Alignment

2.2 Employee’s Strategic Alignment

2.2.1 Alignment

Alignment was first introduced in 1961 by Likert as a "linking pin" that joins internal and external elements, for instance, people, products, and processes, to excel the organisation's performance (Alagaraja & Shuck, 2015). Alignment is both a process and a result; it is expected to result in strategy control, and as a process, it refers to accomplishing a group of activities to achieve strategic alignment (Prieto & de-Carvalho, 2018).

An alignment refers to the alignment between the goals and objectives of the organization and the goals and objectives of its employees, teams, and departments; alignment can also refer to fit, integration, fusion, and linkages (Alagaraja & Shuck, 2015). It creates harmony in the organisation, both internally and externally, in the form of vision, mission, goals and purposes and can be considered as a dividing line between winners and losers and can play a significant role in survival and success (Fernandes & Rinaldo, (2018); Hung et al., (2009). It was defined

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as a valuable and rare resource that has a remarkable outcome on organisation performance (Alagaraja et al., 2015).

The literature provides many perspectives, types and classifications for organisation alignment;

accordingly, alignment has different definitions depending on the type of alignment. The following paragraphs present examples of those various types in order to give the readers full information regarding alignment and how the research variable employee alignment fit within the literature.

The literature explores organisation alignment from three perspectives: process, relational and strategic alignment. Those three perspectives present other arrangements for conveying organisational priorities into goals and objectives (Alagaraja & Shuck, 2015).

Process alignment is considered a continuous and dynamic process where all the functional departments have a mutual agreement, understand the organisational processes, and work smoothly toward continuous improvement (Alagaraja & Shuck, 2015). Organisational process alignment was defined by Weiser (2000), as cited in Hung et al. (2009, p. 325), as "the arrangement of various parts of an organisation so that they work together harmoniously to pursue common organisational goals, to enhance performance, and to sustain competitive advantage".

Process alignment was found to have a significant positive impact on organisations' performance. Moreover, proper management process alignment can develop employees' trust by creating a mutual vision and mission between employees and their managers and organisations and can lead to a strong sense of belonging (Fernandes & Rinaldo, 2018).

Relational alignment matches various internal and external elements; this perspective emphasises the organisation's ability to adapt and develop (Alagaraja & Shuck, 2015). It is

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defined as "the informal organisational structures, norms and agreed processes, divisions of work, formal and informal teamwork, and working relationships" (Ghosh & Scott, 2009, p. 19).

(Frino, et al., 2019) Described strategic alignment as the degree to which employees comprehend their organisation's strategy and realise the required action to transform the versioned strategic aims into a reality. It can also be defined as the fit between the priorities, the functional unit's activities, and the business unit (Ghosh & Scott, 2009).

(Alagaraja & Shuck, 2015) also identified a few emerging alignment perspectives based on more dynamic views, such as "multiple sources of alignment", which include customer alignment, or cross-functional alignment, in addition to alignment models that consist of alignment between people, teams, training, rewards and services.

Another relevant term in the literature is internal alignment, which refers to the fit between an organisation's business strategy and internal variables (Prieto & de-Carvalho, 2018). Goal alignment is another term defined as a mutual idea about the favoured results linked to higher- order objectives and goals. It occurs when members of the same team or department agree with the organisation's goals and acknowledge their clarity and value (Mascareño, et al., 2020).

Furthermore, the organisational alignment literature recognises different forms of alignment (Ghobadian, et al., 2007), including vertical and horizontal alignment. For instance, vertical alignment integrates the organisation's business strategy with specific functional departments such as manufacturing, marketing, and information system (Prieto & de-Carvalho, 2018). It also creates a high degree of internal coherence (Alagaraja & Shuck, 2015). The vertical alignment depends on conceptualising alignment on three levels: corporate, business, and functional. In addition to prioritising and organising activities across these three levels, vertical alignment relies on coordination with the decision-making level (Ghobadian, et al., 2007).

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While horizontal alignment refers to the alignment between various departments, this alignment guarantees the cohesiveness of strategic decisions in different functional units (Prieto & de- Carvalho, 2018). Horizontal alignment investigates the incorporation of social and cultural processes, which, in theory, affects the firm's performance (Alagaraja & Shuck, 2015). It involves coordinating activities across the organisation and is mainly related to the lower level;

horizontal alignment includes both cross-functional and intra-functional. Moreover, the most successful alignment resulted from coordinating horizontal and vertical activities (Ghobadian, et al., 2007).

