Organizations use a range of performance improvement interventions to enhance their business. Internal factors such as people and processes are continuously developed to optimize business performance. External operating factors such as the market environment, shared industry space, and globalization also impact the success and survival of organizations. Put together, the external and internal factors drive organizations to continuously change, adapt and improve. For example, the TQM movement in early1980s, and the more recent Lean improvement practices highlight process improvement methodologies that prescribed an internal and external focus on process, cost, customer and product quality.

 

The global interdependence of markets, consumers, and suppliers created a complex value chain for organizations that presented exciting opportunities for growth as well as presented complex challenges for survival in the face of competition. In fact, the long-term success and viability of organizations is uncertain as constant changes in the external and internal environment can affect their performance. Interventions that help managers understand and evaluate their decision- making as it relates to enhancing the alignment of internal and external organizational components can help not only in managing but also driving performance. Yet, we know little about how alignment is created or measured at multiple levels in the organization. In fact, elaboration on organizational alignment in the literature is not only limited, but also underexplored.

 

According to Tosti and Jackson (2000), alignment links key organizational components such as strategy, culture, processes, people, leadership and systems for the purpose of accomplishing common goals. The alignment of critical factors internal to the organization suggests opportunities for identifying potential partnerships and collaborative integration of different functions, processes, and products. Furthermore, alignment also recognizes the importance of an organization’s connection to the external environment involving suppliers, new markets, customer groups, and shareholders (Powell, 1992). At a global level, organizational alignment can be viewed as connecting an organization’s internal network of people, products and processes to the external environment such as industry, national and global consumer, and producer markets for the purpose of strengthening organizational performance (Kathuria, Joshi & Porth, 2007). We position organizational alignment as a critical factor for enhancing organizational performance as well as for achieving a position of competitive advantage through the integration of people and processes.

 

Alignment acknowledges existing complexities of internal and external networks of an organization’s processes, products, as well as people and emphasizes the potential need for creating stronger linkages that can further enhance, or serve the broader purposes and goals of the organization.  Alignment can also enhance cross-functional fit between departments and units in the organization, as well as the linkages between strategy-structure-culture (Lawrence & Lorsch, 1967).

 

The employee-job, employee-organization fit also emphasizes alignment albeit, at a micro level. Thus, the importance of alignment as a focal construct in understanding assessing and improving the performance of organizations at multiple levels cannot be ignored. Despite the intuitive appeal of organizational alignment, a strong absence of empirical validation has prevented the examination of this construct as a central theme of interest in the management literature. The purpose of our work is to examine how organizational alignment is understood and defined in the literature, identify important perspectives of organizational alignment, as well as elaborate on the implications for practice.

 

Research Questions

 

This paper aims to develop an understanding of alignment as a focal construct in organizational theory and practice. The importance of alignment on performance and learning outcomes of the organization is a relatively new area of exploration that has implications for senior leaders, operations managers and human resource (HR) professionals. For instance, enhancing person- job, and person-organization fit in the organization can significantly enhance the role and performance of HR managers. The following questions guided our inquiry:

 

Research Question 1: How is alignment understood and defined in the literature? What are the important perspectives on alignment and how to do these perspectives shape our understanding of alignment?

 

Research Question 2: In what ways does the literature link alignment with learning and performance outcomes? What are the implications for senior leaders, operations managers and HR professionals?

 

 What is Organizational Alignment?

 

Likert (1961) introduced the notion of alignment as a “linking pin” connecting internal and external networks of people, products and processes for the purpose of strengthening organizational performance Early contributions in the literature emphasized the importance of strategic fit with external factors such as industry characteristics, environmental threats; and, internal factors such as organizational culture and structure (Ansoff, 1965; Andres, 1971). We highlight the importance of organizational alignment – or fit – between internal and external organizational factors as a common theme and distinctive focus in the management literature. For instance, management scholars have extended the notion of alignment to include organizational systems, processes and managerial decision-making (Lorange & Vancil, 1977,

Kaplan, 2005, Kathuria, Joshi & Porth, 2007). Powell (1992) connected organizational alignment and competitive advantage to establish the alignment-firm performance connection. More recent contributions (e.g. Porter, 1996) conceptualized alignment as an array of interlocked activities, where key resources and capabilities are deployed according to organizational requirements.

