Alignment's nomological network: Theory and evaluation

• Intellectual and operational alignment are unique, but the former influences the latter.
• The alignment–financial performance relationship is mediated by customer benefit and the operational alignment–customer benefit relationship is mediated by productivity.
• Social alignment influences intellectual alignment but may not influence operational alignment.

While the importance of IT-business alignment is rarely questioned, a strong theoretical foundation of alignment's nomological network has not been developed or tested. This has generated a debate on why tighter alignment may or may not lead to higher levels of firm performance. To further understand the alignment-performance relationship, we used meta-analytic structural equation modeling techniques to probe the inter-relationships found in 78 independent data sets drawn from the literature. We find intellectual alignment influences operational alignment, identify a more nuanced understanding of the performance constructs, and offer insight into how governance structure and social alignment influence intellectual and operational alignment.