LINKING INTRA-ORGANIZATIONAL STAKEHOLDERS:
CIO PERSPECTIVES ON THE USE OF COORDINATION
MECHANISMS
Carol V. Brown
Visiting Scholar
Center for Information Systems Research
V. Sambamurthy
Associate Professor of MIS
Florida State University
November 1998
CISR WP No. 304
Sloan WP No. 4038
©1998 Massachusetts Institute of Technology. All rights
reserved.
Center for Information Systems Research
Sloan School of Management
Massachusetts Institute of Technology
77 Massachusetts Avenue, E40-193
Cambridge, MA 02139-4307
CISR Working Paper No. 304
TitlE:
Linking Intra-Organizational Stakeholders:
CIO Perspectives on tfle Use of Coordination Mechanisms
Authors:
Carol V. Brown, Visiting Scholar
Date:
November 1998
Abstract:
IT-based innovation requires the attention, involvement, and commitment of
both business and IS stakeholders. Coordination mechanisms are an organization design
solution for linking these stakeholders via formal structures and processes as well as via
informal mechanisms that provide opportunities for voluntary collaboration. This paper
reports the findings from semi-structured interviews with 38 senior IS executives from
primarily Fortune 500 companies representing a broad range of manufacturing and service
industries. The data analysis yields an expanded scheme of 21 specific mechanisms within six
a priori categories (integrator roles, groups, processes, informal-relationship building, human
resource practices, IT-based systems) and an emergent scheme of three coordination goals
(strategic alignment, partnering, learning). The coordination goals and design challenges
associated with specific mechanisms are described from a CIO perspective, and insights
related to implementing a portfolio of mechanisms are shared. Our intent is to provide both a
roadmap for the IS practitioner and some empirical data on a topic of increasing importance
for the IS researcher.
27pages
This paper is also available as Sloan Working Paper No. 4038
INTRODUCTION
The delivery of innovative IT solutions has become a fundamental business competency in
most contemporary firms (Feeny and Wilcocks, 1998). Yet, IT-based innovation requires
the attention, involvement, and commitment not only of information systems (IS)
management, but also of senior management and business (line) management (Mata,
Fuerst, and Barney, 1995; Ross, Beath, and Goodhue, 1996). Thus, one of the challenges
facing CIOs is how to build and sustain effective intra-organizational relationships among
these key stakeholders (Rockart, Earl, and Ross, 1996).
Many organizations are attempting to link business and IS stakeholders by implementing
governance structures that gives business management significant authority for IT
applications. For example, under a federal governance design, corporate IS has authority
for the IT infrastructure and other enterprise-wide IS issues, whereas business units have
authority for local IT application decisions (Rockart et al., 1996).
However, in most mid-sized and large organizations, there are three reasons why
governance structures alone might be insufficient for linking together key stakeholders for
IT innovation. First, when individual business units assume authority for specific IS
activities, business-level objectives may be in conflict with enterprise-wide objectives,
including attention to synergistic opportunities (Brown and Magill, 1998; Kayworth and
Sambamurthy, 1998). Second, many IS activities require ajoint consideration of business
and IS issues. In particular, IT applications decisions require a consideration of the current
IT infrastructure, and IT infrastructure investment decisions should include judgments
about the current and future business needs for IT (Rockart, 1988; Zmud, 1988). Yet, IS
management may not be aware of emerging strategic thrusts or business management may
not have the necessary expertise to make the appropriate IT-related assumptions. Third,
gaining the trust of other stakeholders is a prerequisite for cross-unit partnering and such
trust is built on interpersonal relationships fostered through people-to-people contacts
(Gambetta, 1988; Henderson, 1990).
Coordination mechanisms represent an additional way for CIOs to link intra-organizational
stakeholders.
While governance arrangements vest decision authority with specific
stakeholders, coordination mechanisms laterally link together people from different parts of
an organization (Galbraith, 1993). In particular, horizontal mechanisms bind together
stakeholders through deliberately orchestrated interactions via formal roles, groups, or
processes, or via opportunities for voluntary informal exchanges (Mohrman, 1993).
Contemporary firms are using coordination mechanisms to build and nurture linkages
among senior, business, and IS management (Brown and Ross, 1996; Rockart, 1988;
Zmud, 1988) under different IS governance arrangements (Brown, 1998).
Most prior empirical research on coordination mechanisms for linking IS stakeholders
addresses the merits, pitfalls, and implementation challenges associated with individual
mechanisms (e.g., Hufnagel and Birnberg, 1989; Torkzadeh and Xia, 1992). A few recent
studies also provide frameworks for categorizing coordination mechanisms for linking IS
stakeholders (Brown and Ross, 1996; Brown, 1998). Missing from this empirical research
I
is an investigative survey of the way different types of coordination mechanisms are being
implemented by CIOs to link intra-organizational stakeholders and an understanding of the
specific coordination goals that they seek to achieve with such mechanisms.
This paper draws upon semi-structured interviews with CIOs from 38 primarily Fortune
500 companies in order to develop insights into the usage of coordination mechanisms for
linking intra-organizational stakeholders. The next section reviews prior organization
theory and IS literature to establish our existing knowledge. This literature also provides
the basis for an initial taxonomy of six categories of IT coordination mechanisms that are
the focus of this study.
PRIOR LITERATURE AND RESEARCH QUESTIONS
Coordination theory has its roots in the basic logic of organizing.
Thompson (1967):
As described by
"By delimiting responsibilities, control over resources, and other matters, organizations
provide their participating members with boundaries within which efficiency may be a
reasonable expectation.
But if structure affords numerous spheres of bounded
rationality, it must also facilitate the coordinated action of those interdependent
elements (p. 54)."
In other words, differentiation gives rise to organizational interdependencies -- "situations
in which what happens to one organizational actor affects what happens to others" (Pfeffer,
1981, p. 68). Further, interdependencies require coordination for multiple reasons. First,
interdependencies necessitate greater amounts of information sharing. Rapid changes in
environments and complex internal resource dependencies strain the ability of formal
governance structures to quickly and effectively direct the flow of information (Mackenzie,
1986). Coordination mechanisms create lateral linkages across individuals or units to
facilitate information sharing. Second, interdependencies require collaborative problemsolving across different organizational units.
Coordination mechanisms facilitate
interactions between individuals from different units in order to pool knowledge and
develop a common language and shared understanding that are needed for cross-unit sensemaking (Galbraith, 1993; Weick and Daft, 1984). Finally, information sharing and sensemaking require trust among the collaborating actors (Gambetta, 1988; Henderson, 1990).
Trust is needed for individuals to share accurate information, to tolerate task-related
ambiguities, and to be influenced by others.
Again, differentiation impedes the
development of trust between different individuals responsible for different tasks
(Mohrman, 1993), but coordination mechanisms can be used to build trustful and
harmonious relationships across unit boundaries.
Specific Coordination Mechanisms in the Organization Theory Literature
Organization theorists have identified a variety of formal and informal mechanisms for the
management of organizational interdependencies.
For example, formal groups and
integrator roles are considered to be common mechanisms for managing complex
interdependencies (Galbraith, 1994; Mohrman, 1993). Formal groups bind together
2
individuals from two or more units and vest them with authority and responsibility for
managing interdependencies. Integrator roles vest individuals with formal authority and
responsibility for managing dependencies between designated units. Formal processes,
including planning, budgeting, and transfer pricing mechanisms, can also be used as formal
mechanisms to manage interdependencies (Mohrman, 1993). These mechanisms also
foster the development of trustful relationships and enable more concentrated attention to
information transfer and collaborative problem-solving. On the other hand, these types of
formal mechanisms require substantial personal commitment and time.