 

Defining Organizational Alignment

 

Prior literature defines alignment as a valuable and scarce resource that has significant consequences to organizational performance (Lawrence & Lorsch, 1967; Powell, 1992). For example, Powell (1992) posits alignment as a dynamic capability that brings attention to both the internal and external organizational factors (Burn, 1996). The central premise of prior conceptualizations suggests that alignment-performance linkage is not only important but can also be adopted as a deliberate approach for enhancing the mission and vision of the organization. These conceptualizations explicitly suggest alignment as an outcome of managerial decision-making and skill rather than luck (Powell, 1992); as a “higher order of integrative capacity” (Lawrence & Lorsch, p.245), that is a common feature of high-performing organizations. Other scholars have described alignment as an adaptive dynamic capability (Pascale, 1999; Miller, 1996), an integrative capacity that is a “source of sustainable competitive advantage” (Powell, 1992, p.121) to help organizations achieve their strategic potential (Hamel & Prahlad, 1994).

 

Avison, Jones, Powell, Wilson (2004) identified six popular descriptions of alignment which describe alignment as fit (Porter, 1996), integration (Weill & Broadbent, 1998), bridge (Ciborra, 1997), harmony (Luftman et al., 1996), fusion (Smaczny, 2001) and linkage (Henderson & Venkatraman, 1989). Alignment can be described as “heading in the same direction” (Weiser, 2000, p.90). These explanations emphasize linkages within the organization, and describe how different parts work towards the achievement of shared organizational goals. Drawing from the more recent work of Alagaraja & Shuck (2015), alignment is defined as an adaptive, dynamic resource capability achieved by developing a shared understanding of organizational goals and requirements by employees (p.5). This definition encompasses previous conceptualizations of alignment at the macro level as well as emphasizes micro level approaches for identifying and evaluating managerial behavior and decisions that can influence alignment in different levels such as individual, team, department as well as the whole organization.

 

Review of Alignment Literature

 

Numerous scholars have contributed to the understanding of organizational alignment resulting in the development of key perspectives and types. In the sections below, we provide an overview of these contributions by identifying common themes in the conceptualizations of alignment. Overall, we identified three major perspectives and five types of alignment that inform theory and research. We contend that the three major perspectives of alignment theorize and validate the five different types.

 

Perspectives of Alignment

 

Several streams of literature explored alignment from three dominant perspectives that rest on a different set of agreements about how organizations learn and perform. The three perspectives – process, relational and strategic identify distinctive arrangements for translating organizational priorities into goals, objectives and activities. These major perspectives suggest notions of alignment as emergent and performative resulting from the many interactions involving the organization’s external and internal environment, as well as internal linkages that occur between strategy, structure, culture and other organizational processes. The following sections briefly overview each major perspective, starting with the process perspective.

 

Process Perspective

 

Viewed broadly, the process perspective describes alignment as a continuous and dynamic process (Burns, 1996; Tallon & Kraemer, 1999). Alignment occurs when the organization ensures that departments can work together smoothly (Kanter, 1994). This perspective emphasizes understanding of functional processes, and generating systematic agreement towards optimization and continuous improvement of organizational processes and underscores the conceptualization of organizations’ primarily as a series of processes and processual arrangements. Thus, alignment of macro and micro level processes, focusing on individual, functional, cross-functional and cross-organizational processes through shared engagement and commitment of employees, customers and stakeholder groups emphasize the process perspective. Other descriptions of process alignment suggest, “gaining a collaborative view” through an iterative process in which businesses achieve goals (Gulledge & Sommer, 2002, p. 984). Organizations that take time to align their business processes within and between departments, and across their supply chain (customers, suppliers and regulators) are more likely to enhance overall performance. We contend that attention to the process perspective of alignment allows us to theorize and examine how the design and structure of business processes can improve organizational performance. The process perspective also suggests the importance of optimizing resources, skills, abilities and knowledge for the overall benefit of the organization. As Weiser (2000) suggested, process alignment enhances the ability of different functions or departments to work towards a common goal, such that the organization is not only “heading in the same direction” (p.90) but is also able to reduce internal inefficiencies. This perspective underscores the importance of examining the extent to which there is congruence between different processes involving tasks, responsibilities, goals and objectives in the organization. Yet, in conceiving of alignment as the enhancement of linkages and connections between organizations processes, this perspective under theorizes the value of describing the organization in terms of demonstrating the relational value of strategy, culture, and other elements of the organization that impact performance.

