Proceedings of the 40th Hawaii International Conference on System Sciences - 2007
Business & IT Alignment in theory and practice Drs. A.J. Gilbert Silvius MBA Utrecht University of Professional Education Utrecht, the Netherlands Email:
[email protected]
Abstract A key success factor for a successful company in a dynamic environment is effective and efficient information technology (IT) supporting business strategies and processes. In recent surveys however it is concluded that in most companies IT is not aligned with business strategy. The alignment between business needs and IT capabilities is therefore still a prominent area of concern. This paper reports the first stages of a research program exploring the differences of Business & IT Alignment (BIA) in theory and in practice. The paper presents an overview of the development of theory on BIA and reports the issues with aligning IT to business in practice based on a number of focusgroup discussions with CIOs and IT managers. In line with the practical approach to BIA that the CIOs and IT managers in the focus-groups took, the last part of the paper builds upon Luftman’s BIA maturity model and reports the application of the model to 12 Dutch firms.
1. Introduction In almost all industries, developments like new technologies, mergers and acquisitions, entrepreneurial initiatives, regulatory changes and strategic alliances create a dynamic business environment. A key success factor for a successful company in such a dynamic environment is an effective and efficient information technology (IT) supporting business strategies and processes. The alignment between business needs and IT capabilities is therefore a prominent area of concern. The annual survey on top management concerns by the Society for Information Management ranked ‘IT and Business alignment’ as the No. 1 concern for three years in a row [12] [13] [14]. In a recent survey by Synstar, 78% of European IT managers indicate that their IT is not aligned with business strategy [15]. Another recent survey shows similar results [17]. Given the ‘buzz’ around ‘Business
& IT alignment’ (BIA) in recent years, these results should be surprising. BIA doesn’t seem to live up to its promise [1]. This paper reports the first stages of a research program exploring the differences of BIA in theory and in practice. More information on this program and the research questions is given in section 2. The following section presents an overview of the development of theory on BIA. In this section the familiar frameworks for IT planning and BIA are put in perspective in a three-phased ‘Alignment development model’. Section 4 presents a number of practical issues that are experienced in aligning IT to business in practice. These issues arose from a number of focus-group discussions with CIOs and IT managers of mediumsized and larger firms in the Netherlands. The next section presents the practical approach to BIA that the CIOs and IT managers in the focus-groups took. Section 6 incorporates the conclusions from the focus groups in the development model of BIA described earlier and adds a fourth phase: BIA maturity. The last sections report a first survey of BIA maturity in 12 Dutch firms, based on the BIA maturity assessments developed by Luftman. The paper is concluded with a number of concluding remarks and our suggestions for further research.
2. The research program The goal of the research program reported in this paper is to explore and understand the differences of BIA in theory and in practice. With this knowledge the theory on BIA can be further developed. Steps one and two of the research were a literature review on the topic and a focused group discussion. The literature review is reported in section 3. It focused on the following questions. • How is BIA defined and interpreted? • Which theories are developed on BIA? • What was the development path of BIA?
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Proceedings of the 40th Hawaii International Conference on System Sciences - 2007
To explore the differences between the theory and practice of BIA we formed focused discussion groups of IT managers and CIOs of medium sized and large organizations in the Netherlands. In total 23 participants from trade, manufacturing and financial companies joined in three separate groups. The discussions were aimed at exploring the following questions. • Which issues are faced in aligning IT with business requirements in practice? • Which actions are taken to align IT with business requirements? The results of these discussions are reported in section 4 and 5 of the paper. The results of the discussions give input to the construct of BIA as a dialogue between business professionals and IT professionals instead of a systematic methodology. This dialogue can be well established and matured within an organization, with a clear process and assessment, or it can be still in its infancy. The third step of the research program therefore focuses on the assessment of the maturity of BIA in real-life companies. In November and December 2005 a first (pilot) study was conducted into the BIA maturity in 12 Dutch firms. In these assessments the central question is: • What is the level of BIA maturity in these companies? The goal of this pilot-study was to: • Get acquainted with the methodology of assessment; • Get a first impression of the maturity of BIA of the participating firms; • Test whether the results are recognizable; • Build knowledge to formulate hypothesis. The results of the first group of assessments are reported in paragraph 7. A second group of assessments will be conducted between October and December 2006. The results of these assessments will be presented at the HICSS conference in January 2007.
