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“Generating Premium Returns on Your IT Investment.”

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Abstract

Although IT portfolio management has been a best practice for some time, many companies are still getting returns from IT investments that are below their potential. New studies show that a measureable premium can be gained by implementing a set of interlocking business practices and processes, collectively called IT savvy.

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... uma das maneiras de realizar essa difícil tarefa é a utilização da técnica de Gestão de Portfólio de ti (GPti). ela tem sido apontada como sendo uma das alternativas para identificar, analisar e gerenciar os investimentos em ti pelas organizações (Jeffery e leliveld, 2004; Maizlish e Handler, 2005; Weill e Aral, 2006). esses autores consideram os recursos de ti como ativos, os quais devem ser gerenciados como um conjunto de aplicações financeiras, cada uma com suas características próprias de risco e retorno. ...
... Além disso, a GPti é considerada uma das categorias de avaliação para diagnosticar a inovação do uso da ti elaborado pela revista InformationWeek do Brasil (2008), o que ilustra a importância da técnica e a sua utilização nas empresas atualmente. Mas existem poucos trabalhos que avaliam como as organizações utilizam a abordagem de gerenciamento do portfólio de ti para auxiliar os gestores a escolher corretamente os investimentos em ti de modo a alcançar os objetivos estratégicos da organização (Weill e Aral, 2006). nesse sentido, a questão de pesquisa que orienta este trabalho é: como empresas de manufatura gerenciam seus investimentos em ti, e como a GPti pode auxiliar nessa tarefa? ...
... e, além disso, os investimentos em ti devem estar de acordo com os objetivos organizacionais que a empresa deseja alcançar. os investimentos em ti podem ser classificados em quatro dimensões distintas, de acordo com o objetivo que se deseja alcançar (Weill e Broadbent, 1998;Weill e Aral, 2006). As quatro grandes classificações de investimentos em ti são: transacional, informacional, estratégico e infraestrutura. ...
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The information technology Portfolio Management (ITPM) is seen as one way of identifying, analyzing, justifying and managing investments in information technology (IT). Accordingly, the main objective is to analyze it management of manufactures and identify how itPM, in four dimensions (strategy, informational, transactional and infrastructure), could help this issue. For this purpose, three case studies were developed. The it manager from each firm was interviewed with the aid of semistructured instrument. The preliminary results indicate that infrastructure receives the largest part of the investments and that it manager have difficulty defining the percentage of investments in it in the proposed dimensions. Despite this difficulty the interviewees recommended the use of the ITPM technique.
... It is also interesting to observe the behavior of IT investments shown in the search results by Weill and Aral (2006) among the 140 largest organizations in the world versus the results of this search. For Weill and Aral (2006), areas of increased investment in IT are in the following order: infrastructure, transactional, informational and strategic. ...
... It is also interesting to observe the behavior of IT investments shown in the search results by Weill and Aral (2006) among the 140 largest organizations in the world versus the results of this search. For Weill and Aral (2006), areas of increased investment in IT are in the following order: infrastructure, transactional, informational and strategic. In this research, although not all percentages match the percentage of Weill and Aral (2006), the results confirm the same order of priorities of investments (Chart 7). ...
... For Weill and Aral (2006), areas of increased investment in IT are in the following order: infrastructure, transactional, informational and strategic. In this research, although not all percentages match the percentage of Weill and Aral (2006), the results confirm the same order of priorities of investments (Chart 7). ...
Article
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A common problem in IT management involves the lack of business vision on the part of IT executives who align IT to the strategic assumptions of the company, but forget the tactical functions of the former, managed as a business. This is known as the Lutchen’s gap. Because of its importance in the context of IT management, this paper is a complementary approach to the preceding one from Rodrigues et al. (2009) and aims at identifying the Lutchen´s gap presence in the management of IT among the 100 top companies located in Brazil. To do this, we proceeded to a description of the profile of IT management in these companies, controlled by the executive board. We used a questionnaire filled out by IT executives, containing 77 questions covering the four functions of IT in a company. The main results indicate that: (a) In the IT’s Alignment function, the design of IT reveals dichotomies between business and IT objectives (b) In the IT’s Management function, the IT’s budget is oriented toward ensuring "delivering" abilities to IT services and differing in the methods of cost control, ranging from apportion by volume, overheads and by ABC cost, (c) in the IT’s Deliver function, evidence suggests that IT is managed as a business enabler; and (d) in the IT’s Quality and Safety Assurance, IT executives monitor quality and safety events, but are limited to IT’s basic operations. In conclusion, in the companies surveyed, IT is seen much more as an" on-demand solution provider", rather than as an instrument of innovation and competitiveness enabler for organizations.
... Como muitas empresas conscientes do papel e importância da TI para seus negócios, a rede de conveniência Seven Eleven Japonesa fez efetivos investimentos em TI e administra seu portfólio de TI para dar contínuo suporte à estratégia de seu negócio (WEILL; ARAL, 2006). Ao atender às práticas e preferências locais, a empresa pode suceder na introdução de novas linhas de produtos, em suas unidades. ...