In addition to groups, roles, and processes that orchestrate formal interactions, voluntary
coordination behaviors can be facilitated by "informal" mechanisms (Mohrman, 1993).
For example, mechanisms as varied as job rotation, physical co-location, and IT-based
collaboration systems can create a context in which the cross-unit integration of work is a
"natural" or "spontaneous" response (Galbraith, 1993).
Coordination Mechanisms in the IS Literature
Two recent studies by IS researchers have developed frameworks for categorizing
coordination mechanisms for linking IS stakeholders. Based on data from twelve large
organizations, Brown and Ross (1996) document the usage of individual roles, group roles,
and process enhancement mechanisms for achieving two differing objectives: building ISbusiness partnerships and supporting IT infrastructure development. These include
mechanisms for linking corporate IS with both business management and decentralized IS
units. Brown (1998) has proposed a scheme of four mechanism categories based on a
synthesis of prior organization theory and IS literature: formal groups, formal roles,
informal networking practices, and cross-unit human resource practices.
Empirical
evidence for the usage of all four categories of mechanisms to coordinate across IS and
business units, as well as across corporate IS and dispersed IS units, is reported on the basis
of a theoretical sampling: one case site with a centralized IS governance but geographically
dispersed IS units, and a second case site with a federal IS governance mode. Initial
support is also provided for the propositions that the most highly valued mechanisms in
organizations with centralized IS governance will be those directed at IS-business linkages,
whereas the most highly valued mechanisms in organizations with federal IS governance
will be those directed at IS-IS linkages.
Looking next at the literature on specific mechanisms, steering committees are a type of
formal group mechanism and one of the most frequently researched IT coordination
mechanisms (Brown, 1998). Steering committees have been commonly used by CIOs to
manage resource allocation interdependencies: committee members representing different
business units allocate limited IS resources based on project requests from different
stakeholder groups (Drury, 1984). According to Rockart et al. (1996), CIOs in leading
edge firms have steering committees that focus on strategic IS and business alignment and
this formal group mechanism helps to develop organization-wide perspectives. Earl and
Feeny (1994) found that effective CIOs use this type of mechanism to educate their senior
business stakeholders about IS issues, "seed" them with creative ideas for IT use, and to
help interpret external IT success stories to stimulate executives' thinking about IT
innovations. However, a steering committee mechanism is not universally appropriate
3
(Brown, 1998): context factors, such as the CIO's membership on a top management team,
or the presence of another formal mechanism such as an integrator role, can influence the
appropriateness of a steering committee mechanism.
Empirical IS research on integrator roles is scarce, although evidence of the use of this type
of role mechanism has been documented in the IS practitioner literature (e.g., Hildebrand,
1994). Iaccono, Subramani, and Henderson (1995) report that account manager roles are
used to coordinate the delivery of IS services in response to business clients' interests and
needs, to manage impressions about the responsiveness of the IS organization, and to
establish accountability for client satisfaction with IS services. Brown (1998) found that
integrator role mechanisms are highly valued by IS and business managers for achieving
business and IS integration under both centralized and federal governance contexts.
Strategic planning processes are another highly researched coordination mechanism (Byrd,
Sambamurthy, and Zmud, 1995). As defined by Henderson and Sifonis (1988), strategic
planning is a formal process for enhancing linkages between the strategic business plan and
the strategic IT plan and for defining ways in which IT products and services can be
targeted at strategic priorities. Another type of formal process for managing IS-business
interdependencies is a chargeback system (Ross, Beath, and Vitale). Chargebacks typically
include data center costs, but the inclusion of other services widely varies. A related
process mechanism, service level agreements, can be used for a variety of IS services,
including application development and both network and data center operations.
The
perceived fairness of the basis on which clients are charged for IS services has been
associated with the quality of the IS-business relationships (Hufnagel and Birnberg, 1989;
Ross et al).
One of the "informal" mechanisms mentioned above in the organization theory literature
review, a physical co-location mechanism, has been documented by several IS researchers.
According to Ross et al (1996), physical co-location facilitates the building of stronger
relationships among IS and business managers. Brown (1998) found that the co-location of
systems development managers who were serving integrator roles with their clients was an
effective mechanism combination under centralized governance.
The usage of human resource mechanisms to increase the likelihood of collaboration across
stakeholders has received much less attention in the IS literature. Brown (1998) describes
an IS organization with a federal design that was able to leverage interpersonal networks
between corporate and decentralized IS managers due to the organization's multi-year
history of aggressive, cross-unit job rotation practices.
Finally, the usage of IT-based systems to link organizational members has been widely
documented in the general IS literature; the overall growth of groupware products is a
technological success story of the past decade (Johansen, 1989; Mankin, Cohen, and
Bikson, 1996). DeSanctis and Jackson (1994) argue for the potential of advanced
information technologies such as electronic meeting systems and discussion databases to
enable the coordination of IS activities and planning initiatives across a dispersed IS
workforce.
4
Critique
Our review of the existing literature suggests that coordination mechanisms are an
important element of contemporary organization design. Organization theorists have
argued for the importance of implementing multiple formal and informal coordination
mechanisms. Although most prior empirical research on IT coordination mechanisms has
been confined to specific mechanisms, this body of literature as a whole provides initial
evidence that coordination mechanisms can be effective organization design tools for CIOs
to link not only IS and business stakeholders, but also decentralized IS stakeholders.
Our literature review also suggests an initial coordination mechanism schema of six
categories (see Table 1). Two of these mechanisms are structural overlays emphasized by
organization theorists over the past two decades: integrator roles, such as an account
manager, and formal groups, such as a steering committee. Another category of formal
mechanisms in the framework by Brown and Ross (1996) is formal processes such as
strategic planning and negotiated service contracts. The remaining three categories of
mechanisms are referred to as informal mechanisms by organization theorists (e.g.,
Mohrman, 1993). Informal relationship-building practices such as physical co-location
and human resource practices such as job rotations into and out of corporate IS have been
found to be useful mechanisms for counterbalancing the effects of a centralized or federal
governance structure (Brown, 1998). The sixth category, IT-based systems, has recently
been conceptualized as an important design tool in combination with other mechanisms
(e.g., Galbraith, 1993; DeSanctis and Jackson, 1994). Its inclusion here as a separate
category is further supported by the recent growth in the usage of groupware products to
increase cross-unit information sharing and other collaborative activities (Mankin, Cohen,
and Bikson, 1996).
In the absence of a systematic examination of the set of coordination mechanisms in Table
I for linking IS stakeholders within a sample of IS organizations, we undertook a
descriptive study that focused on the following research questions:
1. From the CIO's perspective, what are the most important coordination
mechanisms for linking intra-organizational stakeholders?
2. What coordination goals are CIOs seeking to achieve through the use of these
mechanisms?
Our specific objectives were to expand the taxonomy in Table I and develop an initial
schema of coordination goals associated with mechanism usage. In addition, the research
methodology adopted for this study allowed us to capture insights from CIOs in mostly
Fortune 500 companies about implementing mechanisms in a variety of organizational
contexts and industries. We present the findings from our survey after a brief description
of our research methods.
5
RESEARCH METHODOLOGY
A professional group of senior IS executives interested in identifying best practices on
critical IS management issues sponsored this field study. The findings reported here are
based on data collected from 38 firms representing nine different industries. These
organizations were part of an initial set of 75 companies noted for their IT management in
the trade press or by peer reputation (see Appendix for details). Most of the participants
were CIOs at Fortune 500 companies; in a few instances, CIOs designated a direct report to
participate.
