A model for investment justification in information technology projects

Department of Management, University of Massachusetts, 285 Old Westport Road, North Dartmouth, MA 02747-2300, USA; School of Architecture and Building, Deakin University, Geelong, Victoria 3217, Australia; 34 Claremont Avenue, Camberley, Surrey GU15 2DR, UK; Department of Marketing and Information Systems, University of Massachusetts, North Dartmouth, MA 02747-2300, USA
International Journal of Information Management (Impact Factor: 2.04). 10/2001; DOI: 10.1016/S0268-4012(01)00024-X

ABSTRACT To remain competitive and ever increasingly sophisticated in the marketplace, businesses must invest in Information Technology (IT) if they are to survive in the long-term. Advances in IT have enabled new competitors to enter existing markets more readily, which has stimulated and strengthened the paradigm of global competitiveness. At the same time, increasing economic pressures are forcing businesses to re-evaluate their IT operations. In response to the changing business environment and to remain competitive and improve organisational performance some businesses have strategically made considerable investments in IT, yet their benefits are difficult to quantify. With this in mind, this paper aims to study the justification for investment in IT projects, by examining tangible and intangible benefits such as competitive advantage and securing future business by facilitating appropriate management change. A model to determine whether or not to invest in IT for any given company is presented. The developed model is then applied to a case study to analyse the implications of implementing IT and its impact on organisations.

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