Linking Business/IT alignment interventions to organizational culture, structure, strategy and ...

159 Pages·2013·13.8 MB·English

by  Eamonn A. Cassidy

RADBOUD UNIVERSITY NIJMEGEN
Linking Business/IT alignment
interventions to organizational culture,
structure, strategy and change readiness
by
Eamonn A. Cassidy
A thesis submitted in partial fulfillment for the
degree of Master of Science of Information Sciences
in the
Faculty of Science
Institute for Computing and Information Sciences
Research number 186
August 2013
Colophon
Title: Linking Business/IT alignment interventions
to organizational culture, structure, strategy
and change readiness
Name: Eamonn A. Cassidy
Studentnumber: 0709379
Study: Information Sciences
Research Number: 186
Location: Nijmegen, The Netherlands
Date: August 2013
University: Radboud University Nijmegen
First examiner: prof. dr. ir. Th. P. (Theo) van der Weide
Second examiner: prof. dr. E. (Erik) Barendsen
Organization: Alliander N.V.
Supervisor: R.F.P. (Remco) Meeuwsen
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“I love deadlines. I like the whooshing sound they make as they fly by.”
Douglas Adams
RADBOUD UNIVERSITY NIJMEGEN
Abstract
Faculty of Science
Institute for Computing and Information Sciences
by Eamonn A. Cassidy
Business/IT alignment has been one of the top issues in organizations for over twenty
years. Interventions for improving Business/IT alignment have been presented in earlier
research, but they lack a level of detail. To see how organizational factors like struc-
ture, culture and change readiness relate to the improvement of Business/IT alignment
on a detailed level, this study was conducted. The goal of the study was to create in-
sight in these relations in a way not only usable for science, but also for professional
organizations. During a literature study a large amout of low level control values that
influence the alignment have been indicated. These control values have been catego-
rized based on a theoretical framework, displaying their relation to culture, structure
and change readiness. A fourth category, strategy, was found by reviewing the control
values that did not match the previous categories. During this review it proved to be
equally important. After the categorization, the control values have been modeled into
a diagram, depicting all the relations found. The resulting model has been presented to
a group of domain experts for validation on completeness and operational usability. In
this validation the model was considered complete. However, due to its complexity it
was only considered useful if a significant amount of time would be invested in gaining a
thorough understanding of the model and its underlying information. The link between
Business/IT alignment and culture, structure, strategy and change readiness however,
is proven to exist, and displayed in a complete graphical overview.
Acknowledgements
By writing this section, the final lines of this thesis are put to paper. Seven months of
work have gone in to it, in which I have had support from numerous persons. Some of
them deserve special attention, as they have contributed largely to either the research
process or the way my personal life evolved in this period.
First of all I would like to thank Alliander, for providing the possibility to write my
thesis while receiving their support. The whole Information Management team deserves
a big thank you, for accepting me as a full member, for providing me with interesting
insights and discussions and for providing me with a lean method of working, which
surely contributed to this thesis being finished in time. Special notion goes out to
Remco Meeuwsen, who has been an excellent supervisor during this time, both on a
research and personal level. Paul Houtman can be thankfully mentioned for providing
thefirsteditorialcommentsonthethesisdraftversion. Hisvastmotivationforproviding
mediocre, dry jokes to lighten the mood and his inexhaustible search for a good thesis
quote can not be forgotten either.
Secondly, I would like to thank Erik Barendsen, who started as an informal sparring
partner on research methods and approaches, but who turned out to be the second
examiner. The discussions and insights gathered during the meetings have had a large
influence on the study presented in this thesis, but also on some personal questions.
Theo van der Weide deserves my gratitude as he has also shown great support on the
research process, providing the right questions at the right time, and interesting points
of view when needed.
Finally, I would like to thank all family and friends who have supported me during this
period, whether they were aware or not. Special thanks goes out to Helen, who has
given me more moral support than she might expect.
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Contents
Colophon i
Abstract iii
Acknowledgements iv
List of Figures viii
List of Tables x
Abbreviations xii
1 Introduction 1
1.1 Motivation and problem statement . . . . . . . . . . . . . . . . . . . . . . 1
2 Understanding the organization 4
2.1 Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
2.2 Understanding structure . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
2.2.1 Mintzbergs view on organizational structure . . . . . . . . . . . . . 5
2.3 Understanding culture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
2.3.1 Understanding cultural background. . . . . . . . . . . . . . . . . . 12
2.3.1.1 Cultural background according to Hofstede . . . . . . . . 13
2.3.2 Understanding organizational culture. . . . . . . . . . . . . . . . . 15
2.3.2.1 Organizational culture according to Schein . . . . . . . . 15
2.3.2.2 Organizational culture according to Hofstede . . . . . . . 18
2.3.3 Main organizational culture versus subcultures . . . . . . . . . . . 19
2.4 Understanding change readiness . . . . . . . . . . . . . . . . . . . . . . . . 20
2.5 Understanding Business/IT alignment . . . . . . . . . . . . . . . . . . . . 20
3 Controlling the organisation 25
