Organizational options for resolving the tension between IT departments and business units in the delivery of IT services

Abstract

The organization of companies’ information technology (IT) functions has been studied and described in three ways: on a centralization‐decentralization continuum, on the basis of technological architecture, and, for multinational companies, as reflective of their strategic focus. This research proposes a classification of organizational structures based on the tension between business units and IT departments in the delivery of IT services. Using a cluster analysis on a sample of 40 companies having corporate offices in the USA or The Netherlands, it identifies four basic structures or patterns that describe the similarities and differences in the way IT services are handled. The paper then describes the implications of these structures for companies that are considering the redesign or restructure of their information technology function.