1
Table 2 profiles the 38 participating organizations in terms of industry represented, their
formal IS governance arrangements, and their overall organizational contexts. Centralized
and federal governance modes predominate, which appears to be characteristic of IS
organizations within large companies in the mid-1990s (Brown and Magill, 1998; Earl,
1996). We have used the term customized for organizations in which there is not a uniform
centralized governance mode: under a customized design, some of the larger business units
have significant authority for IT use decisions and therefore operate in a federal mode,
while other business units have centralized IS governance.
Data gathering occurred via one-hour telephone interviews. Interviewees were provided in
advance with a one-page prospectus that stated the study's objectives and a working
definition of the six coordination mechanism categories in our a priori scheme (for specific
wording, see the Appendix). Each interview began with an inquiry about the respondent's
organizational context. An open-ended question was then asked to elicit three to five
coordination mechanisms that the CIO considered important for achieving a cooperative IT
management climate. Follow-up questions were asked to better understand why a specific
mechanism was being used and any implementation challenges that were encountered.
Many respondents provided details on how the different mechanisms fit together as they
described them. The interview typically lasted about an hour, although some respondents
chose to continue talking longer to us than the initially scheduled time period.
The responses obtained from each company were first mapped into the six categories in the
a priori scheme. Specific mechanism types for each category were then identified based on
cross-company analyses for each category. Similarly, the qualitative responses on
coordination goals were culled from all interview transcriptions and then categorized via an
iterative process. Further details of the methodology are provided in the Appendix.
By using a simple taxonomy and anchoring discussions around mechanisms that the CIOs
considered most important, we were able to develop a relatively rich understanding of the
usage of coordination mechanisms in a given organizational context as well as the goals
and challenges associated with a specific mechanism. Given the profiles in Table 2, our
findings are intended to be generalizable to large organizations with different IS
I This research project was sponsored by the Advanced Practice Council of the Society for Information
Management.
6
governance structures in a broad range of manufacturing and service industries.
FINDINGS: COORDINATION MECHANISMS
As described earlier, the existing organization theory and IS management literatures yielded
a scheme of six categories of coordination mechanisms (see Table 1). Further, the prior
literature suggests that CIOs use these mechanisms for linking the corporate IS unit with
both business and dispersed IS stakeholders. Our analysis of the interview data yielded an
expanded taxonomy of coordination mechanisms, with multiple types of mechanisms in
each of the six initial categories. Below we describe our specific findings for each
mechanism category, including any salient design challenges.
Integrator Role
Within an IT coordination context, an integrator role is an individual who is formally
assigned with the responsibility for linking activities between a corporate IS unit and one or
more business units 2 . This individual is the primary point of contact for the business unit
and is accountable for responding to business management's needs. Individuals who play
this role are also in a position to informally educate and "seed" business managers with
innovative ideas for IT use, as well as sensitize corporate IS managers about their clients'
emergent IT issues. The establishment of this linking role theoretically increases the
likelihood that either a corporate IS initiative or a business unit initiative will jointly take
into account both IS and business stakeholder perspectives.
Table 3 illustrates the different types of integrator roles and their governance contexts that
emerged from our data analysis. Twenty-nine of the 38 organizations in our study reported
some type of integrator role to be among their most important coordination mechanisms 3.
Four different types were identified within centralized or customized IS governance
contexts. The fifth type, which we refer to as a divisional information officer role, was
found in almost three-quarters of the organizations with a highly decentralized or federal IS
governance context.
Patterned on the model of a consulting organization, an account manager role with no
direct responsibilities for a systems development staff was found in all four organizations
with a customized design and five organizations with a centralized design. The account
manager usually reports to corporate IS managers, typically the CIO, but is often physically
co-located with one or more business clients. Few account managers had any formal
reporting relationship to the business unit, although they were typically a part of business
management team meetings and were expected to be knowledgeable about their business
client's strategy and major processes. The process manager role is similar to an account
2 By this definition, the CIO role is also an integrator role. However, since our study was from the
perspective of the CIO as an architect, this role is outside the scope of the study.
2 One
manufacturing company with a customized governance design reported the usage of two
integrator roles: a DIO role played by IS heads reporting to business units and an account manager
role reporting to corporate IT. The total number of integrator role examples is therefore 30 rather than
29.
7
manager, except this role links with business process owners. Both process manager
examples were in process-oriented organizations with major re-engineering initiatives
underway or responsibilities for ongoing integrated IT solutions for multiple business
clients.
Three companies reported the use of systems directors who had significant IS application or
service delivery responsibilities as integrators responsible for managing the business client
relationship. We labeled this type of integrator an "enhanced" systems director because
these directors played the role of account manager as managed an IS unit (usually systems
development staff) with a solid-line reporting relationship to corporate IS.
Four companies with centralized IS governance also reported a type of integrator role
played not by IS managers, but by business managers. Referred to here as client liaisons,
these integrators were typically IT-literate business managers responsible for coordinating
initiatives with corporate IS, such as serving as the "owner" of a key business application.
These integrator role positions were typically implemented without any dotted-line
reporting relationship with corporate IS. In one organization, a former IS manager had
been rotated into this role for an 18-month stint with the specific intention of broadening
his business knowledge.
The divisional information officer (DIO) role describes those senior IS managers who were
responsible for major application development staffs and also had significant IT operations
responsibilities for a business unit, or business sector, in addition to their integrator role
responsibilities.
Two-thirds of the companies with federal IS governance designs
mentioned this type of integrator role. Although not all DIOs were in officer-level
positions within their business unit, all of our DIO examples had a solid-line reporting
relationship to a divisional business head and were typically a recognized member of the
division's management team. Three of the eight DIOs under federal IS designs had matrix
reporting (solid-line report to corporate IS as well as the business); two other companies
reported the use of a dotted-line DIO report to corporate IS.
Design Challenges. Our interview data also uncovered several significant design
challenges. One persistent challenge was the achievement of desired "allegiance" to both
IS and business management. For example, account managers report to central IS
managers, but they need to be active participants in the strategic and tactical meetings of
their business client as well as corporate IS. How can the person in the integrator role
avoid being perceived as only representing corporate IS interests in meetings with senior
business managers? Similarly, how can such an individual avoid being perceived as only
representing the interests of one or more business clients when attending meetings of the
corporate IS leadership? As mentioned by one CIO, overzealous advocacy of a specific
business unit's interests can run the risk of the integrator being perceived as "taking sides"
and becoming alienated from IS colleagues.
CIOs reported two design solutions to help integrators achieve the "right balance." The
first solution was to implement a dual reporting structure. In a few instances, integrators in
centralized contexts who had a solid-line reporting to corporate IS were also given a dotted8
line reporting relationship to the business client. More common was the implementation of
a dotted- or solid-line reporting relationship to corporate IS for integrators in not totally
centralized contexts. However, only 3 of the 29 organizations reported implementing a
dual solid-line reporting (matrix) relationship.
A second solution was to design
performance appraisal and incentive systems that included input from both IS and business
management. For those integrators with dual reporting relationships, both IS and business
input was already ensured; for those integrators without dual reporting relationships, multiunit input provided an institutional incentive to achieve an appropriately balanced
"allegiance" without a formal dual report.
