Strategic Alignment between IT and Business Strategy

Strategy has been always a key concern to top management. Companies are striving to find the right strategy to success, especially in this competitive era. Recent developments in information technology have highlighted the capabilities and the strategic functionalities IT could add to companies' strategies. More and more attention has been granted to exploit IT capabilities in supporting and introducing new business strategies. Also, researchers have showed an increased interest in introducing a model which aligns IT with business strategy. So far, there has been big discussion about the factors which influence the strategic alignment between IT and business strategy. The aim of this dissertation is to critically examine the strategic alignment and evaluate the recent research introduced by various scholars, in order to introduce a framework which refines the major factors which influence the strategic alignment. The proposed model was examined on two companies which have different level of IT exploitation. Primary data was collected through questionnaire disturbed to business and IT mangers, while secondary data was collected from the companies' press releases and disclosures. The findings support the previous research that the shared domain knowledge, trust and understanding, participation and involvement, and communication have an impact on the strategic alignment. However, through the analysis of the results, a new factor has been found which indicates that the level of the industrial IT dependency plays a direct role in determine the level of strategic alignment in firms. The dissertation has come to the conclusion that adopted strategy, level of communication, trust and understanding, participation and involvement, shared domain knowledge and the level of industrial IT dependency have a direct impact on the strategic alignment between IT and business strategy