The Roots of Misalignment: Insights on Strategy Implementation from a System Dynamics Perspective

Abstract

This essay advances the study of strategic alignment by explaining how and why misalignment occurs. We begin by summarizing why IT and business strategies evolve in unintended ways, a phenomenon known as strategic drift. Using the causal loop diagramming approach of system dynamics, we observe that several sources of drift, potentially resulting in misalignment, are paradoxically built into the process of strategy formation and enactment itself. These linked subprocesses involve multiple actors at multiple levels of an organization and operate to promote (or hinder) strategic alignment. This paper contributes to the literature by enumerating and modeling both the top-down processes that can promote (or hinder) strategic alignment, as well as the less-studied bottom-up processes, ultimately yielding a more nuanced, dynamic, process-oriented understanding of strategic alignment. Directions for future research include the study of alignment at the process and group levels, as well as an exploration of settings where certain types of strategic drift and misalignment yield beneficial outcomes.