Strategic IT alignment and organization performance

282 Pages·2017·4.12 MB·English

by  Rachadaporn Pinrattananont

STRATEGIC IT ALIGNMENT AND ORGANIZATION
PERFORMANCE: A RESOURCE-BASED VIEW

RACHADAPORN PINRATTANANONT

A DISSERTATION SUBMITTED IN PARTIAL FULFILLMENT
OF THE REQUIREMENTS FOR THE DEGREE OF DOCTOR OF
PHILOSOPHY PROGRAM IN BUSINESS ADMINISTRATION
FACULTY OF BUSINESS ADMINISTRATION
RAJAMANGALA UNIVERSITY OF TECHNOLOGY THANYABURI
ACADEMIC YEAR 2015
COPYRIGHT OF RAJAMANGALA UNIVERSITY
OF TECHNOLOGY THANYABURI
STRATEGIC IT ALIGNMENT AND ORGANIZATION
PERFORMANCE: A RESOURCE-BASED VIEW

RACHADAPORN PINRATTANANONT

A DISSERTATION SUBMITTED IN PARTIAL FULFILLMENT
OF THE REQUIREMENTS FOR THE DEGREE OF DOCTOR OF
PHILOSOPHY PROGRAM IN BUSINESS ADMINISTRATION
FACULTY OF BUSINESS ADMINISTRATION
RAJAMANGALA UNIVERSITY OF TECHNOLOGY THANYABURI
ACADEMIC YEAR 2015
COPYRIGHT OF RAJAMANGALA UNIVERSITY
OF TECHNOLOGY THANYABURI

Dissertation Title Strategic IT Alignment and Organization Performance:
A Resource-Based View
Name-Surname Mrs. Rachadaporn Pinrattananont
Program Business Administration
Dissertation Advisor Assistant Professor Youdthachai Lertwaraprachaya, Ph.D.
Dissertation Co-advisor Mr. Chalermsak Lertwongsatien, Ph.D.
Academic Year 2015
ABSTRACT
The purposes of this study were to investigate the relationship among strategic
Information Technology (IT) alignment and its support for core competencies,
Information System (IS) capabilities, and over-all organizational performance under the
Resource-Based View framework. The samples of this study were from 161
organizations selected via stratified random sampling taken from the Stock Exchange of
Thailand (SET) official organization lists. The research tools used in this survey
research were a structured questionnaire and a recommendation form. The Structural
Equation Modeling (SEM) was assigned to test the hypothesis with Partial Least Square
(PLS). The measurement model was assessed using Exploratory Factor Analysis (EFA)
to explore the identified set of variables, and Confirmatory Factor Analysis (CFA) was
used to redefine each construct and measurement model with PLS. Composite
reliability test was applied to ensure the reliability of the results by examining the
convergence and the discriminant validity of the constructs.
The results revealed that the majority of respondents were male and their
positions were mostly manager or associate manager. The level of the Chief
Information Officers (CIO) ranked third level from top management. The majority of
organizations (22.98%) were listed as industrial estate organization. The operation time
of organizations were 21-30 years with less than 500 general staff and 21-30 IT/IS staff.
Furthermore, the proportion of IT budget was within the range of 5-15 percent.
The results of hypothesis tests asserted that the strategic IT alignment and IS
capabilities positively affected IT support for core competencies. Furthermore, the IT
support for core competencies yielded to a positive influence to the organizational
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performance. Finally, this study justified that the strategic IT alignment and IS
capabilities positively affected the organizational performance through IT support for
core competencies as the mediator of the model.

Keywords: strategic IT alignment, resource-based view, IS capabilities,
IT support for core competencies, organizational performance

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Acknowledgements

Joining the Ph.D. Program at Rajamangala University of Technology
Thanyaburi enables me to grow in so many directions, as an academic and a person. I
have been blessed with friend and professor who have supported and provided guidance
throughout the last several year. The value and successful of this study, I would like to
express greatly appreciation to:
My advisor, Assistant Professor Dr. Youdthachai Lertwaraprachaya, also to
Dr. Chalermsak Lertwongsatien, who is my co-advisor and advice me for the statistic
with PLS in this study. My chairman, Associate Professor Dr. Kanibhatti Nitirojtanad,
and my committee, Associate Professor Dr. Arunee Intrapairoth, and Assistant
Professor Dr. Daranee Pimchangthong.
My father, Mr. Theerachai Nissaiman and my mother, Ms. Varisa
Simchareoan, who support everything: education, family life, soul, cultivation, and
successful. They are everything for my life, nothing in this world will more valuable
than them, albeit my father has passed way. My husband, Colonel Arnat Pinrattananont
and my children, Mr.Sorawit Pinrattananont, Miss Nattanicha Pinrattananont, Miss
Supitchaya Pinrattananont, and Mr.Palath Pinrattananont, who encourage me to
complete this study.
Finally, I am most thankful for everyone who always supports and encourages
me to complete this study.
Rachadaporn Pinrattananont
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Table of Contents
Page
Abstract………………………………………………………………………..….. (3)
Declaration ………………………………………………………………………. (5)
Acknowledgements ………………………………………………………………. (6)
Table of contents …………………………………………………………………. (7)
List of Tables …………………………………………………………………….. (10)
List of Figures ……………………………………………………………………. (13)
List of Abbreviations …………………………………………………….………. (14)
CHAPTER 1 INTRODUCTION ………………………………………………… 15
1.1 Background and Statement of the Problems ..………………..…...… 16
1.2 Purpose of the Study …………………….……..………………...... 22
1.3 Research Questions and Hypotheses ………………………………... 22
1.4 Conceptual Framework ……………………………………………... 25
1.5 Definition of Terms ………………………..………………………. 28
1.6 Delimitation of the Study ………………………………….………... 37
1.7 Structure and Contents …………………....………………………… 37
CHAPTER 2 REVIEW OF THE LITERATURE ……………………………….. 38
2.1 Strategic IT Alignment …………………………………………........ 38
2.2 Resource-Based View ………………………………………………. 59
2.3 IS Capabilities ……..………...……………………………………… 63
2.4 IT Support for Core Competencies ………….…….………………... 76
2.5 Organization Performance ………………………………………….. 86
2.6 Chapter Summary …………………………………………………… 104
CHAPTER 3 RESEARCH METHODOLOGY ….…………………..………….. 105
3.1 Model/Theoretical Framework ……………...……………………..... 105
3.2 Research Hypothesis ……………………………….……………..… 109
3.3 Research Design ……………………………………………………. 112
3.4 Validity and Reliability Analysis …………………………………… 117
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Table of Contents (Continued)