Another significant challenge was related to the range of skills necessary for effective
performance in the integrator role positions. CIOs mentioned three types of skills as being
important: (i) strategic thinking, or the ability to understand business drivers and key
business processes and to be able to envision opportunities for strategic IT use; (ii)
negotiation and collaboration skills, or the ability to influence people through interpersonal
interactions; and, (iii) IS service brokering skills, or the ability to diagnose client problems
with IS services and to identify appropriate IS experts who could efficiently and effectively
resolve those problems. Several CIOs mentioned the difficulty of filling their integrator
role positions due to the scarcity of individuals that possessed this range of skills. Some
individuals selected for these positions were internal hires with well-established
interpersonal relationships with particular business clients; other individuals were external
hires from consulting organizations with proven technical and interpersonal skills. Several
CIOs reported individually mentoring individuals in these positions or providing special
training programs in order to develop the needed skills. One organization with several
years of experience with different types of integrator role positions in both centralized and
federal IS contexts reported that resources had recently been committed to developing a
corporate IS training and development program specifically for integrator role skills.
Another organization reported that a formal linkage across their account managers was
established using a "centers of excellence" team mechanism in order to facilitate learning
from each other.
Groups
Groups are formally established councils or teams of either business and IS stakeholders, or
central and dispersed IS stakeholders, that are given specific linking or oversight
responsibilities for IS-related activities4 . In contrast to integrator role mechanisms that vest
specific individuals with a coordination responsibility and authority, group mechanisms
vest multiple individuals with coordination responsibilities.
Further, while the
coordination activities of integrator roles are bilateral (the individual integrator and specific
organizational units), groups typically have multilateral responsibilities (i.e., coordination
across more than two organizational units). Thirty-six of the 38 companies reported the use
of a group mechanism and from these responses we identified six different types of groups
4 Task forces for specific systems development or acquisition projects (i.e., systems project teams) were
considered outside of the scope of this study. As described below, the task force classification was
used here for ad hoc groups typically chartered by an executive council to develop recommendations
rather than develop applications.
9
(see Table 4).
We classified half of the instances of groups as an executive council. The typical
membership of an executive council includes the chief operating officer and/or the chief
financial officer, and senior business executives from the dominant lines of business, along
with the CIO. Executive councils deal with enterprise-wide IS issues such as capital
appropriation for large IT projects, IT policy endorsements, and articulations of IT vision
and business-IS strategy. They also as serve as educational and communication forums on
IT-related issues. More than half of the CIOs in organizations with centralized governance
modes mentioned executive councils, but nearly half of the CIOs in federal governance
contexts also considered this mechanism to be significant. Divisional steering councils
were mentioned by CIOs in large, often global, multi-divisional companies, usually with
federal governance modes. In federal contexts, the council members are senior business
managers of the division and the divisional information officers.
One-third of the CIOs in centralized contexts mentioned the use of a project steering team
to oversee a process or one or more large application projects. The use of such a steering
team ensured ongoing involvement of key business executives in major initiatives.
Two types of group mechanisms to link across IS stakeholders were also frequently
mentioned as significant coordination mechanisms: councils of IS managers (12 mentions)
and IT standing teams (14 mentions). In two-thirds of the organizations with a federal
governance mode, an IT management council was used to formally link divisional IS heads
with the CIO and other corporate IS managers who had IT strategy, infrastructure, and
corporate (or enterprise-wide) IT application responsibilities. More specifically, these
councils direct attention to the "IS business" of the organization and serve as a coordination
forum to:
1. Advise (counsel) the CIO on strategic IS organization issues
2 Surface potential impacts of corporate IS policies
3. Share IT-related best practices, solutions, and problems
4. Nurture and grow IS human resources
IT standing teams typically are groups of IS managers formed to address specific IT issues
on an ongoing basis, such as IT standards issues or the identification of IT skill gaps. IT
standing teams are often chartered by one of the above mentioned councils and the standing
team's recommendations are typically submitted to this council for approval. A common
example was an IT architecture group of IT experts to develop recommendations on highlevel IT infrastructure issues. IT standing teams were prevalent across all four governance
designs.
Six of the IT standing team mechanisms mentioned involved experimentation with a
specific form referred to as "centers of excellence" (CoE). Some firms used this group
mechanism as a "virtual homeroom" for IS employees with specific skillsets. These CoEs
focused on developing groups of people with organizationally valued technical skills,
particularly emerging or underdeveloped IS skillsets (e.g., object-oriented development,
client-server applications, project management). Another set of firms regarded their CoEs
as an adhoc source of internal technological expertise: experts on specific IS topics were
10
designated as organizational "gurus" and responded to problem-solving requests from the
entire organizational IS community. These groups also could play key knowledge
dissemination roles, often using IT-based tools for communication across physical
boundaries.
Similar to IT standing teams, task forces are ad hoc groups of managers created to address
a specific task that requires cross-unit coordination for a limited period of time, such as
problem-solving related to a new technology, enterprise-wide applications of technologies,
or enhancement of specific processes or applications. They differ from project teams for
systems development projects in that they are typically chartered by a council to develop
recommendations on specific IT issues.
Design challenges. Several challenges for designing group mechanisms were identified.
First, our respondents identified some of the traditional challenges with managing groups,
such as identifying appropriate group members, choosing the basis of group decisionmaking (consensus vs. majority vote), promoting executive participation, and energizing
group members with a sense of purpose and value to the organization (Goodman and
Associates, 1986). Another key challenge related to how to ensure communication of
group decisions and their acceptance by relevant organizational constituencies. Finally,
some respondents pointed to the necessity of monitoring the continuing relevance of a
given group over time. For example, one CIO reported that he had recently disbanded an
executive council since not many strategic issues were rising to the attention of this
council: as business divisions in this company grew more differentiated, enterprise-level
issues decreased and divisional information officers were capably handling strategic
alignment issues at the division level. IS issues that deserved enterprise-level discussion
were instead now being addressed in the CIO's IT management council, which included the
DIOs.
Processes
Processes are formal organizational routines that achieve coordination through mandated or
negotiated behaviors by individuals in interdependent units. Fourteen firms mentioned a
process mechanism in use. However, in retrospect, we think that this number may have
been influenced by our methodology: that is, we collected data by telephone interview, and
we believe it might be more difficult to describe a process than a formal role or group
mechanism in this medium.
We have grouped our findings into three different process types (see Table 5): strategic
planning (including IT capital investments), chargeback and service level agreements
(SLAs), and software acquisition processes. Similar to the IS literature, strategic planning
was the process mentioned most frequently; the nine mentions were from companies in six
different industries. In centralized governance modes, corporate IS typically initiated the
planning process with an assessment of strategic thrusts at the enterprise level. In
decentralized governance modes, planning initially originated within the business units and
corporate IS typically played a review role in order to identify overlapping initiatives and
coordinate them at the enterprise level.
11
Four firms reported the use of chargeback and/or service level agreement processes
between IS and the business unit in centralized or federal contexts. An IS controller or
other senior IS manager was typically given the responsibility for overseeing these
processes.
Six organizations representing five different industries mentioned software acquisition and
development processes as significant coordination mechanisms: specific methodologies to
guide actions by business and IS managers to evaluate packaged software or deliver inhouse applications. These processes were emphasized in organizations experiencing
significant usage of packaged software or increased pressures for application delivery.
Design challenges. Two design challenges were noteworthy. The first involved designing
feedback to those responsible for overseeing a process. For example, one IT capital
investment approval process was designed to link with executive council decision-making:
a post-implementation review date was set for each project, at which the business
champion for the project was expected to identify factors associated with any schedule
delays or cost overruns as well as the realized business benefit(s). Similar to group
mechanisms, a related design challenge is the continual assessment of mechanism
effectiveness and appropriateness. For example, several companies reported a concern
with ensuring that a given process continued to direct attention to cross-unit coordination
and did not degenerate into a "ritual."
