation, but for these relationships to
endure, skills in people management are
more critical than ever. The skills that orga-
nizations need to get IT projects completed
have assumed new dimensions. This is a
major shift for most IT professionals. Tech-
nical skills have always been the preemi-
nent requirement in staffing. However,
IT education in many organizations now
includes interpersonal skills such as aaive
listening, marketing, negotiation, and team
building."^'
IT Governance Practices
The relationship that results among
the team (business and IT) participating in

the six-step process should be continued
and expanded. Based on the focus of the
senior steering committee, typical members
include business process managers, change
managers, external customers, functional
managers, and vendors. In some cases, this
team remains intact as the IT Executive
Steering Committee. Its job is to determine
an IT governance direction that both
ensures that all of the enablers are main-
tained and that provides a platform for IT
leadership.
The process for establishing and
maintaining IT-business alignment is ongo-
ing. IT governance addresses how to priori-
tize and select projects and how to
appropriately allocate IT resources {e.g.,
staff, budget). Figure 5 provides an alpha-
betized list of some IT governance alterna-
tives. No one of the alternatives can assure
effeaive business-IT alignment. It is the ~
appropriate combination of most of them
that can lead to sustained alignment. Frequently, it is the
assessment of the
alternatives described in Figure 5 that becomes the initial
charge of the steering
committee.
Budget: how financial resources are allocated
to projects
Career Crossover: IT stafF working in the
business unit: business unit staff working in IT
C I O Reporting to CEO: reporting structure

having head IT executive report to head business
executive
Communicate, Market, Negotiate: IT staff
must learn and continuously execute effectively
Education, Cross-Training: IT must understand
the business; business must understand IT
Liaison: primary point of contact for facilitating
IT business relationship
Location: physical placement of IT staff and
business staff together
Organization: alternatives including:
• tr aditional structures like centralized, decen-
tralized, geographic, horizontal, vertical, etc
• federated (hybrid) structure centralizing
infrastructure and decentralizing application
support
• Centers of Competency (Centers of
Excellence) that leverage specialized skills
• insourcing/outsourcing decision identifying
what functions to keep in house and what
functions to assign to external partners
Process: the team and approaches applied to
define strategies, plans, priorrties, and mate IT
decisions
Shared Risks, Rewards/Penalties, and

Responsibilities: strong partnership of business
and IT leaders
Steering Committees (see Figure 6);
• Strategic: senior executives setting "long-
term" direction
• Tactical: middle management planning
• Operational: day to day decisions
Value Measurements: formal assessment and
review of IT's contributions to business strategies
and infrastructure
CALIFORNIA MANAGEMENT REVIEW VOL 42. NO. I FALL
1999 119
Achieving and Sustaining Business-IT Alignmerrt
F I G U R E 6. Steering Committee
Critical Success Factors
To have a Strategic Steering Committee
composed of a group of senior business execu-
tives meeting on a regular basis is considered
among tlie best practices for strategic align-
ment. Successful IT Steering Committees con-
centrate tbeir attention on the areas described
in Figure 4. Obtaining commitment from these
executives is difficult, but keeping their com-
mitment is even harder. The alphabetized list
in Figure 6 highlights many of the critical suc-

cess faaors for sustaining the steering commit-
tee. The critical success factors are important
for all three levels of steering committees
(strategic tactical, and operational).
To ensure success, appropriate value
measurements must be seleaed and continu-
ously tracked. Stakeholders ought to be aware
of the measurements and the actions that will
be taken based on their results. IT should be
able to demonstrate business value. These
measurements should affirm IT's role in pro-
viding the organization with an opportunity to
do something new, allowing the organization
to perform better, faster, or cheaper. At a mini-
mum, IT must understand the priorities of
business value measurements and how the
business perceives the contributions of IT.
Conclusion
Strategic alignment is an ongoing
process. There is no single strategy or single
combination of activities that will enable a firm to achieve and
sustain align-
ment. Technology and the business climate are changing far too
quickly. The
twelve components of alignment are in constant flux and their
interrelationships
are as unique as the companies that follow them. However, the
enablers and
inhibitors to achieving alignment have remained consistent over
the past five
years.

Executives should work toward minimizing those activities that
inhibit
alignment and maximize those activities that bolster it. They
should concentrate
on improving the relationships between the business and IT
functional areas,
working toward mutual cooperation and participation in strategy
development,
maintaining executive support, and prioritizing projeas more
effeaively.
Bureaucracy: focus on reduction/elimination
to expedite opportunities to leverage IT
Career Building: opportunities for
participants to learn and expand responsibilities
Communication: primary vehicle for IT and
business discussions and sharing knowledge
.icross parts of the organization
Compiex Decisions: do not get involved in
"mundane" areas
Influence/Empowerment: authority to have
decisrons carried out
Low Hanging Fruit/Quicic Hits: immediate
changes earned out when appnspnate
Marketing: vehicle for "selling" the value of
IT to the business
Obi«ctlve5, Measurements: formal
assessment and review of ITs business
contributions

Ownership: responsible/accountable for the
decisions made
Priorities: primary vehicle for selecting what
is done, when, and how much of resources to
allocate
Reiatlonships: partnership of business and IT
Right Participants: cooperative, committed,
respected team members with knowledge of
the business and IT
Share Risks: equal accountability, recognition,
responsibility, rewards, and uncertainty
Structure. Facilitator: pnDcesses and
tciidership to ensure the right focus
120 CALIFORNIA MANAGEMENT REVIEW VOL 42, NO, I
FALL 1999
Achieving and Sustaining Business-fT Alignment
Alignment is a dynamic, complex process that takes time to
develop
and even more effon to sustain. Companies that have achieved
alignment can
build a strategic competitive advantage that will provide them
with increased
visibility, efficiency, and profitability to compete in today's
changing markets.
The importance of cooperation between business and IT to

maximize investment
in technology remains dear. As IT plays an increasing role in
defining corporate
strategies, its correct application will facilitate a more
competitive and profitable
organization. The careful assessment of a firm's alignment is
important to ensure
IT is being used to appropriately enable or drive the business
strategy.
Notes
1. J. King, "Re-engineering Focus Slips," Computerworld.
March 13, 1995, p. 6;
J. Henderson and N. Venkatraman, 'Strategic Alignment: A
Model for Organiza-
tional Transformation Via Information Technology," Working
Paper 3223-90,
Sloan School of Management, Massachusetts Institute of
Technology, 1990;
J. Henderson and N. Venkatraman, "Aligning Business and IT
Strategics," in
J. Luftman, Competing in the Information Age: Practical
Applications of the Stratet^ic
Alignment Model (New York, f̂̂Y: Oxford University Press,
1996); Michael J.Earl,
"Experience in Strategic Information Systems Planning," MIS
Quarterly. 17/1
(1993): 1-24;J. Luftman, Competing in the Information Age:
Practical Applications of
the Strategic Alignment Model (New York, NY: Oxford
University Press, 1996);
J. Luftman, P. Lewis, and S. Oldach, "Transforming the
Enterprise: The Alignment
of Business and Information Technology Strategies," IBM
Systems Journal. 32/1