... Sob o ponto de vista científico, pode-se questionar a simplificação dos resultados de desempenho pela lógica dos investimentos. Pesquisas do Centro de Estudos em TI do MIT mostram que a infra-estrutura de TI e aplicativos para processos transacionais consomem 72% de todo o investimento feito pelas empresas em TI (WEILL et al., 2002;ARAL, 2006), enquanto as áreas informacional e estratégica consomem os restantes 28%. Por outro lado, a pesquisa do Instituto McKinsey, coletou respostas de 9.345 executivos no mundo todo e indica que 53% deles reconhecem a inovação como a mais importante capacidade para crescer (MARWAHA et al., 2005). ...
... Essa mesma pesquisa foi repetida em 2006, com os mesmos elementos e parâmetros (WEILL; ARAL, 2006). Os resultados indicaram uma leve mudança de orientação nos investimentos. ...
Article
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The objective of this paper is to identify the design of IT management atn the top 100 Brazilian companies. The research method was a quantitative approach, using the descriptive-statistical method to describe the data collected through a questionnaire with 77 questions, based on the rationale of the IT management, proposed by Lutchen (2003). The main results indicate that: a) IT aligns with the basic processes of business, although not fully synchronized; b) IT management adheres to conformity systems (ITIL, COBIT), but does not show optimization of business processes; c) IT delivers the basic demands, but does not impose or use the best automated practices; and d) IT quality is based on documented processes, but lacks indicators to control and orient business improvement. One may infer that IT management, at the top 100 Brazilian companies is essentially based on standard IT conformity systems, under the rationale of solution providers, and not as a business innovator or rule breaker. Thus, in spite of aligning and responding to business basic demand, IT management still does not show clear signs of alignment with the evolving nature of business models, needed to sustain business performance.
... Further to that, transactional IT investment helps in the applications development efforts devoted to the daily operating activities of the business and also supports the emphasis on the effects of IT investment on cost reductions (Cline and Guynes, 2001). Previous findings (Cline and Guynes, 2001;Weill and Aral, 2006a) showed that tilting the IT investment more towards the transactional class would help in increasing productivity and lowering costs, and the results suggested transactional investment payoff by using IT to support or automate repetitive business processes (Weill, 1992). ...
... Using this method, the manufacturer will have online links with each retailer's check-out data and any ordering, payments and invoicing are fully automated through EDI (Brynjolfsson and Hitt, 2000). Transactional IT investment can also increase the volume of business a firm will be able to do per unit cost such as the order processing, point of sale processing, billing statement productions and other transactions processing functions (Weill and Aral, 2006a) that can promote better interactions with customers. ...
... Financial performance 2 Better interactions between firms and customers via point of sale system, order processing and other transaction processing system (Weill and Aral, 2006a). ...
Article
This research was carried out mainly to find out the results on the relationship between transactional, strategic and informational IT investments with the multidimensional performance measurement in the electrical and electronic manufacturing setting in Malaysia. The second research objective was to study the moderating effects of decentralised decision making on the relationship between transactional, strategic and informational IT investment with firm performance. The data were collected from 74 electrical and electronic manufacturing firms in Malaysia. The results suggest that transactional IT investment has a positive and significant relationship with financial performance, but not with customer performance. The strategic IT investment has no significant relationship with any of the perspectives. Informational IT has a significant relationship with the internal business process perspective only. Although decentralised decision making was theoretically explained as a moderator, statistical interaction effects suggested otherwise.
... The IT portfolio should be aligned with the business strategy (Weill & Aral, 2006), and in the case of financial bootstrapping the essence does not lie in "raising money but having the wits and hustle to do without it" (Bhide, 1992, p. 110). Although ITs and digitization (BarNir, Gallaugher, & Auger, 2003;Vendrell-Herrero, Gomes, et al., 2017) and financial bootstrapping (Carter & Van Auken, 2005; Winborg & Landström, 2001) have received increased attention, the analysis of how different strategic practices-digital and IT-based practices and financial bootstrapping techniques-impact business performance in different types of SMEs remains largely unaddressed. ...
... Digital technologies embracing IT, computing, and communication technologies have gone through radical improvements (Bharadwaj, El Sawy, Pavlou, & Venkatraman, 2013). These innovations have enabled businesses to cut costs, connect globally, increase sales and improve product quality ( Bharadwaj et al., 2013;Weill & Aral, 2006). ...
... Also, frequent interac- tion with customers is a relevant characteristic of knowledge-inten- sive firms (Garicano & Wu, 2012). Following Weill and Aral (2006), informational and strategic tools seem more aligned with knowledge- based operations, while transactional tools may be more beneficial in operational contexts characterized by high process automation. ...