Informal Relationship-building
Informal relationship-building mechanisms are intentional activities or practices that link
managers from two or more organizational units to facilitate voluntary interactions for
cross-unit problem-solving.
Three different types of informal relationship-building
mechanisms were among the coordination mechanisms mentioned by our respondents:
one-on-one management contacts, periodic briefings or conferences, and physical
co-location (see Table 5).
One-on-one contacts are scheduled and unscheduled interactions initiated by senior IS
executives, most commonly with business peers or top managers but also with IS heads
reporting to business managers. Our participants reported using one-on-one contacts to
gain senior executive buy-in to key IT initiatives as well as to increase IT-related
knowledge and awareness of senior business executives, sometimes with the CIO acting as
a "personal coach." Some CIOs reported using this mechanism as a substitute for an
executive council in companies where the prevailing organizational culture precluded the
use of group mechanisms to link with high-level business managers. No pattern by
governance mode was apparent, but one pattern by industry type was observed: four of the
five healthcare organizations in our sample mentioned this mechanism. Our findings thus
suggest that the importance of one-on-one contacts for linking interorganizational
stakeholders may be highly influenced by context factors, such as the number of
professional employees in the organization and the overall organizational culture.
Periodic briefings and conferences entail structured information-sharing, but are also
occasions for facilitating informal networking. Briefings occur in small group settings.
12
Conferences are highly interactive settings for larger groups, often with outside speakers or
vendors as presenters. All the five companies that mentioned this mechanism as highly
important had governance designs that were not highly centralized.
In contrast, the CIOs that reported the use of a co-location mechanism were primarily in
companies with centralized governance. Physically locating an IS manager or unit in close
proximity to a business client was a mechanism that was implemented with and without a
dual reporting structure for the individual integrator or unit head. Some CIOs reported that
their co-located individuals acted as if they had a reporting relationship to business
management, even though they formally reported to an IS manager only.
Design challenges. Our interviews surfaced two design challenges specific to the
implementation of informal relationship-building mechanisms. The first is related to the
voluntariness associated with these mechanisms: their usage is dependent on the
willingness of the participants to engage in voluntary cross-unit interactions. In those
organizations where informal interactions were a key characteristic of the culture,
participation was assured-i.e., cross-unit decision-making was conducted via one-on-one
contacts at the executive level in these organizations in general. The second challenge was
determining circumstances under which to continue to rely on informal mechanisms versus
institute a formal group, role, or process mechanism. For example, in one organization
where informal relationship-building mechanisms were reported to be of great importance,
the CIO mentioned plans for introducing an executive council and account manager roles
after there was a greater appreciation of IT coordination needs on the part of business
management.
Human Resource Practices
We defined human resource practices as actions related to the human resource management
of IS personnel that are also intentional activities or practices to facilitate voluntary crossunit problem-solving across two or more individuals reporting to different organizational
units. Our participants mentioned three types of practices that we classified in this
category: (i) training and development initiatives specifically directed at increasing crossunit linkages, (ii) job rotations of a temporary nature that were implemented in order to
provide cross-unit experiences to improve IT stakeholder linkages, and (iii) rewards and
appraisal systems designed to incent cross-unit collaboration (see Table 5). No pattern by
governance mode was apparent. One CIO reported delegating the "championship" of
specific HR-related initiatives to his corporate IS directors in order to ensure that HR
management tasks became a priority.
Eight organizations mentioned training and development mechanisms. A variety of
training approaches to "grow" IS managers' soft skills, especially in conjunction with
integrator role positions, and to "stretch" the technical skills of business personnel were
reported.
Four companies mentioned temporary job rotations for IS personnel that were short
assignments, typically within a business division, to increase an individual's business
knowledge or sensitivity to special unit needs. For example, a CIO with centralized
13
governance reported temporarily assigning IS personnel to do "real business work" for a
few weeks in order to enhance their business knowledge and learn the department's "hot
buttons." A CIO with federal IS governance reported using 6-month assignments in an IS
unit within manufacturing plants for corporate IS personnel in order to increase their
understanding about differences in local versus enterprise-wide IS objectives or priorities.
Redesigned appraisal systems and special rewards for cross-unit collaboration were
reported by four companies. For example, one company had established discretionary
rewards to recognize contributions to a unit for which the employee had no direct reporting
relationship.
Design challenges. The primary challenge in implementing human resource practices as
coordination mechanisms is that the implementation of such practices typically requires
either formal approval by the corporate HR department or an executive-level agreement
about the IS department's freedom to "work around" institutionalized policies and
procedures. Some CIOs reported having corporate HR buy-in to their implementation of a
new HR mechanism as a pilot initiative for the overall organization.
IT-based systems
IT-based systems were mentioned as an important mechanism for linking intraorganizational stakeholders by only eight firms. Most of the examples involved using ITbased systems to link IS personnel in different organizational units. Examples included an
"ask the CIO" bulletin board, videoconferencing among dispersed IS managers, databases
on technology topics designed to pool together "thinly spread" knowledge or expertise, and
other collaborative groupware applications. Electronic media were especially useful for
disseminating time-sensitive information related to technical problems or solutions. No
pattern by governance mode or industry was apparent.
Design challenges. Consistent with the knowledge management literature (Quinn,
Anderson, and Finkelstein, 1996), we found that one of the major challenges in the use of
IT-based systems for cross-unit collaboration is related to motivating individuals to become
active contributors, not just users of information provided by others. For example, one
organization mentioned experimenting with monetary incentives to motivate contributions
to a Lotus Notes discussion database.
FINDINGS: COORDINATION GOALS
Our second research question for this study is: What coordination goals are CIOs seeking to
achieve through the use of these mechanisms? Whereas our data collection on important
coordination mechanisms involved the use of an initial schema, our data collection on
coordination goals was a "blank slate" approach: the participants were not provided with
any a priori categories or variables. As described in Appendix A, our analysis of the
responses to our open-ended inquiry initially yielded nine types of coordination goals.
These were subsequently clustered, via an iterative process, into a schema of three
categories of coordination goals: Strategic Alignment, Partnering, and Learning.
Table 6 presents our emergent schema along with a sample of CIO responses for each of
the specific goals. In the following subsections we first briefly present our emergent
14
schema along with references to contemporary literature to ground our findings. Next we
share our findings on types of goals by governance form (see Table 7). Finally, we close
this section with a discussion of our findings on the associations between mechanism usage
and our emergent three-goal schema (see Table 8).
Emergent Schema of Three Coordination Goals
Strategic Alignment refers to a synchronization of current business strategy and emergent
strategic thrusts with IT strategy and competencies (Henderson and Venkatraman, 1992;
Rockart, et al., 1996). Alignment is achieved when key IT investments are directed at the
firm's strategic priorities and the current abilities of the IT infrastructure proactively shape
the emerging business strategy. Successful firms therefore not only design IT capabilities
to support current business strategies, but also to implement new business strategies based
on emerging and proven technologies. Thirty-four of the 38 firms emphasized the use of
coordination mechanisms to accomplish three specific Strategic Alignment goals (see
Table 6): (i) fusion of IT and business strategies, goals, and resources, (ii) market value
through IT, and (iii) business ownership of IT and endorsement of IT policies.
Partneringbetween business and IS is a goal that requires long-term commitment, mutual
cooperation, and both risk-sharing and benefit-sharing on the part of each stakeholder
group (Henderson, 1990). According to Henderson, partnership relationships are sustained
when business executives understand the value created by the IS function and have
developed trust with their executive counterparts. Ross et al. (1996) view such a
"relationship asset" as one of three IT assets requisite for the effective use of IT in
sustaining competitive advantage. Twenty-six of the 38 firms associated the use of
coordination mechanisms with achieving four specific partnering goals: (i) ongoing, twoway communication among business and IS management, (ii) trust, credibility, and
responsiveness of the IS function, (iii) valuing standards for the IT infrastructure, and (iv)
an understanding of, and satisfaction with, the value of overall IT investments.