(1993): 19S-221; L. Goff, "You Say Tomayto, I SayTomahto,"
Computerworld.
November 1, 1993, p. 129; S. Liebs, "We're All in This
Together,' Information Week.
October 26, 1992. p. 8; R. Watson and J. Brancheau, "Key
Issues In Information
Systems Management; An International Perspective,"
Information & Management.
20 (1991): 213-23; W. Robson, Strategic Management and
Information Systems: An
Integrated Approach (London; Pitman Publishing, 1994).
2. C. Wang, Techno Vision II (New York, NY; McGraw-Hill,
1997).
3. J. Luftman. R. Papp, and T Brier, "Enablers and Inliibltors of
Business-IT Align-
ment," Communications of the Association for Information
Systems. Volume 1, Article
11, 1999; J. Luftman, R. Papp, and T Brier, "The Strategic
Alignment Model:
Assessment and Validation.' Proceedings of the Information
Technology Management
Group of the Association of Management. 1 3th Annual
International Conference,
Vancouver, British Columbia. Canada, August 2-5, 1995, 57-66.
4. Luftman, Papp, and Brier (1999), op. cit.
5. E. McLean and J. Soden. Strategic Planning for MIS (New
York, NY; John Wiley &
Sons, 1977); IBM, Business Systems Planning, Planning Guide.
GE20-0527, IBM Cor-
poration, White Plains. New York, 1981. ?. mWs, Managing
Service Industries (New
York. NY: Ballinger, 1986); M. Parker and R. Benson,

Information Economics (Engle-
wood Cliffs, NJ: Prentice-HaII. 1988); J. Brancbcau and J.
Wetberbe. "Issues In
Information Systems Management," MIS Quarterly, 11/1 (1987):
23-45; P. Dixon
and D. John, "Technology Issues Eacing Corporate Management
in tbe 1990s,"
MIS Quarterly. 13/3 (1989): 247-255; F. Niederman, J.
Brancheau. and J. Weth-
erbe, "Information Systems Management Issues for the 1990s,"
MIS Quarterly
15/4 (1991); 475-95.
6. R. Papp, "Determinants of Strategically Aligned
Organizations; A Multi-industry,
Multi-perspective Analysis," Dissertation, Stevens Institute of
Technology, Hobo-
ken, NJ, 1995; Luftraan (1996), op. d t .
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1999 I2I
7. R. Papp and J. Lufiman. "Business and IT Slrategic
Alignmeni: New Perspeaives
and Assessments,' in Proceedings of the Association for
Information Systems. Inaugural
Americas Conference on Infonnation Systems, Piltsburgh, PA,
August 25-27,
1995.
8. Henderson and Venkatraman (1990), op. cit.; Henderson and
Venkatraman

(1996), op. cii.; Luftman (1996), op. cit.
9. E, Faltermayer, "Competitiveness: How US Companies Stack
Up Now," Fortune.
April 18, 1994. pp. 52-64; K. Adcock, M. Helms, and K. Wen-
Jang, "Information
Technology: Can It Provide a Sustainable Competitive
Advantage?" Infonnation
Strategy: The Executives Journal {Spring 199?). pp. 10-15; R.
Cardinali, "Informa-
tion Systems—A Key Ingredient to Achieving Organizaiional
Competitive Strat-
egy." Compu/frsm Mc/wjcfry, 18 (1992): 241-245.
10. Y. Chan and S. Huff, "Strategic Information Systems
Alignment," Business
Quarterly. 58/1 (1993): 51-56; Luftman (1996), op. cit.;
Michael J. Earl. Corporate
Information Systems Management (Homewood, IL:, Richard D.
Irwin. Inc.. 1983);
J. Henderson, J. Thomas, and N. Venkatraman. "Making Sense
of IT: Strategic
Alignment and Organizational Context." Working Paper 3475-
92 BPS, Sloan
School of Management, Massachusetts Institute of Technology,
1992.
11. P. Keen. "Do You Need an IT Strategy?'in Luftman (1996),
op. cit.; B. Ives,
S. Jarvenpaa, and R. Mason, "Global Business Drivers: Aligning
Information Ttch-
nology To Global Business Strategy." IBM Systems .loumal.
32/1 (1993): 143-161.
12. A. Boynton, B. Viaor, and B. Pine II. "Aligning IT with
New Competitive Strate-

gies,' in Luftman (1996), op. cit.; W. Davidson, "Managing the
Business Transfor-
mation Process." in Luftman (1996), op. cit.
n . P. Keen, Shaping the Future {Boston, MA: Harvard Business
School Press, 1991);
R. Foster. Innovation: The Attacker's Advantage {New York.
NY: Summit Books.
1986).
14. A. Alter, "The Profit Center Paradox.' Computerworld, April
24, 1995, pp. 101-105;
Henderson and Venkatraman (1996). op. cit.; P. Pyburn,
"Redefining the Role of
Information Technology," Business Quarterly, 55/3 {Winter
1991): 89-94.
15. J. Rockan and J. Short, "IT in the 1990s: Managing
Organizational Interdepen-
dence," Sloan Management Review. 30/2 (Winter 1989): 7-17;
T. Davenpon and
J. Short, "The New Industrial Engineering: Infonnation
Technology and Business
Process Redesign," Sloan Management Review. 31/4 (Summer
1990): 11-27; M.
Hammer and J. Champy. Reengineering the Corporation: A
Manifesto for Business Revo-
lution (New York, NY: Harper Btisiness, 1993); M. Hammer
and S. Stanion, The
Reengineering Revolution (New York, NY: Harper Business,
1995).
16. Robson, op. cit.; L. Rogers, "Alignment Revisited," CIO
Magazine. May 15. 1997;
J. Rockan, M. Earl, and J. Ross. "Eight Imperatives for the New
IT Organization,"

Sloan Management Review, 38/1 (Fall 1996): 43-55.
17. Rockart. Earl, and Ross. op. cit.
18. Luftman. Papp, and Brier (1999), op. cit.
19. Luftman (1996). op. cit.; Papp and Luftman (1995), op. dt.
20. Luftman. Papp. and Brier (1999), op. cit.
21. Ibid.
22. D.A. Garvin. 'Leveraging Processes for Strategic
Advantage." Harvard Business
Review, 73/5 (September/October 1995): 76-79.
23. E. Schonfeld, "Schwab Puts It All Online," Fortune.
December 7. 1998, pp. 94-100.
24. Luftman. Papp, and Brier (1999), op. cit.; Rockan. Earl, and
Ross (1996), op. dl.
25. Rockan, Earl, and Ross (1996). op. cit.
122 CAUFORNIA MANAGEMENT REVIEW V O L 42. NO. I
FALL 1999
Summer 2010 Journal of Computer Information Systems 107
examININg taCtICal INfoRmatIoN
teCHNology — BuSINeSS alIgNmeNt
moNIdeepa taRafdaR SufIaN qRuNfleH
The University of Toledo University of scranton
Toledo, OH 43606 scranton, PA 18510
Received: August 8, 2009 Revised: October 25, 2009 Accepted:
November 19, 2010
aBStRaCt