Article
Knowledge‐intensive service firms achieve superior productivity levels with management practices oriented to improve the relationship with customers. Managerial practices linked to digital and IT‐based practices and cash management techniques contribute to enhance SMEs’ productivity level. The positive effect of cash management techniques and digital/IT‐based practices is conditioned by the characteristics of the businesses’ operations, in our case, the knowledge orientation of the organization. While nonknowledge‐based businesses benefit more from practices linked to digitization and IT practices, knowledge‐intensive businesses capitalize more on management practices that seek to improve the relationship with customers.
... 1 -Resultados de desempenho de processos digitais é determinada pela medida de uso de mídias eletrônicas como e-mail,Intranet, dispositivos wireless, etc. (ARAL;WEILL, 2006).A intensidade de transações digitais estabelece a dimensão para o grau no qual transações internas e externas são conduzidas eletronicamente e é determinada pela combinação linear de duas razões: ordens de compra eletrônicas em relação ao total de ordens de compras e vendas eletrônicas em relação ao total de vendas (ARAL;WEILL, 2006). Há indícios de que transações digitais com fornecedores podem reduzir custos de coordenação (MALONE; YATES; BENJAMIN, 1987) e que empresas com maior capital de TI empregam menos pessoal (BRYNJOLFSSON;. ...
... 1 -Resultados de desempenho de processos digitais é determinada pela medida de uso de mídias eletrônicas como e-mail,Intranet, dispositivos wireless, etc. (ARAL;WEILL, 2006).A intensidade de transações digitais estabelece a dimensão para o grau no qual transações internas e externas são conduzidas eletronicamente e é determinada pela combinação linear de duas razões: ordens de compra eletrônicas em relação ao total de ordens de compras e vendas eletrônicas em relação ao total de vendas (ARAL;WEILL, 2006). Há indícios de que transações digitais com fornecedores podem reduzir custos de coordenação (MALONE; YATES; BENJAMIN, 1987) e que empresas com maior capital de TI empregam menos pessoal (BRYNJOLFSSON;. ...
... Há indícios de que transações digitais com fornecedores podem reduzir custos de coordenação (MALONE; YATES; BENJAMIN, 1987) e que empresas com maior capital de TI empregam menos pessoal (BRYNJOLFSSON;. O impacto das vendas eletrônicas sobre o desempenho organizacional (ZHU; KRAEMER, 2002) e o aumento de satisfação dos clientes em operações eletrônicas (BRESNAHAN, 1986) contribuem para a relevância dessa classe de práticas.Uma prática mais moderna, o emprego de arquiteturas abertas de Internet -que se contrapõe ao uso de arquiteturas de TI proprietárias -permite que firmas interajam de forma ampla com seus clientes, coletando dados que sustentem decisões mais precisas e responsivas (ARAL;WEILL, 2006;ZHU;KRAEMER, 2002). O emprego de arquiteturas proprietárias mostra-se menos eficiente, principalmente no que se refere à integração com os sistemas de informação, e mais dispendioso que as arquiteturas abertas (ARAL; WEILL, 2006), entretanto a influência de arquiteturas abertas sobre o desempenho organizacional foi ainda pouco explorada empiricamente (KOHLI; GROVER, 2008).Fundamenta-se a suposição desta pesquisa e suas respectivas hipóteses considerando-se o valor de negócio das práticas de TI e sua potencial relação com os processos de negócio.Proposição: Investimentos em práticas de TI estão associados com maior desempenho dos processos de negócio da cadeia de valor. ...
Article
p>A real contribuição da Tecnologia da Informação (TI) para a geração de valor é ainda bastante discutida, sendo que resultados de diversas pesquisas são divergentes. Alguns autores sustentam que o motivo das divergências pode residir na excessiva agregação dos construtos que se referem à TI (BRYNJOLFSSON; HITT, 2003) e ao desempenho organizacional (RAY; BARNEY; MUHANNA, 2004). Esta pesquisa empregou um modelo que procura avaliar o valor de negócio da TI por meio da relação entre os recursos internos da TI e o desempenho de processos de negócio da cadeia de valor (MOONEY; GURBAXANI; KRAEMER, 1996). Após pré-teste para verificação da linguagem do questionário, coletou-se dados de 96 empresas da área de serviços de Belo Horizonte por meio de survey transversal. Os dados foram validados e analisados com o emprego de estatística univariada e multivariada, onde Partial Least Squares Path Model foi a técnica central. Verificou-se que o construto práticas de TI, formado por uso da arquitetura de Internet, intensidade de transações digitais e intensidade de comunicações digitais internas, apresentou relação relevante com o desempenho de todos processos de negócio da cadeia de valor e razoável efeito preditivo. O modelo avaliado apresentou grau de ajuste geral elevado, indicando que a TI contribui para a geração de valor na organização. Do ponto de vista gerencial, o estudo demonstra a importância do desenvolvimento das práticas do TI e, ao explorar um modelo teórico multidimensional orientado por processos de negócio, contribui academicamente por apresentar novas perspectivas para avaliação do valor a TI.</p
... Investigation of the role of IT is especially interesting in digital transformation, because the ratio of shadow IT has increased by 30-50 per cent according to the research work findings of the Gartner, and Everest Group (Bendor-Samuel, 2017). Characteristics of IT-savvy leaders and firms are hot topics in the literature (Weill and Aral, 2006;Weill and Ross, 2009). Digitalization requires new skills of management, such as flexibility and risk taking will be more important than before (Kohnke, 2017). ...
