Week 4 - Strategic Alignment Model

Source / Reference:
1)  "Strategic Alignment: Leveraging Information Technology for transforming Organizations
Based on the paper of J.C. Henderson, N. Venkatraman (1993)" by Philipp Maderthaner

http://www.123helpme.com/view.asp?id=87646

2) "Explanation of Strategic Alignment"

http://www.valuebasedmanagement.net/methods_venkatraman_strategic_alignment.html

Subject: 
In Lect 4 - Which alignment strategy in SAM model is the best? and why?
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Response:

In my opinion, there is no Best alignment strategy in SAM. Whether the alignment strategy is the best for an organization is mainly depend on its own situation. Different companies have different background, characteristics and situations, an approach fits this company may not be the best approach for another company. The four approaches in the SAM model have their own advantages. 

The four alignment perspectives:

1. Strategy execution

Business strategy is the driver to the design of both organization and IT. It is the most common perspective.

2. Technology Transformation

Business strategy is supported by both IT strategy and IT infrastructure. 

3. Competitive Potential

Design IT strategy to affect the business scope and develop new forms of relationship

4. Service Level

Focusing on the IT service organization in order to satisfy customers.

For the Strategy execution, it will be more suitable to small shops and small companies. It is not necessary for them to develop very good IT infrastructure since they have only simple structure and they may not have enough money. For these companies, IT is not very important for their business. Therefore, they will focus on business strategy and the IT infrastructure is just only develop to implement the business strategy in a more efficient way.

 On the other hand, if the company is doing a business that requires good technology and information system, Technology Transformation will suit for the case. For example, the American Express. It is a company well known for its credit cards. In order to let its customers to enjoy using the credit cards conveniently and efficiently. It is extremely significant for American Express to have very good IT strategy and IT infrastructure in supporting its business strategy. 

For the company which wants to develop new products or service, Competitive Potential would be effective in this case. For instance, the smartphone companies such as Samsung, LG and Motorola. They must be innovative and develop new products in order to compete with others. The Competitive Potential strategy will be the best approach for them.

Satisfying customer's needs is the main point in success of a business. Companies can apply the service level approach if they are mature enough and want to provide high quality service. Nowadays, all banking companies provide many online services for customers so that customers can do so many things conveniently. They are applying this approach to attract more customers and keep the current customers.

To conclude, there is no best alignment strategy in SAM. All the strategy can provide different benefits for companies. Each company should select its own strategy depends on its business and situation. Although companies may focus on doing one business, the world keeps on changing. Companies should consider the current situation and change to other approach when necessary.