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Business and IT Strategic Alignment and Strategic Use of IT in Small Firms
Abstract
In businesses large and small, information technology has become an integral part of operation. To compete with large businesses, IT savvy small firms are at an advantage (Beheshti, 2004; Lin, Vassar, & Clark, 1993; Schaefer, 1995). Studies have shown positive impact of IT on small businesses, from helping small firms enhance their operational efficiency (Beheshti, 2004; Penhune, 1998) to driving business growth (Eckhouse, 1998), to integrating marketing operations with marketing strategies (Roge & Chakrabarty, 2002). In addition to the operational and strategic importance of IT, given small businesses’ limited financial resources (Small Business Administration, 2000), small firms must invest wisely by making sure that their IT resource allocation properly reflects their business priorities. In other words, they must ensure their IT strategies are inline with their business strategies. This study examines the impact of IT and business strategic alignment in small firms, their business strategic orientations, and owner characteristics on the strategic use of IT.
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