The Impact of Information Technology Infrastructur

TheImpactofInformationTechnologyInfrastructureFlexibilityonStrategicAlignmentandApplicationsImplementationSockH.ChungDepartmentofComputerInformationSystemsCollegeofBusinessEasternMichiganUniversityYpsilanti,[e-mail],Jr.**DepartmentofManagementCollegeofBusinessAuburnUniversityAuburn,Alabama36849(334)[e-mail]inessWakeForestUniversityWinston-Salem,NC27109(336)[e-mail]**CorrespondingAuthor:KellyRainer2TheImpactofInformationTechnologyInfrastructureFlexibilityonStrategicAlignmentandApplicationsImplementationAbstractITinfrastructureflexibilityisnowbeingviewedasanorganizationalcorecompetencythatisnecessaryfororganizationstosurviveandprosperinrapidly-changing,competitive,businessenvironments.Utilizingdatafrom200U.S.andCanadiancompanies,thisstudyexaminestheimpactofthefourcomponentsofITinfrastructureflexibility(compatibility,connectivity,modularity,andITpersonnel)onstrategicIT-businessalignmentandtheextentofapplicationsimplementationwithinanorganization.Thefindingsfromanalysisofastructuralmodelprovideevidencethatconnectivity,modularity,andITpersonnelhavesignificant,positiveimpactsonstrategicalignmentandthatallfourcomponentshavesignificant,positiveimpactsontheextentofapplicationsimplementation.ThestudyreinforcestheimportanceofITinfrastructureflexibilitytoorganizationsasonesourceforsustainablecompetitiveadvantage.KeyWords:ITinfrastructureflexibility,strategicIT-businessalignment3I.INTRODUCTIONIntheearly1990s,Johnson&Johnsonfacednewbusinesspressureswhenlargecustomers,suchasWal-MartandK-mart,madenewdemandsonthecompany,suchascostsavingsandjust-in-timestockreplenishment.Johnson&Johnson’sbusinessandITmanagersactedinpartnershiptodevelopanewsetofinformationtechnology(IT)infrastructurecapabilitieswhichenabledthecompanytoprovidethenecessaryservicesforitslargecustomerswhileatthesametimereducingcostsatJohnson&Johnson[Weill&Broadbent,1998].Inthelate1990s,CharlesSchwabfocusedondeliveringcustomizedinformationtoitsinvestorsinatimelymanner.Usingthecompany'sITinfrastructureandapplicationsalignedwithitsbusinessfocus,Schwabbecameafullservicebrokeragefirm.Thefirmwasabletoprovideinformationandprocesstransactionsinmeetingitsbusinessobjectives.CustomerscouldretrievestockquotesandplaceordersviaSchwab'sWebsite.Asaresult,thecorporationcontinuestobeanindustryleader.Thesetwoexamplesdemonstratethatanorganization’sITinfrastructurecanprovidetangiblebenefitsandacontinuityofbusinesspractices[Kettinger,Grover,Subanish,&Segars,1994].AparticularlyimportantcharacteristicofITinfrastructureisflexibility[Byrd&Turner,2000].ResearchershavestatedthatITinfrastructureflexibilityshouldbeviewedasanorganizationalcorecompetencyandthatITinfrastructureflexibilityisnecessarytohandleincreasedcustomerdemandswithoutincreasedcosts[Davenport&Linder,1994;Weill,1993].Aswediscussnextindevelopingthetheoreticalframeworkforourstudy,twoimportantaspectsofITinfrastructureflexibilityemergefrompreviousresearch:thecore4businessapplicationsofanorganizationandthestrategicIT-businessalignment.Thatis,anorganization’sITinfrastructureflexibilityshouldbereflectedinitsimplementationofcorebusinessapplicationsandtheextentofitsstrategicIT-businessalignment.Therefore,thepurposeofthisstudyistoempiricallyexaminetherelationshipbetweenITinfrastructureflexibilityandtheextentofapplicationsimplementationintheorganizationandtherelationshipbetweenITinfrastructureflexibilityandstrategicIT-businessalignment.II.THEORETICALFRAMEWORKWedevelopourtheoreticalframeworkbyfirstreviewingdefinitionsofITinfrastructureanditscomponents.WethendefinetheconceptofITinfrastructureflexibilityanditsrelationshiptostrategicIT-businessalignmentandtoapplicationsimplementationintheorganization.InformationTechnologyInfrastructureThetopicofITinfrastructurehasbeenakeyissueforbothresearchersandpracticingmanagersforsometime[seee.g.,Brancheau,Janz,&Wetherbe,1996].Theorganization’sITinfrastructurebasicallyintegratestechnologycomponentstosupportbusinessneedsbuttheITinfrastructureconceptismorecomplicated.ThedefinitionofITinfrastructureencompassesavarietyofcomponents.Basedonpreviousstudies,Duncan[1995]statedthatITinfrastructureincludesagroupofshared,tangibleITresourcesthatprovideafoundationtoenablepresentandfuturebusinessapplications[Broadbent&Weill,1997;Davenport&Linder,1994;Earl,1989;5Keen,1991;McKay&Brockway,1989;Niederman,Brancheau,&Wetherbe,1991;Weill,1993].Theseresourcesinclude:(1)computerhardwareandsoftware(e.g.,operatingsystems);(2)networkandtelecommunicationstechnologies;(3)keydata;(4)coredata-processingapplications;(5)sharedITservices.Duncan[1995]alsostatedthatITinfrastructureincludesthealignmentofITplanstobusinessobjectives,theITarchitecture,andtheskillsofITpersonnel.BroadbentandWeill[1997]notedthatITinfrastructurecapabilitiesenablethevarioustypesofITapplicationsrequiredtosupportcurrentandfuturebusinessobjectives,andenablethecompetitivepositioningofbusinessinitiatives.McKayandBrockway[1989]describedITinfrastructureastheenablin