3.1 Phase 1: Traditional IT planning The challenge of aligning IT with business requirements is not new. Together with the rise of information systems in organizations, the need for alignment of its use with business processes and strategy grew. As a response to this challenge, methodologies of IT planning and system development were developed. Amongst others: Business Systems Planning [5], Information Systems Study and Information Engineering [8]. These methodologies can be regarded as the predecessors of BIA theory. Since these methodologies were developed in the ‘70s and ‘80s of last century, it is not surprising that the goal of these methodologies is building a foundation for the development of (large) bespoke information systems. The methodologies therefore focused heavily on the analysis and structure of the organizations’ data. Table 1 shows an overview of the characteristics of the main methodologies. The application of these methodologies in practice resulted however in extensive schemes and reports, most of the time lacking the involvement of user’s perspective. IT planning, designed as a tool for business management, became a procedure by IT professionals for IT professionals [9]. The rigid and structured nature of these methodologies, although theoretically sound, alienated the business and user side of organizations and their use faded.
Table 1. Characteristics of the main IT planning methodologies.
Based on the experiences with the assessments, the program will continue conducting the assessments on a third and fourth group of companies in 2007. With these assessments the program hopes to understand the relation between BIA maturity and organizational performance.
3. The development of Business & IT Alignment
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business professionals in the development of information systems became even more eminent. By clearly addressing the relation between business strategy, processes and IT projects, modern IT planning succeeds in involving business professionals in the IT planning project, thereby building commitment for the IT plan.
3.2 Phase 2: Modern IT planning Since the traditional IT planning methodologies failed to provide a practical solution, the issue of aligning IT to business needs remained. In the ‘90s this lead to another approach of IT planning [10]. Less formalized, but more practical. This ‘modern IT planning’ differs from traditional IT planning in the following aspects [10]. • •
Focus on Strategy Where the traditional methodologies showed a strong focus on data analysis and structure, the modern methodologies for IT planning show a focus on the business strategy of the organization. IT is seen as an enabler for the goals and targets of the organization and this is reflected in the process of IT planning. By working with (business) management to translate strategy into ‘smart’ performance indicators, the relation between business goals and IT applications is strengthened.
•
Pragmatic vs. Methodological The modern approach to IT planning is less formal in methodology. In order to gain acceptance for the results of the planning process, the project creating the IT plan is done ‘quick’, but sometimes also ‘dirty’. A sound analysis of the required data structures is quite often postponed to a ‘follow-up’ project.
•
Results in system enhancement and/or selection projects In contradiction to the traditional methodologies, is the modern approach to IT planning not primarily aimed at developing new (bespoke) information systems. Given the fact that companies nowadays have more ITlegacy than in the ‘70s and ‘80s, most results from modern IT planning are enhancements to current systems. If however a new system should be developed, it makes more sense to select potential standard software packages, e.g. CRM, ERP and financial applications, than to develop bespoke systems
Planning IT applications, infrastructure and organization In the traditional methodologies of IT planning, the IT infrastructure was a requirement, resulting from the IT applications to be developed. This approach, logical as it is, however tends to underestimate the importance of the infrastructure as a company asset. In most organizations the IT infrastructure accounts for 30% - 50% of the IT budget. Furthermore its technology develops autonomously, separating from the applications. Modern IT planning therefore pays more attention to the IT infrastructure as a company asset that can be optimized by standardization and utilization of economies of scale. The same considerations apply to the organization of the IT processes.
3.3 Phase 3: Business & IT Alignment The second half of the ‘90s saw the rise of ‘Business & IT Alignment’ as a more logical, and also more fancy label for the alignment process. Despite of the apparent importance of aligning IT and business, the majority of publications are rather vague in terms of how to define or practice alignment [7]. In over a million Google hits, a definition is seldom found. Especially consultants and IT companies tend to use the term in unclear and probably different ways. One of
Business
IT
Business Strategy
IT Strategy
Organisational Infrastructure and Processes
I/S Infrastructure and Processes
Functional Integration
External
Strategic fit
•
Together with the business With the impact of IT on business shifting from an efficiency enhancing production factor towards a source of business innovation, the need for involvement of
Internal
Figure 1. The ‘Strategic Alignment Model’.