The goal of strategic IT-business alignment has been to
deploy IT applications that support business strategy. In spite of
voluminous “strategic” IT plans and numerous studies on
strategic
IT-business alignment, accounts of wasted IT investments and
deployment of business-irrelevant applications are rampant,
indicating lack of alignment at the tactical level, that is, lack
of execution-level processes addressing issues of resources,
objectives and implementation-priority matching, between IT
and
the business. We answer the question: What are the aspects and
outcomes of tactical IT-business alignment? We (1) identify six
aspects of tactical IT-business alignment, and (2) show how
they
lead to four outcomes — implementation of planned
applications,
execution of IT-enabled aspects of business strategy, increased
credibility of the IT function and increased business value from
IT projects. Our results are based on qualitative primary data
(45 hours of interviews with 28 IT and functional managers and
company documents) from four organizations.
Keywords: IT-business Alignment, Tactical IT-business
Alignment, IT strategy, Project Management
1. INtRoduCtIoN aNd motIVatIoN
The goal of strategic IT-business alignment has been to
facilitate the deployment of IT applications, infrastructure and
human talent that support business needs vis-à-vis products
and processes [13]. That is, if strategic IT-business alignment
exists in a firm, it is expected that the firm has a plan to deploy
IT necessary for supporting its business strategy. However, the
actual acquisition and implementation of the planned
applications
requires execution-level IT-business alignment, the absence of
which is one reason why in spite of voluminous “strategic” IT

plans, accounts of wasted IT investments, failed IT projects,
and the deployment of business — irrelevant applications and
technologies are rampant [20].
To give examples, during 2002-2004, $100 billion to $ 150
billion worth of IT projects failed and an estimated 68% of IT
projects did not fulfill originally stated business goals or
deliver
envisioned business benefits [9]. Another study [17] found that
30% to 75% of new systems and applications do not improve
work processes or register significant financial impact. During
2000-2002, companies threw away $130 billion of IT
applications
and infrastructure they purchased [18]. As of 2005, 50% of all
IT
projects finished over-budget and over-time [16]. Further, in
spite
of apparently “good” relations between CIO’s and their C-level
counterparts at the top management level, the interface between
middle- and junior-level IT managers and functional managers
is
often strained and hostile, resulting in communication problems.
Centralized implementation decisions by corporate IT often face
resistance by middle-level functional managers who prefer
greater
control over applications that are deployed in their departments,
leading to conflict between the IT department and other
functions
and the consequent lack of resources and co-operation for
execution. These examples show a clear lack of alignment at the
tactical level, that is, a lack of processes that can address issues
of communication and matching of resources, objectives and
implementation priorities, between IT and the business at the
execution levels.
The lack of tactical alignment leads to gaps between IT that is
planned and envisioned (and IT that supports business strategy)

and IT that eventually gets executed and implemented, and
given that IT plays important roles in facilitating many aspects
of business, to possible failures in the execution of business
strategy.
studies on strategic IT-business alignment have addressed
processes for aligning business plans/strategies with IT plans/
strategies [24, 13, 25] and involving the CIO in executive-level
planning processes [4]. However there is dearth of literature
identifying IT-business alignment processes at the tactical level.
Recent work has turned to alignment processes at a higher level
of granularity such as interaction between IT and functional
managers [22, 11], IT structure-organization structure alignment
[2], and functional commitment to IT projects [23]. Continuing
this focus, we address the following research questions:
1. What are the aspects of tactical IT-business alignment?
2. What are its outcomes?
based on field data (45 hours of interviews with 28 IT and
functional managers and company documents) from four
manufacturing and service organizations, our findings show that
routines and processes for tactical IT-business alignment can
be encapsulated in six aspects (Communication, Governance,
skill, sourcing, IT Professionals and Projects) that lead to four
outcomes (Implementation of planned applications, Execution
of
IT-enabled aspects of business strategy, Increased credibility of
the IT function and Increased business value from IT projects).
The paper thus contributes to emerging literature on finer-
grained
levels of analysis of IT-business alignment.
2. lIteRatuRe SuRVey
There are numerous studies on strategic IT-business
alignment1.

broadly speaking, such alignment implies that there is a match
1. For a recent, detailed review of strategic IT-business align-
ment, see Chan and Reich (2007).
108 Journal of Computer Information Systems Summer 2010
between the firm’s business strategy and the planned portfolio
of
IT applications. It is accomplished by linking strategic business
and strategic IT plans [5, 24, 13] and activities such as
participation
of the CIO (CEO) in the business planning process (IT planning
process) [11]. strategic IT-business alignment leads to improved
business performance across different business strategies and
industries, and increased effectiveness of the IT function [25].
However, increasing complexity, organizational span and
number of stakeholders of IT projects, increased end-user in-
volvement in IT projects, rapid changes in technology capa-
bilities, the long time between the beginning and end of many
implementation exercises, and the dynamic nature of strategic
IT
plans themselves, have given rise to the need for developing
more
granular and execution-driven aspects of IT-business alignment,
with the anticipation of understanding dynamic and adaptive
alignment processes that can aid the execution of IT strategy.
Recent alignment research has focused on a number of
alignment
approaches of this kind.
2.1. alignment of Structure and decision making
Research has looked at alignment between organization

structure, locus of decision-making, diversification, and the IT
function. Centralized corporate decision-making structures (i.e.,
strong central direction and monitoring) strive for enterprise-
wide
economies and efficiencies, whereas decentralized structured
(i.e.,
greater autonomy at the business unit level) address localized
business needs and opportunities. Unrelated diversification and
high business unit autonomy should be aligned with primarily
decentralized IT structures whereas related diversification,
related
core businesses, and organizational centralization should be
aligned with centralized IT structures that emphasize efficiency,
standardized controls and integrative architectures. Where there
are more (less) opportunities for IT related cross-unit synergies,
business units where the strategic importance of IT is low
(high)
will implement centralized (decentralized) IT decision-making
[2]. A federal or hybrid IT form [26] is associated with matrix
structures and multidivisional companies.
2.2. Social alignment
social alignment [22] describes IT-business partnerships at
various organizational levels. It is accomplished in two ways.
First, by fostering cross-domain knowledge and building a
dialog
between IT professionals and functional managers to address
mindset blockages, such that IT professionals understand more
about the organization and its business, and functional managers
become familiar with existing and possible uses of IT in the
context of the firm and its industry [21]. second, through
informal
networks and relationships between businesses and Is
executives
in the form of proactive, positive and ongoing interactions

between them [4].
2.3. project alignment
The management of projects has emerged as an important
aspect of the implementation of applications and hence in the
execution of IT strategy. IT project alignment is the degree to
which an IT project’s deliverables match the organization’s IT
strategy and the project’s objectives [3]. Project selection and
governance are important for alignment, as are service levels
that
demonstrate contribution to the business. Factors important to
successful project completion include definition of clear project
mission, metrics and expected outcomes [15], communication
and
availability of required resources [8], synergies between project
group members [14], presence of project monitoring techniques,
and reducing goal conflict, shirking and information hoarding
among project members [15]. IT projects may be abandoned
due to cost overruns, schedule slippages, and technological
inadequacies [19]. Past project success, sunk cost, high risk
propensity of project members and high risk perception of the
project, lead to tendencies to continue with projects [12].
Practice-based accounts [1, 10] suggest a number of reasons
that make the management of IT projects difficult. First, a
typical firm has many simultaneous projects and often does not
have the information to leverage synergies across them. Efforts
are therefore duplicated, resulting in stretched resources and
schedule/cost slippages. second, there is often no prioritization
and whoever’s idea has the greatest passion wins. As a result,
projects are either orphaned or become the pet projects of the IT
functions with no business interest. Third, despite the presence
of strategic IT plans, the IT function and other departments
often
have conflicting opinions about technologies and priorities.