... The role of the IT unit is frequently discussed as a crucial factor in digital transformation (Berghaus and Beck, 2016;Bohnsack et al., 2018;Weill and Aral, 2006;Weill and Ross, 2009;Turel et al 2019;Yeh et al. 2015). IT departments are not always responsive enough to implement rapidly emerging business initiatives, and many companies establish a digital IT (unit), based on the concept of the concept of bimodal IT, where digital and traditional IT have different roles and characteristics (Horlach et al. 2016, Haffke et al., 2017. ...
... IT departments are not always responsive enough to implement rapidly emerging business initiatives, and many companies establish a digital IT (unit), based on the concept of the concept of bimodal IT, where digital and traditional IT have different roles and characteristics (Horlach et al. 2016, Haffke et al., 2017. Weill and Aral (2006) highlight the importance of linking IT investments to the business strategy of the organisation. Companies able to create this alignment can outperform their competitors. ...
Article
Purpose This research aims to discuss the success of digital transformation focusing on the role of IT and management commitment in digitalization together with sectorial relevance as influencing factors. According to the literature, these dimensions are key elements of digitalization, and there is no consensus on their decisiveness. The authors measure the success of digital transformation with the digital innovation. The research is part of ongoing work, in which the IT-related practice of Hungarian organizations has been explored on an annual basis since 2009. Design/methodology/approach The research methodology is a combined one; both qualitative and quantitative methods were applied including surveying digital transformation literature, interviews with key representatives of Hungarian organizations, developing a survey to collect quantitative data, data collection and processing with PLS-SEM. Findings The results revealed that the digital innovations are strongly determined by business, management commitment and, to a far lesser extent, by strategy. In the case of digital transformation, the role of IT departments and the services they provide are less relevant. Research limitations/implications The most important limitation of the research is the size and composition of the sample. Results do not present the situation of a specific industrial sector. Originality/value Digital technologies influence and disrupt practically every industry; the development of information and communication technology has changed economies all over the world. Decisive factors of digital transformations are widely researched, but there is no consensus about them. This research contributes to understanding the role of IT department and their services in this process together with leadership, sectorial relevance as influencing factors.
... 6 Both have been shown to closely relate to the four IOR elements and their impact on IT outsourcing projects. Firms need to keep a healthy balance in prioritizing multiple IT functions for reaching specific strategic objectives Weill and Aral 2006). For example, an outsourced IT type is typically associated with both relationship type and the number of outsourcing vendors (Koo et al. 2017). ...
... As explained earlier, this study focuses on strategic decisions on the four key relational elements at the early stage of outsourcing, a set of decisions that guide the entire outsourcing process. Although outsourced IT type (e.g., application development and maintenance, data center, network, etc.) is an important decision factor, it is not considered to be a key strategic element but rather an internal contingency factor because IT type can have a significant impact on determining the fit of a profile to strategic objectives (e.g.,Weill and Aral 2006).7 Measurement development procedure and the final questionnaire items are explained in Appendix C, instrument validation steps prior to the primary data-gathering and testing are described in detail in Appendix D, and the result of the construct validity test is given in Appendix E. ...
Article
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The goal of this paper is to determine holistic archetypes of information technology (IT) outsourcing strategy. It does this through an overarching theoretical framework that integrates three dominant theories of inter-organizational relations in the IT outsourcing literature, namely transaction cost economics, resource dependency, and social exchange theories. A contingency fit theoretical framing is married to a configura-tional approach to explicate the intricate relationships that spring up between a focal firm and its outsourcing vendors when they are working toward specific strategic objectives under varying contingencies. In line with this theoretical objective, we used qualitative comparative analysis (QCA), a set-theoretic configuration method that can handle the interdependent complexity among multiple elements of IT outsourcing. The technique was applied to a sample of 235 companies that have outsourced some or all of their IT functions. Findings at the project level of analysis empirically reveal two sets of configurations of strategic IT outsourcing elements, one set of configurations resulting in high economic benefit and the other set leading to high strategic benefit. Next, we compare similarities and differences among multiple, equifinal configurations and infer archetypes of IT outsourcing strategy internally congruent in terms of the strategic objectives as well as matching specific contextual contingencies. Our holistic archetypes take the form of theoretical propositions integrating the previous fragmented and inconsistent knowledge in IT outsourcing resulting from the causal ambiguity and complexity inherent in IT outsourcing projects as well as from divergent theories in the literature. Furthermore , by defining specific contingency boundaries, our archetypes provide managers with context-specific guidelines for strategic decisions regarding their relationships with outsourcing vendors, helping different sized firms to effectively succeed in IT outsourcing, contingent on the IT type being outsourced. Finally, we discuss new insights and implications of this study for complementing and extending the extant theories in IT outsourcing.