Page
3.5 Data Collection …………………………………………..……….… 119
3.6 Data Analysis ……..……………...…………...………..…………… 121
3.7 Chapter Summary ……………………………………….………….. 123
CHAPTER 4 RESEARCH RESULT….……………………………...………….. 124
4.1 Data Preparation ……………...…………...………………………… 124
4.2 Pilot Study and Main Study …………………………..……...……… 126
4.3 Refining and Reliability Analysis …………………………………... 127
4.4 Construct Assessment and Validity Analysis ……………………..… 127
4.5 Partial Least Square (PLS) …………………………………..…….... 144
4.6 Demographic Summary ……………………………………………... 145
4.7 Results of Constructs ……………………………………………...… 148
4.8 Model Validity ………………………………………………………. 155
4.9 Hypothesis Testing Results ………………………………………….. 156
410 Results of the Recommendation Form ……………………………… 165
4.11 Conclusion …………………………………………………………. 171
CHAPTER 5 CONCLUSION AND RECOMMENCATIONS ……..…...……... 173
5.1 Summary of the Findings …………………………...…….………... 173
5.2 Discussion and Recommendation ….………………..…….………... 174
5.3 Implication for Practice and Future Research ……..……………...… 180
5.4 Chapter Summary …………………………....……………..……….. 182
Bibliography ……………………………………………………………………... 184
Appendices ………………………………………………………………………. 201

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Table of Contents (Continued)

Page
Appendix A Name of The Listing Organizations of the Stock Exchange
Of Thailand (SET) Under the Supervision of Securities
and Exchange Commission (SEC) …………………………. 202
Appendix B Definition of variables in the study ……………………......... 223
Appendix C The Full Items of Each Variable in Survey Questionnaire … 227
Appendix D Full Survey Questionnaire in the study …………………….. 232
Appendix E The Assessment of IOC Score ……………………………… 246
Appendix F Reliability Assessment By Cronbach’s Alpha ……………… 251
Appendix G The Assessment for Normality Distribution ………………. . 254
Appendix H Rotation Matrix and Factor Score of Factor Analysis ……… 264
Appendix I The Recommendation Form For CIO ……………………….. 273
Biography ………………………………………………………………………... 280

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List of Tables
Page
Table 1.1 Definition of Constructs in This Study …………….…….….………… 31
Table 1.2 Definition of variables of Each Construct …………...…..….………… 33
Table 2.1 Review Literature of Strategic-IT Alignment …….…………………… 53
Table 2.2 Review Literature of IS Capabilities or IS Resources In term of
Resource-Based View …………………………………………………. 71
Table 2.3 Review Literature of Core Competencies Competitive Advantage …... 8 3
Table 2.4 Review Literature of Organization Performance ……….…………….. 93
Table 2.5 Review Literature that relate this research ……………….…………… 101
Table 3.1 The Detail of Likert Scale …………………………..…………………. 113
Table 3.2 The Population’s Type and Number of Organizations ………………... 113
Table 4.1 Total Variance Explained for Strategic-IT Alignment After
Dropped Item ………………………………………………………….. 128
Table 4.2 Rotated Component Matrix of Strategic-IT Alignment After
Dropped Item ………………………………………………………….. 129
Table 4.3 Statistic Of CFA, Reliability and Convergent Validity

Assessment For Strategic IT Alignment …………………………...….. 131
Table 4.4 Total Variance Explained for IS capabilities After Dropped Items ….. 1 33
Table 4.5 Rotated Component Matrix of IS capabilities After Dropped Items ….. 134
Table 4.6 Statistic of CFA, Reliability and Convergent Validity Assessment
Of IS capabilities ………………………………………………...…… 135
Table 4.7 Total Variance Explained for IT support for Core Competencies
After Dropped Items …………………………………………………... 137

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