enterprise strategic alignment method - a cross-disciplinary capability-driven approach
The environment of organisations is changing more rapidly in the recent years, which makes it increasingly more difficult to stay competitive. Organisations need to ensure that when they make transformations, they focus on maintaining or improving the alignment between the competitive position of the organisation and their design of an appropriate strategy and structure, also known as strategic alignment. However, this pursuit for strategic alignment can prove very challenging for organisations, which, as seen from literature, can in many cases lead to issues with designing a suitable strategy and/or problems with implementing it successfully. The most common issues with strategic alignment, as identified from literature, are related to formulating appropriate strategies and implementing them within the organisation.
One very important question when discussing strategic alignment is why it is considered crucial for organisations to pursue it. A simple answer to this is, as identified from literature, that it helps improve business performance, in the form of increased sales revenues, improved operational efficiency, cost reductions, and enhanced customer value.
Throughout the years many models, methods, frameworks, etc. have been developed to help organisations improve strategic alignment. However, most of these proposed solutions share the same limitations such as, predominantly top-down solutions, lack of alignment evaluation and correction techniques, informal modelling support, and the most importantly, a strong emphasis on the Business and IT alignment, and not on strategic alignment as a whole. Furthermore, most of these solutions are not cross-domain, which is a strong limitation from the perspective of strategic alignment.
Therefore, in order to fill this research gap, we propose a strategic alignment method, named the Enterprise Strategic Alignment Method (ESAM), which incorporates cross-domain knowledge from Strategic Management (SM), Capability-based planning (CBP) and Enterprise Architecture (EA), and which facilitates cross-domain relationships. Furthermore, our proposed method incorporates support for formulating strategies with the help of a flexible and objective process which includes linked strategy techniques. Moreover, the ESAM provides support for strategy implementation by including several capability-based techniques which can be used for communicating strategic intent within an organisation, and also can be used as intermediaries between strategy and execution. Additionally, the ESAM includes support for translating the strategic intent of an organisation into their EA by means of the ArchiMate modelling language, which can facilitate impact analyses, planning and monitoring of change, and the links between strategy techniques and EA. Finally, the method includes support for improving strategic alignment by focusing on communication, facilitating better partnerships, supporting improved governance, promoting an integrated architecture, and insuring an alignment between the different types of measurements an organisation can have.
We have validated and evaluated the method presented above with the help of three very distinct case studies, in terms of organisation type and scope of the case study. In the first case study, we focused on helping the Insurance organisation with translating their high-level strategic intent into more actionable information, which can be modelled and related to their EA. In the second case study, we focused on helping the Public university improve the alignment between their high-level strategic plans, and their Information strategy (called i-Strategy), their application landscape, and their Project Portfolio. Finally, in the third case study, we facilitated the Investment fund with formulating their strategy in three different instances, namely with elaborating their strategy, exploring a new business idea, and analysing the impact of a strategic decision.
By having such a diverse application of the ESAM, we can identify which aspects of our method can be used by all three types of organisations, and which can be considered more situational. As a result, within all three cases, capabilities have played a central part, while aspects such as strategy formulation, modelling with ArchiMate, and relationships to projects can be considered situational. Furthermore, based on a cross-case analysis we can conclude that the ESAM has had a positive influence on different aspects relating to Communication, which are identified in literature as very important enablers of strategic alignment. Besides the ESAM, within our research, we have also designed further support for the method in the form of a software tool. This includes a management dashboard tool, named Strategy on a Page, with several custom templates, multiple computer-aided canvases, a spreadsheet-based strategy design tool. The software tool was demonstrated with the help of two case studies also used for the method validation, namely the Public university and Investment fund case studies.
Additionally, we have also developed two serious games which can also be used to support the ESAM and disseminate it. The scope of the first serious game is to allow players to experience the benefits of using interlinked strategy techniques for the strategy process, in an easy manner. The second game is focused on helping participants explore, in a simulated world, how the introduction of digitalisation in the strategies and business models of organisations operating on the horticultural industry would affect themselves and their whole supply chain. While these two games can be considered fairly distinct based on how they use aspects of the ESAM, we consider both of them to be very useful ways to demonstrate different aspects of the method.
We consider that the main contribution of this dissertation is proposing a cross-domain method for strategic alignment which can assist organisations with formulating and implementing strategies, and with translating strategic intent into their EA. Furthermore, this method addresses several challenges, identified from both theory and practice, as issues experienced by organisations in their pursuit of strategic alignment. Moreover, this method is also supported by two practical applications, namely the software tool and the two serious games, which can be used by practitioners to design and analyse their strategies, and also to experiment with different strategy techniques and decisions in a safe environment without real-life consequences.