... IT budget is the amount of money spent on an organization's IT professionals, systems and services. Furthermore, IT budget includes the costs of maintaining and constructing enterprise systems and supporting IT services [3]. An important difference between IT budget and other traditional budgets is that not all IT spending fall within the IT department (i.e., it is controlled by business divisions instead of IT). ...
Conference Paper
Traditionally in large enterprises, budget cuts are a treat for IT departments. One way to guard IT budget is visualizing the impacts in IT services of such cuts. Data visualization tools are capable of bridging the gap between increased data availability and human cognitive capabilities. In this paper, we present a budget visualization tool that allows enterprise wide data-driven decision-making. Our proposal was developed in the context of a large multi-industry state-owned company, with rigid control structures and external pressures for cost reduction and investment optimization. Our tool promotes visualization as the main mechanism to justify IT budget requests and to defend from budget amendments and cuts. We propose a generic tool that might manage different perceptions from many parts of an organization. However, to evaluate our tool’s effectiveness we incorporated four stakeholder’s perspectives: financial, technical, business’ clients and supply chain. In our efforts, we developed a data model that encapsulates these four perspectives and improves communication capabilities between stakeholders.
... Specific IT capabilities have been defined in a variety of ways by different researchers. Organizational IT capabilities have been defined as an interlocking system of competencies (Human Resource, Management) and practices (IT use intensity for communication, digital transactions intensity, internet architecture) [2,46]. Organizational IT capabilities also have been defined as "complex bundles of ITrelated resources, skills and knowledge, exercised through business processes that enable firms to coordinate activities and make use of IT assets to provide desired results" [40, p. 182]. ...
Article
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The increasing use of data-driven decision making and big data is leading organizations to invest in analytics software and services. However, little is known about the type of analytics capabilities within IT that are required and whether there is a common progression or development model of analytics capabilities. Also unknown is how the level of analytics capabilities and other factors influence a firm’s decision to invest in analytics. The purpose of this research is to explore the relationships between levels of distinct analytics capabilities and to understand how they and other factors influence the analytics investment decision. The findings suggest that there is a distinct progression in the development of analytics capabilities, and that firm size is associated with increased capability. The results suggest that firms more likely to invest in analytics have higher current levels of specific analytics capabilities, are larger, and are located in less-competitive industries.
... There is broad consensus that information technology (IT) 1 is a capability for value creation and is central to a firm's strategy for gaining competitive advantage (Clemons & Row, 1991;Drnevich & Croson, 2013;Luftman, 2003;McAfee & Brynjolfsson, 2008;Mentzas, 1997;Peppard & Ward, 2004, 2005Venkatraman, Henderson, & Oldach, 1993, Weill & Aral, 2006. Since the 1990s, it has commonly been acknowledged that value can be created by IT; for example, by increasing the productivity of a firm or by providing advantages to customers (Hitt & Brynjolfsson, 1996;Mata, Fuerst, & Barney, 1995). ...
Article
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This research expands our understanding of IT value by adding a customer-based view (CBV) to the prevalent resource-based view (RBV). Founded on a template analysis, this article suggests an integrated definition for IT value consisting of two complementary facets: monetary customer value and non-monetary organizational value. Value from IT investments can have direct or indirect effects on firm performance. This research also discusses the relationship between IT value, firm performance, and competitive advantage.
... Based on research of over 1800 companies world-wide (e.g. Weill & Aral, 2006;Weill et al., 2008;Ross & Weill, 2005), Weill & Ross (2009) conclude that 'IT savvy' companies improve their performance through the intelligent use of IT. They have better profits, operational costs, system reliability, adaptability, IT maintenance, data integration, and capability to support and drive business improvements. ...
Thesis
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This research is undertaken in response to a perceived lack of research providing practical business/IT alignment support to help organisations improve their IT value. It investigates the issues and enterprise elements that need to be considered or managed, as well as the necessary mechanisms and tools for alignment modelling, measurement and successful implementation. This work is based upon secondary data, including case studies, experiences and best practices. A qualitative research methodology is applied, using coding and data modelling techniques to discover and classify enterprise architecture elements from an analysis of alignment-related factors, implementation mechanisms, and value measurements. Alignment solutions are found to vary by company and there is no ‘alignment panacea’. However, there is sufficient consistency across the alignment research confirming the value of the topic and the legitimacy of a business/IT alignment framework. This research compiles common successful business/IT alignment mechanisms and offers new findings, including: an alignment definition, alignment principles, an alignment metamodel, a generic alignment strategy map and sample alignment measures. The research draws from the well-known Balanced Scorecard, COBIT and TOGAF frameworks and also compares their coverage of the key alignment topics discovered. None of these frameworks covers the minimum requirements of an alignment framework in detail, but together they provide a basis for one.
... This is because processes are well-organized and all resources are used efficiently [11], creating a competitive advantage, and also enabling future business ventures. Moreover, as a result of the high competition in the market, companies must understand clients' needs in order to keep them satisfied [12]. Clients' main concern is the design, high quality, timely delivery, service levels and most importantly price [11]. ...
