ALIGNING BUSINESS AND IT STRATEGIES 39

Developing and adapting organizations focus on the need to assess and

adapt the processes and skills of the organization as technology changes.
Companies often spend a great deal of resources developing human skills
independent of their investments in IT capabilities. Investment in training
to leverage IT functionality is minimal compared to the investment in tech-
nological systems and applications. If done well, development and adapta-
tion enable organizational capability to be continually updated, thus
minimizing the need for large-scale layoffs that are invariably due to the
mismatch between existing human skills and the emerging technology. In
essence, organizational capability defines and redesigns the basic operating
structure of the business.

Putting the Alignment Model, Perspectives,

and Mechanisms Together
A major reason for the current dissatisfaction with the level of integration
between the business and IT domains, and possibly the absence of value
derived from IT investments, lies in the lack of understanding of the ena-
bling strategic choices that bind a business strategy to the IS infrastructure.
Viewed from within the strategic alignment model, the direct link between
business strategy (top left of Fig. 2.1) and IS infrastructure (bottom right
of Fig. 2.1) can derive its logic only within the context of the two alignment
perspectives that have business strategy as the driver: strategy execution and
technology potential refered to as IT Intrastructure Fusion by Luftman in
Chapter 3. In the former case, the link derives its meaning from translating
the implications of business strategy for the organizational infrastructure
into subsequent demands for IS products and services. In the latter case,
the link is achieved through the effective positioning of the firm in the IT
marketplace—namely, specification of the three components of IT strategy
and the consequent implications for the three internal components of the
IT infrastructure and processes.
Similarly, the direct link between IT strategy (top right of Fig. 2.1) and
organizational infrastructure (bottom left of Fig. 2.1) has no direct mean-
ing. One cannot and should not seek simply to identify and adopt the best
available technologies to restructure the organization or streamline the
business processes without due consideration to the two relevant alignment
perspectives that have IT strategy as the driver: competitive potential and
service level refered to as Organization Infrastructure Fusion by Luftman.
The former identifies the potential impact of IT strategy on business strat-