Business-IT Strategic Alignment in Complex Multinational Corporations (MNCs) – Research Results

Effective management of IT required planning

processes that create a high degree of business-IT alignment.

Business-IT strategic alignment is among the main management concerns

of information systems managers and corporate chief executives. The

problem is that alignment become difficult to implement as companies

strive to link business and technology in light of the

internationalization of their businesses. The purpose of IT strategic

alignment research is twofold: (a) identify the reasons why alignment

gaps exist between business goals and IT strategies, and (b) find a

fit between business objectives and IT plans by building an

integrated framework to explicate their interactive values.

Purpose of the Study

The purpose of the present positivistic

research study was to investigate business-IT strategic alignment in

a multinational corporation by examining (a) the role of knowledge

management processes in the relationship between contextual factors

and alignment, and (b) the role of IT projects in the relationship

between alignment and organizational performance and effectiveness.

This study used a field survey and structural equation

modeling (SEM) techniques to analyze data collected through the

stratified random sampling of 263 IT and business managers employed

in the U.N. Secretariat.

Implications to Leaders in MNCs

This study had several managerial implications for the

consideration of business executives and information systems managers

and provided insights to researchers on the issues of business-IT

strategic alignment in complex multinational organizations.

The results of this study have at least four implications to

leaders in MNCs:

(a) the effects of top managers’ knowledge

of IT on strategic business-IT alignment
(b) the importance of

business-IT alignment to organizational performance and effectiveness

(c) the importance of internal context and nature of the

organization to knowledge integration
(d) the role of senior

management in knowledge management and strategic management of IT.

Recommendations for Leadership

A theoretical and

practical perspective of business-IT strategic alignment in the U.N.

Secretariat is provided. The business-IT strategic alignment

implementation model for MNCs (mSAIM) is the model for application

proposed as critical recommendations of this research study.

The mSAIM model is a five-stage process or a roadmap for business-

IT strategic alignment. The mSAIM model draws upon the proposed

business-IT strategic alignment model for MNCs (mSAM) which covers

process and content perspectives of the interrelationship between

business and IT for this category of organizations.

The

Five-Stage Process of IT Strategic Alignment

The five-stage

process of IT strategic alignment covers process and content

perspectives of the interrelationship between business and IT in

MNCs. The process perspective includes the following dimensions: (a)

intellectual and social, (b) short- and long-term, (c) shared domain

knowledge, and (d) enablers and inhibitors. The content perspective

focused on the strategic orientation of business enterprises and the

strategic orientation of the existing portfolio of information

systems.

The five-stage process summarizes the steps for a

successful IT strategic alignment in MNCs. The process has five

stages, each of which is associated with one of the nine reasons

explaining IT projects failure. The steps are: clarifying the

strategic business orientation, developing leadership competencies of

business and IT managers, sharing knowledge, strategically planning

IT projects, and strategically managing IT and technological

changes.

Information:

Don’t forget to join the

Business-IT Strategic Alignment community and share your experience

using LinkedIn.

Kindly please send me an invitation to

connect to download the five-stage process of business-IT strategic

alignment from the Slideshare presentations on my profile.

Coming Soon:

Two peer-reviewed articles and two books on

Business-IT strategic alignment for complex MNCs will be published

soon.

Practical Applications of Total Quality Management (TQM) – Part I

Aside

Total Quality Management (TQM) is a philosophy of management that strives to make the best use of all available resources and opportunities through continuous improvement. TQM means achieving quality in terms of all functions of the enterprise. Many researchers attempted to analyze how IT and TQM can jointly add value to organizations and the purpose of this first post on TQM is to evaluate the practicality of TQM in an IT service.

In this evaluation, a balance of the service management needs with the reality of bottom-line effectiveness is provided. The post also provides a list of critical success factors to consider in a change management initiative engaged by an IT service.

TQM in Practice

The essence of quality is to do it right the first time, and to satisfy customer requirements every time by involving everyone in the organization. The works of Crosby and his colleagues on the evolution of TQM cut across all pervasive philosophies of management. TQM has been a key business improvement strategy since the 1970s, as it has been deemed essential for improving efficiency and competitiveness. TQM aims to achieve an overall effectiveness which is higher than the individual outputs from the sub-systems such as design, planning, production, distribution, customer focus strategy, quality tools and employee involvement. This philosophy of management strives to make the best use of all available resources and opportunities through continuous improvement.

As a management philosophy, TQM makes use of particular set of principles, practices, and techniques to expand business and profits and provides a bypass to enhanced productivity by avoiding rework, rejects, waste, customer complaints, and high cost. This can be achieved by emphasizing the organization’s commitment from data-driven, problem-solving approaches to quality accruing.

