Business and IT Alignment in Dutch Vocational Education and Training Organizations

Abstract

Information technology is a critical component of organizational architecture, enabling new business strategies, business models, organizational structures and processes. This paper presents a model to address the persistent challenge of alignment of business and IT in multi-business organizations. It makes two contributions. One is to reframe the business and IT challenge from a simple dyad between a single level business and IT strategy, to a multi-dimensional model of alignment among the corporate IT platform and SBU IT portfolios, and between the corporate business strategy and each SBU business strategy. The other contribution is the application of a real options pricing-based model to separate IT platform strategy and SBU IT portfolio investment over time, which locates them in the normal corporate and SBU planning cycle. The implications for IT infrastructure investment, project complexity and IT governance are discussed, and a research agenda around the dynamics of alignment is proposed.