Learning reflects the need for people-to-people interactions to leverage the organization's
IT and business know-how. People-to-people knowledge sharing is required for knowledge
creation and sense-making (Nonaka and Takeuchi, 1995). As businesses experience
pressures for globalization, customization, and cycle time reduction, locating and
integrating webs of dispersed expertise within an organization becomes an imperative
(Fruin, 1997; Grant, 1996; Leonard-Barton, 1995). As the range of valued IT skills and
costs associated with their acquisition rise, the pooling of IT expertise across organizational
boundaries in order to transfer ideas, best practices, and IT solutions also becomes an
imperative. The CIOs in our study indicated the following goals as being important in the
context of learning: (i) leveraging IT expertise, (ii) promoting a collaborative work
environment between IS and business, and (iii) promoting a collaborative work
environment among IS professionals. Twenty-six of the 38 organizations also associated
the use of coordination mechanisms to achieve specific learning goals.
Goal Findings by Governance Form
Table 7 plots our findings on specific coordination goals by IS governance form of the
respondent organizations. CIOs in all governance modes mentioned coordination goals of
15
all three categories. However, two of the most significant differences provide support for
the theoretical notion that coordination mechanisms are used by CIOs for linking across
organizational boundaries that are established or reinforced by an IS governance design
(Brown, 1998).
First, IS managers under a centralized governance design are already linked with each other
via their reporting relationships, but a centralized structure provides no formal linkages
between IS and business management. Not unexpectedly, then, CIOs with a centralized
governance mode mentioned one specific strategic alignment goal almost twice as often as
any other specific goal: fusion of IT and business strategies, goals, and resources. Second,
federal and decentralized governance designs formally align business and IS management,
but erect organizational boundaries between divisional IS staff and corporate IS staff. Not
unexpectedly, then, all but one of the CIOs organizations with a federal or decentralized
governance mode mentioned learning goals, especially the specific goal we labeled
leveraging of IT expertise. In contrast, the leveraging of IT expertise goal was mentioned
by only two CIOs among the centralized governance firms.
Goal Findings by Coordination Mechanism Type
Table 8 presents our findings on associations between the three overall coordination goals
and the specific mechanism types discussed above and presented in Tables 3, 4 and 5.
Shading is used in Table 8 to emphasize patterns where more than half of the instances of a
specific mechanism type were associated with an overall coordination goal.
As can be seen from Table 8, all five types of integrator role mechanisms were associated
with achieving strategic alignment goals. Further, the three group mechanisms that link
senior business managers with IS leaders (executive councils, divisional steering councils,
and project steering teams) were also predominantly associated with strategic alignment
goals. Not unexpectedly, all nine organizations that mentioned a strategic planning process
associated this mechanism with strategic alignment goals as well. Only one "informal"
type of mechanism was associated with this goal cluster: periodic briefings or conferences.
In contrast, only one type of coordination mechanism was strongly associated with
partnering goals: the IT management council. Recall that this type of council, which was
mentioned by two-thirds of the organizations with a federal governance context, links the
CIO and other corporate IS managers with senior IS managers reporting to and/or colocated in a business unit. This mechanism is therefore considered to be critical for
achieving corporate IS-business partnering, including goals related to valuing IT
infrastructure standards (see Table 7). One half of the instances of two informal
relationship-building mechanisms were also associated with partnering goals: 1-on-I
contacts and physical co-location. Both of these mechanisms foster ongoing two-way
communication and the building of trust across people in different units.
Looking at the learning goals, all instances of IT-based system mechanisms were associated
with this goal cluster, which included specific leveraging and collaboration goals. Two
group mechanisms that typically link IS managers for cross-unit initiatives--IT standing
teams and task forces--were also associated with learning goals. Although the total
16
numbers are small, three of the four instances of temporary job rotation mechanisms were
also associated with learning.
FINDINGS: DESIGNING A PORTFOLIO OF COORDINATION MECHANISMS
In the section on findings for specific coordination mechanisms we reported the key
challenges for designing specific mechanisms reported by-our respondents. In addition, our
interviews surfaced some key insights related to an organization's entire portfolio of
coordination mechanisms. We present these insights in two parts below.
Inter-linking Logic for a Mechanism Portfolio
Our interviews uncovered three distinct explanations for why CIOs select and design specific
mechanisms that extend beyond associations with coordination goals. We have named these
mirror-image, continuous improvement, and visionary. Each approach is described below,
along with a case example.
Mirror-image logic describes an approach where the mechanism portfolio mirrors the firm's
internal practices; this logic taps into the milieu of the firm's management practices and
coordination mechanisms in use for the overall business. This approach is found in
organizations where, for example, mechanisms that enable team-oriented management may
already be well accepted within the organization. CIOs draw upon the existing institutional
legitimacy of specific mechanisms to create a portfolio of coordination mechanisms, in order
to minimize the difficulties associated with implementing new types of formal mechanisms.
For example, business success through continuous and rapid product innovation in one of our
participating firms was internally attributed to the use of multidisciplinary teams with either
often overlapping or exclusive responsibilities.
The firm's portfolio of coordination
mechanisms tapped into the company's recognized success with the use of groups with crossunit membership: the firm uses an executive council, divisional steering councils, project
steering teams, and a variety of IT standing teams, mostly with overlapping roles and
responsibilities, for achieving goals in all three categories described above.
Continuous improvement logic describes an approach where the portfolio is periodically
assessed; individual mechanisms are either retained, modified, or abandoned, depending upon
assessments of their value-adding contributions; and new mechanisms are added as the CIOs
and other senior executives learn about them. This logic is suitable in firms where a spirit of
continuous improvement and measurement exists, or where the firm has had a history of
success with a portfolio of coordination mechanisms and anticipates only incremental
adjustments in the near term.
For example, in one organization that has been externally recognized for success with strategic
IT applications, an executive council was associated with achieving fusion of between IT and
business strategies. However, while this council was able to surface ideas for high-level
strategic opportunities, difficulties surfaced in moving them forward to implementation at the
tactical level. Therefore, the CIO changed the mechanism portfolio in two ways. First, a
project steering team mechanism was introduced to ensure continued business management
17
oversight of specific initiatives. Second, systems designers were invited to participate as
"backbenchers" in the executive council meetings to increase their knowledge about emerging
strategic thrusts.
Visionary logic describes the design and implementation of a portfolio of coordination
mechanisms as part of a fundamental IS organizational transformation. This approach is
found in organizations where CIOs are repositioning their IS organizations in anticipation of,
or concurrent with, discontinuous changes in their business or IT environments.
For example, at an organization facing dramatic regulatory changes for its industry, the CIO
anticipated the need for a change-ready IS organization to facilitate the organizational agility
required by the company in the future. One large systems development unit served as a pilot
for transforming a staff with mainframe legacy support skills to one with new client-server
skills that could deliver applications within short cycle times. An entirely new portfolio of
coordination mechanisms was designed, including skills-based IT standing teams (centers of
excellence), account manager roles, a new resource planning process, and new HR practices
for job moves and reward systems. The entire portfolio was implemented by the CIO with a
"jump in" approach; in the words of the senior IS executive, "you must trust in your vision
and drive that vision forward."