3.1 Interventions for Business/IT alignment . . . . . . . . . . . . . . . . . . . 25
3.2 Finding success factors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
4 Research method 27
4.1 Finding the control values and their relations . . . . . . . . . . . . . . . . 27
4.2 Representing the control values . . . . . . . . . . . . . . . . . . . . . . . . 30
4.3 Domain expert validation . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
v
Contents vi
5 Linking control structures to organizational factors 33
5.1 Sorting the control values . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
5.2 Explicitly include IT in the strategy formation process . . . . . . . . . . . 34
5.3 Stimulate and initiate experiments . . . . . . . . . . . . . . . . . . . . . . 38
5.4 Improve the power of the demand side of the organization . . . . . . . . . 40
5.5 Hire or replace a CIO . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
5.6 Create IT investment procedures . . . . . . . . . . . . . . . . . . . . . . . 44
5.7 Make IT costs more transparent . . . . . . . . . . . . . . . . . . . . . . . 46
5.8 Create an information architecture . . . . . . . . . . . . . . . . . . . . . . 47
5.9 Create IT awards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
5.10 Create multi-disciplinary IT policy making processes . . . . . . . . . . . . 49
5.11 Additional success factors . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
5.11.1 Non categorized Additional success factors . . . . . . . . . . . . . 51
5.11.2 Success factors in strategy . . . . . . . . . . . . . . . . . . . . . . . 53
6 Theimpactofinterventionsasafunctionofculture, structure, strategy
and change readiness 64
6.1 Modeling the success factors . . . . . . . . . . . . . . . . . . . . . . . . . . 64
6.1.1 Basic model . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
6.1.2 Grouped and categorized model . . . . . . . . . . . . . . . . . . . . 65
6.1.3 Final model . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
6.1.3.1 Using the final model . . . . . . . . . . . . . . . . . . . . 75
6.2 Validating the model . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
6.2.1 Perception of completeness . . . . . . . . . . . . . . . . . . . . . . 76
6.2.2 Operational value . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
7 Conclusions and discussion 79
7.1 Conclusions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79
7.1.1 How are control values to improve the Business/IT alignment
linked to culture, structure and change readiness? . . . . . . . . . 80
7.2 Discussion and future research . . . . . . . . . . . . . . . . . . . . . . . . 82
Bibliography 85
A The first causal loop diagram depicting the relations between the con-
trol values 89
B Groups of control value relations 90
C Clusters of control value relations 101
D Diagram with groupnames, categories and all relations 104
E Set of tables containing relations between all groups 106
F Set of tables containing relations between all factors 110
Contents vii
G Full transcripts of the validation interviews 115
List of Figures
2.1 Basic parts of organizations according to Mintzberg . . . . . . . . . . . . 6
2.2 Three levels of mental programming . . . . . . . . . . . . . . . . . . . . . 14
2.3 The Onion model of culture . . . . . . . . . . . . . . . . . . . . . . . . . . 14
2.4 Schein’s model of organizational culture . . . . . . . . . . . . . . . . . . . 16
2.5 Old situation of Business/IT alignment . . . . . . . . . . . . . . . . . . . 21
2.6 New situation of Business/IT alignment . . . . . . . . . . . . . . . . . . . 21
6.1 The uncategorized relations . . . . . . . . . . . . . . . . . . . . . . . . . . 68
6.2 The restructured diagram . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
6.3 The final diagram . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
A.1 The first causal loop diagram depicting the relations between the control
values . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89
B.1 The Benchmarking group . . . . . . . . . . . . . . . . . . . . . . . . . . . 90
B.2 The CIO group . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91
B.3 The Finance group . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92
B.4 The Governance group . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93
B.5 The Incentives and Practices group . . . . . . . . . . . . . . . . . . . . . . 94
B.6 The Innovation group . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95
B.7 The Managerial Practices group . . . . . . . . . . . . . . . . . . . . . . . . 96
B.8 The Planning group . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97
B.9 The Portfolios group . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97
B.10 The Power group . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 98
B.11 The Skills and Capacities group . . . . . . . . . . . . . . . . . . . . . . . . 99
B.12 The Strategic Orientation group . . . . . . . . . . . . . . . . . . . . . . . 100
C.1 The first cluster . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 101
C.2 The second cluster . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102
C.3 The third cluster . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102
C.4 The fourth cluster . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 103
D.1 Diagram with groupnames, categories and all relations . . . . . . . . . . . 105
E.1 Table with relations to and from Influence groups . . . . . . . . . . . . . . 107
E.2 Table with relations to and from Main groups . . . . . . . . . . . . . . . . 108
E.3 Table with relations to and from Influenced groups . . . . . . . . . . . . . 109
F.1 Table with relations to and from all Influence and Influenced factors . . . 110
F.2 Table with relations to and from all Strategy factors . . . . . . . . . . . . 111
viii
List of Figures ix
F.3 Table with relations to and from all Structure factors . . . . . . . . . . . . 112
F.4 Table with relations to and from all Culture factors . . . . . . . . . . . . . 113
F.5 Table with relations to and from all Change readiness factors . . . . . . . 114