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the reasons for this is that the theoretical foundation of BIA is still young. The most widespread and accepted framework of alignment is that of Henderson and Venkatraman [3]. This model, also known as the Strategic Alignment Model, describes BIA along two dimensions (Figure 1). The dimension of strategic fit differentiates between external focus, directed towards the business environment, and internal focus, directed towards administrative structures. The other dimension of functional integration separates business and IT. Altogether, the model defines four domains that have been harmonized in order to achieve alignment. Henderson and Venkatraman pay extensive attention to the different approaches of achieving this alignment. In the model this can be visualized by starting the process of alignment from any one of the four domains. Based on the scarce definitions in literature, among others Tallon [16], Silvius defines BIA as [10]: Business & IT Alignment is the amount to which the IT applications, infrastructure and organization, the business strategy and processes enables and shapes, as well as the process to realize this. In this definition, BIA can express both a ‘state’, the amount of alignment, as a ‘process’, the activities to reach a certain state of alignment. So far in this paper BIA is used as the process of reaching alignment. This process elaborates on the methodologies of IT planning mentioned earlier. It covers not just the alignment process aimed at developing, selecting or enhancing IT applications and infrastructure, but also the agreements regarding the application and service management. BIA therefore covers more than just the ‘plan’ phase of IT. It covers also the ‘manage and maintain’ phase. In the Strategic Alignment Model, this is shown in the different levels of alignment. The strategic level covers the alignment between business strategy and IT strategy, whereas the operational level the alignment between business processes & organization and IT infrastructure & organization covers. The development of BIA can be summarized as shown in the ‘alignment development model’ (Figure 2). This development reflects the shift in impact of IT on business. From an efficiency enhancing production factor, IT developed into a source of business innovation. However, the impact of IT on business is not undisputed. In his famous article ‘IT doesn’t matter’, Carr argues that IT, like electricity or railways, does not provide a strategic advantage anymore because of the fact that it is not unique and not scarce [2]. The
Business focused
Business & IT Alignment Modern IT planning
Traditional IT planning
IT focused ’70
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Figure 2. The development of BIA. fiery discussion that followed this publication is best summarized by Smith and Fingar [11]. For this paper it is sufficient to conclude that for many organizations the use of IT is still of critical importance to their business. The challenge of aligning IT to business needs is therefore still relevant.
4. Practical issues with Business & IT Alignment The message of BIA is logical and undisputed. IT should support the business and this will be more successful if the IT resources are developed and organized with the business strategy and processes in mind. If this message is so clear, how can the results from the Synstar [15] and BMC [17] research be explained? Based on the discussions with IT managers and CIOs, as outlined in section 2 of this paper, the application of BIA in practice provides some of the following considerations.
4. 1 Alignment versus Economies of Scale The economic downturn of the last years forced many companies to cut back on IT costs. A widely used approach to cost savings was the utilization of Market
B Alignment: IT effectiveness
IT
Standardisation: IT efficiency
Figure 3. Alignment versus standardisation
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economies of scale. Standardization of IT suppliers, systems, components and configurations proved to be a practical way to save a significant percentage of the IT budget. The first area of IT that was standardized was the IT infrastructure and the generic applications like email, calendar and the office suite. This area is not very specific to the business and could easily be standardized. The second wave of standardization hit the IT service management processes. The standardization of service levels and organization had, in some organizations, a relation with the business, which led to de-central additions to a central service level agreement. The next step in IT standardization aimed at standardizing the configuration and versions of standard software packages in use (e.g. ERP and CRM). In this wave the effect on the business was much stronger, since it hit the information systems supporting the core processes of the organization. In the urge for standardization, the ambition to align IT with business needs as best as possible loses from the ambition to realize cost savings. The balance between optimally aligned (‘unique’) and optimally standardized is a delicate one. Figure 4 illustrates this balance as found in the participating companies and shows that there is quite some variance in the ‘aligned zone’. The CIOs in the discussions agreed that the exact border between uniqueness and commonality was not always rationally deducted from the business requirements. Also aspects like history, culture and balance of power are factors of influence. Standard
Unique
Corporate Identity Branding
Business Strategy Specific IT applications Core processes Business(wide) IT applications Supporting processes Generic IT applications IT Infrastructure
Application consolidation Appl. Portfolio Mgt.
Process optimization
one consolidation d z Application Application Portfolio Management e n Alig Shared Services Outsourcing
MS SPS & Exchange Win XX migration
Outsourcing, Network en Datacenter consolidation
Figure 4. The delicate balance between central IT standardisation and decentral uniqueness.