Article
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As a result of the ongoing economic crisis and the international market competition, Greek SMEs, particularly the ones focusing in manufacture and production, need to stay profitable by increasing efficiency, while reducing operational costs. Information collected, stored and processed by ERP systems help SMEs to reduce uncertainty, and improve operations and managerial decision making. Manufacture SMEs could benefit from the implementation of an ERP system, as there are many aspects in the business to consider. However, most decisions are based on financial information. The current study explores the accounting benefits of implementing ERPs on manufacture SMEs, from an accounting standpoint. Findings demonstrate the difference in importance of the various accounting benefits within the different manufacturing categories.
... For example, if an organization only invests a technology or follow a technology used by its competitors, it may not provide any advantage, because excellence can only be achieved by using the right technology to support business and create added value. In addition to investment, it is necessary for an organization to have an adequate level of intelligence to get a value or significant benefit from IT [26,27]. The intelligence of IT brings to [18]: a. ...
Article
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Higher education over the past decade has experienced several view changes that include: paradigm shift, management and competition changes, and so forth. The only university supported by the excellent IT that will be able to enhance and maintain its advantages. The purpose of this article is reviewing the strategic design of IT implementation at the university. The analysis used to reveal the fact, problem and problem-solving in this article adopts the model of Strategic Management of Information Technology (SMIT) developed by Flodström. The strategy design of IT implementation based on the competitive environment of UIN Sunan Gunung Djati Bandung is coordinated with its business strategy. The role of IT as an enabler or tool that allow the university to be able to create cheaper-better-faster educational process. In this article, there are designed two types of IT Functions: back office and front office. For back office application function, there is a software management with specific modules to support the implementation of university management. In the front office function of IT usage, there are some types of IT usage concepts that directly and indirectly affect the way of establishing education that leads to quality improvement which can be implemented through: media simulation, course management, virtual class, computer-based training (CBT), knowledge portal and cyber community. The strategic design of IT implementation presented in this article is a generic model of the plan, design, and implementation of IT in the object of study.
... According to the results of Weill and Aral (2006) high IT savviness is originated from five characteristics of successful organizations, amongst them companywide IT skills and management involvement. Our results showed that companies recognized the strategic importance of the digital transformation, but the implementation related competencies should be developed further. ...
Conference Paper
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This paper presents the findings of a research on Digital Transformation, performed among the Hungarian companies in the first half of 2016. Investigated organisations consider digital business transformation as a key issue. Many factors influence Digital Transformation readiness: risk-tolerance, development of IT skills, and conscious management of innovations ideas. Adequately aligned IT strategy can be also a catalyst of digital strategies. http://press.um.si/index.php/ump/catalog/view/234/197/326-1 DOI: https://doi.org/10.18690/978-961-286-043-1
... • As digitization reached business departments, the requirement of IT knowledge, and IT savvy employees became vital of organizational success (Weill and Aral, 2006). Therefore business leaders and employees had to acquire digital skills, so IT departments' knowledge monopoly is under demystification. ...
Conference Paper
Full-text available
In our research, we used Design Thinking and our "One Week Sprint" methodology to identify digital transformation opportunities for the Hungarian banking sector. Our main findings can be grouped to three main areas: (1) the changing role of branches (2) online, mobile and phone-based services and (3) products and services. The compound of customers is quite heterogeneous in age, education or income status for all banks in our research, therefore, the possibility of generalization of problems and possible solutions is limited. A major challenge for banks is that they need to think up to 20-30 customer segments, and offer services with which can serve the needs of other segments – so generic enough to meet more segments' needs. Of course, the strategies of banks may differ in the targeted segments; however, banks with general strategy can be dominated by competitors concentrating on a niche strategy, or a FinTech, for example, with the widespread application of digital solutions. http://press.um.si/index.php/ump/catalog/view/234/197/326-1 ISBN: 978-961-286-043-1 DOI: https://doi.org/10.18690/978-961-286-043-1
... Discussions of presence and place (Cottone, Pieti, Schivinato, Soru, Martinelli, Varotto, & Mantovani, 2009;Jackson, Gharavi, & Klobas, 2006) were also noted and compared to elements of synchronicity, that is, the effectiveness of asynchronous (serial) individual activities versus synchronous (parallel) collaborative activities (DeLuca & Valacich, 2006) as well as the adequacies of supporting technologies (Jackson et al., 2006;Karsten, 1999aKarsten, , 1999bWeill & Aral, 2006). And, discussions of the organization's culture were noted and compared to the approaches of open systems, learning systems, aligned systems, or on a continuum from a controlling to collaborative organizational environment (Fleet & Griffin, 2006;Halbesleben, Wheeler, & Buckley, 2006). ...
