The impact of cloud computing on business - IT strategic alignment

Abstract

Research has shown that Information Technologies (IT) can be a source of competitive advantage for companies and can improve company performance. However, researchers have also found that not all IT investment leads to increased competitiveness and improved company performance. That phenomenon has been named as the ‘IT Paradox’. One of the main reasons for the IT paradox is the missing strategic alignment between the business units and the IT department of the firm. Since the first decade of the 21st century, a new phenomenon, ‘cloud computing’ changes the way companies use IT. Instead of building own IT systems, companies can use IT as a service, from external providers. That new way of IT consumption also impacts the alignment between the business units of the firm and the IT department. In this paper, we analyze the impact of cloud computing on the strategic alignment between business and IT. We conclude that cloud computing changes the role of the IT department and the use of cloud services can improve the strategic alignment.