This research examines how business-IT alignment at the operational level in hospitals is constituted and how operational business-IT alignment facilitates value creation. A conceptual model of operational alignment is developed and empirically tested in German hospitals. Conceptualized as cross-functional interconnectedness enabling purposeful collaborative processes between business and IT, it is shown that operational alignment is particularly constituted by strong relations between business and IT, mutual trust and cognitive linkages. Results show a strong impact of cross-functional cooperation on IT business value. Cross-functional cooperation is found to influence value both directly and mediated through the degree to which information systems fit with requirements, working processes, and existing practices of medical de-partments. Overall, it is demonstrated that social capital between business and IT unfolding in effective collaboration at the operational level facilitate the creation of IT business value. The results may motivate practitioners to take measures in order to strengthen social capital and, hence, blur boundaries between business and IT, particularly in hospitals.