Week 4 - Strategic Alliance Model

Source / Reference:
1)  "Strategic Alignment: Leverage Information Technology for transforming organization" by J C Henderson and N Venkartraman 1993
http://search.proquest.com/docview/26252741/134A6C8B53F19A4F606/1?accountid=16210

Subject:
In Lect 4 - Which alignment strategy in SAM model is the best? and why?

Response:

Service level is the best in SAM model. It ensures the effective use of IT resources. It focuses on building the excellent IT system to enhance the service level of the organization and use IT to improve products and services delivered. The Top Management allocates and utilizes resources in IT while IT Management completes tasks to make successful internal service business. The performance of service level is assessed by satisfaction of customers.

A graph of service level:

Service level alignment approach use technology to improve business and the anchor is IT. Data-mining of Amazon.com is one of the examples. Each time after customers bought products from Amazon, the system records the category of products which are purchased. Then information of relevant product is sent by email to customers to encourage customers purchasing more items. The data-mining of Amazon is one of the loyalty program and it helps amazon keeping high retention rate of customer, it means customer are generally satisfied by Amazon. Amazon has effectively used IT resources to keep customers.

Another example of service level alignment is PARKnSHOP which uses RFID to increase the “supermarket” market share. PARKnSHOP introduced “Money Back” program that whenever customer purchases products, “Points” can be earned and saved in the “Money Back RFID card”. Customer can use the RFID card to “Money Back Kiosk” to find redemption choices or do points conversion. Moreover, “Money Back” consists of one main card and three mini cards, therefore the main card holder can provide mini cards to family members, thus this increase the customer base of PARKnSHOP. PARKnSHOP uses IT to develop the business successfully.

To conclude, service level is an excellent approach to fully utilize the IT resources in order to provide better services to customers. The example mentioned above interpreted the importance of using IT to serve customers.