Strategic Alignment
(Venkatraman)

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Four Alignment Perspectives

1. Strategy Execution. This perspective views the business strategy as the primary driver of both organization design choices and the logic of the IT infrastructure (the classic, hierarchical view of strategic management). Top Management formulates the strategic objectives for IT based on the business strategy; IT Management is only strategy implementer. IT Management will seek to provide IT capabilities that will support the business strategy through the achievement of key performance indicators as determined by top management and defined within the business/marketing strategy. [Arrow 1]

2. Technology Potential. This perspective also views the business strategy as the primary driver. However it involves the formulation of an IT strategy to support the chosen business strategy and the corresponding specification of the required IT infrastructure and processes. The top management should provide the technology vision to articulate the logic and guide the choices pertaining to an IT strategy that would best support the chosen business strategy. The role of the IT manager should be that of the technology architect. He designs and implements efficiently and effectively the required IT infrastructure that is consistent with and allows strong control over the external components of IT strategy (scope, competences and governance). [Arrow 2]

3. Competitive Potential. This alignment perspective is concerned with the exploitation of emerging IT capabilities to:

   • impact new products and services (i.e. the business scope),
   • influence the key attributes of strategy (i.e. distinctive competences), as well as
   • develop new forms of relationships (i.e. business governance).

   Unlike the two previous perspectives, which considered business strategy as pre-defined and fixed and a constraint for organizational transformation, this perspective allows feedback into the modification of the business strategy via emerging IT capabilities. The specific role of the top management to help this perspective succeed is that of the hybrid IT/ business visionary, who advocates how the emerging IT competences and functionality as well as changing governance patterns in the IT marketplace would impact positively the business strategy. The role of the IT manager is to act as a catalyst and advisor. He identifies and interprets the trends in the IT environment. In doing so he assists the business managers to understand the potential opportunities and threats from an IT perspective. [Arrow 3]

4. Service Level. This alignment perspective focuses on how to build world class IT organization within an organization. In this perspective, the role of business strategy is indirect. This perspective is often viewed as being necessary in early stages of IT maturity, but not being sufficient, to ensure the effective use of IT resources and to be responsive to the growing and fast-changing demands of the end-user population. The specific role of the top management to make this perspective succeed is that of the prioritizer. They decide how the scarce resources should be allocated, both within the organization as well as in the IT marketplace (in terms of joint ventures, licensing, minority equity investments, etc.). The role of the IT manager is one of business leadership, with the specific tasks of ensuring that the internal business succeeds within the operating guidelines issued from top management. [Arrow 4]

Forum Start a new topic about Strategic Alignment Write here. Ask a question or explain something. Current forum discussions about Strategic Alignment: 🔥 How to Reach Consensus among Executives on the Strategy? Achieving alignment and agreement among the top executives of a large corporation in respect of the strategic vision and strategy is obviously really important, but not easy. Especially at times when ... 16   9 comments Aligning Project Management with the Business Strategy What are the major alignment problems when we're trying to align project management with the business strategy of an organization?... 14   5 comments Practical Implementation of IT Strategy The Venkatraman model for strategic alignment offers a framework for understanding the organizational drivers for technological development and alignment. These drivers will change over time and alte... 10   8 comments Integrated Business and IT Strategy and Execution In Australia as elsewhere I've seen many organisations that can and do articulate their highest strategic goals, objectives etc. but then have no idea of how to execute upon that strategy in terms of ... 7   7 comments New Role? Chief Marketing Technologist According to Scott Brinker and Laura McLellan (2014), marketing is increasingly becoming a technology dependent function in business. Research firm Gartner predicts that by 2017 a company's Chief Mar... 6   14 comments

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Expert Tips Advanced insights about Strategic Alignment. Here you will find professional advices by experts. Consultancy Tips Teaching Tips Practical Implementation Tips Realizing Strategic Alignment in your Organization Implementation of Strategic Alignment, Best Practices Although the Strategic Alignment Model clearly recognizes the necessity of a continuous alignment, it does not provide a... Balanced Scorecard and Strategic Alignment IT Strategy and IT Governance Kaplan and Norton’s Balanced Scorecard concept has been applied to IT and IT processes, for the achievement of a Strateg... The Basis of the Strategic Alignment Model Understanding the Assumptions of Strategic Alignment Strategic Alignment Model is based upon the concepts of strategic correspondence and functional integration: 1. Strateg...

Information Sources Various sources of information regarding Strategic Alignment. Here you will find powerpoints, videos, news, etc. to use in your own lectures and workshops. The Strategic Alignment Model (Henderson and Venkataraman) IT Strategy, Henderson, Venkataraman, Strategy Domains, Infrastructure Domains, Information Strategy This presentation presents the strategic alignment model by Henderson and Venkataraman and includes the following sectio... IT - Business Alignment IT Strategy, Business Strategy Alignment, IT Service Delivery, IT Alignment Presentation about IT <--> Business alignment, specifically emphasizing its inhibitors. The presentation includes the fo... Organizational Agility and the Role of Information Systems Organizational Agility Presentation about Agility, specifically focusing on the role of IT. The presentation includes the following sections: ... Closing the Communication Gap: The Six IT - Business Alignment Process Metrics IT Alignment, Business Alignment, Alignment Metrics This video explains why aligning IT with Business has been on every CIO's to do list over the past 20 years. It is all a...

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