The relationship between information technology flexibility, capability and strategic alignment

Abstract

The quest for information technology (IT) and business strategic alignment has become more complex due to the fact that organisations are finding it hard to align their IT with business strategies in today’s ever changing business environment. Upon reviewing previous literatures, it is found that IT flexibility and IT capability are two most important factors to sustain strategic alignment. Studies investigating the effect of IT flexibility dimensions (i.e., connectivity, compatibility, and modularity) and IT capability dimensions (i.e., IT infrastructure, IT architecture, IT relationship resource, and IT human resource) on strategic alignment are very limited and there is an opportunity to study these relationships. Furthermore, the effect of IT flexibility dimensions on IT capability is another key issue of the research and has not been studied in previous studies. 125 IT managers of top medium-to-large Iranian firms were the target subjects in this study and statistical software of SPSS and PLS were used to analyze the data. The results revealed that one dimension of IT flexibility (i.e., connectivity) and three dimensions of IT capability (i.e., IT human resource, IT relationship resource and IT infrastructure) significantly affect strategic alignment. Furthermore, the relationships of two dimensions of IT flexibility (i.e., compatibility and modularity) were significant with IT capability. The findings also indicated that the dimensions of IT flexibility and IT capability explain 67% of the variance in strategic alignment and IT flexibility explains 39% of the variance of IT capability. Unexpectedly, the effects of compatibility, modularity and IT architecture on strategic alignment and the relationship between connectivity and IT capability have not been supported in the present study.