4.2 Multiple businesses In most organizations that participated in the discussion groups the standardization of IT also included the centralization of IT resources. A practical
Market
Market
Market
B
B
B Alignment: IT effectiveness
IT
Standardisation: IT efficiency
Figure 5. BIA in a multi-business company. issue in BIA for these CIOs was that the IT had to serve different business divisions with different businesses. The 1-to-1 relationship between IT and business that is suggested in the literature was in the practice of a multi-business-company an n-to-1 relationship. Each business division will have its own business requirements, but the IT requires standards to be cost-effective. In divisional organizations this situation is likely to occur. BIA then becomes the result of a negotiation process between divisional information managers and a centralized IT department.
4.3. A fuzzy target While trying to align IT with the business, many CIOs experienced a quite fuzzy target. With what ‘business’ should IT align? According to the ‘Strategic Alignment Model’, a first answer should be with the business strategy. In practice business strategy is unfortunately not often a clear target. An organization must be able to be responsive to developments in its environment. The company strategy is therefore not a destiny that is ever reached. In reality strategy provides a direction, not a destiny. On the second level of the Strategic Alignment Model, the alignment is aimed at the business processes and organization. The organization provides only limited information about the business requirements. It is focused on hierarchical structure, but not on information content. An additional problem is that in many organizations the organization structure is not very stable. Departments and job titles change frequently. The business processes tend to be more stable. In the development of IT applications they provide an important basis for the analysis of the information requirements. A problem however is that there are multiple views of the business processes, all
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with different goals and different content. For example the process descriptions in the quality handbooks do not provide a sufficient basis for the IT analyst to work from because of lack of methodology, incompleteness and focus on activity. As a result of this most IT development projects will build their own process models according to their own modeling conventions.
5. Business & IT Alignment in practice Based on the second question to the discussion groups, which actions are taken to align IT with business requirements?, the following list of BIA practices could be developed.
5.1 Create an overview A first action for all CIOs was to establish an overview of current IT applications, assets, budgets and resources. For most CIOs their starting situation was one of IT anarchy as a result of the uncontrolled implementation of the personal computer as an important IT platform and the economic growth in the ‘90s. Providing an overview is a prerequisite for creating awareness about the cost of IT.
5.2 Create buying power A ‘quick-win’ for the CIOs was the centralization of IT procurement contracts in order to organize the organization’s buying power. This action usually created an immediate visible return that brought the CIO the respect of senior management. Another practical benefit of centralized procurement contracts is that it helps the CIO to get and maintain the overview mentioned above.
5.3 Install a project authorization process A relatively simple action to increase the planning and control cycle of IT is the tightening of the project authorization process. By requiring clear business cases, the CIO could strengthen the involvement of business managers in the preparation of IT projects. The project authorization process provided the CIOs the opportunity to create an overview of projects, next to the earlier mentioned overviews of IT assets, resources and applications.
5.4. Develop (technical) standards With the increased quality of information provided by the CIO, the awareness of the actual IT situation
grew with senior management. The fact that this actual situation most of the time was one of suboptimal solutions, lacking standards, overlapping projects and huge numbers of applications, combined with the tighter budget constraints in recent years, built a foundation on which the CIO could act. Starting with the more technical side of IT most CIOs developed a set of technical standards for hardware, network, server platforms, databases, development platforms, etc. These standards are a low-interest topic for business managers, but provide an opportunity for the CIO to create economies of scale and to gain control.
5.5. Rationalize the application portfolio A next step for most CIOs and an actual challenge for the frontrunners is the cleaning-up of the application portfolio. Most organizations use between 200 and 2000 different software applications or versions. It is estimated that a rationalization of the portfolio could save between 10% and 35% of the IT budget for maintenance and enhancement. This action however relates very much to the business process, which makes it complex. The ‘aligned zone’ in Figure 4 is therefore quite complex.
6. Maturing Business & IT
the
alignment
between
From the input provided by the participants in the focus-groups, as described in sections 4 and 5, it can be concluded that aligning IT to business needs in practice: • Is not a straightforward methodological process. • Has a more fuzzy context as is implied by the methodologies • Consists of quite pragmatic and sometimes even simplistic actions aimed at creating overview and control.
Business focused
Business & IT Alignment Modern IT planning
Business Business & IT Balancing? Maturity? Traditional IT planning
IT focused ’70
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Figure 6. A next phase in BIA?
