The present study tries to investigate role of information technology in terms of developing business in Indonesian small medium enterprises. In accordance with that, information technology business values are examined as information technology alignment maturity. Whilst the alignment literatures use a range of approaches to determine the fit between information technology and business (Tallon 2016), this research prefers to use process level alignment to get different perspective. However, this method might deliver result which illustrate not only in process level but also in corporate level view. As comparison, alignment study by Raymond and Bergeron (2008) examines technology capabilities specifically related to e-business. Meanwhile, …show more content…
Following to that, the data shows that 33 company as the second majority group of SMEs reach level 3 of business information technology alignment maturity level. As stated by Luftman (2000), company with alignment position in level 4 probably having improved or managed information technology process. On the other hand, he mentions that level 3 of alignment maturity means there are some establish focus processed running in the company. It is likely that maturity level in corporate level view varies significantly across enterprises and is approximately bell shaped (Figure 17). It is clear that most companies can be found in the middle belly of distribution which means they reach either the improved / managed process level or established focus process level. Another significant finding is the number of company with lowest level of maturity is zero. Nevertheless, there are five companies still have committed process level maturity status as the second lowest rank of the league. In addition to that, only 6% of companies already in highest level of maturity which is optimised process. For these reasons, it seems that is still a lot of room for improvement for many Indonesian SMEs. Despite that, it is quite surprising that the result looks slightly similar with Cumps et al.’s study (2006) which selects European organisations as research sample. Their survey involves multiple European countries: Belgium, France, Germany, United Kingdom, The
The purpose of this article is to illuminate the need for any organization to have its IT strategy and business strategy properly aligned. While many organizations view IT and business alignment as an event – it is actually an on-going process, or continuous journey. Therefore, the main problem is that many organizations of today still hold these two principles (business mission & IT strategy) as two separate entities. However, in the Information Age – collaboration is key to capturing and retaining market penetration. To not have alignment with the IT and business strategy together is not a matter of want it is a matter of survival. This report will expand upon the need for business and IT strategic alignment as well as examine what happens in lack of a comprehensive plan. This will be done by examining the Vermont Teddy Bear company prior to and after the arrival of Bob Stetzel, the Vice President of Information Technology. This document will view it findings and make recommendations on the immediate and future operations of the company.
(ABSTRACT) This research project addresses the issues affecting information technology development and deployment. The issues represented in this study are addressed in the context of IT
How information technology can be effectively integrated with company’s "production, marketing, human resource, research design and finance" to take the advantage of core competence, as well as leveraging the quality and speed to help company business continuity.
IT by itself does not provide any value, however, the alignment of IT to strategic, operational, and cultural objectives provides business value. Thus, the CIO must ensure that any new investment in IT is for the sake of business objectives and not for “IT for ITs sake”. Ensuring business alignment against IT project delivery is critical, must be undertaken for any investment and is the key component of IT value.
Business–information technology alignment is the tight integration of the IT function with the organization’s strategy, mission, and goals. That is, the IT function directly supports the business objectives of the organization. Such an alignment enables firms to adhere to business objectives, and to maximize the value from investments. An excellent alignment will reduce costs, standardize processes, enhance productivity, improve workflow and communications, sustain repeatable service levels, improve Risk control mechanisms, implement new business strategies, facilitate growth, facilitate competitive advantage by exploiting new technology, enable IT driven projects to meet time and budget requirements, help to optimize the IT budget utilization. As more and more new business opportunities are created, IT plays an
I learned several lesson from the case study that has significant implications for my organization. First, I learned that my organization needs to align its IT and business strategy. Second, it needs to benchmark its IT capacity, capacities, and structure and highlighted the related weaknesses and concerns. Third the organization needs to find out the right solutions by getting consultancy from some experts or skillful people to address those concerns and weaknesses. Finally, the organization needs to develop and implement a transformational plan for aligning IT and business strategy for reaching its growth and success. I can contextualize and apply in learning in my organization. I will spend time with the CEO and senior management to introduce them the importance of aligning IT with business strategies. Next based on my learning in this course, I will conduct a comparative study of my organization to benchmark it in terms of IT and identify the areas for improvement. In addition, in consultation with the concerned people and using my learning in this course, I will develop a transformational plan and implement it
Alignment of an enterprise’s goals with its IT1 and IS1 systems has been a challenge ever since IT became a business enabler. Proposing an IT alignment requires a thorough understanding of the business goals of the enterprise and the knowledge that alignment is an iterative process which requires constant measurement and honing (Chan, 2002). Enterprises often face the problem of balance of priorities between IT and Business objectives. This report deals with one such case that faced alignment and prioritization hardships resulting in an unclear approach to achieve a corporate strategy.