Fourth, there are ad-hoc project requests from user departments,
without specific business benefits/justification and without
informing the IT function. The IT function therefore does not
have an idea of what the departments want to achieve, making
it difficult for them to contribute in an informed way. Finally,
whereas IT plans are themselves dynamic, changing with day-
to-
day contingencies and mid-way changes in business strategies,
IT
execution is not correspondingly synchronized, because projects
are not dynamically monitored and consolidated.
2.4. outcomes of execution-focused alignment mechanisms
Execution-focused alignment processes lead to increased
quality of IT project planning and reduced number of
implementation problems [11], better systems integration, more
effective resource allocation, greater end-user satisfaction with
the IT function [2], harmonious relationships between the IT
function and other departments, and an organization structure
that
is matched with the IT architecture and infrastructure [7].
3. ReSeaRCH deSIgN
The objective of this study was to identify the aspects and
outcomes of tactical IT-business alignment. Our intention was
to observe (1) organizational processes and mechanisms for
achieving tactical alignment in firms and (2) how these
processes
lead to particular outcomes. From the point of view of
methodology
[6], the case study method is recommended for studying details
of how and why a phenomenon takes place; we thus adopted
this method. We executed a three-phased research design that
included (1) Questionnaire development, (2) Data collection and

(3) Data analysis.
In the first phase, we identified from our academic and prac-
titioner literature survey, a list of broad themes on execution-
level
alignment mechanisms. We then developed open-ended
questions
based on these themes, addressing IT roles and responsibilities
in
systems implementation, extent of IT centralization,
relationships
between IT and other functions, development of IT personnel
skills, technology choices regarding application development,
project management practices facilitating on-time/on-budget
execution, reasons for IT project failures, difficulties of
procuring
IT resources, and challenges in managing multiple vendors. The
questions formed the basis of the primary data collection.
In the second phase, we developed case studies in four study
sites, as given in Table 1. All of these firms had implemented or
were in the process of implementing major applications through
multi-year IT projects. We promised anonymity to the study
sites. We first contacted the CIO of each organization,
explaining
the purpose of the study and soliciting support. At each site
we interviewed CIO’s and senior/middle/junior level IT and
functional managers. Questions relating to technology sourcing
and IT professional skills were asked primarily to IT managers.
Other questions, i.e. those relating to project management,
project
failures, IT roles and responsibilities etc., were asked to
functional

and IT managers. The senior IT and functional managers were
asked to comment on all the questions. We triangulated findings
from the different managers and sought more than one interview
with a particular manager if we found discrepancies. We also
collected data from IT plan documents, minutes of project
meetings and internal memos. We interviewed 28 people (some
more than once) and each interview lasted 45 minutes to an
hour.
The interviews were taped and transcribed.
In the third phase, we coded the interviews in two iterations.
In the first, each author independently identified the main
themes
of tactical IT-business alignment, and attached codes to similar
themes. In the second, the codes from the two authors were
compared. Matching codes were retained and differing codes
were resolved and modified through discussion. some of the
codes (e.g., those relating to communication and centralization)
reflected tactical IT-business alignment practices discussed in
existing literature. Most codes however, reflected emergent
themes and illustrated alignment practices revealed by this
study
4. fINdINgS
Our analysis of the data revealed two categories of codes.
The first described aspects of tactical IT-business alignment,
i.e., organizational processes and mechanisms for
accomplishing
tactical IT-business alignment. There were six sub-categories
under this code, each yielding descriptions of a specific aspect
for tactical alignment. The second category described outcomes
of tactical IT-business alignment, and how the aspects lead to
the
outcomes. We first describe the aspects of tactical alignment,
with

illustrative codes from each sub-category under the first
category.
We then describe its outcomes and explain how each outcome
is facilitated by particular aspects, drawing from the second
category of codes.
4.1. aspects of tactical It-Business alignment
IT-business alignment at the tactical level occurs when IT
professionals’ resource allocation imperatives, project selection
and execution priorities, and technology-choice decisions are
aligned with those of the other functions. As illustrations of
lack of tactical IT-business alignment, according to three of our
study-participants, “When we first present our annual IT
strategic
plan to the functional areas, we don’t get any push back because
everyone agrees to it in principle, but starting the very next day,
the functions want to start doing things which were not part of
the plan”, or “I feel comfortable that we have alignment at the
C-level, but if we go down the line and ask the functions if IT
folks are working on the right things and are responsive to their
needs, I am not sure their answer will be positive”, or “There
are disconnects between corporate IT strategies and plant-level
IT strategies. For plant managers the metric is production,
shipping, inventory etc. For corporate IT, the metrics are
projects
completed, compliance, budgets, standards, up-time etc. The
two
do not always line up.”
We found six aspects of tactical IT-business alignment as
shown in Table 2 — (a) Communication related, (b) Governance
related, (c) skill related, (d) sourcing related, (e) IT
professionals’
role related, and (f) Project related. We next explain these
aspects,
with illustrations from the data.

(a) Communication-related
This aspect focuses on communication within the IT
department and between the IT department and other functions.
First, communication of the corporate-level It strategy down
to the middle and lower management levels in the IT function
is necessary for ensuring that technical specialists are aware of
planned applications, and that the IT strategy (what) is
translated
into specifics of required applications, technologies and
resources
(how). IT managers use their understanding of the IT strategy as
a
basis to plan for resources, select projects, and evaluate
unplanned
firm pseudonym firm profile details of Interviewees
eduCo A state-funded university in mid-western 3 senior
managers in IT (interim CIO’s), 2 middle-level IT
U.s., with about 20,000 students, more managers (application
and networks), 1 junior-level IT manager
than 300 faculty and 11 colleges. (application delivery), 2
senior administrators, 1 faculty
HealthCo A healthcare company having 7000 CIO/VP of IT, 1
senior level IT-business liaison (physician), 1
employees and 2000 medical staff, with project manager 3
middle level IT managers (applications and
$3-$4 billion in annual revenues networking), 2 senior level
administrators in charge of 2 clinical
departments (both physicians), 1 junior level IT staff
glassCo A glass manufacturing company engaged CIO, 2 senior

functional managers, 2 middle level IT managers
in design, manufacturing, and supply of (application and
networks), 1 senior manager in the engineering
tableware glass, with operations in 4 function, 1 middle level
IT-business liaison.
continents and having $400-$500
million in annual revenues
IndustrialCo A diversified (electrical, automotive, CIO, 1
middle level IT manager, I middle level functional
fluid), global industrial manufacturer with manager (supply
chain)
$13 billion in annual revenues
table 1: details of firms
aspects of tactical Routines and processes for achieving each
aspect (guidance
It-business alignment definition for empirical measures and
managerial actionables)
Communication of Is strategy from ∞ Conduct retreats, staff
meetings, project meetings, round
the C-level down to the middle and tables, and post strategic
plan documents on company
lower levels of the Is function portals.
Communication related ∞ Institute formal IT-business
communication through regular
Interaction between the IT function and meetings of steering
and project committees, desktop icons on
other functions user screens for IT support requests, corporate
portals and

