MIT Sloan Management Review

Management of Information Systems, Management of Technology and Innovation

The Dynamic Synchronization of Strategy and Information Technology

By C.K. Prahalad and M.S. Krishnan

July 15, 2002

A rigid information-technology infrastructure will stymie even the best strategic initiatives, making it difficult to introduce change in cost- and time-efficient ways. An applications-infrastructure scorecard can help managers consistently recognize inherent trade-offs between efficiency and innovation and create a more flexible application-portfolio framework.

Managers are continually being confronted with new and ever-changing competitive pressures from deregulation, globalization, ubiquitous connectivity and the convergence of industries and technologies. But managers’ ability to respond rapidly to those challenges is predicated upon having a sophisticated and facile organizational and technical infrastructure, and a degree of information-technology flexibility that traditional approaches cannot provide. Increasingly, even at global companies known for their competitive and technical savvy, the gap between emerging strategic direction and IT’s ability to support it is significant and debilitating.

Working with more than 500 senior executives in large companies over the past four years, we have been able to identify the nature and seriousness of this disconnection. Typically, we worked with groups of 25 to 30 managers, each focused on business transformation. We asked managers to respond to a set of questions about their capacity to lead change within their companies. Almost invariably, they indicated that the quality of the IT infrastructures in their organizations lagged behind their need and desire for change and was, to some degree, an impediment to it. (See “Managers’ Dim View of Companies’ Capacity To Lead Industry Change.”)

Although in every case, the companies’ chief information officers or chief technology officers sincerely intended to support the business managers in creating value in quickly evolving markets, they were constrained by legacy infrastructure —incompatible databases and... To read the complete article, login or sign-up using the form below.

From The Magazine

Fall 2009

Special Report: Sustainability

8 Reasons That Sustainability Will Change Management

Michael S. Hopkins

Transparency, accidental innovation, trust, collaboration — as sustainability affects how the world works, so will it affect how business works in the world.

Intelligence: Management

Debunking Management Myths

Martha E. Mangelsdorf

In this interview, Henry Mintzberg questions some of the conventional wisdom about managerial work.