=Paper=
{{Paper
|id=Vol-2991/paper14
|storemode=property
|title=Strategic Alignment for Digital Transformation: Insights from the Public sector
|pdfUrl=https://ceur-ws.org/Vol-2991/paper14.pdf
|volume=Vol-2991
|authors=Gideon Mekonnen Jonathan
|dblpUrl=https://dblp.org/rec/conf/bir/Jonathan21
}}
==Strategic Alignment for Digital Transformation: Insights from the Public sector==
https://ceur-ws.org/Vol-2991/paper14.pdf
Strategic Alignment for Digital Transformation: Insights
from the Public sector
Gideon Mekonnen Jonathan [0000-0001-6360-7641]
Department of Computer and Systems Sciences (DSV), Stockholm University
Borgarfjordsgatan 8, SE-164 07 Kista, Sweden
gideon@dsv.su.se
Abstract. Digital transformation, a form of Information Technology (IT) enabled
organisational transformation, is recognised as a phenomenon that has resulted
in a business model innovation fundamentally changing how organisations
operate. In the public sector, the proliferation of emerging digital technologies
has brought about myriads of opportunities. The findings of empirical studies
indicate that digital transformation has improved not only the efficiency of
business processes but also the variety and quality of public services delivered to
citizens. However, success in digital transformation is dependent on various
factors. Strategic alignment—the alignment between IT and overall
organisational strategy—is considered one of the essential prerequisites for
digital transformation. This paper presents an ongoing study exploring the role
of strategic alignment on digital transformation. Preliminary results identified
various organisational and managerial factors related to strategic alignment,
which are critical for digital transformation. Expected contributions and future
research directions are proposed.
Keywords: Business-IT Alignment, Digital Transformation, IT Enabled
Organisational Transformation, Strategic Alignment, Public Organisations.
1 Introduction
Digital transformation, defined as “technology-induced change on many levels in the
organisation that includes both the exploitation of digital technologies to improve
processes, and the exploration of digital innovation, which can transform the busines
model” [1, p. 2], is a topic currently debated among Information Systems (IS)
researchers and practitioners. Despite the emergence of new technologies and improved
business models as the result of these technologies in the business processes of today’s
organisations, digital transformation is still a concept not fully understood yet [2]. The
extant literature also suggests a lack of attention on studies exploring digital
transformation in the public sector. Nevertheless, there are exponentially growing
digital transformation initiatives both in the private and public organisations [3].
On the other hand, researchers argue that previous digital transformation studies
focused on the technical aspects of emerging technologies while the formulation of new
strategies is overlooked [3, 4]. Strategic alignment, for instance, is among the IS topics
Copyright © 2021 for this paper by its authors. Use permitted under Creative Commons License
Attribution 4.0 International (CC BY 4.0)
165
that are not studied within the context of digital transformation. Defined as “the
application of information technology in an appropriate and timely way, in harmony
with business strategies, goals and needs” [5, p. 3], strategic alignment is considered
to be one of the important prerequisites for digital transformation [6, 7]. According to
[3], strategic alignment in the public sector is critical to facilitate a common
understanding and shared vision among the various stakeholders resulting in the
realisation of the benefits derived from digital transformation. To contribute to the
emerging literature on digital transformation and strategic alignment, this study is set
out to explore the role of strategic alignment for digital transformation. Public
organisations are targeted in response to the calls for further studies on the relationship
between strategic alignment and digital transformation within the sector (e.g., [8, 9]).
Thus, the following research question is formulated to meet the objective of the study:
What is the role of strategic alignment for public organisations undertaking digital
transformation?
The remainder of this paper is structured as follows. First, a summary of related
studies on digital transformation and strategic alignment is presented. Next, the
research methodology discusses the strategy adopted as well as the data collection and
data analysis methods. The subsequent section presents the contribution of the study
for research and practice.
