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Plugging into Strategic Partnerships: The Critical IS Connection Henderson, John C. Sloan Management Review; Spring 1990; 31, 3; ABI/INFORM Global pg. 7
Plugging into Strategic Partnerships: The Critical IS Connection
John C. Henderson MIT Sloan School of Management
GIVEN THE INCREASING COMPLEXITY of the technological infrastructure, there is a critical need to build effective working relationships between line managers and information systems managers. This paper explores the concept of building partnerships as a management strategy. Using interviews with executives, the author focuses both on external partnerships (relation-ships between managers in separate organizations) and on internal partnerships (relationships between line managers and information systems managers in the same organization) to create a descriptive model.
IN TODAY’S COMPETITIVE WORLD, the effective use of information technology (IT) as an ele-ment of a competitive strategy is critical. In the literature there are numerous examples of how organizations have used information technology to build and sustain new relationships with sup-pliers or customers and, as a result, have achieved a significant competitive advantage.’ A common theme in these examples is the use of information technology to improve coordination of the activi-ties across organizations that are critical to deliver-ing goods and services to a market. However, it is often noted that these organiza-tions did not gain their advantage by virtue of the information technology alone. Foremost McKes-son radically changed both its internal operations and its relationships with customers in an effort to gain a competitive advantage over large, in-tegrated pharmaceutical companies.2 Rockart and Short argue that effective internal integration across value-added functions is a key to interorganizational information systems (IS) implementation.’ Others have noted that the use of information technol-ogy linkages between organizations may only “speed up the mess” if a fundamental restructuring of the nature of work in organizations is not achieved.’” To the extent that these observations are cor-rect, senior managers must now learn to integrate information technology into every aspect of their organizations.’ One approach to achieving this level of integration has been to decentralize the infor-mation systems organization, placing the respon-
sibility for management of the IS function directly under the general manager of strategic business units. Yet this decentralization in itself does not remove the need for effective coordination across the information systems community. In fact, such decentralization may increase the cost of coordi-nation for critical infrastructure components such as telecommunications or data resource man-agement.’ Further, while there are many examples of how investments in technology yielded significant com-petitive advantage, there are also many examples where such investments resulted in no measurable impact.8 In many cases, this failure appears to stem not from an inappropriate vision but from the in-ability of the organization to integrate the use and the management of the technology infrastructure into the mainstream of the firm. One key element of a solution to this management challenge is to build a partnership between IS organizations and line managers. Rockart and Short argue that, while there is a fundamental role for line managers in providing leadership in and commitment to the use of information technology, IT managers also play an essential role: to manage the information technology infrastructure; to understand an emerg-ing and dynamic technology marketplace; and to change the work processes associated with the de-velopment, implementation, and operations of in-formation systems. In short, effective delivery of information systems products and services requires an effective partnership between the two major ac-
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Sloan Management Review
7
Spring 1990