Information Technologies and Business Value: An Analytic and Empirical Investigation.

Author List: Barua, Anitesh; Kriebel, Charles H.; Mukhopadhyay, Tridas;
Information Systems Research, 1995, Volume 6, Issue 1, Page 3.
An important management question today is whether the anticipated economic benefits of information Technology (IT) are being realized. In this paper, we consider this problem to be measurement related, and propose and test a new process-oriented methodology for ex post measurement to audit IT impacts on a strategic business unit (SBU) or profit center's performance. The IT impacts on a given SBU are measured relative to a group of SBUs in the industry. The methodology involves a two-stage analysis of intermediate and higher level output variables that also accounts for industry and economy wide exogenous variables for tracing and measuring IT contributions. The data for testing the proposed model were obtained from SBUs in the manufacturing sector. Our results show significant positive impacts of IT at the intermediate level. The theoretical contribution of the study is a methodology that attempts to circumvent some of the measurement problems in this domain. It also provides a practical management tool to address the question of why (or why not) certain IT impacts occur. Additionally, through its process orientation, the suggested approach highlights key variables that may require managerial attention and subsequent action.
Keywords: Business value; Contribution measurement; Information technology investments; Manufacturing sector; Process orients models; Strategic business units
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List of Topics

#148 0.256 productivity information technology data production investment output investments impact returns using labor value research results evidence spillovers industries analysis gains
#44 0.131 approach analysis application approaches new used paper methodology simulation traditional techniques systems process based using proposed method present provides various
#67 0.097 production manufacturing marketing information performance systems level impact plant model monitor does strategies 500 unit present fortune integrated sales plants
#263 0.090 instrument measurement factor analysis measuring measures dimensions validity based instruments construct measure conceptualization sample reliability development develop responses assess use
#229 0.062 alignment strategic business strategy performance technology value organizational orientation relationship information misalignment matched goals perspective fit firms executives argue need
#286 0.061 success model failure information impact variables failures delone suggested dimensions mclean reasons variable finally categories years recommendations benefits studies identify
#143 0.060 value business benefits technology based economic creation related intangible cocreation assessing financial improved key economics assess question created create understanding
#238 0.053 shared contribution groups understanding contributions group contribute work make members experience phenomenon largely central key common especially major conceptualizing study