A systems perspective on the contribution of project portfolio management practices towards business and IT alignment
Thesis (PhD)--Stellenbosch University, 2019.
ENGLISH SUMMARY : Investment in information technology (IT) has significant implications for modern enterprises and requires careful management to ensure value delivery. Not only is the value of IT often transient in nature – as it may erode over time, requiring new investments and ongoing incremental IT enhancements – but it can also be entirely elusive. A further implication of IT investment is the complex management of the dynamic interdependence between operational IT assets, assets being deployed, and new IT systems being considered for future deployment. A key challenge is to understand the impact of IT on the strategic posture of the organisation, and to plan suitable support for the execution thereof. IT influences the ability to execute strategy, as it shapes the value extended to customers and the operational capabilities to create this value. The basic premise of business and IT alignment (BITA) is that organisations are able to reinforce their competitiveness and improve performance only if IT and business strategies are aligned. The continued academic interest in BITA is the result of several studies, with contradictory findings, on the relationship between IT investment and corporate performance. Authors agree that the collaborative development of IT and business strategy is fundamental to ensure BITA. This suggests a dynamic process – similar to managing an active portfolio of interdependent projects – known as project portfolio management (PPM). This research focussed on the contribution of PPM practices to BITA and the gaining of insights from a qualitative system dynamics diagram. Given the lack of universally-accepted BITA success factors and PPM practices, an inductive approach was used to perform two systematic literature reviews to identify BITA success factors and PPM practices. This was followed by the application of the deductive approach to probe the presence of PPM practices and the impact on BITA during in-depth interviews. Qualitative system dynamics diagrams were constructed based on interviews with 23 purposefully sampled senior managers with significant IT experience in the South African financial services industry. Their experiences and observations were captured in causal loop diagrams. The final stage of the research was a validation of the diagrams with six prominent IT researchers who approved of the methods used, and supported further research into IT value using system dynamics. Analysis of the diagrams provided insights about the impact of PPM practices on BITA success factors as well as points of leverage to improve BITA. Six high-level success factors were identified, namely: collaborative planning, effective communication, IT credibility, shared knowledge, executive commitment and user involvement. Three PPM practices had a direct influence on alignment; these are, strategic alignment, portfolio optimisation and resource management. Another four PPM practices were found to have a moderate or low influence on BITA, and one practice had no influence. The research confirmed the importance of certain leverage points well established in IT research, such as risk management, appropriate IT leadership roles, joint planning, knowledge sharing and user involvement. A novel perspective that emerged – not well documented in IT literature – was the importance of acknowledging and resolving IT failures and the significantly positive impact that this had on IT credibility. Conversely, the effect of more modern agile and iterative deployment methods of IT assets, did not feature as strongly as expected, given their current prominence in IT practitioner literature.
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