Information Technology and Business Alignments among Different Divisions: A Comparative Analysis of Japan and South Korea

Authors: Michiko Miyamoto

Abstract:

This paper empirically investigates whether information technology (IT) strategies, business strategies, and divisions are aligned to meet overall business goals for Korean Small and medium-sized enterprises (SMEs), based on structure based Strategic Alignment Model, and make comparison with those of Japanese SMEs. Using 2,869 valid responses of Korean Human Capital Corporate Panel survey, a result of this study suggests that Korean human resources (HR) departments have a major influence over IT strategy, which is the same as Japanese SMEs, even though their management styles are quite different. As for IT strategy, it is not related to other departments at all for Korean SMEs. The Korean management seems to possess a great power over each division, such as Sales/Service, Research and Development/Technical Experts, HR, and Production.

Keywords: IT-business alignment, structured based strategic alignment model, structural equation model, human resources department.

Digital Object Identifier (DOI): doi.org/10.5281/zenodo.1126850

References:

[1] Miyamoto, M. (2015). Consideration of IT-Business Alignment based on Organizational Structure. The 4th International Symposium on Business and Social Sciences, Proceedings, 275-284.
[2] Silvius, A.J.G. (2008). The Impact of National Cultures on Business & IT Alignment, Communications of the IIMA, Vol 8, No.2, pp 11-22.
[3] Hofstede, G. (1980). Culture's Consequences: International Differences in Work-Related Values. Beverly Hills, CA: Sage.
[4] Miyamoto, M. (2014). IT-Business Alignments among Different Divisions of Japanese SMEs on Structured Based Strategic Alignment Model. International Journal of Business and Information, Vol 9, No.2, 217-244
[5] Whitley, R. (1991). The Social Construction of Business Systems in East Asia. Organization Studies, 12(1), 1-28.
[6] Cho, Y., McLean, G. N. (2008). IT companies HR practices in South Korea. Asia-Pacific Collaborative Education Journal, 4(1), 49-64.
[7] Brockett, J. (2009). Line Managers Question HR’s Credibility, People Management, 15, 2, 11.
[8] Jacoby, S.M. (2005). The Embedded Corporation: Corporate Governance and Employment Relations in Japan and the United States. Princeton, NJ: Princeton University Press.
[9] Kagano, T., Nonaka, I., Sakakibara, K. and Okumura, A. (1983). Nichi-bei kigyou no keiei hikaku: Senryakuteki kankyo, tekio no riron, Comparison of management in Japanese and US corporation: Theory of adaptation to the strategic environment (in Japanese) Tokyo: Nihon Keizai Shinbunsha.
[10] Hirano, M. (2011). 2009 nen no Nihon no jinji-bu (Japanese Human resources departments in 2009) (in Japanese), JILPT Research Report No.606, 2011.
[11] Yamashita, M. (2008). Jinjibu Human resources departments In Nihonteki koyo sisutemu (Japanese employment system (in Japanese)), ed. Nitta, M. and Hisamoto, N., 235-268. Tokyo: Nakanishiya Shuan.
[12] Hirano, M. (2013). Human Resources Departments of Japanese Corporations: Have Their Roles Changed? Japan Labor Review, 10 (1), Winter.
[13] Yashiro, A. (2002). Kanrishokusou no jinteki shigen kanri: Rodo shijoronteki approach, (Human Resources Management of Managerial Employees: Labor Market Theory Approach (in Japanese)). Tokyo: Yuhikaku.
[14] Kim, D., and Bae, C. (2004), Employment Relations and HRM in South Korea, Aldershot: Ashgate.
[15] Main, T. J., and Short, J. E. (1989). Managing the Merger: Building Partnership Through IT Planning at the New Baxter. MIS Quarterly, 13(4), 468-484.
[16] Henderson, J. C. and Venkatraman, N. (1989). Strategic Alignment: A Framework for Strategic Information Technology Management, MIT Sloan School of Management, The Management in the 1990’s Research Program, Working Paper 89.
[17] Sabherwal, R. and Chan, Y.E. (2001). Alignment between Business and IS Strategies: A study of prospectors, analyzers, and defenders, Information Systems Research 12(1): 11–33.
[18] Oh, W. and Pinsonneault, A. (2007). On the Assessment of the Strategic Value of Information Technologies: Conceptual and Analytical Approaches, MIS Quarterly, 31, 239-265.
[19] Yayla, A.A. and Hu, Q. (2012). The Impact of IT-Business Strategic Alignment on Firm Performance in a Developing Country Setting: Exploring Moderating Roles of Environmental Uncertainty and Strategic Orientation, European Journal of Information Systems 21(4): 373–387.
[20] Gerow, J. E., Grover, V., Thatcher, J. B., and Roth, P. L. (2014). Looking Toward the Future of IT-Business Strategic Alignment through the Past: A Meta-Analysis, MIS Quarterly, (38: 4)1059-1085.
[21] King, M., Cragg, P. and Hussin, H. (2000). IT Alignment and Organizational Performance in Small Firms. ECIS 2000 Proceedings. Paper 190.
[22] Cragg, P., King, M. and Hussin, H. (2002). IT Alignment and Firm Performance in Small Manufacturing Firms, Strategic Information Systems 11(2): 109–132.
[23] Byrne, B.M. (2010). Structural Equation Modeling Using AMOS. Basic Concepts, Applications, and Programming, 2nd Ed, New York: Routledge.
[24] Bentler, P.M. (1990). Comparative Fit Indexes in Structural Models, Psychological Bulletin, 238–246.
[25] Bollen, K.A. (1989). A New Incremental Fit Index for General Structural Equation Models, Sociological Methods and Research, 17, 303–316.
[26] Browne, M.W. and Cudeck, R. (1992). Alternative Ways of Assessing Model Fit, Sociological Methods and Research, 21, 230–258.
[27] Wheaton, B., Muthen, B., Alwin, D., F., and Summers, G. (1977). Assessing Reliability and Stability in Panel Models, Sociological Methodology, 8 (1), 84-136.
[28] Tabachnick, B.G. and Fidell, L.S. (2007). Using Multivariate Statistics (5th ed.). New York: Allyn and Bacon.
[29] Akaike, H. (1974). A New Look at the Statistical Model Identification, IEE Transactions on Automatic Control, 19 (6), 716-23.
[30] Putti, J. M., Koontz, H., and Weihrich, H. (1998). Essentials of Management: An Asian Perspective. Singapore: McGraw-Hill.