ALIGNING IT WITH BUSINESS MODEL TO PERFORM ORGANIZATIONAL CAPABILITIES IN ACHIEVING BUSINESS PERFORMANCE

Dissertation Outline of Edhi Juwono (1640000710)DRM Program, Bina Nusantara UniversityPresented for 1st Colloqium on 15 November 2014

Presentation OutlineThe Study BackgroundProblem Identification and Research QuestionsResearch ObjectivesResearch Benefits

Study Background (1) Information technology (IT)-Business alignment has been

consistently ranked at the top among other contemporary IT related top management concerns; in 2008 it was ranked on the first place (Bayzidnejad, Kafche, & Shafeai, 2012: 391).

IT need to support the bank's business growth, and customer needs (Ikatan Bankir Indonesia, 2014: 146).

IT is expected to transform the business model (Applegate, Austin, and Soule, 2009: 68).

Study Bacground (2)

A region with free movement of goods, services, investment, skilled labor, and free flow of capital(*)

(*) Asian Development Bank 2013:1)

Study Background (3) The problem is business performance (indicated by its profit &

growth (Croteau and Raymond, 2004) toward ASEAN Economics Community, especially on the ASEAN Financial Integration

The solution is performing organizational capabilities (indicated by its agility & control and accountability & collaboration (Applegate, Austin, and Soule, 2009).

The Solution should be done by aligning information technology (IT Stratey and IT Infrastructure (Henderson & Venkatraman, 1999) with Business Model (strategy and capability to execute (Applegate, Austin, and Soule, 2009)

Study Background (4)Banking Industry Represented by Banks that Associated in National Banks Association (Perbanas)

No. Numbers of Bank Minimum Capital Requirement

1. 60 <Rp1 Billion

2. 35 Rp1 billion to < Rp5 billion

3. 11 Rp5 billion to < Rp30 billion

4. 4 >Rp30 billion

Problem Identification & Research Questions (1)

To cope with new challenges driven by the semi-integrated financial market by 2020, the aroused problems will be the business performance of the banks. The business performance will be solved by the banks’ organizational capability, and the organizational capability will be affected by banks’ business model, its IT, and its aligned competency.

Problem Identification & Research Questions (1)

a. Is there any relationship between IT and alignment competency?b. Is there any relationship between business model and alignment

competency?c. Is there any relationship between IT and business model?d. Does IT impact on organizational capability?e. Does business model impact on organizational capability?f. Does alignment competency impact on organizational capability?g. Does organizational capability impact on business performance?

Research Objectives

The objectives or purposes of this research is to find:a. the relationship between IT and alignment competency;b. the relationship between business model and alignment competency;c. the relationship between IT and business model;d. the IT impact on organizational capability;e. the business model impact on organizational capability;f. the alignment competency impact on organizational capability;g. the organizational capability impact on business performance.

Research Benefits

The research is conducted to bring benefits for scientific or academic purpose and industrial purposes:.a. for scientific or academic purpose: the research is expected to enrich the

study of information systems, especially in the field of corporate information systems;

b. For the industry: the research is expected to help companies, especially in banking industry to align its information technology with it business model to perform its organizational capability in achieving the business performance.

References

Applegate, Lynda M., Austin, Robert D., and Soule, Deborah L. 2009. Corporate Information Strategy and Management. 8th Ed.Boston: McGraw-Hill.

Asian Development Bank. 2013. The Road to ASEAN Financial Integration: A Combined Study on Assessing the Financial Landscape and Formulating Milestones or Monetary and Financial Integration in ASEAN. Metro Manila: Asian Development Bank.

Croteau, Anne-Marry and Louis Raymond 2004. “Performance Outcomes of Strategic and IT Competencies Alignment.” Journal of Information Technology (2004) 19: 178-190.

Henderson, J.C. and Venkatraman, H. 1999. “Strategic Alignment: Leveraging Information Technology for Transforming Organization, in IBM Systems Journal; 38, 2/3, 1999: 472-84.

http://www.bi.go.id/id/publikasi/laporan-keuangan/alamat-bank/umum/Default.aspx# (7 Nov 2014)