 

Relational Perspectives

 

Some scholars attempted to address the lack of demonstrated value around strategy and culture by taking a more relational approach. This perspective describes alignment as the extent to which the organization is able to experience congruence between different components of the organization’s internal and or external environment. For example, several scholars highlight the relational perspective of alignment through the examination of the organization’s internal environment. The performance of different components within the organization are motivated by the alignment of strategy and structure (Mintzberg, 1979); organizational size and strategic planning (Mintzberg, 1973); and strategy –culture linkages (Mintzberg, 1989, 1991). Other scholars in this perspective have suggested the organizational “fit” with the external environment resulting from the interactions and general response of the organization to the environment (Lawrence & Lorsch, 1967; Thompson, 1967, Miles & Snow, 1978). As one example, managers must consider the fit of organizational design to the external environment (Burns & Stalker, 1961, Khandwalla, 1973). This strand of organizational alignment emphasizes the role of organizational flexibility, adaptation and ability to respond well to changes in both the external and internal environment. Organizational priorities and arrangements are viewed as contingent upon the conditions of the environment, and thus, alignment occurs through ongoing adaptations of the organization. But, how these alignments might unfold given that senior executives play an important part in influencing if and whether organizations adopt a particular strategy, strategic orientation or perspective has not been a concerted focus of the relational perspective. This is discussed next.

 

Strategic Perspective

 

Within the strategic perspective, scholars have positioned strategy as likely to influence the ways in which organizations could achieve alignment. For example, Snow and Miles (1983) argued the importance of linking strategic planning and overall strategy to the specific configurations of technology, structure and processes in the organization. In this view, the extents to which processes and organizational components are consistent with the selected strategy determine the performance of the organization. The resultant outcome of this perspective suggests that organizations can create unique strategic alignments for achieving a position of competitive advantage.

 

The strategic alignment perspective has found empirical support in the literature. For example, several scholars found strategic alignment as positively related to organizational performance. For example, Avison, Jones, Powell, Wilson (2004) validated a strategic alignment model examining the integration of information technology (IT) strategy to business performance. Bergeron, Raymond, Rivard (2003) described ideal patterns of strategic alignment and business performance. Burn & Szeto (1999) compared critical success factors for achieving strategic alignment. Further, Campbell, Kay, Avison (2004) used causal model building to analyze IT and business alignment. Through performance measurement systems, organizations leverage alignment of strategy and organizational learning to achieve competitive advantage.

 

  Within the strategic perspective, another strand is a differing approach where some scholars examine the extent of misalignment between the strategies of a function or department and the organization. For instance, studies examined the misalignment of IT strategy and business strategy, describing the lack of alignment as the emergent from “continuous adaptation and change” (Henderson & Venkatraman 1993, p.5). Saberwal, Hirschheim and Goles (2001) expanded on this strand to emphasize the importance of IT alignment on organizational strategy and structure. Tallon, Kraemer and Gurbaxani (2001) argued that alignment of IT and business strategies were a critical factor for enhancing the performance of the IT department as well as the overall organization. Other studies renewed the focus on misalignment inquiring into issues arising from the implementation of organizational and functional strategies (Grover, Jeong, Kettinger & Teng, 1995).