The five basic pillars of TQM are: (a) top management commitment for quality enhancement, (b) customer centric advancements of processes and building a long-lasting trustworthy relationship between the organization and the customer, (c) relentless development by setting goals and deadlines, (d) benchmarking with several specific tools and quality-adding techniques, and (e) strengthening the employee base by concentrating at any stage of a process on quality, where customer satisfaction is stationed. Table 1 provides a summary of the key dimensions that constitute TQM.

Table 1: TQM key dimensions

TQM dimensions Description
Top management leadership Top management commitment is one of the major determinants of successful TQM implementation. Top management has to be the first in applying and stimulating the TQM approach, and they have to accept the maximum responsibility for the product and service offering. Top management also has to provide the necessary leadership to motivate all employees.
Customer relationships The needs of customers and consumers and their satisfaction should always be in the mind of all employees. It is necessary to identify these needs and their level of satisfaction.
Supplier relationships Quality is a more important factor than price in selecting suppliers. Long-term relationship with suppliers has to be established and the company has to collaborate with suppliers to help improve the quality of products/services.
Workforce management Workforce management has to be guided by the principles of: training, empowerment of workers and teamwork. Adequate plans of personnel recruitment and training have to be implemented and workers need the necessary skills to participate in the improvement process.
Product design process All departments have to participate in the design process and work together to achieve a design that satisfies the requirements of the customer, which should be according to the technical, technological and cost constraints of the company.
Process flow management Housekeeping along the lines of the 5S concept. Statistical and non-statistical improvement instruments should be applied as appropriate. Processes need to be mistake proof. Self-inspection undertaken using clear work instructions. The process has to be maintained under statistical control.
Quality data and reporting Quality information has to be readily available and the information should be part of the visible management system. Records about quality indicators have to be kept, including scrap, rework, and cost of quality.

TQM and Change Management Initiative for IT Performance

A business firm achieves world-class status when it has successfully developed operational capabilities through TQM to support the entire company in gaining a sustained overall performance over its competitors. Although there is insufficient statistical evidence to conclude significant simple relationships between TQM and IT services quality performance, many studies investigated the notion that TQM practices provide approaches to improve the economic position in the service sectors in general. Both IT and TQM had, and will continue to have a significant impact on most organizations. I only regret the lack of empirical research on the relationship between the two and how they both relate to business performance.

Critical success factors for TQM implementation in an IT service are summarized in Table 2. The implementation of TQM in an IT service should facilitate the adoption of appropriate policies and procedures that enhance the eight categories of TQM.

Table 2: Critical success factors for TQM implementation

Categories Critical success factors
Leadership Top management leadership and commitment, supervisory leadership, organizational commitment.
Quality unit Role of quality unit, strategic quality management.
Empowerment Training, employees’ satisfaction, employees’ relations, teamwork structures for improvement, providing assurances for employees, education.
Supplier management Supplier quality management, supplier integration, external interface management, supplier partnerships.
Process management Product design, quality policy, quality improvement measurement systems, operating procedures, operational quality planning.
Quality of data Quality data reporting, quality information systems, technology utilization.
Customer satisfaction Customer satisfaction orientation, people and customer management.
Communication Communication of improvement information, cross functional communications to improve quality.

 

Business-IT Strategic Alignment Models for Complex MNCs

My dear readers,

I am

pleased to inform you that I just completed a research study on

Business-IT Strategic Alignment Models for Complex

Multinational Corporations (MNCs). The purpose of this

positivistic research study was to investigate business-IT alignment

in an MNC by examining (a) the role of knowledge management processes

in the relationship between contextual factors and alignment, and (b)

the role of IT projects in the relationship between alignment and

organizational performance and effectiveness.

The objective of

this 4-year study was to provide a theoretical and practical

perspective of business-IT strategic alignment in the U.N.

Secretariat. The sample consisted of 166 IT managers and 97 business

managers from 50 offices in the U.N. Secretariat. The study focused

on two aspects of strategic IT planning within the U.N. Secretariat:

(a) business-IT strategic alignment and (b) IT project planning. This

study drew upon the strategic alignment model (SAM) and the typology

of MNCs to propose and test an IT strategic alignment model for MNCs

(or mSAM) using the U.N. Secretariat as a field study.

A

theoretical and practical perspective of business-IT strategic

alignment in the U.N. Secretariat is provided. The business-IT

strategic alignment implementation model for MNCs (mSAIM) is the

model for application proposed as critical recommendations of this

research study.

Please regularly visit my website www.nkoyock.net. On the front page

of the site, you can read the background of the study, statement of

the problem, purpose of the study, data analysis, main outcomes of

the research study, research findings, implications to Leaders in the

U.N. Secretariat and in MNCs, and the recommendations for leadership.

More materials, such as articles and books, will be available very

soon.