newsletters, and IT point-persons within functions.
Encourage a climate of informal IT-business communication
∞ Mirror the structure and decision-making responsibilities
of
the IT function with the authority-responsibility structure of
the
business
structure of and decision making in, ∞ Centralize decisions on
infrastructure and network
the IT function technologies (i.e. those which affect the entire
firm). Localize
decisions for local support, desktop and specialized application
requirements
governance related ∞ Have the local IT report to the local
business head, with a
dotted line relationship with central IT.
∞ Create liaison positions between IT and a particular
function
∞ Recruit advanced users from the functions for training users
Creating governance positions and providing feedback on
initial features
Create “executive sponsors” for providing business
justification for
IT initiatives.
Matching the skills of IT professionals ∞ skills (relating to
technology and culture) required other of
Skill related with dynamic business-driven IT require- IT
professionals at the execution level change as the
ments such as mergers and acquisitions, business strategy

changes; retool skills and expertise of the
new products and global expansion IT function and keep them
continually current.
∞ standardize infrastructure, communication, compliance,
storage and network-related hardware and software, and
balancing technology standardization enterprise applications.
and customization ∞ Customize process-specific applications
closely tied to unique
unique process workflows or providing competitive advantage
Sourcing related advantage.
∞ Develop global vendors that can deliver products and
services
across multi-national and multi-site facilities, for infrastructure-
Contract management related technologies.
∞ Develop local vendors for division-specific applications
∞ Include flexible entry and exit clauses in vendor contracts
∞ Use the IT function’s cross-departmental views of
Proactive identification of IT related organizational processes
to suggest technology solutions to
opportunities, pain-points and business strategy execution
hitches
achievements ∞ Identify pitfalls and trade-offs regarding IT
choices that
It professionals’ functional managers may want to make
role related ∞ Celebrate IT achievements within the firm
End-User support Mechanisms ∞ Cross-train implementation
level IT staff for user hand-
holding and support
Create job tickets for systematizing end-user/desktop support
requirements.
∞ Classify projects in order of business importance
∞ Evaluate IT managers based on how well they fulfill

objectives
of the broader IT strategic plan
Project Prioritization ∞ Keep part of the IT budget unallocated
to any specific project;
use it for projects which emerge over the course of the year.
∞ Avoid over-formalizing project-portfolio management and
prioritization.
Matching of technical deliverables ∞ Articulate business
metrics (cycle time reduction, cost savings,
and business deliverables increase in sales of particular
product lines etc.) and technical
metrics (on time, within budget) for project success.
Measure and monitor business success criteria, post project-
project related execution
∞ Create multiple approval authorities, depending on project
size
Dynamic resource allocation and budget.
Acquire and release temporary resources for projects
∞ Functional project team members should take care of
process
and workflow requirements, IT members should address
Mixed project team composition development, configuration
and customization.
Functional project team leads should coordinate user
requirements and
change requests, technical leads should match these with
capabilities
of the technology

IT-related requests from functional departments. As we found
out,
“. . . money and people requirements for IT strategy execution
are
calculated on the basis of the IT plan”, and “. . . a lot of times
the
functions have unplanned needs which I evaluate against the IT
strategy and broad project plan that has been communicated to
me.”
second, interaction between middle and junior-level
management of the It function and other functions takes
place through communication and collaboration between IT
managers and functional managers. Formal communication
involves exchanging information and feedback about system
requirements and deficiencies, user problems, and
implementation
schedules. Means of formal communication include meetings
of project committees, desktop icons on user screens for IT
support requests, corporate portals and newsletters, and IT
point-persons within functions. A middle-level IT manager told
us, “. . . when we communicate, we let the business folks know
what we are doing and are no longer a black box.” Informal IT-
business communication brings out day-to-day concerns that
may
not get voiced at formal meetings for fear of conflict or lack of
time. An application manager told us, “I walk by [the
production
manager’s] office a few times a month and ask her about how
things are going and what she needs. This keeps us on her radar,
so she knows to call us when there is an issue”.
Communication leads to IT-business collaboration and in
strong IT-business relationships. IT and functional managers
begin to think together in order to work through resource
allocation gridlocks, project management issues, and crisis
resolution. They begin to have a stake in each others’ success,

see
the value of one another’s perspectives and are more
forthcoming
about requirements and problems. A CIO told us, “. . . our IT
and
functional folks are on the same page on most things, so it is the
functional guys who count on us to make them shine and so it is
they who stand up to ask for IT dollars when this or that project
is
in danger of being shelved because of money, and I hope that
this
continues . . .”.
(b) governance-related
The governance-related aspect describes decision-making
mechanisms and structures for coordinating day-to-day opera-
tional issues between IT and the functions. First, the structure
and decision-making responsibilities of the It function should
reflect the authority-responsibility structure of the business. A
mix of centralized and decentralized decision-making structures
in the IT function, appropriately matched with corresponding
decision-making structures of other functions is desirable. IT
specialists at the corporate level (i.e. “corporate IT”) should
generally be responsible for those decisions that affect the
entire
firm. (e.g. infrastructure and network related). IT specialists at
each business division or function, (i.e. “divisional” or “local”
IT)
should be responsible for local support, desktop and specialized
application requirements. such a structure ensures effective
firm-
wide infrastructure integration and synergy as well as effective
function or division-level IT acquisition and support. One of
our CIO-interviewees told us, “In the hardware, networks,

infrastructure and enterprise application areas, corporate IT
makes decisions. But I keep a strong dotted line relationship
with
our domestic and international plants, so we can keep
synergies.”
Another corporate IT interviewee said, “The divisional IT folks
are
closer to end users than corporate IT and are in a better position
to take the lead on division-specific application decisions. But
we
do reinforce broad technology mandates from corporate [IT].”
second, governance structures and positions help to co-
ordinate operational issues between the IT side and the
functional
side. At one firm, we found “business-unit liaison” positions,
responsible for liaising between IT and a particular function,
and
for aligning problems, requirements, wish-lists, and suggestions
for that function, with IT solutions, capacities and resources.
The liaisons ensured that the IT function was cognizant of end
users’ activities, particularly of those users that were IT-savvy,
as illustrated by this comment, “Our engineers are high-end
users and tend to push new systems from the shop-floor, without
communicating with IT and without looking at ripple impacts
with the rest of the network. So they will suddenly come up
with a
system and say “Hey we want this”. [This] puts things out of
sync
and strains IT resources”. At another firm, we found the
presence
of “power-users” or “super-users”, early users who volunteered
peer-training and feedback on initial features, helping align
system
functionalities with user requirements. Another governance
position is the “executive sponsor”, typically a middle or senior
functional manager who provides business justification for a

particular IT initiative. The position serves as a spokesperson
and
champion for the initiative by taking the responsibility for
linking
it to specific operational-level business benefits and creating
managerial buy-in for it.
(c) Skill-related
This aspect relates to matching the skills of It professionals
with dynamic business-driven It requirements, and ensures
that the IT function is continually current and has the necessary
expertise. skills required of IT professionals at the execution
level change as the business strategy changes. Good examples
are new product initiatives, mergers and acquisitions, and
global
expansion. Illustrating the first, one of the interviewees said,
“we
are going to offer more distance learning courses and professors
should not have to learn the nuts and bolts of the technology,
which
means that we will have to provide technical support for the
new
course management applications.” As an instance of the second,
the IT function may have to acquire technical skills to integrate
and maintain new applications from acquired companies. One of
the interviewees told us, “We are primarily a Cisco network and
they [the acquired company] are a Novell shop. Depending on
which one we keep, we have to figure out how to integrate”. For
the third, soft skills relating to culture, change management and
language are necessary for assimilating international IT sites
into
the parent company and for communicating with them. The CIO
of the one of the firms, which at the time of the study was in
the process of acquiring and setting up plants in other countries

