TOWARDS AN EXTENDED ALIGNMENT MODEL FOR

A COMPLETE ALIGNMENT OF

MANUFACTURING INFORMATION SYSTEMS

Oscar Avila, Virginie Goepp and François Kiefer

INSA de Strasbourg, 24, Boulevard de la Victoire, 67084 – Strasbourg Cedex, France

Keywords: Manufacturing information system, information system alignment; alignment framework.

Abstract: Today companies need flexible and adaptable Information Systems (IS) to support their business strategies

and organisational processes, as well as to facilitate their adaptation to changes in environment. In

particular, in the manufacturing sector companies need flexible IS to make the integration of infrastructures

easier, to support production management and to be able to respond to the evolution of support

technologies. To deal with these specific requirements the alignment between the manufacturing IS with the

organisation's strategy and its outside environment is necessary. However, most of the research in the IS

alignment field is related to the alignment of IS with the organisation's strategy, neglecting the alignment

with the external environment. Thus, in order to support complete alignment of manufacturing IS we

propose in this paper an extension to the Strategic Alignment Model (SAM) of Henderson and Venkatraman

(1999). The extended SAM allows the definition of possible alignment perspectives that accentuate

elements to be aligned and the alignment sequence. This set of perspectives and the extended SAM are a

first step towards tackling the alignments with the strategy and with the environment.

1 INTRODUCTION

Today companies need flexible and adaptable

Information Systems (IS) to support their business

strategies and organisational processes, as well as to

facilitate their adaptation to changes in environment.

Corresponding dynamic adaptations of the IS are

studied in the field of IS alignment. Contributions to

IS alignment focus mainly on the so-called -internal-

strategic alignment. Particularly, the Strategic

Alignment Model (SAM) (Henderson and

Venkatraman, 1999) is interesting because it

provides guidelines structuring the domains to be

aligned as well as possible alignment processes by

proposing alignment sequences in the form of four

alignment perspectives.

However, the importance of achieving coherence

between the organisation’s strategy and its

environment has also been acknowledged

(Andrews, 1987). Therefore, in (Camponovo et al.,

2004) it is suggested studing the IS alignment not

only from the strategic alignment point of view, also

by considering two additional levels that enable a

global and complete alignment of the IS. First,

alignment with the environment takes into

consideration the external environment and assumes

that the information system has to integrate features

for assessing this environment. Finally, alignment

with uncertain evolutions over time emphasizes the

necessity to design information systems able to

evolve according to future changes.

In particular, in the manufacturing IS sector these

two additional levels of alignment are crucial and

have to be operationalised. Therefore, it is proposed,

in this paper to extend the Strategic Alignment

Model (SAM) of Henderson and Venkatraman by

adding the manufacturing domain. Section 2 gives a

brief overview of the SAM with its underlying

concepts. Section 3 presents the extended SAM,

derived from the original SAM model by analogy of

concepts. Section 4 discusses the possible alignment

modes between the extended SAM domains. Section

5 concludes with work perspectives.

231

Avila O., Goepp V. and Kiefer F. (2008).

TOWARDS AN EXTENDED ALIGNMENT MODEL FOR A COMPLETE ALIGNMENT OF MANUFACTURING INFORMATION SYSTEMS.

In Proceedings of the Tenth International Conference on Enterprise Information Systems - ISAS, pages 231-234

DOI: 10.5220/0001691102310234

 SciTePress

2 SAM OVERVIEW

2.1 SAM Concepts

The Strategic Alignment Model (Henderson and

Venkatraman, 1999) is structured in terms of three

classes of concepts:

• Domains: Business and Information

Technologies (IT);

• Perspectives or levels (that split domains):

external (strategy) and internal (structure) ,

• Components (that characterize and compose

each level): scope, competencies and governance in

the external level; infrastructure, skills and processes

in the internal level.

IS strategic alignment is conceptualised in the SAM

in terms of two building blocks (Henderson and

Venkatraman, 1999):

• Strategic fit (the interrelationships between

external and internal levels of a domain) and

• Functional integration (integration between

“Business” and ”IT” domains).

This functional integration is detailed into: (1)

Strategic integration related to the external level;

and (2) Operational integration related to the

internal level.

2.2 Towards an Extended SAM

Managing manufacturing IS complete alignment, in

particular with the environment, requires to cope

with various stakeholders by assessing numerous

expectations, and integrating numerous uses while

managing the strong links existing between the

information technologies to be implemented and the

manufacturing infrastructure. Indeed, as shown in

(Goepp and Kiefer, 2006) the actors involved are

various from the workshop manager to the operators,

and the manufacturing IS has to play an integrating

role between the manufacturing infrastructures.

Therefore, it is proposed in this paper to extend the

SAM by adding the manufacturing domain, which

aims at integrating the dimensions linked to the

manufacturing infrastructure and actors (cf. figure

1). The structure of the manufacturing domain is

derived from the original SAM through analogy of

concepts. The next section details this work.

3 MANUFACTURING DOMAIN

The definition of the manufacturing domain is based

on the work of (Hayes and Wheelwright, 1984; Hill,

1995) detailing the decision categories involved in

the definition of a specific manufacturing strategy. It

is proposed to map these categories into the

manufacturing components structuring the external

and internal levels. By analogy with the original

SAM components, some categories of decisions can

be easily mapped in the external or internal level.

For example, human resources and organisation

decisions address issues such as: incentives and

compensation, investment in human capital These

match therefore with the internal component termed

manufacturing skills.

Nevertheless, mapping some other categories can

be quite complex because they involve aspects

belonging both to the external level and the internal

level. In this case, we choose to match these

categories to the external level in order not to miss a

potential impact on the other domains.

Figure 1: Extended SAM with manufacturing domain.