Portfolios of Formal and Informal Coordination Mechanisms
Roles, groups, and processes are all formal mechanisms that have received the most
attention in the prior literature (e.g., Mohrman, 1994; Galbraith, 1993). Our findings in
Table 8 suggest that many specific formal mechanisms, including all five types of
integrator roles, three group mechanisms that particularly link senior business managers
with IS leaders, and the strategic planning process, are predominantly associated with the
coordination goal of strategic alignment. In contrast, the specific types of mechanisms in
the remaining three "informal" categories were more likely to be associated with learning
or partnering objectives
Figure 1 captures these ideas through what we have called an "iceberg" metaphor.
Integrator roles, groups, and processes are the more visible mechanisms for achieving the
primary goal of strategic IT alignment. However, informal relationship-building, human
resource practices, and IT-based systems exist "below the waterline" and are more likely to
be used to achieve the less obvious (and more difficult to measure) goals of partnership and
learning. In many instances these informal mechanisms may serve as supplements within a
portfolio that includes formal roles, groups, and processes. For example, physical colocation and cross-unit human resource appraisal processes can be used to help achieve the
goals associated with an account manager role. Similarly, IT-based systems can be used to
nurture the coordination behaviors of members of an IT management council or IT standing
team by providing a supplementary means of communication and information exchange.
However, in other contexts these below-the-waterline mechanisms may be used as
substitutes for the use of formal mechanisms, perhaps even "paving the way" for the
introduction of more formal mechanisms in the future.
One of our executive sponsors suggested a tree metaphor for conveying the same idea:
18
informal relationship-building, human resource practices, and IT-based systems could be
viewed as the roots, whereas roles, groups, and processes could be viewed as the more visible
limbs of the tree. Whatever the metaphor, Figure 1 emphasizes the potential utility of all six
categories within a portfolio of coordination mechanisms for linking intra-organizational
stakeholders.
DISCUSSION OF FINDINGS
The landscape for IT use and governance has changed significantly in recent years: IT has
emerged as a strategic differentiator in many contemporary firms' competitive strategies and a
variety of IS governance modes have emerged in response to these new competitive pressures.
This study began with an assumption that coordination mechanisms are an important
organization design solution for linking intra-organizational stakeholders. Our objective was
to extend the existing knowledge by: (i) expanding an initial schema of coordination
mechanisms that builds on prior literature, (ii) developing an initial schema of coordination
goals associated with these mechanisms, and (iii) identifying some patterns of usage,
including insights into the logic underlying the design of portfolios of coordination
mechanisms.
Our findings appear to provide extensive evidence for the utility of coordination mechanisms
for linking IS stakeholders within a variety of organizational contexts. As suggested by
organization theorists, multiple categories of formal and informal mechanisms can be used to
link people for cross-unit coordination tasks. Our findings also suggest that CIOs are using
these mechanisms to achieve three coordination goals: strategic alignment, partnering, and
learning. The face validity of our emergent schema of three coordination goals for today's IS
organizations also appears to be supported by prior IS literature (e.g., see Boynton, Zmud, and
Jacobs, 1994; Cooprider and Victor, 1993; Henderson, 1990; Rockart, et al., 1996; Ross, et
al., 1996; Weill and Broadbent, 1997). Further, our findings support prior literature which
suggests that coordination mechanisms are used by CIOs to link corporate IS managers with
both business stakeholders and dispersed IS stakeholders, under different IS governance forms
(Brown and Ross, 1996; Brown, 1998).
Our study also revealed that several organizational context factors other than IS governance
form can influence a CIO's selection and design of specific mechanisms. Figure 2 graphically
portrays our contextual findings. First, as shown in Figure 2, the organization's culture
influences IT coordination mechanism selection. In some organizations certain mechanisms
have already been institutionally legitimized. In other organizations, the prevailing culture
precludes the use of a specific mechanism. Second, other governance designs within the
overall organization, such as the CIO's membership on a company's top management team,
may influence mechanism selection. Both of these findings appear to support the conclusions
of prior researchers about important factors for predicting the CIO's ability to build
relationships with their business peers (Armstrong and Sambamurthy, 1998; Brown, 1998;
Earl and Feeny, 1994).
Third, in some organizations, the introduction of new coordination mechanisms is strongly
associated with initiatives to respond to major changes in business imperatives. For example,
19
our respondents mentioned implementing mechanisms to develop fundamentally new IS
delivery capabilities or to enable the development of new business competencies.
Before discussing additional implications for research and practice, an assessment of the
study's limitations is useful for interpreting its contributions. First, as stated earlier, we
focussed our attention upon capturing the CIO's perspective. Although this ensured that we
captured the perspective of the chief architect of an organization's coordination mechanisms
(Earl, 1996; Sambamurthy and Zmud, 1996), our study did not directly tap into viewpoints
outside of corporate IS. Second, in order to capture data from a large number of CIOs, we
used a telephone interview data collection method and asked the participants to focus on the
discussion of three to five important IT coordination mechanisms. Therefore, while our study
has provided empirical evidence for a variety of mechanisms that our respondents considered
to be especially important for nurturing their desired IT coordination goals, we did not attempt
to collect data on the full range of mechanisms in their portfolio. Third, our work is
descriptive rather than evaluative: no attempt was made to systematically capture effectiveness
measures for either the specific mechanisms or IS organizational performance.
Implications for Practice
This study was supported by sponsors interested in identifying best practices for linking IS
stakeholders. Our model in Figure 2 supports the notion that the answer is not a universal
one: mechanisms for linking stakeholders should be selected and designed with an attention to
both overall organizational and IS contexts. However, the 21 types of specific mechanisms
identified in this study for the six a priori mechanism categories can serve as a catalog of
potential mechanisms. CIOs can use our schema of mechanisms and coordination goals, along
with the three inter-linking logic examples that we have described (mirror-image, continuous
improvement, and visionary), to re-examine their own company's portfolio of IT coordination
mechanisms and coordination goals as well as to make future mechanism decisions.
In addition, although specific mechanisms from all categories were considered significant in
organizations with different governance designs, some specific types of coordination
mechanisms within our six categories were associated with particular governance modes. For
example, account managers were the most common integrator role in centralized contexts;
divisional information officers most commonly played integrator roles in federal contexts.
Some mechanisms were also observed to be more strongly associated with a particular
coordination goal. For example, all integrator roles were strongly associated with strategic
alignment goals; all IT-based system examples were associated with learning goals; and the
majority of IT management councils were implemented in federal contexts to achieve
partnering goals.
Our study also yielded several insights about addressing specific design challenges associated
with different mechanism categories. Table 9 summarizes our findings on mechanism design
challenges in the form of questions to consider for each mechanism category. Along with the
other tables in this paper, this listing can be used by senior IS managers as a roadmap for
building linkages with top management, business management, and other IS stakeholders.
Our final implication for practitioners is based on not only this individual study's findings, but
also the authors' research on related IT organization design topics over the past decade: our
20
coordination mechanism schema can be useful for designing a new kind of value-adding IS
organization. For example, this schema could be used to analyze IT transformation initiatives
ranging from a centers of excellence design for a systems development unit (Clark, 1997) to
the design of an IS function heavily outsourced to a customized set of vendors (Cross, Earl
and Sampler, 1997).
Implications for Researchers
We began this paper with a brief discussion of organization interdependencies. Crowston
(1997) has argued that the utility of coordination theory lies in its ability to facilitate an
understanding of how an organization's task interdependencies could be managed through
alternative mechanisms. Three types of intra-organizational interdependencies have been
identified by Malone and Crowston (1994): resource allocation, producer/consumer, and taskto-subtask. The primary coordination goal that emerged in this study, strategic alignment, can
be argued to be a goal most associated with a producer/consumer type of interdependency.
