IT Issues in Alliances

Long term IT considerations, such as IT architecture, is a major consideration. A strategic consideration, such as new alliances, would require visioning of a different IT architecture. Applegate, McFarlan and McKenney (1999) view IT architecture as an overall picture of the range of technical options as well as business options. "Just as the blueprint of a building's architecture indicates not only the structure's design but how everything — from plumbing and heating systems, to the flow of traffic within the building — fits and works together, the blueprint of a firm's IT architecture defines the technical computing, information management and communications platform" (p. 209).

Figure 2 brings out the dynamic nature of the IT architecture development process. The technology part, shown by dotted oval, is concerned with design, deployment and how it is used. This part is the core of IT architecture and a huge proportion of IT professionals' time is devoted to these activities. Consideration of business options, which feed to various technology options, is a higher-level activity in the IT architecture development process. Business options, such as strategic alliances, mergers and acquisitions, outsourcing, diversification, etc., are influenced by major internal as well as external factors, such as current business practices, business opportunities, and organizational strategy. There is a direct link between technology and organizational strategy. The technology (with its operational and technical settings) exerts a strong influence on the organization's future strategic direction. Thus, one can observe (as shown in Figure 2 through connecting lines), a close link between technical and other business factors, and, like ever changing business, the IT architecture is a dynamically evolving phenomena.

click to expand
Figure 2: Forces Affecting Overall IT Architecture

An alliance can exist between any number of organizations. For example, telecommunication organizations could form an alliance for international joint ventures, or an alliance can be established between a banking organization and an IT supplier. The notion of developing a strategic alliance suggests an organization's performance can be significantly improved through joint, mutually dependent action. For a strategic alliance to be successful, business partners must follow a structured approach to developing their alliances and should include as part of this process, strategic planning, communication, efficient and effective decision-making, performance evaluation, relationship structure, and education and training.

Strategists have often suggested organizations should consider entering into similar or somewhat related markets sectors to broaden their product/service portfolios (Henderson & Clark, 1990; Markides & Williamson, 1997). Both the dimensions of market [customer and product as per Ansoff (1986)] in a related market can easily be identified and strategies formulated for deployment. The main advantage of adopting such a strategy is an organization can easily use its competencies and strategic assets in generating a strategic competitive advantage (Markides & Williamson, 1997). Determining the design and the requirements of a new information system (IS) is a relatively simple task. In contrast, diversification into a significantly different market for an IT/IS organization is a very challenging task, which needs considerable evaluation of IT infrastructure and human relations.



Computing Information Technology. The Human Side
Computing Information Technology: The Human Side
ISBN: 1931777527
EAN: 2147483647
Year: 2003
Pages: 186

flylib.com © 2008-2017.
If you may any questions please contact us: flylib@qtcs.net