Stevens Institute of Technology Professor Dr. Jerry Luftman has published the article, “An Update on Business-IT Alignment: ‘A Line’ Has Been Drawn,” in MIS Quarterly Executive’s September 2007 issue. Luftman serves as a Distinguished Professor and Associate Dean for the Master of Science in Information Systems in Stevens’ Wesley J. Howe School of Technology Management.
Luftman’s article presents positive correlations between the maturity of the information technology (IT)-business alignment and IT’s organizational structure, the CIO’s reporting structure and firm performance. With the assistance of Rajkumar Kempaiah, a Stevens graduate student, Luftman focused his research on understanding the persistent problem of attaining alignment between IT and business and found there is no single cause for this problem. He proposes that the alignment is best understood by measuring six different components—communications, value, governance, partnership, scope and architecture and skills—and then placing these components on a five-level maturity model, where Level 5 is the highest maturity. After measuring these six components for global organizations in the United States, Latin America, Europe and India, it was found that most organizations today are at Level 3 on the five-level maturity model. It was also found that federated IT organizational structures are associated with higher alignment maturity than centralized or decentralized structures, and that companies with CIOs reporting directly to the CEO, president or chairman have significantly higher alignment maturity than those where the CIO reports to a business unit executive, the COO, or the CFO. Furthermore, higher alignment maturity correlates with higher firm performance. -Stevens Institute of Technology
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