Project sponsorship Appoint functional project sponsors
Institute software-based (stage Gate tools, Ms sharePoint and
Project Monitoring spreadsheets) and governance-based
(executive committee or
steering committee) processes for project monitoring
table 2: aspects of tactical It-business alignment, and processes
for accomplishing them
said, “. . . our IT folks got trained on how people from [the new
country] make decisions, how they handle controversy, how
they express disagreement and resistance . . . and we have been
traveling internationally for the first time, to integrate these
sites
into our infrastructure.”
(d) Sourcing-related
The sourcing-related aspect describes policies with respect to
technology acquisition and vendor management. First, balance
between firm-wide technology standardization and process-
specific customization helps the IT function identify technology
acquisition and implementation choices that align with IT
strategy. Typical candidates for standardization include
enterprise
applications and infrastructure, telecommunications,
compliance,
storage and network related hardware and software. For
example,
the IT implications of a merger or an acquisition do not always
get

worked into the IT strategic plan. In such a case,
standardization
choices form the basis of technology-related tactical decisions.
At one of our study sites, following an acquisition, networks
and email systems, which had been different for the two firms,
were standardized across the combined firm. standardization
is also important for aligning requirements of new applications
with capabilities of existing infrastructure. The CIO of one the
healthcare site mentioned, “When you decide to introduce a new
radiology or cardiology machine, you have to take into account
the
network and image storage implications and possible upgrades,
even though it may not have been part of the original IT
strategic
plan.”
Process-specific applications that are either closely tied
to the (unique) workflow of some operation or provide some
sort of a competitive advantage, are not good candidates for
standardization. A middle-level IT manager of one site said,
“Yes, some applications are not part of the ERP and we do not
plan to standardize them. They are custom written and mirror
our product configuration process and provide what we believe
is a differentiating advantage to our sales force. We call them
“modules of advantage”.”
second, contract management is important for achieving
the flexibility required for aligning IT strategy and IT
execution.
Flexible sourcing contracts enable firms to reconfigure their IT
resources as required by the business. The CIO of one of our
sites told us, “We negotiated an ERP contract with [vendor
name
deleted] for implementation at 19 sites. As the implementations
were about to start, we sold our stake in a few divisions and did
not need as many sites. Because we had worked in flexibility
into
our contract, quick reconfiguration was possible.” Developing

global vendors that can deliver products and services across
multi-national and multi-site facilities, for infrastructure-related
technologies like operating systems, servers and networking,
enables cost-effective technology standardization. Developing
local vendors for acquiring division-specific applications
aligns particular end-user requirements with local IT support
capabilities.
(e) It professionals’ role-related
This aspect describes the role of IT managers, particularly
middle managers, in identifying day-to-day concerns in
implementing applications and providing end-user support. First
IT managers should proactively identify It-related business
opportunities, pitfalls and achievements. The IT function has
vantage-point and cross-departmental views of organizational
processes; it can see how information flows and where it can get
obstructed. IT managers can therefore abstract out of the silo-
level view that most functional managers identify with and not
only suggest technology solutions to business strategy execution
hitches, but also anticipate possible resistance to such solutions.
One of the CIO’s told us, “We had a business strategy
imperative
to consolidate information across our plants in four countries.
We
[the IT function] looked at the information-silos, and were able
to suggest a big-picture data-warehouse solution.” Another IT
manager from the hospital site told us, “the clinical
environment
is an information-gathering engine — every piece of clinical
innovation that comes along has an IT component to it. One of
my
roles is to build relationships with the clinical folks, to hear
[what
they want to do] and to tell them proactively how IT needs to

get involved to make it happen” Identifying and communicating
pain-points and trade-offs is also important. Functional
managers
are better positioned to articulate project selection preferences
and requirements if they know the business implications of such
decisions. said one project manager, “I tell them the business
implications of doing X and Y, without doing Z, for instance.”
Communicating and celebrating IT execution successes beyond
the IT function and into the larger firm is essential for building
and sustaining the interest of functional managers in the
business
value what IT can do.
second, the firms we studied emphasized the importance of
end-user support mechanisms to ensure that applications are
used. such mechanisms include hand- holding and support for
new applications (by cross-training implementation-level IT
staff
on different applications), and job tickets for systematizing end-
user/desktop support requirements. An interesting example
came
from one of the medical firms in our study. “We had teams of
IT folks called “redcoats” [IT staff who had prior clinical and
nursing backgrounds] working round the clock in the hospitals
and laboratories to assist doctors and nurses in operating the
computers or navigating the screens. They ensured that clinical
folks did not have a reason not to use these applications”.
(f) project related
project–level alignment is the congruence between an IT
project’s deliverables and the organization’s business and IT
strategies, accomplished in part by the project’s response to
change triggers such as changed requirements and resource
crises.
We found six dimensions of project — level alignment.
First, projects have to be appropriately prioritized.

Unplanned projects (unplanned by IT strategy, but required at
the
immediate, tactical level) are often undertaken. such projects do
not have allocated budgets and hence take resources away from
planned projects. One senior IT manager that we interviewed
stated, “The ideal situation would be if we planned “x” number
of
projects at the beginning of the year and completed all of them
by
the end, no less, no more. But that is very rare and things
change
around a lot.” One reason for these ad-hoc projects is
maintenance
requirements, which need resources and which, if not done on
time, can interfere with implementation of the strategic IT plan.
Maintenance projects, because of their perceived “operational”
nature, tend not to be included in strategic IT plans, as a result
of
which they may have to be funded and staffed in a last-minute,
fire-fighting context. A senior IT manager of one of our sites
said,
“We have been running our servers for four years and they are
pretty much at the end of their life and have come off warranty.
If we do not replace them soon, then one of these days, they
will
break down, and all new applications which are slated to run off
them will have to be put on hold until these are replaced, even
if it is in the middle of the year.” Another reason is change in
functions’ priorities and emergence of new pressing needs as
a result of sudden business events. A middle manager told us,
“We acquired a new customer during the year and they wanted

B2B capabilities. All of a sudden that became a priority.” Or, IT
managers might find themselves listening to those functions that
shout the loudest, and working on their operational-level crisis
issues.
One way to address the prioritization issue is by project
classification in order of business importance. Another is to
evaluate projects based on how well they fulfill objectives of
the
broader IT strategic plan, rather than short term “fire-fighting”
criteria; this might reduce the incidence of unplanned projects.
A third way is to keep part of the IT budget unallocated to any
specific project but use it for projects which emerge over the
course of the year.
second, technical deliverables for a project must be
matched with business deliverables, to ensure that the execu-
tion of a particular IT project leads to execution of some aspect
of business strategy. business metrics should be typically
framed
in terms of parameters such as cycle time reduction, cost
savings,
increase in sales of particular product lines, etc. One middle
manager told us, “Often the business side would rather give us
very high level requirements and say ‘build it’. We get a lot of
push
back when we insist on detailed requirements and expectations.”
Post project-execution, the functions and IT should measure
and monitor the business success criteria. One CIO told us, “We
don’t have a structure right now which makes the functions
accountable for delivering business goals from specific appli-
cations . . . which means if people don’t use the applications,
that
doesn’t get factored in.” The results must be communicated to
the
larger organization. As one IT middle manager said, “It must be
more than a loose loop of ‘thank you’ at the time the project is
done and ‘by the way it didn’t do that’ a month or two later”.

