Impact of IS alignment strategies on organizational perceptions of quality

This survey research focused on approaches used to align organizations’ IS application development activities to internal line business unit needs. Relationships between use of alignment approaches and IS product/service quality were examined. Two separate views of quality were measured: that of the IS producer unit, and that of the IS customer unit.. Alignment approaches studied included: I) dispersal of responsibility for IS activities to line business; and 2) use of coordination mechanisms (e.g., JAD ‘s) to bring customers and producers together in face-to-face project planning and shared action. 34 subunits of US and Canadian organizations participated in the stua’y providing data on actual IS application development/support eflorts. IS coordination mechanism use was found to correlate with improvement in Customer, but not Producer, perceptions of IS quality. 1: Problem statement Lack of alignment between a company’s information systems (IS) and its pressing business needs is a major barrier to organizational effectiveness. Industry observers generally agree that in order to address this problem, the IS function must become more integrated and coordinated with line business operations. How will business accomplish this? A variety of IS alignment strategies are in use. Many companies are implementing changes in their organizational structure with the aim of improving integration between line business and the IS function. Structural change approaches vary, but all generally involve some degree of IS function “dispersal” that is, movement of some IS activities and staff expertise out of specialized, enterprise level IS units and into line business units. Another category of alignment strategy commonly employed involves the use of mechanisms expected to better coordinate efforts of the IS technical staff (i.e., IS producers) and the line business staff (i.e., IS customers) during IS application development and support projects. The use of Joint Application Design (JAD) techniques, formal assignment of line business staff to project teams, Service Level Agreements (SLA’s) on projects, and customer involvement in system requirements definition and design inspections all fit into this “coordination mechanism ” category. Improved information systems and service quality is the major thrust behind the current experimentation, But which, if any, of the various alignment strategies in use are effective in achieving this end? Despite much anecdotal evidence of their value, this question has never been specifically studied. In the next section of this paper the relevant literature on IS alignment strategies and IS quality will be briefly reviewed. Following this, the research designed and executed to investigate the question of IS alignment strategies’ impact on IS quality will be presented and discussed. 2: Literature review-IS alignment strategies 2.1: IS function dispersal There is great variation in the description of what is happening in IS organizational restructuring initiatives aimed at improving alignment between IS and business functions. Variously, organizations have used the terms “centralized”, “decentralized”, “recentralized”, “centrally decentralized”, “dedicated”, “hybrid” structure, and “distributed” to describe the resulting organizational forms [ 131 [ 121 [27]. The term “dispersed” has also been used [ 191 [24], and was adopted as the most accurate construct for use in this research. IS dispersal is the transference of control over computing resources to the hands of business unit managers. The term implies a close integration, with informal and day-to-day interchange possible between business people and technologists. The literature suggests that IS dispersal might facilitate more effective working relationships between IS customers and IS producers. Previous research [16] [24] described natural pressures for IS dispersal in business today including: business 379 1060-3425/95$4.00Q1996IEEE Proceedings of the 28th Hawaii International Conference on System Sciences (HICSS '95) 1060-3425/95 $10.00 © 1995 IEEE Proceedings of the 28th Annual Hawaii International Conference on System Sciences I995 units gaining intluence over the systems development agenda and/or budget; bootleg development shops springing up in business units; increasing dissatisfaction from business units about IS costs, poor delivery, etc.; and business units stepping up their purchases of outside software for either business-critical applications or to meet competition. These have been interpreted as signs that the IS organization is not meeting the needs of the line business functions and that IS function dispersal should be considered as a mechanism to increase quality and accessibility of service. 2.2: IS codinatim mechanisms The IS business literature reports several other strategies that organizations are using in attempts to improve alignment between their IS and line business functions. One very common alignment approach is that of utilizing one or more internal line business customers as members of the development team staff (i.e., having a “customer on the team”). Baroudi, Olson, and Ives [2] conducted research to empirically esamine the common assumption of the positive value of user involvement in information systems development. The results of their research demonstrated that customer involvement in the development of information systems tends to enhance both user information satisfaction and system usage. Specific processes to facilitate communication between the IS application development and line business functions have also been developed. JAD, or Joint Application Design technique, is one of these. JAD, originally developed in the early 1980’s by IBM, is now in widespread use in its original form as well as in variant forms. The technique was developed as an alternative to traditional methods of requirements and design specification which placed full responsibility for developing IS application requirements and design specifications on the IS staff, and typically involved information gathering in one-on-one interviews with the business customers. JAD sessions. instead, involve IS application customers working with systems development specialists as equals to produce these specifications [25] wi [291. Service Level Agreements (X4’s) have also been suggested as a means of improving communication between the IS application development staff and their line business customers. Service Level Agreements are essentially contracts, mutually developed and agreed upon by an organization’s IS and line business functions. SLA’s establish targets of performance that appear realistic to IS producers and appear to meet the needs of the IS customer. When actual performance differs from the targeted performance level, corrective action is needed. Common areas of focus of SLA’s include: system reliability, availability, on-line response time, and the accuracy and timeliness of application generated outputs aspects of IS performance that are negotiable [I51 [4]. Effective SLA’s specify the negotiated agreement with regard to expected quality levels of delivered information products and services, and who is responsible for doing what to achieve them. They also specify agreed upon quality criteria and procedures by which compliance with these will be monitored, judged and reported [15]. The service-level agreement is seen as providing an improved communication vehicle that results in more effective management of customer expectations as well as careful definition of performance expectations for IS. A third commonly employed process with potential for facilitating communication between the IS application development and line business functions is involvement of customer representatives in requirements dejinition and design “inspections”. An “inspection” is a structured meeting focused on the identification of defects in specific IS products (e.g., the documented system requirements or the system design based on these, or, later in the development process, of actual code). An inspection’s aims include verifying the traceability of requirements to products, the early detection and correction of IS application errors, and the provision of the correct technical base for the next project step [6]. Research on the effectiveness of inspections focused on the IS application design suggests that these are a more cost effective means of IS application defect detection and removal than is after-the-fact testing [9]. In an inspection focused on IS application requirements and design specifications, there is clear value in involving IS application customers in the process as “inspectors”, since they are most knowledgeable about the business need to be met. According to Keen and Gersch [ 1 I], one major value of customer involvement is that it encourages the emergence of potentially conflicting goals which, if left unidentified and unresolved, can cause later problems of withdrawal of support or loss of momentum in IS application development efforts. These authors point out that the resolution of ambiguities in defining what the finished system will do and look like is &en more a political process than an intellectual one, because different customers may hold conflicting ideas of what they want. They relate a case study wherein IS application customers were provided an opportunity to evaluate and criticize a design specification and then itemized the benefits of the use of this process as follows: acquisition of customer knowledge; transferal of responsibility for the system design from the “technical