The solution to what ills the alignment of IT strategy and business strategy can be found in the alignment of the organization’s CEO, CIO, and CFO. In order for the business strategy and the IT strategy to come together to for any type of alignment (cutting edge) there must be harmony among this group. The reason why this select few people are important to the alignment process is because of their roles inherent within the organization. Below is an illustration followed by a brief description of each role and what that person would be expected to bring to the organization.
Author suggests that business corporations should spend less on the IT infrastructure by arguing that IT is no more a strategic advantage and is similar to other commodity which is assessable to each and every one at market place. Author advices organizations to spend less on the IT capital, to wait and learn from the mistake of competitors and also evaluate the risks associated with the implementation of IT infrastructure. Author has provided the details of it spending and financial outcome of the industry. Here we need to understand that financial out come from an IT investment cannot be expected immediately or in the same financial year. First of all capital goods are very different from the information good. Business benefitted from the Information technology not only based on the how much they spent on the IT rater than how their IT operations are aligned with their
This case analysis discusses the findings in the article ‘Avoiding the Alignment Trap’, where even though most companies are aware that IT must be aligned with business strategy in terms of aligning IT expenses with revenue growth, over 11% of companies that align IT with business strategy spend more than 13% on average on IT expenses with a resulting of less than 14% average in revenue growth. The objective of this case analysis is to recommend a governance arrangement that will lead most companies that are currently have less effective IT alignment with business alignment to IT-enabled growth where the cost of IT more than compensates with the revenue growth of the company. The recommendation is to adopt a Duopoly
To aid financial and performance reporting in the company, its objectives also include achieving a harmonious user adoption of the Business Intelligence technology across all departments within the firm. IT department also aims to support and maintain the IT operations including software installations, network security, and telecommunications. Another major IT objective is to build a formal assessment process for company’s overall information management requirements, which will help in leveraging parent company’s IT resources. All these IT objectives align with and in turn, will help achieve the business objective of seamless integration.
Kin suggested when to use the case study method to provide the guidelines. According to Kin case study method should be used when, (a) the focus is to answer why and how, similarly when we look at our problem at hand, we have same question. The thesis aims to investigate, how IT influences the final outcome of the process; (b) the boundaries between the problem and the background is not clear i.e. the problem area of research is still in the understanding, discovery or description stage, in the same way, the impact of IT information technology on the revenue is a contemporary topic that is not deeply discussed in research yet. Following the literature review, the Business Processes IT and impact of IT business processes is highly contemporary phenomenon; (c) considering the contextual conditions relevant for the study, similarly BPIT decision making, BPIT integration and BPIT implementation are relevant in the context and we cannot study the outcome of the business process without considering these factors. In context of the online media industry, attitude of the managers and processes awareness by the employees are sought to be the factors influencing the BPIT decision making for example. The case study approach is selected because study is about the readiness of IT in the revenue processes, which cannot be considered without the context of the BPIT decision making by the manager and more specifically the BPIT implementations and BPIT integration. Impact of IT
It is not that companies do not want to keep up with the evolving markets, it is simply the fact most companies cannot, due to the established technical and social infrastructures which do not have the capacity to keep up with the preferred strategic desires. The article states a main root of the of the issue is that there is a lack of urgency in both agreement and for systems that support collaboration. In order for organizations to remain competitive, they must have a IT structure that energizes the internal organization, engages customers, and strive for innovation and experimentation. The gap is when companies fail to change their habitual structure toward an IT environment that can handle rapid reconfiguration of business-process and work-flow technologies.
Measures must embrace and cover technical and business performance of IT in an integrated manner [8]. The measures also need to identify the costs and benefits of IS/IT project through prioritizing it and aligning with the strategic direction of organizations. It means taking into account the cost effectiveness and containment, embracing IT/business performance criteria and linking this to the strategic business direction and associated performance competitive of the organization.
Despite the greater difficulty in which small and medium size firms (SMEs) have in adopting technology such as IT tools to assist in the day-to-day running of their business