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Is IT-Business Strategic Alignment Really That Important?

Although it’s common belief that tighter alignment between business and IT strategy directly results in better firm performance, the relationship is far more complex.

Jason Thatcher, along with Dorothy Chau, director at Tencent Holdings Ltd., and their co-authors from the Hong Kong Polytechnic Institute and Virginia Military Academy, found that better structures and processes surrounding IT could either improve or impair firm performance, depending on how strongly business and IT strategies were aligned. Problems associated with misalignment could be mitigated by having a stronger shared understanding of IT’s role within the firm.

Thatcher’s research reveals that the effectiveness of business-IT strategic alignment on performance is influenced by how IT is being managed within firms.