... However, there is not consensus on the importance of this impact, nor whether all levels of digitalisation/ICT implementation provide the same performance. Hence, the timely completion of this study (Brynjolfsson & Hitt, 2003;Hitt & Brynjolfsson, 1996;Loveman, 1994;Lucas Jr., 2000;Powell & Dent-Micallef, 1997;Strassmann, 1985;Weill & Aral, 2006). ...
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This paper analyses how innovation affects the relationship between the digitalisation of the company and its economic and financial performance, reviewing the cause-effect situation of this relationship. As some scientific literature suggests, the impact of ICT technologies on business performance is not homogenous amongst firms. The answer to this issue is probably to be found in innovation. In order to further develop this statement, this study examines the role of innovation in the relationship between business performance and business digitalisation. This research framework has been built based on the Innovation Theory of Rogers. Companies from all over Spain have been surveyed and the data has been contrasted with Partial Least Squares-Structural Equation modelling (PLS-SEM) and Moderation Analysis. The results show that in effect, innovation acts as a moderator variable in the relationship between business digitalisation and performance. These results allow us to conclude that it is not only important to digitalise the company to improve its performance, but that this digitalisation should also be aligned with a clear innovation strategy that allows for improving the company´s performance. The aim of this study is to contribute with greater knowledge to how the digitalisation of the company affects its economic/financial performance and manifest the role innovation plays in this relationship.
... Whereas Alfa needs tools and practices for benchmarking PPM processes and governance, it has much experience and strong capabilities in external and internal comparison of project portfolio costs (Verhoef, 2002, Verhoef, 2005, the balance of its assets (Weill and Aral, 2006) and the balance of its strategic buckets (Chao and Kavadias, 2008). The manager explained that Alfa has many practices for supporting portfolio balancing, as this has direct and instant impact on the project selection process. ...
Conference Paper
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As projects constitute a major part of organizational budgets and strategic development, practitioners become dependent on project portfolio management (PPM). However, the existing knowledge on how to evaluate and improve PPM is rather fragmented and lacks empirical grounding. We ask: How can we develop a holistic and empirically validated PPM evaluation framework? Drawing on evaluation theory, we structure contributions from 20 PPM publications into a framework with four evaluation areas. Together with a large company, we develop, apply, and refine the framework. As a result, we offer two contributions: (1) a theory-ingrained artifact that structures a fragmented body of knowledge into four related PPM evaluation areas, and (2) a demonstration of how a theory-ingrained evaluation artifact can serve as an evaluation framework that helps practitioners identify strengths and improvement potential in PPM. In conclusion, we discuss how our results may inform future research and help organizations evaluate PPM.
... This is consistent with Wu et al. (2015, p. 503), who define SITA as "how well the content of the realized business strategy matches the content of the realized IT strategy." Based on such prior conceptualizations (Lee and Mithas 2014;Weill and Aral 2006), we define SITA as the extent to which a firm's relative investments in different areas of IT are consistent with the firm's business strategy. ...
... PPM has aspects related to financial portfolio management, such as risk balancing and rewards [20,21] and describes real options used in financial portfolio management to help prioritize project portfolios based on an overall risk strategy. The concept of PPM in world standards and models, interpreted from different points of view, significantly affects for the procedure of project portfolio formation. ...
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The article deals with the methodological aspects of implementing the organization’s strategy through project portfolio management. The existing concepts, models, and methods of organizational development portfolios management are analyzed. The types of organizational cultures are considered in accordance with the evolutionary theory of values. The article shows that the success of the implementation of the organization’s development strategy is impossible without taking into account its dominant values. The organization development model links the spiral nature of systems development and the organization’s strategy in the form of a project portfolio. The model of the projects’ portfolio formation based on the definition of organizational values at the stages of the life cycle of the system is shown. The application of the competitive analysis method for the projects’ portfolio formation using the principles of value-oriented and reflexive management for making management decisions is presented.
... This can be utilised to reach the customer for quick resolution of his grievances, which can also help the organisation get specific ideas for improvement. e-SCM systems like blockchain can use customer feedback for improving the design, manufacturing, procurement, quality, customisation and delivery of its products (Weill and Aral 2006;Kohli and Melville 2009). Drawing from the information processing theory (IPT), sharing trustworthy information among supply chain members is necessary to avoid the opportunistic behaviour in supply chains (Ahmad and Schroeder 2001). ...
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Blockchain is a disruptive technology that promises to embed visibility and trustworthiness in supply chains. This paper examines the perceived role of blockchain in improving SCM and profitability of organisations in the manufacturing industry. It establishes the blockchain benefits for the manufacturing industry using the process of scale development. The proposed hypotheses related to the indirect effects are based on the resource-based view of the firm. The conditional indirect effects for four organisational factors are tested. The research framework is operationalised based on data from 236 practitioners. The findings show that blockchain is perceived to drive improvement in six supply chain dimensions of the manufacturing industry. The breadth of organisation size and geographical dispersion moderate the mediation relationship between blockchain benefits and incremental profitability. Furthermore, the conditional indirect effects are found significant at mean and ±1σ values of integration intensity and IT integration. According to managers of manufacturing industry, blockchain can bring significant improvement in delivery reliability and mass customisation, which would result in increasing the profitability of the organisation. Organisations with low integration intensity, high IT integration and small size organisations are likely to be the early adopters of blockchain technology.
