IT-Business Alignment: A Systematic Literature Review IT-Business Alignment: A Systematic Literature Review
IT-Business Alignment: A Systematic Literature Review IT-Business Alignment: A Systematic Literature Review
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Procedia Computer Science 00 (2020) 000–000
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Procedia Computer Science 181 (2021) 333–340
1. INTRODUCTION
Information technology (IT) plays a prominent role in organizations worldwide. Back in 2011, IT and
business alignment appeared as a top concern for IT practitioners and company executives [1]. This interest lies in the
potential of IT– business alignment to drive not only technological success, but organizational success as well, and
above all it facilitates competitive and strategic advantages of an organization. Moreover, IT is transforming the way
companies operate. In particular, IT affects business processes, how companies deliver their services to customers,
their communication means with customers, suppliers, and even employees inside the organization [2]. However,
many organizations and consultants have realized that IT cannot in itself offer these benefits, but it is rather through
its proper use and management, in alignment with the business objectives, that corporate value can be obtained [3].
Hence, for any organization to achieve long-term sustainable success, it is essential that all elements that comprise the
organization, in particular IT, fully understand the business objectives and work together in a duly controlled and
coordinated way to ensure that those objectives are met.
The concept of IT-business alignment entails IT and business working in communion. In this paper, authors
adopt the definition provided in [4] given the seminal importance of the work. In this paper, the alignment between
business and IT is defined as the degree of fit and integration between business strategy, IT strategy, organisational
infrastructure and IT infrastructure. More precisely, alignment is the degree to which business and IT depend on one
another and share their domain knowledge to achieve a common goal.
Unfortunately, the majority of research in the last fifteen years in the topic has treated IT and the business as
diverse and separate organizational areas [5]. This approach has been criticized as it creates artificial boundaries,
which in turn lead to misalignment. The claim is that large investments required for IT projects often raise questions
regarding their business justification. Some companies, for instance, poured millions of dollars into enterprise resource
planning (ERP) systems, only to find ineffective operations, work disruption, or even lost revenues[6]. It also argues
that IT alignment remains elusive, not because of a lack of understanding of the requirement or challenge, but rather
because of a lack of clarity as who should be held responsible, which parties should contribute and what mechanisms
should be employed[7]. In particular, the collective role of the board and the chief information officer (CIO) in an
organization still remain vague. Given the importance of the subject, authors carried out a systematic literature review
(SLR) in order to find out the different initiatives reported to achieve this alignment, as well as the main challenges
and benefits reported.
2. RESEARCH METHODOLOGY
We adopted SLR as the technique to conduct the literature review. A SLR is a means of identification,
evaluation and interpretation of research relevant to a specific research question or a subject of interest. The reference
guide for this piece of work is adapted from [8]. In the next subsection, the research questions defining the focus and
aim of this paper are presented. Finally, authors will explicitly describe the process of review protocol and data
sources.
2.1. Research questions
The following research questions were examined:
Q1: What are the reported benefits of IT-Business alignment?
Q2: What are the available models of IT- Business alignment?
Q3: What are the challenges in adopting IT-Business alignment models?
2.2. The process of systematic review protocol
This subsection comprises of a series of steps, as follows: establishing a reliable data source for the research
questions, conducting a search strategy, study process, selection of relevant primary studies (inclusion and exclusion
criteria), quality assessment and data extraction.
2.2.1. Data sources
To find relevant literature on the benefits and challenges of IT and business alignment, five databases were
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query term was executed in the various databases and a total of 732 results were retrieved initially. In the first round
after reading their titles, keywords and abstracts, a final number of 84 papers were selected. In the second round,
inclusion and exclusion criteria were applied, duplicates files removed, as a result 24 full texts were selected as primary
sources for the study to answer the research questions.
Table 1: paper filtering phases
Library Number of hits Titles, keywords and Abstracts Full text
ACM Digital Library 31 5 2
ScienceDirect 175 10 3
Springer Link 259 28 4
IEEE Xplore 179 21 8
This section describes the findings and answers the research questions. The relevant literature will be
discussed with respect to each research question. Firstly, Research Question 1 (RQ1) will discuss the reported benefits
or advantages of IT-Business alignment in an organization. Secondly, Research Question 2 (RQ2) will explain some
proposed models or methodologies that have been able to address misalignment to sustain the relationship between
Chief Information Officers (CIOs) and Chief Executive Officers (CEOs). Thirdly, Research Question 3 (RQ3) will
broadly discuss major challenges faced in implementing the IT-Business alignment models.