Third, effective resource allocation and dynamic resource
re-allocation is necessary for adequately funding and staffing IT
projects. This can become especially complicated when offshoot
smaller and unplanned projects associated with a large, planned
project need to be executed. For instance, in one organization, a
middle level IT manager told us, “at the time we acquired this
new plant, due diligence had not accounted for a new building
for 250 people. The cost of routers, cables, phone lines, wiring
. . . we had to quickly come up with a budget for that.”
Approving
such projects at lower- and middle-management levels can keep
functional requirements and IT project goals in sync and
dynamically adjust resources for tactical business imperatives.
balancing resources among different projects and the acquisition
and release of temporary resources also facilitate resource
allocation.
Fourth, mixed project teams (having functional and IT
representation) enable execution-level alignment of functional
requirements with technical capabilities and resources.
Functional
managers are required for taking care of process and work-
flow requirements and change requests, and IT professionals
for development, configuration and customization, and for
matching requirements with the constraints and capabilities of
the technology.
Fifth, functional sponsorship of a project ensures managerial
participation and accountability. Projects that do not have a
functional sponsor tend to suffer from lack of credibility and
are
perceived as IT-driven projects. One IT middle manager said,
“We do not get a project off the ground unless it is approved by
the business side and they know and approve the deliverables.”
Workflow configuration and execution cannot be accomplished
without managerial participation. Functional mangers who are
accountable for project completion are prepared to put in the

time
for communicating with IT and to take the responsibility for
giving
early user feedback, rather than wait till the end. One senior IT
manager told us, “If there is sponsorship, there is
accountability,
they show up at meetings, they spend time telling us what they
think . . .” Further, projects may face resource escalation;
business
sponsorship helps to make the case for more resources and
results
in fewer half-finished or shelved projects and wasted resources.
Finally, project monitoring is necessary to avoid scope
creep, ensure resource availability, and accommodate emerging
user requests. Project monitoring is often done by a steering or
an
executive committee. These committees oversee change
requests
in scope, features, deliverables and budgets, so that arbitrary
and unplanned changes to projects cannot be done by users
communicating directly with project team members. Ongoing
monitoring keeps project goals, timelines and resources in step
with tactical and operational changes in business requirements.
4.2. outcomes of tactical It-Business alignment
In general, we found that a lack of tactical IT-business align-
ment leads to waste and duplication of IT resources, failed
projects,
difficulties in executing those aspects of business strategy that
are IT-dependent or IT-enabled, and a possibly marginalized IT
function. specifically, we found that there are four outcomes of
tactical IT-business alignment — (a) Implementation of planned
applications, (b) Execution of IT-enabled aspects of business
strategy, (c) Increased credibility of the IT function, and (d)
Increased business value from IT projects. We next describe

each of these outcomes and explain how they are facilitated
by particular aspects of tactical IT-business alignment. Table 3
summarizes these descriptions.
(a) Implementation of planned applications
Tactical IT-business alignment enables implementation of
planned applications. The Communication-related aspect
ensures that the Is strategy is communicated from the C-level
down the IT department. At one of the manufacturing firms,
there
were annual IT retreats for discussing the Is strategic plan, in
addition to regular staff meetings and roundtables. As a result
of
communication, middle and junior-level IT managers are aware
of IT strategy and can translate it into the specifics of required
applications, technologies and resources. They can also work
with
functional managers to resolve resource allocation gridlocks.
One
of the CIO’s told us, “If I have, say, do five things to do, and I
can
do only three, already I am stretched. On top of that suddenly
one
of the functional heads brings another two things. I try to get
such
things resolved by talking to the functions [middle
management]”.
The governance-related aspect ensures that tactical issues with
respect to implementation are sorted out by liaison positions
between IT and the functions. The Skill-related aspect ensures
that skills required for project planning and implementation are
available from the IT function. The Sourcing-related aspect
ensures timely acquisition of technology, and firm-wide synergy
with respect to infrastructure. The project- related aspect

enables prioritization of specific IT projects within the
reference
framework of the IT strategy. At one of our study sites, the
project
selection process made sure that all projects that were executed
were part of the IT strategy and variances were addressed on a
case-by-case basis.
(b) enabling execution of It-enabled aspects of Business
Strategy
A second outcome is to enable the execution of those
aspects of business strategy that are IT-enabled or IT-
dependent.
The Communication-related aspect ensures that middle-
level IT managers are aware of the business strategy and thus
understand business requirements from specific IT projects.
The It professionals’ role-related aspect builds and sustains
interest of functional managers in the value of what IT can do
and directs them towards IT-related pitfalls that could come in
the
way of implementing specific business goals. The governance-
related aspect coordinates operational issues between the IT and
functional sides, aligns business requirements with IT solutions,
and aligns IT perspectives with functional perspectives. At our
medical site, one of the business goals was to introduce new
machines for advanced imaging. The IT department worked
with the doctors to identify related networking and storage
requirements, which apparently had not been considered when
the plan was initially proposed. One of the senior IT staff told
us,
“All of a sudden there was this whole new dimension to

consider
without which we could not have had the imaging systems.” The
project-related aspect aligns project deliverables with business
strategies, leading to business metrics for project success and
consequent accomplishment of business goals from completed
IT
projects.
At the healthcare site, tactical IT-business alignment
mechanisms facilitated two IT-enabled aspects of business
strategy — workflow re-design for physician order-entry and
patient record-keeping processes. The two new processes were
developed around applications that would implement their
workflows. Although two multi-functional and multi-year
projects to execute this re-design were included in the strategic
IT plan, tactical alignment mechanisms were required to address
the day- to-day technical issues and resource conflicts that
emerged and accommodate the smaller, unplanned projects that
were spawned. These included ongoing communication and
collaboration between the IT function and other functions,
special
governance roles that facilitated interactions between end users
and IT managers, and project teams having both IT and
functional
membership for accomplishing the re-design objectives.
Another example related to execution of business objectives
in the context of a merger/acquisition. Anticipated cost savings
from mergers may require administrative departments (e.g.
payroll) from the two firms, to merge. From the execution point
of view, this requires the integration of disparate enterprise
applications, networks and communication systems. One of
our study sites had recently gone through a merger and another
had acquired a downstream firm. At the first site, the merged
organizations had different email and phone systems, networks,
and server vendors. The merger committee for executing the
integration of the networks consisted of senior and middle IT

