FACULTIET ECONOMISCHE, SOCIALE EN POLITIEKE WETENSCHAPPEN & SOLVAY BUSINESS SCHOOL

Information Systems Strategy and Management 2012-2013 Analyse of paper STRATEGIC BUSINESS/IT ALINGMENT USING GOAL MODELS by Bna S ., Ansias P-Y, Petit M. , Castiaux A.

Alexei Blokhine 93297 Professor: Jegers, M. Prof: Dr. Casteleyn S.

Content 1. Situation article ................................................................................................................... 3 2. 3. 4. a. b. 5. a. b. c. 6. Business strategy ................................................................................................................. 3 IT Strategy ........................................................................................................................... 3 Introduction to Business and It alignment .......................................................................... 4 Concept Business/IT alignment ...................................................................................... 4 Venkatramans Strategic Alignment Model (SAM) ....................................................... 4 Goal Model and Allignment ............................................................................................... 5 Goal and SR model situation ........................................................................................... 5 Goal model constraints and benefits .............................................................................. 5 Combinig Goal Model and SAM .................................................................................... 6 Conclusion .......................................................................................................................... 6

1. Situation article The paper Strategic Business/IT alignment using Goal Model focuses an discusses the relation between interview based Business/ It alignment and the SAM- model of Venkatraman, using a goal model to analyse the Business and IT strategies. This approach is also illustrated by two real case studies achieved within partner enterprises (SMEs).

Using the paper, listed above, as basis, we will discourse the basics of strategies and methodologies used, to make a business and IT alignment using a goal model.

2. Business strategy Business strategy is a long term plan of action deliberated in order to achieve a particular goal or a set of goals or/and objectives. Creating a business strategy is a core management function. The aim of a business strategy is to strengthen a particular business so that its performance increases and, in turn, the business becomes more profitable. Without a business strategy, a business has no guide to follow and has an increased risk of failure. The business strategy of a firm is the match between its internal competences and its external relationships. It describes how it reacts to its suppliers, its customers, its competitors, and the social and economic environment within which it activates. 1 3. IT Strategy Information Technology has become a key of business function for almost every organization and most have great expectations of their investment in IT for the future benefits to the business- expectations that will be enable the business to reduce costs, standardized processes, enhance productivity, improve workflow and

communications, sustain repeatable service levels, improve risk control, implement new business strategies, facilitate organic and acquisition-driven growth, gain competitive advantage by exploiting new technology2.

http://books.google.be/books?hl=en&lr=&id=WhLCD4s8klIC&oi=fnd&pg=PA3&dq=business+strategies&ots=XXcVyIIKMA&sig=bt3U45t9QlBto64oANGb1q4Dl7 M p. 4
2 Tallon, P., Kraemer, K. (1999)

4. Introduction to Business and It alignment a. Concept Business/IT alignment Strategic alignment emphases on the activities that management performs to achieve cohesive aims across the IT and other functional organizations (e.g., finance, marketing, H/R, manufacturing). Consequently, alignment addresses both how IT is in harmony with the business, and how the business should, or could be in harmony with IT. b. Venkatramans Strategic Alignment Model (SAM) The term IT- Business alignment refers to het degree of fit between Business and IT activities, such as Business strategy, business infrastructure, IT strategy and IT infrastructure. Those four interactions where defined by Venkatraman into the Strategic Alignment Model (SAM) In this model we can distinguish four different strategic approaches linked by two axes; the horizontal, which gives the direct alignment relation between Business and IT, and the vertical, strategy linkage, which determines the infrastructure of the business. The four main strategies defined by Venkatraman are: a. Strategy Execution: This traditional, hierarchical perspective assumes that the organization is business driven and the strategic management designs the logic of IT infrastructure. b. Technology Transformation: This perspective also starts with Business Strategy as a driver, but use the IT strategy approach to define an IT infrastructure that supports the chosen Business Strategy. c. Competitive Potential is based on exploitation of new IT opportunities. On this base IT determines new products, services and develop new forms of relationships. That reflects directly on the Business Strategy and defines new organizational structures. d. Service Level perspective is completely based on IT service and internal information flow to meet the needs of fast changing demand of the end users. Even though the SAM is used as a standard tool for strategic alignment measures and improvements, the paper we analysed assumes many do still base their analysis on subjective interviews.