 

Recent Conceptualizations of Alignment

 

The aforementioned perspectives have highlighted the different ways alignment can manifest from different sources such as processes, internal and external environments, as well as organizational strategies. Contemporary conceptualizations have argued for a more dynamic understanding, which suggests a need to simultaneously focus on multiples sources of alignment– not just one perspective. For example, strategic perspectives of alignment have begun to emphasize the need for addressing customer needs and other requirements of the external environment (Hall, 2002). Moreover, relational perspectives have emphasized symmetry in organizational design and structure that enables process optimization through cross-functional behavior (Weiser, 2000). As Schneider, Godfrey, Hayes, Hyang, Lim, Nishii, Raver, Ziegert (2003) explain, internal organizational systems and their environments must achieve “fit, congruence, consistency, alignment, and matching” of goals and objectives at multiple levels in the organization. (p.124). They developed a star alignment model examining the reciprocity of strategy and culture through the alignment of five organizational components – team work, people, goals and rewards, training and development, and service. More complex perspectives of alignment advance the recognition of conflicting patterns of alignment and misalignment that involve business performance, strategy, structure, human resource (HR) and IT systems (Alagaraja, 2013; Bergeron, Raymond &Rivard, 2003).

 

These emerging perspectives suggest the need for understanding what perspectives of alignment are of value, why they are valued, and how managers and business leaders can recognize, facilitate or manage when and where alignment or misalignment occur in the organization. The alignment ontology offers a potentially promising approach for understanding the value of achieving shared vision, mission, values, goals, objectives and direction for the organization. However, these contributions do not explicitly address specific types of alignment as they relate to different levels of the organization (individual, departmental, supply chain etc.) that can be pursued by managers and leaders for improving organizational performance. By investigating the specific types of alignment we hope to offer new distinctions to the practice of alignment and its relevance to real world contexts. To do so, we take a human resource (HR) infused practice perspective to examine the different types of alignment and their implications for leaders and managers in organizations.

 

 Types of Alignment and Relevance to Human Resources

 

As we have noted, the organizational alignment literatures distinguish between several types of alignment. Horizontal alignment, for example, involves the “co-ordination of efforts across the organization” (Kathuria, Joshi & Porth, 2007; p.505). This type of alignment emphasizes roles, responsibilities among different work groups, departments and teams and closely links different elements of structure with business processes in the organization. As such, this type of alignment also addresses the integration of social and culture processes, which in theory have greater impact on alignment and organizational performance (Mezias, 1990; Powell, 1991). In the human resource (HR) literature, this type of alignment highlights the importance of achieving internal coherence and consistency of human resource policies towards improving employee performance (Gratton & Truss, 2003).

 

Vertical alignment emphasizes alignment within each function and focuses on how different departments orient their functional goals to that of the organization or business unit. Gratton and Truss (2003) proposed the linking of HR strategy to business strategy as an example of vertical alignment and suggests “a much more fluid dynamic that allows for variation and flexibility” (p.75). A high degree of vertical alignment helps in developing internally coherent HR policies that “consistently relate to one another” (p.75).

 

As described by Venkatraman, Henderson and Oldach (1993), management practices act as “alignment mechanisms” that deal “with translating strategic choices . . . into administrative practices and operational decision-making” (p. 144). Semler (1997) identified strategy, structure, culture, leadership and HRD as important components for building alignment. According to him, three additional types of alignment were identified: structural alignment, cultural alignment, and environment alignment.

 

Structural alignment emphasizes the systematic design of structure to ensure the achievement of strategic goals (Swanson, 1994; Rummler & Brache, 1990). Of particular relevance to HRD professionals is the need for designing motivational structure of rewards and incentives that are in alignment with organizations’ strategic and tactical goals. Structural alignment differs from vertical and horizontal alignment in its narrow focus on design and structure of organizational roles, responsibilities. On the other hand, horizontal and vertical alignments also consider social and cultural norms and values.

 

Cultural alignment emphasizes alignment of planned tactical behaviors with cultural behavioral norms. This type of alignment is a strong predictor of actual individual performance. Finally, environmental alignment underscores the strategic fit of the organization (vision, goals and tactics) and external environment. This type of alignment refers to the removal of barriers, increase in cooperation and performance by HR departments for enhancing employee performance. Within the literature, structural alignment emphasizes organizational design and rewards structure, cultural alignment suggest the importance of attending to existing cultural norms, and environmental alignment highlights cooperation and removal of performance barriers between different departments.

