We employ an interpretive hermeneutic approach to develop a normative model for formulating information technology (IT) strategy leveraging the theories of real options and the Resource-Based View. Unlike abstract and contemplative models for formulating strategy, our model for IT strategy is concrete, action-oriented, and hence can be readily operationalized by practitioners. Furthermore, in stark contrast to the empirical positivist strain of research that is the staple approach in the information systems (IS) discipline, we demonstrate that useful models for guiding key managerial decisions can be built using an interpretive hermeneutic approach. We show how to apply this qualitative methodology in building a decision-making model for enterprise integration, which is a priority area of investment for IT organizations.