RQ1: What are the reported benefits of IT- Business alignment?
In what follows, the main benefits of IT-business alignment in an organization are reported.
Enhanced cooperation: Cooperation refers to the shared domain knowledge and common understanding
between the IT and line managers about a specific business process and how IT can be used to improve the
performance of that process [9]. This Shared IT-Business Understanding is the knowledge that IT managers possess
about a specific process, the knowledge the line managers possess about the potential opportunities to apply IT to
improve the process, and the common understanding between IT and line managers regarding how IT can be used to
improve process performance[10]. In other words, shared IT-Business understanding enables the organization to
conceive, implement, and use innovative IT applications to improve process performance [11].
Enhanced competitive advantage: This refers to a sustain advantage or an edge a company has over its
competitors. Alignment of IT and business strategy plays an important role to achieve company goals. Indeed, the
business and IT performance are tightly coupled, and company cannot be competitive if their business and IT strategies
are not aligned [12]. In this dimension, CIOs and CEOs today have a great role in the alignment of IT and business
strategy. They are responsible for matching IT strategy to organizational orientation to achieve competitive advantage.
They also play several leadership roles such as decision making, informational role, leader for change management,
and provocateur for technology initiatives among others.
Facilitates organizational processes and growth: When alignment exists, IT delivers systems and services
that are crucial to the company's strategies, operations, or user needs. As a result, executives can perceive the
contributions IT makes, and users are more likely to accept and utilize IT resources. In fact, its potential does not stop
there. By making plans based on the business strategy, IT can actually anticipate what the business will require in the
future, and lay out a trajectory to meet those upcoming needs [13].
Higher return on investment and performance enhancement: Business-IT alignment has shown to improve
return on investment, cost savings, time efficiency, and so on. This is because huge investments spent on IT by
companies are highly managed and controlled [14]. Research has also shown that small and medium enterprises
(SMEs) with high level of business- IT alignment indicate better performance and profit than SMEs with low level of
business-IT alignment. This means that there is a positive relationship between business- IT alignment and
organizational performance based on strategic perspective [13].
RQ2: What are the available models of IT- Business alignment?
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Several models have been proposed to explain how alignment between IT and business can be achieved and sustained.
The two main models are as follows:
I) Strategic Alignment Model (SAM): The model [15] relies on four different strategic domains: the business strategy,
organizational infrastructure and process, IT strategy, and IT infrastructure and process. It is also based on two
building blocks: strategic fit and functional integration and within each block, there are the external and internal
domains.
The concept of strategic alignment is primarily based on the notion that information technology must match
business strategy in order to forge a strong competitive edge and bring powerful solutions to organisations [16].
According to [15], a company must consider both ‘strategic fit’ and ‘functional integration’ to fully develop its
competitive potential and enhance alignment. Strategic fit is the extent to which infrastructure and processes support
a company's strategy while functional strategy is the extent to which information technology approaches support the
business approaches[17].
In the business strategy field, the external domain is the arena in which the firm competes and is concerned
with business scope decisions, distinctive competency decisions and governance decisions. This domain is termed as
‘business strategy’. On the other hand, the internal domain is concerned with choices that define the administrative
structure, the design or redesign of critical business processes and the acquisition and development of human resource
skills. This domain is termed as ‘organizational infrastructure and processes’. In the IT strategy field, the external
domain is concerned with how the firm is positioned in the IT marketplace according to its technology scope, systemic
competencies and IT governance. This domain is termed as ‘IT strategy’.On the other hand, the internal domain is
concerned with how the IT infrastructure should be configured and managed in respect of its architecture, processes
and skills [18]. This domain is termed ‘IT infrastructure and processes’. Research has shown [15] that effective
management of IT means achieving a balance among the choices made across all four domains—business strategy,
IT strategy, organizational infrastructure and processes, and IT infrastructure and processes.
area that are relevant to the measurement. SAMM prescribes the following areas in order to measure organizational
maturity: A) Communication; B) Competency / Value measurement; C) Governance; D) Partnership; E) Scope and
architecture; and F) Skills. For each of these areas, this maturity model classifies the alignment between business and
IT into five levels: 1) Initial / Ad hoc process (where business and IT are not harmonized or aligned); 2) Committed
process (where the organization has committed to becoming aligned with IT); 3) Established / Focused process (where
the alignment is established between IT and business and focused on business objectives); 4) Improved / Managed
process (where the concept of IT as a “Value Centre” is reinforced); 5) Optimized process (where the strategic
planning of business and IT is integrated and reached a co-adaptive stage).