By combining interviews with Business and IS managers into a Goal model, this approach can capture both the real life and the needed heuristics to make the interview less subjective and more standardized. 5. Goal Model and Alignment a. Goal and SR model situation Business/IT goal modelling is an enterprise language which is used to identify the business/IT goals and the hierarchy among them. The form used is inspired by the strategic rational (SR) model of the i* framework. The SR model describes the relationships that are "internal" to actors, such as meansends relationships that relate process elements, providing explicit representation of "why" and "how" and alternatives.i The Strategic Relational (SR) Model focuses on actors tasks and their relations and influences on the goals, well suited to provide an overall view, indicates how actors, their tasks, goals, soft goals and resources relate to each other, and what are the dependencies between them. The language is well accepted among business analysts in order to maintain an organizational structure which is easy to understand within organizational-related activities, important to create a standard structure for the alignment. b. Goal model constraints and benefits Implementing the business/IT goal model into an I* framework enables IT analysts to examine the business requirements at an early stage of system development. By studying the two cases, explained in the paper, the organizational actors have their own goals and beliefs and each actor is connected to one another, and differ from IT and Business approach. Still the use of a goal model does contain several weakness on its own. First of all the technique is complex to understand and provide little information on business goals, as IT people tend to lack business knowledge and setting business goals is a complex process. At second they are unable to support business analysts in a rapidly changing business environment, as the techniques require a huge amount of time to implement.

c. Combinig Goal Model and SAM Once we have created a Business and a IT strategy goal model, we can identify and compare the different elements simply by making Cause/Effect links. Identifying semantic links and orientate the relationships by asking the question What element existed first and which goal achievement implies achievement of the other. This makes it possible to map those relationships into Venkotramans Strategic Alignment Model and determine the most suitable strategy.

6. Conclusion
IT is continually evolving, and through the rapid changes of industrial, social, political and environmental sectors we can observe the importance of strategic alignment. As companies evolve, and comprise new forms of IT-focused competitiveness, strategic alignment is likely to assume an even greater degree of importance. With IT spending forecasted to grow at unprecedented rates, managers have to use IT resources in the most effective and efficient manner possible. In this paper we discussed about the combination of SAM model with the goal models to include problems related to identification of strategy and problems related to the method by which alignment is identified.

Through the medium of i*, goal models determines a better decision-making process and combining goal models analysis with SAM gives a structure for a model driven Business/IT alignment. The alignment of strategic business and IT using goal models is realized through the architectural design that is going further than only a simple supporting role for IT in the current business processes. IT is also working as activator for renewed or even totally new business. The new IT enabled company will have new forms of organisation, new business processes, new products, new services and new channels and relationships to the customer, which are possible by combining the strategic business with IT in order to operate as one whole.

7. References: 8. (4)Tallon, P., Kraemer, K. (07-20-1999). A Process-oriented Assessment of the Alignment of Information Systems and Business Strategy: Implications for IT Business Value. eScholarship University of California. Retrieved from http://escholarship.org/uc/item/74b1s5rk 9. 10. (5) Serge, T. (22-11-2011).What does developing an IT Strategy mean. The Open Group website. Retrieved from http://blog.opengroup.org/2011/11/22/what-doesdeveloping-an-it-strategy-mean/

11. (6) Brisebois, R., Boyd,G., Shasid,Z.(n.d.) What is IT Governance? And why is it important for the IS auditor. INTOSAI, working group of IT Audit. Retrieved from http://www.intosaiitaudit.org/intoit_articles/25_p30top35.pdf 12. (9)Mane, S. (2005) "IT Governance: The ultimate IT weapon" http://www.igatepatni.com/media/10342/tp_ITGovernance_Ultimate-IT-Weapon.pdf

http://www.cs.toronto.edu/~gross/istar/didactic05-228.htm