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The CIOs agreed that the success of BIA in their organizations probably depended more on the clearness of the strategic vision, the IT awareness of (senior) business management and the IT management skills of the company, than on the methodology followed. All recognized that the IT department also had its own responsibility and target. BIA therefore was a dialogue between business and IT more than the business telling IT what to do. This insight brought us to the addition of a next phase to the alignment development model presented earlier: Business & IT maturity. In this phase the alignment between business and IT is created in a dialogue between business and IT, each with their own responsibility and targets. ‘BIA maturity’ is than more important than ‘BIA methodology’. The concept of BIA maturity is developed by Luftman. In his studies of BIA he found that enablers and inhibitors of alignment, as shown in Table 2, seem to be different ends of the same variable. The ability of aligning IT to business needs is therefore a result of the position of the dialogue on the variables. This position is determined as a maturity level, with the BIA maturity resulting from the mean maturity on all variables. Based on the components of the strategic alignment model (Figure 1) and the enablers and inhibitors of BIA (Table 2), Luftman recognizes six criteria to determine the maturity of the alignment of IT and business [6]. These six criteria are: Communications Maturity How well does the technical and business staff understand each other? Do they connect easily and frequently? Does the company communicate effectively with consultants, vendors and partners? Does it disseminate Table 2. Enablers end inhibitors of BIA [5]. Enablers of BIA: • Senior executive support for IT; • IT involved in strategy development; • IT understands the business; • Business-IT partnership; • Well-prioritized IT projects; • IT demonstrates leadership. Inhibitors of BIA: • Senior executives do not support IT; • IT/business lack close relationships; • IT does not understand business; • IT fails to meet commitments; • IT does not prioritize well; • IT management lacks leadership.
Figure 7. The criteria of BIA maturity. organizational learning internally? Competence / Value Measurement Maturity How well does the company measure its own performance and the value of its projects? After projects are completed, do they evaluate what went right and what went wrong? Do they improve the internal processes so that the next project will be better? Governance Maturity Do the projects that are undertaken flow from an understanding of the business strategy? Do they support that strategy? Partnership Maturity To what extend have business and IT departments forged true partnerships based on mutual trust and sharing risks and rewards? Scope & Architecture Maturity To what extend has technology evolved to become more than just business support? How has it helped the business to grow, compete and profit? Skills Maturity Does the staff have the skills needed to be effective? How well does the technical staff understand business drivers and speak the language of the business? How well does the business staff understand relevant technology concepts?
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These maturity criteria match the input provided by the participating CIOs in the focus-groups in the way that they cover also relational aspects of the alignment of business and IT and not just methodology. In the concept of BIA maturity, the level of maturity indicates an organization’s capability to align IT to business needs. As in many maturity models, Luftman’s BIA maturity assessments involves five levels of maturity: 1. Initial / Ad Hoc Process 2. Committed Process 3. Established Focused Process 4. Improved / Managed Process 5. Optimized Process
Table 3. The participants of the pilot-study. Company 1 2 3 4 5 6 7 8 9 10 11 12
Gemeente Zaanstad Albeda College CFI DTO IMN Managing Consultants Inter Access Getronics PinkRoccade F. van Lanschot Bankiers N.V. Interpolis Verzekeringen N.V. Achmea Rabobank Nederland SNS REAAL Groep N.V.
Industry
# Employees
Public Public Public Public Professional Services Professional Services Professional Services Financial Services Financial Services Financial Services Financial Services Financial Services
300-500 300-500 300-500 1000-2500 5000 300-500 >5000 >5000 >5000 >5000
Respondents #
IT Mgt
1 2 6 2 1 1 4 2 4 1 2 3
Y Y Y Y
Y Y Y Y Y Y
Bus Mgt
Y Y Y Y Y Y Y
Y
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independent ‘knowledge hub’ on BIA (see http://www.bita-center.com/masterclasses). In this way we assured that the participants had an interest in BIA. The participating companies are listed in table 2. They represent three types of industry: public services, professional services and financial services. Seven companies have substantial international activities. From each company in the pilot-study one to six persons were interviewed in positions differing from IT management, information management, general management, financial management and commercial management. In an individual structured interview an assessment of maturity was made on each of the aspects of the six criteria shown in Figure 7. The assessments were scored on a five point scale, corresponding with the five levels of maturity. The interviews were conducted between October and December 2005.
