The Alignment of Business Strategy with Agile Software Development within SMEs

Abstract

The alignment of business strategy and IT strategy has been recognised as a strategic weapon within organisations. Small and medium sized enterprises (SMEs) also recognise a need for new Information Technology and Information Systems (IT/IS) functions to support business strategies, and provide new services to the market. Agile methodologies support the timely and economical development of Web and Internet-based software, the technologies being exploited by organisations seeking to enhance their business performance. Based on multiple-case research, this paper explores the impact of agile software development on the alignment of business strategy with IT strategy in SMEs. Several models of strategic alignment developed for large enterprises were used to examine the SME environment. The findings suggest that agile methods are applied to provide added flexibility for organisations to create or react to new opportunities, to increase responsiveness to customer requirements not possible with traditional software development, and to gain competitive advantage. Personal interest was found to be a factor in adopting agile methodologies, in addition to IT maturity and technical IT sophistication. However, the use of agile methods in response to internal and external uncertainty may change the role of ICT in the firms, and hence impact on the alignment of business and IT/IS strategy.