Organizational alignment and performance: past, present and future

Abstract

Purpose The purpose of this paper is to identify and define the types of organizational alignment – vertical and horizontal; to examine the evidence for the alignment‐performance relationship, and propose research questions and practical implications to advance the theory and practice of managing alignment. Design/methodology/approach The study is a conceptual examination based on a thorough review of both theoretical and empirical research. Findings The paper finds that vertical alignment has received considerably more attention in the literature. Studies of horizontal alignment within organizations are less common. When horizontal alignment is studied, the focus tends to be dyadic – between two functional areas. The limitations posed by the dyadic approach suggest gaps in the research and opportunities for future research. As firms grow and diversify, becoming multi‐business organizations, the importance of horizontal alignment will be elevated. Research limitations/implications Research on vertical alignment should focus on developing larger sets of moderating variables, such as the morale of the workforce, or the life cycle of the firm or industry. Research on horizontal alignment should explore multi‐point horizontal alignment. Practical implications Managers in organizations with multiple strategic business units could use the application questions in the study to assess the state of alignment in their respective units and the organization as a whole. Originality/value The paper documents existing literature on the concept of organizational alignment and identifies new opportunities to continue to build and expand the research stream. It also provides a list of application questions that may be used to assess organizational alignment in organizations.