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Thus, for example, manufacturing technology

decisions concern choices on specific manufacturing

technologies, such as recent innovations in

computer-aided design (CAD), that could impact

new products and services (business scope) and

strengthen business distinctive competencies. Thus

such decisions may support or shape the business

strategy, this is why they may be placed at the

external level, specifically, in the manufacturing

scope component. However, manufacturing

technology decisions also concern the configuration

of equipment into lines, cells, etc. that collectively

define the technical infrastructure. In this way, a part

of these decisions may be also placed at the internal

level, specifically, in the manufacturing

infrastructure component. Based on the previous

analysis, the categories of decisions are mapped as

follows (table 1):

Table 1: Categories of manufacturing decisions mapped

on manufacturing domain component.

Manufacturing External level

Scope *Manufacturing technologies

*Product scope/introduction

Competencies *Manufacturing capacity

*Quality

Governance *Vertical integration

Manufacturing Internal Level

Infrastructure *Equipment configuration

*Facilities

Processes *Manufacturing planning/processes

Skills *Human resources/organisation

Adding the manufacturing domain to the original

SAM is a first step to reach our target. To efficiently

support manufacturing IS alignment, it should be

completed, with alignment perspectives. These set

the paths between the different sub-domains in order

to align them. However, to be exploited and

extended to our work, the underlying mechanisms

and conceptual elements are worked out and

discussed for the manufacturing domain in the next

section.

4 ALIGNMENT PERSPECTIVES

CONCEPTUAL ELEMENTS

4.1 Alignment Principles

For building SAM alignment perspectives the two

following hypothesis are made:

• Alignment perspectives involve both strategic

fit and functional integration.

• Strategic alignment can only occur when three

of the four domains or set of choices are in

alignment. Indeed, change cannot happen just in one

domain without impacting on at least two of the

remaining three components in some way.

Thus, an alignment perspective can be derived by

drawing a line through three of the four domains.

This line includes first a strategic fit and later a

functional integration or vice versa. To identify the

alignment direction, the three involved domains can

be classified through as anchor domain, pivot

domain and impacted domain (Luftman et al., 1993)

(cf. figure 2).

Anchor domain

Pivot domain

Impacted domain

Functional Integration

Figure 2: Types of domains.

4.2 Alignment Mechanisms

Keeping the previous elements in mind, the four

alignment perspectives (Strategy execution,

Technology transformation, Competitive potential,

Service level) detailed in by (Henderson and

Venkatraman 1999) have been analysed. As a result

the following underlying alignment mechanism are

worked out:

• Alignment mechanism A: The alignment

perspectives imply always two relationships

between the four domains: a strategic fit and a

functional integration.

• Alignment mechanism B: the anchor domain

takes always place at the external level because it

is the interaction with the external environment,

it is the domain that drives change.

• Alignment mechanism C: the impacted domain

always takes place at the internal level because

short term changes take place in the

infrastructure.

4.3 Possible Alignment Perspectives

Applying the alignment principles and mechanisms

ten alignment perspectives (cf. Figure 3) are defined

for the extended SAM. These perspectives are set up

into three categories depending on the anchor

domain: (1) Business as the driver (perspectives 1 to

3); (2) IT as the driver (perspectives 4 to 7); (3)

Manufacturing as the driver (perspectives 8 to 10).

Strategic

Fit

TOWARDS AN EXTENDED ALIGNMENT MODEL FOR A COMPLETE ALIGNMENT OF MANUFACTURING

INFORMATION SYSTEMS

233

Figure 3: Alignments perspectives for the extended SAM.

5 CONCLUSIONS

AND PERSPECTIVES

In order to support the complete alignment of

manufacturing IS an extension of the Strategic

Alignment Model (SAM) has first been proposed.

The structure of the manufacturing domain was

derived from the original model by analogy of

concepts. The conceptual elements that structure

“original” alignment perspectives were pinpointed in

the form of alignment mechanisms. As a result, ten

potential perspectives impacting the IS infrastructure

have been identified. Among the perspectives

impacting the IS infrastructure these with the

business strategy as driver of change are, probably,

the most common. They explore the different paths

enabling to implement a given business strategy

through related manufacturing capabilities either

directly (perspectives 1 and 2) or indirectly

(perspective 3). The perspectives driven by the

manufacturing strategy underline the fact that the

manufacturing domain could impact and shape the

business domain. However, business and

manufacturing driven perspectives consider the IT

domain as a support. This is among other linked to

the fact that manufacturing technologies evolve

slower than IT. As a consequence the design of

manufacturing IS is usually conditioned by the

evolution of manufacturing technologies and has to

be adapted consistently. The perspectives driven by

the IT explore how IT strategy might drive change

asking therefore for new IS functionalities. They

underline the fact that IT capabilities play a central

role in order to improve organisation performance

and increase value. For example, perspective 4

involves the five domains related by perspectives 1

and 2 in combination. The main difference is that in

perspective 4 the IT strategy is the initiator of

change, shaping thus the business strategy and later

manufacturing strategy with its corresponding

infrastructure. The set of proposed perspectives and

the extended SAM are a first step towards tackling

alignments with the strategy and with the

environment. Indeed, the proposed elements

emphasize what should be aligned and in which

sequence. However, the question how to choose the

best perspective remains open. Moreover, the

alignment with uncertain evolutions can not only be

tackled with the extended SAM and its related

alignment perspectives. This kind of alignment

requires a “dynamic” view on alignment by, for

example, integrating the temporal perspective. By

doing this the problem becomes more complex

because it implies to work out “dynamic” alignment

perspectives. These deal with the interactions

between several extended SAMs from time horizons.

To do this the multi-screen tool exploited in (Goepp

et al., 2006) to perform a coarse IS alignment, could

be developed and completed.

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