In order to further clarify the differences between BIA in theory and in practice, the BIA maturity assessments as developed by Luftman are applied to a number of international and Dutch firms.
7. Assessing Business & IT Alignment maturity This section reports a pilot-study into the BIA maturity in 12 Dutch firms. These assessments are the first application of the BIA maturity assessment in the Netherlands.
7.1 Participants of the pilot-study 7.2 Expected results The participating companies in the pilot study were selected from a group of participants of a series of master classes organized by bITa center, an
Based on the differences between BIA in theory and in practice as indicated in the focus groups, it was Communications
Skills
4
Management style Locus of Power
Scope & Architecture
Innovation, Entrepreneurship
Liaison(s) breadth / effectiveness
3
IT Metrics Business Metrics
2
Architectural transparency, flexibility Architectural intergration Int Architectural intergration Ent
Balanced Metrics
1
Service Level Agreements
0
Benchmarking
Architectural intergration Fun
Formal Assessments/Reviews
Standards Articulation
Continuous Improvement
Traditional, Enabler/Driver, External
Business strategic planning
Business sponsor/champion
IT strategic planning
Relationship/trust style IT programmanagement Shared goals, risk, rewards/penalties Role of IT in strategic business planning Business perception of IT value
Partnership
Competence / Value Measurement
Understanding of business by IT Social, political, trusting environment 5 Understanding of IT by business Education, cross-training Inter/Intra-organizational learning Career crossover Protocol Rigidity Change readiness Knowledge Sharing
Reporting/Organization structure Budgetary Control IT investment management Steering com mittee(s) Prioritization process
Governance
Figure 8. Detailed results of the pilot-study.
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expected that: H1. The overall BIA maturity level would be between level 2, committed process, and level 3, established process. H2. Maturity levels would differ strongly over the six variables. H3. The type of industry would be relevant to the BIA maturity score. H4. Business and IT professionals would assess the level of BIA maturity differently.
7.3 Research findings The pilot-study generated some useful results. Overall maturity between level three and level four. The assessed maturity level ranked on average between level three, established process and level four, improved/managed process. These results are on average higher than expected in H1. H1 is therefore not supported. An explanation for the high level of BIA maturity could be the size of the organizations in the pilot-study. On general the IT management function is more established in larger organizations than in smaller organizations. Another potential explanation is a bias in the assessment process. Some further testing of the assessment instrument is required to understand the possible impact of the assessment process on these scores. The maturity levels on the individual variables all ranked around the average level plus or minus 0.2. Therefor no support was found for H2. On a more detailed level however, the maturity level of the variables differ more with outstanding high scores on ‘career cross over’, ‘education / cross training’ and ‘business sponsor / champion’ (Figure 8). This results provides some support for H2.
Communications
Overheid 33% Financiele dienstverlening 42%
5 4
Professional Services Skills
3 2 1 0
Public Scope & Architecture
Zakelijke dienstverlening 25%
Competency & Value Measurements
Financial Services Governance
Partnership
Differences between industries Figure 9 shows the average scores by industry. As expected in H3, different industries show different levels of BIA maturity. Not surprisingly the financial services companies scored highest and the public sector scored lowest. The participants from the public sector indicated that in their efforts to align with ‘business’ strategy they were hindered by unclear and immeasurable goals and political opportunism. Differences between business and IT professionals One of the expected results, H4, from the pilot-study was a difference in perception of BIA maturity between business professionals and IT professionals. After all, BIA seems to be more of a concern to IT professionals as it is to business professionals. The results by profession however showed surprisingly little difference in perception between business management and IT management. A finding that will be researched further in the follow-up survey following the pilot. Assessment process The questionnaires used in the assessments, taken directly from Luftman [6], proved to be complex and difficult to understand. In the interviews quite some explanation and examples were needed to reach an assessed score. This is likely to have caused a bias of the respondents towards ‘acceptable’ scores.
7.4 Follow-up research The next steps in the research program will be to expand the assessments to 20-25 other companies during the years 2006 and 2007. The first 5-10 assessments of this follow-up research are planned for October 2006 to January 2007. At the HICSS conference in January 2007 we will be able to present a more detailed design and the first results of this research. To strengthen the validity of the assessments, a minimum of 20 respondents per company are included in the assessments. The assessments will also make use of improved questionnaires, including examples and descriptions of situations, that do not clearly give away the related maturity level. This way we intend to make the questionnaires less self-fulfilling and to allow for ‘unattended’ answering. The research questions of this follow-up research will focus on the difference in perception of BIA by business professionals and IT professionals. In a later phase of the research program, the relation between
Figure 9. Results by industry.