Table 2: SAMM and its areas, maturity levels and attributes [19].
Area Level Attributes
Communication maturity: Liaison 1 Business/IT lack understanding
Effectiveness, Understanding of Business by IT, 2 Limited business/it understanding
Understanding of IT Inter/Intra-organizational 3 Good understanding; relaxed communications, emerging
Learning/Education, Protocol Rigidity, 4 Bonding, unified
Knowledge Sharing 5 Informal, pervasive
IT Value measurement/competency maturity: 1 Some technical measurements
IT Metrics, Business Metrics, Balanced, Metrics, 2 Measures functional cost efficiency
Service Level, Agreements, Benchmarking, 3 Measures some cost effectiveness; dashboard established
Formal, Assessments/Reviews, and Continuous 4 Measures cost effectiveness; some partner value; dashboard managed
Improvement 5 Measures extended to external partners
Governance maturity: Business Strategic 1 No formal process, cost centre, reactive priorities
Planning, IT Strategic Planning, Budgetary 2 Tactical at functional level, occasionally responsive
Control, Steering Committee(s), Prioritization 3 Relevant process across the organization
Process. 4 Managed across the organization
5 Integrated across the firm and partners
Partnership maturity: Business Perception of IT 1 Conflict; IT is a cost of doing business
Value, Role of IT in Strategic Business Planning, 2 IT emerging as an asset; process enabler
Shared Goals, Risk, Rewards/Penalties, IT 3 IT is as an asset; process driver; conflict seen as creative
Program Management, Relationship/Trust Style,
4 IT enables/drives business strategy
Business Sponsor/Champion.
5 IT-business adaptive and improvise together
Scope and architecture maturity: Traditional, 1 Traditional (e.g., accounting, email)
Enabler/Driver, External, Standards Articulation, 2 Transactional (e.g., ESS, DSS)
Architectural Integration, Architectural 3 Integrated across the organization
Transparency, Agility, Flexibility, Manage 4 Integrated with partners
Emerging Technology. 5 Evolve with partners
Skills maturity: Cultural Locus of Power, 1 IT takes risk, little reward; technical training only
Change Readiness, Innovation, Entrepreneurship, 2 Differs across functional organizations
Management Style, Career Crossover, 3 Emerging value service provider; balanced technical and business hiring
Training/Education, Hiring and Retaining. 4 Shared risks and rewards
5 Education/careers/rewards across the organization
difficult-to-achieve factor. Therefore, to achieve sustainable alignment between IT and business, a holistic approach;
one that combines and balances both the short and the long term perspective, is necessary [24].
Lack of communication: Communication between business and IT leaders is challenging in developing
effective IT-Business strategy. One of the reasons for the miscommunication lies in the difficulties both of them face
in understanding what business wants from IT and vice versa. IT managers suffer from ambiguous and unclear
business requirements, thereby it is difficult for them to deliver business issues that are understandable in IT
perspective [25].
Poor governance: IT managers are frequently out of the decision-making processes related to IT [25].
Consequently, CIOs feel frustrated for this lack of visibility. In addition, allocation of budget for IT project is a tedious
process and demands a lot of negotiation between IT managers and business executives.
Inadequate skills: IT competence needed in organizations is changing rapidly. In this perspective, IT
professionals need to develop their skills to meet continuously changing IT world. In this environment, IT managers
and business leaders need to enhance their skills and abilities in order to strategize. However, it is quite challenging
for them choosing which technology is the most appropriate for the organization, given the wide spectrum of IT
solutions. Proper training and education is needed for business leaders in order to help them understand one another
[26].
Other challenges for low success rates in business/IT alignment are lack of a uniform definition of business/IT
alignment, pursuit of a unilateral strategy for alignment, and lack of an appropriate tool to measure success of
business/IT alignment [27].
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