Competing in the Information Age: Strategic Alignment in Practice

Most managers realize that information is among their company's most important assets. However, many don't know how to leverage their investments in information technology. Often, says Jerry N. Luftman, companies rush to acquire state-of-the-art systems without considering their long-term impact. For example, in the 1980s, retail banks invested heavily in ATMs--until ATMs ceased to be a competitive advantage and became merely another (and increasingly expensive) cost of doing business. Stemming from IBM's highly regarded Consulting Group, combining the expertise of consultants and leading academics, Competing in the Information Age shows managers how to avoid being blindsided by information technology. It outlines how to match information systems with business strategy to forge a strong competitive edge and bring powerful solutions to bear on real-world problems.
The bottom line, Luftman contends, is that a firm must coordinate, or align, four elements: its business strategy, the strategy of its information systems, its organizational infrastructure, and its information technology infrastructure. To this end, he adds to his own expertise contributors who offer models, frameworks, and methods that can help companies in any industry discover their ideal strategic alignment. The contributors have a wide variety of backgrounds and approach information technology from a number of illuminating angles. They discuss how to distinguish between information systems that automate human skills and those that augment them; how to put together worldwide, flexible information structures that seamlessly connect people, products, and processes; and how to gauge the benefits of object-oriented programming and connected computer networks. A recurrent theme is the amount to which an executive should be versed in technology, with the caveat that technological jargon sometimes inhibits business opportunities. Other crucial topics include how inter- and intra-organizational systems (IOS) and Electronic Data Exchange (EDI) are creating a whole new raft of management challenges; and how corporate culture affects attitudes toward information technology. The book also offers a six-stage process of transformation to technology, with suggested roles for the CEO, CIO, and other players, and gives advice on coping with the changes and clashes sparked by new information systems. Managers also get advice on how to benchmark information technology strategic alignment, looking at the results of an IBM benchmarking project.
Citing examples from companies as diverse as Federal Express, a Swiss bank, a fresh produce supplier, four airlines contemplating a merger, and a consumer finance organization, this volume will be valuable to managers from small firms to global corporations, at various stages of contemplating--or implementing--leveraging information technology. It gives companies the key to unlock the power of information, and boost their competitiveness in a tough global marketplace.

Jerry N. Luftman is Professor of Information Management at the Stevens Institute of Technology.