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BIA maturity and organizational performance will be investigated
8. Conclusions Aligning IT to business needs is still an important challenge for many organizations. The input provided by the participants of the focus groups made clear that aligning IT to business needs in practice is not a mechanical ‘by-the-book’ process. The real world provides a more complex and fuzzy situation in which BIA is not as straightforward as implied by the methodologies. This BIA requires conditions like ‘being on speaking terms with each other’ and ‘partnership between business and IT’. These fuzzy conditions are indications for an organization’s maturity of the relationship between business and IT. Luftman introduced an assessment model to assess the maturity of BIA. This paper reported a pilot-study of the BIA maturity in 12 larger Dutch companies. The study provided some useful insights in the perception of BIA by different industries and different professions as well as a good experience with the process of assessment. Based on these experiences the research program will continue with new assessments with an improved assessment process. Regardless however of the results of this study, the concept of ‘maturity’, in any field, raises the question: ‘Does maturity matter?’. A challenging would therefore be to establish a relationship between the development of an organization’s performance and the development of its BIA maturity.
References [1] BLOEM, J. & DOORN, M. VAN. (2004). ‘Realisten aan het Roer, Naar een prestatiegerichte governance van IT’ (in Dutch,), Sogeti VINT [2] CARR, N.G. (2003). ‘IT Doesn’t Matter’ Harvard Business Review, May. [3] HENDERSON, J.C. & VENKATRAMAN, N. (1993). ‘Strategic alignment: Leveraging information technology for transforming organizations’, IBM Systems Journal, Vol. 32, no. 1. [4] IBM CORPORATION (1981). ‘Business Systems Planning; Information Systems Planning Guide’, IBM application manual.
[6] LUFTMAN, J.N. (2000). ‘Assessing Business-IT Alignment Maturity’, Communications of the Association for Information Systems, Vol 4, Article 14. [7] MAES, R., RIJSENBRIJ, D., TRUIJENS, O. & GOEDVOLK, H. (2000), ‘Redefining Business-IT Alignment through a unified framework’, white paper, http://imwww.fee.uva.nl/~maestro/PDF/2000-19.pdf. [8] MARTIN, J. (1982). ‘Strategic Methodologies’, Prentice Hall.
Data-Planning
[9] POLS, R. VAN DER (2003). ‘Nieuwe informatievoorziening; informatieplanning en ICT in de 21e eeuw’ (in Dutch), Academic Services, The Hague. [10] SILVIUS, A.J.G. (2005). ‘Business & IT Alignment in theory and practice’, proceedings of the IMB 2005 conference. [11] SMITH, H. & FINGAR, P. (2003). ‘IT Doesn’t Matter; Business Processes Do’, Meghan-Kiffer Press, Tampa, U.S.A. [12] SOCIETY OF INFORMATION MANAGEMENT (2003). ‘Execs provide insight into top management concerns, technology developments in new SIM survey’ (http://www.simnet.org/Content/NavigationMenu/About/Pr ess_Releases/PressReleases.htm). [13] SOCIETY OF INFORMATION MANAGEMENT (2004). ‘Execs provide insight into emerging technology developments, top management concerns in New SIM survey’ (http://www.simnet.org/Content/NavigationMenu/About/Pr ess_Releases/PressReleases.htm). [14] SOCIETY OF INFORMATION MANAGEMENT (2005). ‘Execs provide insight into emerging technology developments, top management concerns in SIM survey’ (http://www.simnet.org/Content/NavigationMenu/About/Pr ess_Releases/PressReleases.htm). [15] SYNSTAR (2004). ‘The Pressure Point Index: V’, Synstar. [16] TALLON, P.P. & KRAEMER, K.L. (1999). ‘A Processoriented Assessment of the Alignment of Information Systems and Business Strategy: Implications for IT Business Value’, Proceedings of the Fourth Americas Conference on Information Systems (AIS). [17] WINMARK & BMC SOFTWARE (2004). ‘The Communication Gap: The Barrier to Aligning Business and IT’.
[5] LUFTMAN, J.N., PAPP, R. & BRIER, T. (1999). ‘Enablers and Inhibitors of Business-IT Alignment’, Communications of the Association for Information Systems, Vol 1, Article 11.
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