Management of information technology evaluation – the development of a managerial thesis (original) (raw)

Reviewing Interpretive Approaches for Evaluation of Information Systems Investments

rapport nr.: Report/IT University of Göteborg 2007: …, 2009

As information systems/technologies (IS/IT) become embedded in organizations, these systems cannot be isolated from important issues such as human intellect, culture, philosophy, politics and socio-organizational changes. Limited business resources on one hand and the various concerns and demands from different stakeholders on the other hand have led to an evergrowing need to evaluate IS/IT investments. In other words, due to the heavy rise of IS/IT costs IS/IT investments must be justified. Evaluation of IS/IT investments is generally taken to mean the identification and the measurement of capital expenditures spent on and the initial anticipated revenues gained from the deployments of these systems (IS/IT).

Justification for IT Investments: Evaluation Methods, Frameworks, and Models

The productivity and profitability paradox in IT investments literature have made the work of IT managers very difficult in justifying for IT investments. Another difficult issue to grapple with by IT managers is how to measure or evaluate intangible benefits. These problems have led to the proposition of many IT evaluation frameworks/models and methods by researchers. This works aims to review a number of these frameworks/models and methods to see the way forward in this business of IT investments justification. About 40 categories/sets of research outputs or articles out of more than 50 articles reviewed were used for this work. The results showed that tangible benefits are not enough to justify for IT investments as they mostly point to corporate benefits which are short term, and that the justification of intangible benefits which are more strategic, must be included to make the justification process complete no matter how difficult it is. Again, no evaluation framework/model with its associated methods of evaluation is a panacea to the evaluation problem; evaluation depends on so many factors, and so is contextual. Also, the firm must factor into the evaluation process its corporate and strategic objectives. Lastly, in most cases, IT evaluation is seen as a must do, and therefore does not require that justification is done.

A strategy-based method of assessing information technology investments

Purpose -The purpose of the paper is to present a theoretical framework and the preliminary results of a research on how to assess information technology (IT) investments so as to deliver maximum business value. Design/methodology/approach -To see whether IT projects fit strategy, the Strategy Map provides a framework for defining the portfolio value and data envelopment analysis (DEA) is used to measure the efficiency of project portfolios. Subsequently, an application that illustrates the value of the framework is described. Findings -The authors offer a framework that integrates the Strategy Map and IT project portfolio management (PPM) and suggest that this conceptual framework will allow an organization to enhance the value of IT investments. Research limitations/implications -This paper is supported by a case study using secondary data only. Practical implications -The suggested method could help CEOs to understand the interactions between projects and strategy and thus supports decision making to prioritize and track IT investments. The paper illustrates how the proposed framework is applied. It also provides the basis for further research. Originality/value -By explicitly linking IT investment with organizational goals, this approach produces results that differ from those of previous studies and provides a strategy-based approach to PPM.

Information Systems Investment and Evaluation: Mini-Track Introduction

2003

Introduction The ubiquitous nature of Information Systems (IS) and its ever-changing underlying technology is demanding organisations to keep abreast of technological innovations. Yet, companies are becoming more aware that a competitive advantage cannot be achieved, or even maintained simply by utilizing the latest technology. Indeed, it is becoming more apparent that a strategic competitive advantage will not be achieved through embracing each new technology as it arrives but in the way companies exploit their technology assets. The management approach to evaluation is critical in this endeavour and needs to embrace the spectrum of human, organizational and technology based assets and infrastructure. The adoption of new technology remains a prime driver for organizations seeking to improve their short, medium and long-term performance. Yet, the adoption of all-embracing ISs that can be 'rolled-out' throughout the organization and adequately integrate functionally isolated ...

Investment i IT Managing Investment in Information Technology: Mini Case Examples and Implications

2016

While businesses are investing enormous re-sources in information technology (IT), there little evidence linking IT investment to organiza-tional performance. The purpose of this article, therefore, is to increase understanding of the basis for IT investment in firms. Six mini case studies of companies in five different industries address questions of how they define IT for the purpose of determining the level of investment, how they track IT investments, and what other factors influence IT investment decisions. Each organization uses a different definition of IT, but there appears to be an overall trend to broaden the definition. Although companies track IT investment with varying degrees of rigor, they appear to be generally moving toward centralized tracking of all IT investment. Political considerations are important and sig-nificantly impact investment decisions. In all cases, the effectiveness with which IT invest-ment is converted to useful output is acknowl-edged to be affec...

Creating, Capturing and Measuring Value From IT Investments: Could We Do Better?

Communications of the Association for Information Systems, 2010

Spending on IT continues to show long-term growth throughout the economy, reflecting an apparent belief in the economic benefits of IT. However, we also see organizations struggle in practice to demonstrate such benefits. Conventional thinking suggests that individual organizations can improve their performance in this area through better financial analysis of opportunities. But does this characterization of the solution reflect the real problem? Is there more value that can be achieved through IT at a macro level or are we simply seeing market competition with winners and losers? And will better understanding of the detailed financial consequences of IT systems enable businesses to improve decisions and achieve greater returns? This 2009 ICIS panel session reflected on the literature on IT value over the last thirty years, the future direction of research and the relationship between research and the needs of business in this area.

Assessing the Business Value of It Investments : Combining the Market and Organizational Perspective

International Conference on Information Systems, 2009

This research aims to advance understanding of how investments in Information Technologies (IT) impact on firm performance by developing and testing an advanced model of IT business value. Research so far has provided incomplete and controversial evidence as to the difference that IT investments made on firms' performance. This research adopts a novel multi-method research approach that combines a study of stock market returns on over 10,000 IT investment announcements between 1990 and 2009 in Australia and in-depth case studies of value creation after IT deployment in selected firms. The research aims to provide a more refined model of IT business value and an extensive analysis of IT investments impact on firms' market value in Australia. The advanced model of the business value of IT investments will fill the gap in the literature and contribute to better understanding of the relationships between IT investments and firm performance. The model is expected to improve understanding of numerous factors relevant for assessing and predicting the business value of IT investments and thereby assist business and IT managers in making better informed IT investment decisions.

Assessing IT-investments: costs, benefits, risks

2000

Many methods aimed at cost-benefit analysis for IT-projects can be found in literature. These all have one thing in common: actual usage is limited. In our view this is due to two factors: the criteria to take into account in the analysis are fixed and the process to support the analysis is lacking or at least flawed. In this paper an approach towards costbenefit analysis will be described that explicitly takes account of these two factors. First, a framework to support the identification of locally relevant criteria will be described. Secondly, a process to support the analysis that takes into account human factors is presented. Some results from practice will be presented to illustrate the approach.

INFORmATION TECHNOLOgY PERFORmANCE AND PROCESS : FOUR CASE STUDIES

2007

The payoffs from investment in Information and Technology (IT) and the organisational, managerial and technological requirements necessary to bring about successful performance have proved difficult to find since the advent of the IT era. In this chapter, we investigate the levels of IT investment undertaken, and the subsequent performance benefits found in a number of Irish organisations. The chapter also focuses on the processes that contribute to successful performance and with the difficulties of attempting to measure results. Our results indicate that organisations that have a clear strategic focus that embraces IT investment achieve greater benefits. We also find that the management component is the most critical issue in terms of assuring successful performance outcomes. Finally, the chapter presents a model for optimising the benefits from IT investment. INFORMATION .TECHNOLOGY .PERFORMANCE .AND .PROCESS: .FOUR .CASE .STUDIES