2 Related Studies
2.1 Digital Transformation in the Public Sector
Digital transformation has become a way of improving organisational performance in
many organisations, regardless of sector and industry [10]. In addition to academia,
private and commercial organisations, the topic has also engaged policy-makers and
elected officials in the public sector [11]. Despite its popularity, digital transformation
is a phenomenon that is not well defined in the literature. However, a closer look into
the IS literature suggests that the various definitions of digital transformation seem to
have two themes in common. To start with, digital transformation is characterised by
the various benefits it brings to organisations. Since organisations attempt to increase
their investment in acquisitions of new digital technologies, researchers view digital
transformation as the introduction and use of emerging IT solutions to create added
value [12]. In the public sector, digital transformation enables automatisation of work
processes, and improves efficiency which in turn increases transparency, creates new
forms of stakeholder relationships and improves service delivery, innovation, and
citizen satisfaction [4, 9, 13].
On the other hand, IS researchers recognise digital transformation as an
organisation-wide transformation altering not only the existing business processes but
also human resource allocations, organisational structure as well as IT and business
strategies [13, 14]. Wessel [11] argues that digital transformation entails changes in the
configuration of organisations utilising the internal and external resources to meet
organisational objectives. Such characterisations cover all aspects of an organisation
(both IT and non-IT organisational changes). However, digital transformation is viewed
166
as a mere technology phenomenon [1]. This lack of comprehensive oversight of
organisational factors affecting digital transformation has resulted in unrealised
benefits.
Within the context of public organisations, various internal and external factors
determine the success of digital transformation. For instance, organisational culture
[15], organisational structure [16], stakeholder participation [17], and regulatory
frameworks [13] are recognised as factors affecting the success of digital
transformation. In recent studies, digital transformation is recognised as a set of planned
and executed activities with the premise that the introduction of new technologies is
followed by appropriate adjustments to organisational resources as well as strategies.
Thus, according to [1] and [18], organisations that do not succeed to align their business
and IT strategies will have difficulty to realise the benefits from their digital
transformation initiatives.
2.2 Strategic Alignment in the Public Sector
Strategic alignment, commonly referred to as “business-IT alignment” remains to be
among the extensively researched areas in the IS and cognate disciplines. Given its
association with the overall organisational performance, the attention it has garnered so
far is justified. However, despite the rich volume of literature and extensive research in
the last four decades, strategic alignment in the public sector has not attracted sufficient
attention among IS researchers [8].
Even though the rationale for strategic alignment, regardless of sector and industry,
is the fit between IT and business strategies which enables the realisation of
organisational goals, different contextual differences have been recognised to have
influence on the approaches taken to reach and maintain strategic alignment. For
instance, [8] and [17] argue that the pronounced differences between organisations in
the private and public sectors call for a closer look into strategic alignment in different
organisational settings. In comparison with organisations in the private sector, strategic
alignment is more challenging in the public organisations. Scholars attribute these
differences to the large number of stakeholders in the public sector with competing or
at times opposing interests, the wide variety of services delivered, and the complex
organisational structure whereby both political and administrative management powers
are exercised [19]. Besides, assessing whether strategic alignment has created an added
public value is difficult given the intangibility of services delivered [10]. Thus, strategic
alignment in the public sector is defined as “the degree to which the IT goals support
the strategic goals of a public agency, and to which administration and IT stakeholders
are committed to support these goals” [17, p. 834].
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Fig. 1. Research Model.
The research model in Fig. 1 shows the conceptualisation of the study depicting the
relationship between strategic alignment and digital transformation as well as the seven
constructs. The extant literature on strategic alignment IT alignment, organisational
studies, and digital transformation (for instance, [17, 20]) are the foundation for the
development of the research model as well as the measurement items for each construct.
3 Research Methodology
This study follows both exploratory and confirmatory research approaches. The choice
of mixed research methodology (systematic literature reviews, and case studies) is to
improve the rigour of the study as recognised among researchers [21].