and functional managers. The committee ensured interaction
between IT specialists and departmental managers; through
these
interactions it identified where and how different applications
could be integrated. Cross-functional project teams carried out
the required process and technical analysis. Political resistance
by those departments whose workflows were re-configured was
resolved through sustained IT-business communication. At the
other site, we found the absence of a cross-functional merger
team and active IT-business collaboration. Ordering processes
of
the acquiring firm were not integrated with purchasing
processes
of the acquired firm, even though they were in physically
adjacent
facilities. Efficiencies envisaged from the merger were hence
not
generated.
(c) Increased Credibility of the It function
A third outcome of tactical IT-business alignment is increased
credibility of the IT function. As a result of the
Communication-
related aspect, the IT function has the potential to have a view
not only of the IT strategy (through top-down communication
of IT strategy), but also of the business strategy (through IT-
business interaction at the middle and junior management
levels).
This enables them to offer a holistic view of both business
and IT strategies and help functional managers overcome
outcomes of tactical It-business alignment alignment aspects
facilitating each outcome
∞ Communication-related

∞ Governance-related
Implementation of planned applications ∞ skill-related
∞ sourcing-related
∞ Project-related
enabling execution of It — enabled aspects of Business Strategy
∞ Governance-related
∞ IT Professionals’ role-related
∞ Project-related
Increased credibility of the It function ∞ Governance-related
∞ IT professionals’ role-related
∞ skill-related
Increased business value from It projects ∞ Communication-
related
∞ Project-related
table 3: outcomes of tactical It-Business alignment and
Corresponding facilitating aspects
silo-driven perspectives. The governance-related aspect
enables IT professionals effectively address operational-level
IT related issues of the functions and empowers them to make
informed applications and technology related decisions. The It
professionals’ role-related aspect facilitates end-user
satisfaction
and education regarding IT opportunities. The Skill-related
aspect ensures that IT professionals are not found wanting in
the skills required of them. All of this ensures that end users
and
managers trust the IT function and perceive it positively. They
are

more willing to give credit to the IT function where appropriate,
engage IT managers in their future plans and contribute their
time
and thoughts to the associated discussions. At one of the sites, a
senior project manager told us, “We give inputs about what can
be done. The business has started to respect our understanding
of
both the technology and process.”
(d) Increased Business Value from It projects
A final outcome of tactical IT-business alignment is a higher
incidence of execution of those projects that deliver business
value. In the context of the project-related aspect, project
prioritization leads to classification of projects according to
their importance to the business, and matching technical project
deliverables with business deliverables ensures that the
execution
of each project leads to the achievement of specific business
goals. A functional manager in one of our study sites told us,
“The technical and business objectives of every project we work
on are jointly agreed upon by IT and the functions.” Functional
sponsorship of projects ensures managerial participation and
accountability, enables resource acquisition in case of project
escalation, and avoids scope creep. A senior IT manager at
another site said, “IT projects are approved on the basis of
benefits
(such as 5% cost reduction in a particular process), so the
functions are also responsible for project completion.” The
Communication-related aspect ensures that frontline IT man-
agers understand the business and IT strategies, communicate
effectively with the other functions, and hence provide big-
picture
business perspectives for IT projects.
All of the above increases the probability that projects
duplicated across divisions or departments are not undertaken,

necessary projects are executed and technologically impossible
projects are not undertaken. The possibility therefore, that
projects are selected based on “who shouts the loudest” or
“which
technologies are the coolest” decreases significantly.
5. CoNCluSIoN
In this paper we have examined tactical IT-business alignment.
We have found that it has six distinct aspects relating
respectively
to communication within the IT function and between IT and
other
functions, governance structures and decision making authority/
responsibility of the IT function, skills of the IT function, IT
sourcing, tactical/every-day roles of IT professionals, and
project
— level alignment. We have further demonstrated how these
aspects lead to four outcomes — execution of IT strategy,
execu-
tion of business strategy, increased credibility of the IT
function
and increased business value from IT projects. We would like to
note here that the benefits from tactical IT-business alignment
will be particularly significant only when strategic IT-business
alignment is present as well. Tactical IT-business alignment
may
not result in increased business value from IT projects or
facilitate
execution of business strategy, if the planned applications are
not
aligned with the firm’s business objectives to begin with, that
is,
if there is lack of strategic IT-business alignment.
The contributions of this paper to theory lie in (1) developing

the concept of tactical IT-business alignment by identifying and
describing operational-level dynamic and adaptive alignment
mechanisms and processes between IT and business, (2)
demonstrating that these mechanisms can help bridge the gap
between planning and execution of IT strategy, and (3)
extending
current academic conversation on IT-business alignment to
include
alignment at a relatively higher level of granularity than has
been
discussed thus far. Contributions to practice include actionables
for managers to consider in accomplishing tactical IT-business
alignment, as described in Table 2.
Notwithstanding its contributions, the study has limitations
that future research might find worthwhile to address. One, the
paper presents an exploratory and qualitative analysis of tactical
IT-business alignment. Future research should further empirical
examination, referencing the measures for tactical IT-business
alignment specified in Table 2. Two, the selected firms come
from a limited number of industries. In this context, we did
observe some industry-level differences impacting the aspects
of tactical IT-business alignment. For instance, the
technological
sophistication and IT-comfort level of end-users was the least at
HealthCo and EduCo, possibly due to historically low levels of
IT
usage in the healthcare and higher education sectors. We
observed
that the level of end-user support (part of the It professionals’
role aspect) that IT professionals were required to provide in
these two firms was qualitatively higher than that required for
IndustrialCo, where most employees were engineers and hence
more technically inclined. The IT department at HealthCo found
it difficult to identify advanced users from the clinical functions
who could train other users and provide feedback on
implemented

systems (part of the governance aspect). We also observed that
the Communication aspect was influenced by historical relations
between the IT department and other functions. At HealthCo
for instance, the IT department had historically close working
relationships with the clinical departments and thus found it
easier
to interact formally and informally with the doctors and nurses,
than
at GlassCo, where there had been traditional animosity between
the engineering/technical functions and the IT department.
These
observations lead us to believe that future studies should study
organizations from other industries to examine industry-specific
aspects of tactical IT-business alignment. Three, the interview
data
is retrospective and recall-based. Longitudinal or ethnographic
studies of IT implementation projects would likely reveal
greater
richness of tactical issues from a “real-time” perspective.
There has been a re-emergence of academic interest IT-
business alignment (e.g. [27, 11, and 3]) with particular
emphasis
on understanding execution-level processes through which
alignment is achieved. In spite of extensive academic discussion
on strategic IT-business alignment, there is ample evidence of
managerial concern [20] that applications which are ultimately
implemented do not always add business value, and those
applications that are deemed strategic, have been planned for,
and are important from the business perspective are not always
implemented. This paper, in examining the concept of tactical
IT-business alignment, provides a framework by which such
dis-
connects can be addressed.
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If the CIO is to be valued as a strategic actor, how can he bring.docx

If the CIO is to be valued as a strategic actor, how can he bring.docx

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If the CIO is to be valued as a strategic actor, how can he bring.docx