 

 Discussion

 

Our review of the organizational alignment literature revealed several challenges, from conceptual or theoretical perspective as well as an applied perspective. We explore these challenges in an attempt to bring clarity to this conceptual domain of interest as well as to call for further research in this important area.

 

First, there is a significant lack of agreement on a discrete definition of alignment. Our review of select alignment literature revealed several descriptions (see, e.g. Avison, Jones, Powell & Wilson, 2004), which we categorized thematically into various types and perspectives. However, a single, unified understanding of alignment was absent. This is perhaps due to the contextual nature of organizational alignment construct. We contend that organizational alignment is embedded in and emergent from the context and unique operating environment with a multitude of constraints and contextual characteristics (e.g. specific industry, governmental regulation, employee culture, organizational mission, etc.). This results in unique ways in which organizational alignment can occur. This lack of agreement on a definition leads to a conceptual overlap between the various ways of understanding organizational alignment. Furthermore, it is difficult to measure to what extent alignments and misalignments surface, intensify or dissolve so that these manifestations can be managed effectively for the organization from a practical standpoint.

 

We compare the definitions of organizational alignment by juxtaposing the various perspectives of alignment with different types of alignment we identified. Table 1 identifies conceptual overlap that exists between the various perspectives and types of alignment. From the literature we examined, we thematically identified which perspective and type of organizational alignment that was most closely described by the author.  For example, Gulledge and Sommer’s (2002) work seemed to address issues of process alignment with an emphasis on a vertical alignment type. While this list is not meant to be exhaustive, it points to the overlapping definitions of organizational alignment that exist and compete for managerial and organizational attention.

  

Table 1

 

Comparison of Organizational Alignment (OA) Perspectives and Types

 

Alignment Type

 

Alignment

Perspective

Vertical

Horizontal

Structural

Cultural

Environmental

Process

Gulledge &

Kanter, 1994

Weiser, 2000

Mezias, 1990

 

 

Sommer,

 

 

Powell, 1991

 

 

2002

 

 

 

 

Relational

 

Mintzberg,

Burns &

Mintzberg,

Lawrence

 

 

1973

Stalker, 1961

1989, 1991

&Lorsch, 1967

 

 

 

 

Khandwalla,

 

 

Thompson,

 

 

 

1973

 

1967

 

 

 

 

Mintzberg,

 

 

Miles & Snow,

 

 

 

1979

 

1978

Strategic

Chenhall

Hammer,

Snow &

 

Hall, 2002

 

(2005)

2001

Miles, 1983

 

 

 

 

 

Spector,

 

Venkatraman

 

Schneider,

Godfrey,

 

 

1999

, Henderson

 

Hayes, Hyang,

 

& Oldach,

 

Lim, Nishii,

1993

 

Raver, Ziegert

 

 

(2003)

Swanson,

 

 

1994

 

 

 

Rummler &

 

 

Brache, 1990

 

 

 

 

Building on this difficulty of reconciling on a common definition or definitions of alignment, we point to an absence of a consistent and reliable way of measuring organizational alignment within an organization. Although measurement is present in the literature (see, e.g. Avison, Jones, Powell, & Wilson, 2004), it is difficult to generalize findings and compare across contexts. This poses a problem of an almost cyclical nature. Because it is difficult to measure organizational alignment empirically, it is difficult to arrive at consensus on definitional attributes. While these challenges are not insurmountable, they must nevertheless be taken into account when examining the organizational alignment construct. Of particular note, both scholars and practitioners should be aware of the specific context from which alignment is being studied or practiced. Again, while the measurement of organizational alignment may be difficult, it is not an unfruitful endeavor, and should be considered in the context of the organizations’ environment.