3.1 Data Collection Method
This study is conducted in three stages. First, two literature reviews were conducted to
establish a theoretical base and provide the state-of-the-art. The first literature review
identified 94 articles exploring strategic alignment. The aim of this review was to gain
an overview of strategic alignment studies during the digitalisation era. The second
literature review of 13 articles focused on three factors related to strategic alignment
and organisational agility in the public sector—organisational structure, organisational
culture, and stakeholder relationships. The last literature review of 29 relevant articles
explored information security management and strategic alignment. Databases
indexing premier journals and conference proceedings were searched using
combinations of keywords [22].
Interviews were used to collect data in the second stage of the data collection at
multiple organisations. The first ten interviews, lasting between 60 and 85 minutes,
were conducted in one municipality. The focus here was on the relationship between
organisational structure and IT alignment. The next 17 interviews were with leaders in
four public organisations. The interviews, lasting between 85 and 110 minutes, were on
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information security and organisational agility, focusing on organisational structure,
organisational culture, and stakeholder relationships. Purposive sampling strategy was
adopted to recruit informants from IT and administration divisions.
Quantitative data is required for the confirmatory part of the study in the third stage.
The survey questionnaire will be formulated based on the operationalisation of the
constructs and research model. Similar public organisations where the interviews were
conducted will be targeted to distribute the questionnaire. Given the the number of
contacts we establish during the course of the study, we expect to collect about 500
complete responses. The 26 measurement items will be used to test the seven
constructs. Respondents will be asked to score according to a 7-point Likert Scales
which will be adopted for the survey questions corresponding to each of the
measurement items. The unit of analysis for the study is the public sector. Thus, the
questionnaires are formulated to assess how the various organisational and managerial
factors influence IT alignment and digital transformation in public organisations.
Before the questionnaires are distributed, a sample of experts will test it for
comprehension and clarity.
3.2 Data Analysis Method
Since the aim of the study is to explore the organisational and managerial factors that
are relevant for strategic alignment and digital transformation, thematic analysis is
chosen for the qualitative data. The rationale for this choice is that thematic analysis is
not associated with a particular epistemology or theory. Besides, thematic analysis has
been popular among IS researchers [3]. For the literature reviews, a concept matrix was
used to thematically analyse the data, as suggested by [23]. For the analysis of the
interview data, the six-steps thematic analysis procedure by [22] was followed. The
analysis of the quantitative data from the survey is the last step in the data analysis.
Partial Least Structural Equation Modelling (PLS-SEM) will be used to test the
proposed research model and hypotheses posited. PLS-SEM is one of the multivariate
data analysis methods which has gained popularity among IS researchers [25]. Two
steps are involved in the analysis—the measurement model will be tested by evaluating
convergent and discriminant validity while the structural model is evaluated by
assessing the coefficients of determination (R2) and path coefficient significance [25].
4 Expected Contribution
Prior IS studies indicate that strategic alignment is critical for the success of digital
transformation. Thus, it is in the best interest of researchers and practitioners to explore
the various factors affecting strategic alignment. To this end, the findings of this study
will be an addition to the scarce literature on IT management in the public sector. Given
the extensive adoption of new digital technologies in the sector, identifying the various
factors influencing strategic alignment will also provide insight to leaders with the
responsibility of managing the digital transformation in public organisations. In
addition to previous studies focusing on the technical elements of digital
transformation, the findings of this study provide an overview of organisational and
169
managerial factors to support public organisations as they configure their resources to
succeed in their digital transformation attempts.
The mixed-research method approach chosen will also improve the rigour of the
study. Besides, by conducting a confirmatory analysis, the findings would be invaluable
for practitioners. For instance, identifying the influence of various organisational and
managerial factors on strategic alignment as well as the degree of influence will enable
the formulation of an actionable plan. On the other hand, prioritisation of scarce
resources might be possible based on the analysis of the degree of influence of the
various factors on strategic alignment.
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