However, the secondary coordination goals found in this study, partnering and learning,
appear to be less associated with achieving a particular task interdependency than with
establishing an overall environment conducive to cross-unit problem-solving and innovation.
Taken together, our goal findings suggest that the interdependencies associated with the IS
staff function involve complex cross-unit relationships and "sticky" management issues.
Further, in order to achieve IT-based innovation, effective relationships are required not only
across IS and business personnel, but also across corporate and dispersed IS personnel. Future
research that specifically applies prior theoretical work on task interdependencies to
mechanism usage at the senior management level, as well as at other IS managerial levels
(Brown and Ross, 1996), may prove to be a fruitful extension of prior coordination theory to
the study of IT coordination mechanisms.
Figure 2 and our specific findings in Tables 3-8 also suggest an enlarged research agenda.
Studies that ferret out factors associated with the effective use of each of the different
categories of coordination mechanisms are required. These investigations need to include
research designs that gather data from multiple respondents (top management, line
management, and IS management) to enhance our understanding about the effectiveness and
impact of alternative coordination mechanisms on IT innovation and business performance.
Further, studies to examine the effectiveness of alternative portfolios of coordination
mechanisms under different organizational contexts are required. We have offered our
preliminary insights on the inter-linking logic underlying a portfolio of coordination
mechanisms and have suggested some appropriate organizational contexts for these
approaches. However, systematic investigations are required to provide answers to questions
like the following: What mechanism portfolio (selection of specific mechanisms, their interlinking logic, and specific design characteristics) is associated with a given pattern of overall
organizational structure, business strategies, and IS governance arrangements?
Configurational theories at the organization level could provide a useful theoretical
perspective for examining these research issues (e.g., Doty, Glick, and Huber, 1993).
Conclusion
The primary objective of this study was to refine our a priori schema of six types of
21
coordination mechanism for linking IT stakeholders from the CIO's perspective. Our findings
on mechanism types, coordination goals, and their usage within organizations of different IS
governance types have yielded a roadmap for practitioners. We have also shared insights
gleaned from more than three dozen CIOs about challenges encountered when designing
specific mechanisms, as well as some approaches to designing a portfolio of coordination
mechanisms.
Although much additional research is needed to develop a theory of IT coordination
effectiveness, this descriptive study has also yielded empirical evidence and insights from toplevel managers in primarily Fortune 500 companies that greatly expands our knowledge about
an emerging research topic. The usage of coordination mechanisms for linking
intraorganizational stakeholders appears to be an IS capability well worth the attention of
practitioners faced with demands for IT innovation within complex, highly dynamic
organizations and IS researchers interested in research for practice.
22
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27
Appendix
Details of the Research Methodology
Our research began with the identification of a list of organizations that have been noted for their IT management and use in the trade
press (e.g., Computerworld, CIO) and peer reputation (based on our own personal contacts and informal conversations with the CIO
members of our sponsoring organization). A one-page prospectus was then mailed to senior IS executives at about seventy-five targeted
companies. Forty-four executives indicated their willingness to participate in the research via follow-up phonecall and telephone
interviews were scheduled. Each telephone interview typically lasted about an hour; all interviews took place during the first six months
of 1995.
While the authors divided the interview task, a common semi-structured interview guide was used. Each interview began with a
reaffirmation of the purpose of the study and our interest in mechanisms that link business and IS units, as well as any mechanisms that
link central and dispersed IS units. Open-ended questions were used to elicit the "three to five most important mechanisms" for
achieving a cooperative IT management climate, as well as the participating firm's "climate goals." To help ensure shared meaning,
participants were referred to the definitions and examples provided in the prospectus. These included examples from our a priori
scheme of six categories, as follows:
Coordination mechanisms are structures, processes, and roles that link people and activities across functional boundaries.
Examples include integrator roles such as liaisons or account managers, cross-functional groups such as steering committees or
task forces, informal relationships such as physical co-location, management processes such as standards setting or planning
systems, and human resource practices such as incentive systems that foster cross-functional networking. We are also interested in
how IT-based systems such as e-mail, bulletin boards, and document databases are being utilized as coordination mechanisms.
While respondents were given the above examples as aids in understanding the scope and nature of our inquiry, we did not ask them to
give examples of each of the above mechanisms at their organization. Instead, they were encouraged to describe coordination
mechanisms that, in their opinion, were most important at their organization for managing intra-organizational relationships.
The principal investigator who conducted the interview then mapped the responses obtained from each firm and shared these
transcriptions with the other researcher. The mechanisms were categorized as roles, groups, and processes, informal relationshipbuilding, human resources practices, and IT-based systems. Next, each researcher took a lead role for three of the six categories of
mechanisms to understand variations in the types of specific mechanisms, organizational context issues, and implementation challenges.
These analyses were then passed iteratively between the researchers until agreement was reached. For analysis of coordination goals,
the specific qualitative responses were culled from all interview transcriptions, and then sorted into common groupings -- first
separately, then jointly by the researchers -- until agreement was reached on the ten goals shown in Table 6. Subsequently, these ten
goals were grouped together into three higher-order coordination goals after discussions among the researchers and a consultation of the
IT management literature. Finally, the two researchers worked together to examine the transcripts and understand how specific
coordination mechanisms were being used to accomplish the coordination goals.
Our initial findings were presented to the CIO members of our sponsoring organization. Feedback from these executives led to some
finer-grained mechanism analyses. A guidebook of IT coordination mechanisms was then produced and shared with our sponsors as
well as our participants.
The results reported in this paper are based on a re-analysis of the data collected from 38 of the original 44 participants. Six
organizations were excluded due to unique industry or IS unit characteristics that were judged to constrain generalizability; one firm
with heavily outsourced IS functions, four firms in he consulting industry, and one firm that had responded in terms of a single business
unit rather than from the enterprise level were not included in our final analysis.
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TABLE 6
Emergent Schema of IT Coordination Goals
Number of
Coordination Goals
Mentions
Specific Examples
Overall CoordinationGoal: Strategic Alignment (n=34 *)
Fusion of IT and business
strategies, goals, and resources
23
Market value through IT
16
*
*
*
*
*
Business ownership of IT and
endorsement of IT policies
9
*
*
Walk in-step with the business
Alignment with the business
Ensure meshing of IT and business
Enhance speed to market through IT
Create shareholder value through IT
Achieving organizational agility
through IT
Joint process/project ownership
Business endorsement of IT policies
Greater championship of IT
initiatives
Overall CoordinationGoal: Partnering (n=26)
·
Talk about dilemmas, different
problems
Two-way communication
Advice about key events, boiling
points
Ongoing two-way communication
among business and IT
management
13
IS trust, credibility, and
Responsiveness
12
*
*
Mutual trust and partnership
Enhanced credibility of IS
Building a customer service culture
in IT
Value standards for IT infrastructure
9
*
Valuing standardization of IT assets
and services
Gain standardization and it's
associated benefits
Understanding of, and satisfaction
with, the value of IT investments
4
*
Prove that IT is creating corporate
value
Better understanding of the return
on IT investments/IT value
Overall CoordinationGoal: Learning (n=26)
Leveraging of IT expertise
15
*
*
*
Collaborative work environment
between IT and business
9
*
*
Become a learning organization
Nurture an IT-literate client base
Leverage global IT knowledge &
experience
Willingness of IS and business to
share ideas and information
Collaborative attitudes
*
Building a global IS community
*
Collaborative attitudes
* Numbers in parentheses reflect the total number of organizations that mentioned one or more specific goals of this category.
Collaborative work environment
among IT staff
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