Avoiding the Alignment Trap in Information Technology

1825 Words Jan 26th, 2018 7 Pages
According to survey results, two major patterns lead to failure of IT: alignment and efficiency. Alignment is the degree to which the IT group understands the priorities of the business and expends its resources, pursues projects ad provides information consistent with them. This case recognized the following four IT alignment quadrants that companies fall into as followed:

1. Alignment Trap: This situation arises when business's IT is highly aligned but are not highly effective. According to the case, 11% of the companies surveyed were in this quadrant. Their IT spending was 13% higher then the average company yet they had 14% lower revenue growth on average over three years. Schwab & Co. is an example used in the case and they were spending 18% of their revenue on IT compared to the 13% leading competitors were spending and even then the progress of several of their big ambitious projects were preventing the company from responding effectively to competitors.

2. Maintenance Zone: This situation arises when business’s IT capabilities are neither highly aligned nor are they highly effective. According to the case, three quarters of the surveyed companies found them selves to be in this quadrant, which is underneath the Alignment Trap. Companies in this quadrant record a slower rate of…
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