 

Theoretical Implications

 

Perhaps most notably, our review of the alignment literature revealed a lack of agreement on one particular definition of the construct posing serious problems for advancing theoretical propositions of alignment. As we have noted, this lack of definition stems from the idea that alignment in any given organization will be uniquely and singularly constructed. We however come to some terms about what organizational alignment is. We have highlighted several streams of organizational alignments literature that rests disparately across academic disciplines.

 

As such, we maintain there is a unique opportunity for theoretcial advancement around the construct of organizational alignment.  While the construct of organizational alignment enjoys a robust history, the evolution and maturation the the theoretcial frame is only beginning application in organizational contexts. For example, while we name and highlight several perspectives and types, we actually know very little about the inner workings, influence, or interactions of the phenomonon in practice.

 

For example, theoretcially, we wonder how varying perspectives and types might look like together. If we use the contextual and specific definitonal positioning offered by each set of authors, we can then juxtapose their position graphically. See Figure 1.

 

Unpacking Organizational Alignment: The View from Theory and Practice 6

 

Figure 1. Theoretcial Juxtapostion of Organizational Alignment Perspectives and Types

  

Grounded in the literature and definitions reviewed, we propose that horizontal and vertical alignment make up those systems and processes that define the context of the organization while structural and cultural alignment define the organizational bounds of alignment. Moreover, environmental alignment works as a catalyst for the creation of alignment – either in the process of removing barriers or spurring activity that facilitates the performance of alignment in an organization. The nuanced model highlighted in Figure 1 contextualizes the theoretical overlap, convergence, and utility of unique perspectives under one frame of reference.

 

Practical Implications

 

From a practical perspective, alignment has received little attention. Again, this may be due to the difficulty in defining and measuring organizational alignment as a construct.  Yet, organizational alignment indeed can have important consequences for organizations.  As noted in the literature, organizations that understand and implement good alignment practices can see increased productivity and performance (Bergeron, Raymond, & Rivard, 2004).  Therefore, it is imperative for managers and leaders to understand organizational alignment and their role in driving alignment.  Ultimately, it is these individuals that facilitate alignment in the organization through various channels of implementation. According to Kathuria, Joshi and Porth (2007), alignment “requires a shared understanding of organizational goals and objectives by managers at various levels and within various units of the organizational hierarchy” (p. 504).  In a sense, implementing an alignment plan involves not only the alignment of processes, structures, and systems, but also an ideological alignment among employees and leaders.  Without a “shared understanding” of alignment within the organization, it is difficult to fully ensure that relevant and important organizational elements are truly aligned.

 

Additionally, different subsets of employees may find it beneficial to focus on different aspects of organizational alignment.  We have outlined suggested foci for three different functional areas of organizational managers/leaders (executive leadership, operations, and human resources) in Table 2.  To be sure, this is not an exhaustive list, but may nevertheless be useful for determining where certain emphases can be placed for maximal impact.  Operational employees (those carrying out the “central” aspect of a given business) could have more influence over vertical and horizontal process alignment, for example, because of the proximity of these individuals to the work being carried out.  Similarly, human resource professionals might have notable influence in alignment that pertains to issues of organizational culture because of their roles within the organization and their job tasks.  Lastly, executive leadership should be particularly interested in the strategic execution of alignment, especially when this pertains to the interaction of the internal and external operating environment.

 

 Table 2

 

Suggested Foci for Organizational Leaders

 

Unpacking Organizational Alignment: The View from Theory and Practice 7

 

Note: Red = executive leadership, blue = operations, green = human resources

 

Conclusion

 

Organizational alignment is a phenomenon shown to contribute to both organizational performance as well as employee and team performance.  Alignment can be used to improve internal processes and reduce inefficiencies as well as link the organization more closely to its external operating environment (regulators, suppliers, and customers, e.g.).  However, our examination of the organizational alignment literature has revealed that there is considerable difficulty in arriving at a single definition of alignment that remains useful across contexts as well as specific and bounded.  This appears to be due to the unique organizational contexts within which alignment is enacted.  This difficulty in defining alignment naturally leads to difficulty in measuring alignment and making useful conclusions based on empiricism. Nevertheless, the process of planning for and implementing alignment plans is beneficial to employee and organizational success.

 

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