Other types of alignment include structural, cultural, and environmental; (Venkatraman, et al., 1993) presented this classification in 1993. Structural alignment highlights the orderly design of the structure to guarantee the accomplishment of strategic goals, while cultural alignment stresses the alignment of organised tactical actions with cultural norms. Finally, environmental alignment emphasises the strategic fit of the organisation's vision, goals, and tactics with the external environment (Alagaraja & Shuck, 2015).

Further examples of alignments include directing improvement efforts across the organisation, agreeing on organisation policies and practices, integrating employees' roles and responsibilities with their departmental efforts, and aligning job specifications and criteria with employees' skills and knowledge (Alagaraja & Shuck, 2015). Table (1) provides a summary of the alignment types and definitions.

The principle of alignment is that when there is agreement, collaboration, teamwork or harmony among an organization’s strategy, structure, processes, cultural norms, and employees, there will be a greater possibility that the organization will accomplish its goals and objectives in a successful matter. (Alagaraja & Shuck, (2015); Ayers, (2015); Boswell, (2006)).

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From the listed definitions, one can see that there are two main categories of alignment, despite the several types, organizational alignment and employee (people) alignment.

Organizational alignment concerns the alignment of organization processes, strategies, functional departments, organisation's vision, goals, and tactics with the external environment and cultural norms.

While employee alignment cares about how employees comprehend their organisation's strategy and realise the required action to transform the versioned strategic aims into a reality, people alignment investigates the degree to which employees understand and support their organization’s strategy and mission, and in especially, the alignment of top management with their organization's strategy and values. The main aim is to enhance employee performance through the alignment of their internal processes and cooperation among employees. This perspective of alignment is often found in human resource literature, which highlights the importance of aligning top management attitudes along with organization values and norms, as their explicit role is important for achieving employee alignment. (Volk &

Zerfass, 2018)

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T

ABLE

1: A

LIGNMENT TYPES AND DEFINITIONS

Type of alignment Definition Source

Process alignment "The arrangement of various parts of an organisation so that they work together harmoniously to pursue common organisational goals, to enhance performance, and to sustain competitive advantage."

Weiser (2000), as cited in (Hung, et al., 2009, p. 325)

Relational alignment "The informal organisational structures, norms and agreed processes,

divisions of work, formal and informal teamwork, and working relationships"

(Ghosh & Scott, 2009, p. 19)

Strategic alignment the degree to which employees comprehend their organisation's strategy and realise the required action to transform the versioned strategic aims into a reality

(Frino, et al., 2019)

Internal alignment the fit between the organisation's business strategy and internal variable (Prieto & de-Carvalho, 2018) Goals alignment the mutual idea about the favoured results linked to the higher-order

objectives and goals

(Mascareño, et al., 2020)

Vertical alignment "The configuration of strategies, objectives, action plans, and decisions throughout the various levels of the organisation"

(Ghobadian, et al., 2007)

Horizontal alignment the alignment between various departments (Prieto & de-Carvalho, 2018) Structural alignment the orderly design of the structure guarantees the accomplishment of strategic

goals

(Alagaraja & Shuck, 2015)

Cultural alignment the alignment of organised tactical actions with cultural norms (Alagaraja & Shuck, 2015) Environmental

alignment

the strategic fit of the organisation's vision, goals, and tactics with the external environment

(Alagaraja & Shuck, 2015)

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Following the previous discussion, this thesis will adopt strategic alignment, defined as the degree to which employees comprehend their organisation's strategy and realise the required action to transform the versioned strategic aims into a reality (Frino, et al., 2019). This research's primary aim is to explore how employee strategic alignment will enhance employee engagement and organisational performance. (Kaplan & Norton, 2004) defined strategic alignment as communications and inducements that would help employees comprehend the strategy and support it. Strategic alignment includes awareness of the organisation's strategic priorities, perceiving the importance of those priorities, and understanding how daily work is linked directly contribute to the organisation's capacity to achieve the organisation's priorities (Biggs, et al., 2014 ).

Communication of strategy among various employee levels enhances the employees' ability to comprehend the organisation's strategic goals. When employees are directly linked to their organisation's strategic goals and objectives, they will make decisions in their daily work based on what contributes to achieving these goals directly. Nevertheless, without clear direction, employees might start acting based on their needs (Herd, et al., 2018).

Though strategy is often developed within the top-management levels, the messages that go down through the different management and employee levels must be distortion-free. The message should be clear and simplified for employees to reach them effectively (Boswell, 2006).