... The benefits of a particular department's peripheral knowledge are governance contingent. By contrast, prior studies overlook a firm's IT governance choices in encouraging increasing business acumen of IT staff (Bassellier and Benbasat 2004;Heller 2012, p. 94), line managers' IT skills (Bassellier et al. 2003, Weill andAral 2006), and shared knowledge between IT and line functions (Nelson and Cooprider 1996;Ross 2002;Weill and Ross 2004, p. 68). The value of shared knowledge is discriminating, not unconditional. ...
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The IT governance literature predominantly explains firms’ IT governance choices, but not their strategic consequences. We develop the idea that a firm’s IT governance choices induce adeptness at strategically exploiting IT only when they are discriminatingly aligned with its departments’ knowledge outside their specialty. Discriminating means that governing the two undertheorized classes of IT assets—apps and infrastructure—requires “peripheral” knowledge in different departments. Analyses of data from 105 firms supports our middle-range theory.
... There is broad consensus that information technology (IT) 1 is a capability for value creation and is central to a firm's strategy for gaining competitive advantage (Clemons & Row, 1991;Drnevich & Croson, 2013;Luftman, 2003;McAfee & Brynjolfsson, 2008;Mentzas, 1997;Peppard & Ward, 2004, 2005Venkatraman, Henderson, & Oldach, 1993, Weill & Aral, 2006. Since the 1990s, it has commonly been acknowledged that value can be created by IT; for example, by increasing the productivity of a firm or by providing advantages to customers (Hitt & Brynjolfsson, 1996;Mata, Fuerst, & Barney, 1995). ...
Preprint
Value is a nebulous term in information technology (IT) science. In the IT literature, definitions for IT (business) value and categories for IT value are diverse. This research attempts to find a universal definition for IT value and concise categories of IT value. IT-value activities were systematically searched in the IT literature and used as data for template analysis. As a result, four categories of organizational value were inductively developed. The template analysis also shows in deductive ways that the three customer-value disciplines "operational excellence", "product leadership", and "customer intimacy" are applicable to the IT realm. This paper suggests an integrated definition for IT (business) value consisting of two complementary facets: customer value resulting in cash inflows and organizational value that is non-monetary. We propose that IT value can have direct or indirect effects on firm performance. Direct effects result from product/services that create customer value, while indirect effects result from organizational value that are needed for production. Based on the findings, this research also discusses the relationship between IT (business) value and competitive advantage. Competitive advantage requires both high customer value and scarcity of competing products/services with equal value (differentiation strategy by product leadership or customer intimacy). If such scarcity is low, firms must compete on low costs for comparative advantage (cost leadership strategy by operational excellence). Overall, this article expands the prevalent resource-based view (RBV) with a customer-based view (CBV).
... No tocante à sua expansão, a infraestrutura necessita: (1) ampliar cada vez mais sua base de usuários e demandas plurais atentando para padronização (CONSTANTINIDES; BARRETT, 2015); (2) lidar com as tensões entre a necessidade de desenvolver novos recursos e interesse de infraestrutura, e o trabalho contínuo de fixação e atualização dos existentes (HANSETH; MONTEIRO, 1998, HANSETH;LYYTINEN, 2010); e (3) controlar a natureza da sua escalabilidade reconhecendo os desvios de processos e as consequências não intencionais HANSETH et al., 2006;SAHAY et al., 2009;WEILL;BROADBENT, 1998, WEILL;ARAL, 2006). ...
Research
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The main purpose of this article is to study the installed base tensions and how these influence the establishment of the Electronic Health Record (EHR) as an Information Infrastructure (II) in the Paraíba State context. Among some of the examples of II are the Internet, e-commerce, Electronic Data Interchange, the wireless network infrastructure (wireless), integrated enterprise management systems (Enterprise Resource Planning - ERP), the interaction between people, the health sector and the scientific collaboration networks. Methodologically, it adopted a qualitative position and a more social and humanistic view of the subject to reach the understanding of its influence. In addition to the bibliographic sources consulted, the content analysis was used for the interpretation of the collected interviews. The results show’s that the EHR are complex and permeated by unresolved tensions, adjacent to consolidate a II and require practices that do not underestimate or neglect their installed base, their socio-technical effects, its tensions and its salient reverse. Future studies that expand the study of understanding by region will serve to extend and confirm additional discoveries.
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This article comes from research that sought to deepen existing discussions on the evaluation of IT investments and to assess their impact on organizational performance. The goal was to identify and analyze the impacts of spending and investments in information technology in the financial performance of Brazilian industries. The results allowed to state that the industries that have invested in Information Technology (IT), from 2001 to 2011, had higher growth of its operating revenue and improved operating results compared to the industries that invested less in the period. We adopted a research model that used accounting and financial indicators and IT spending metrics, also the combination of statistical techniques for analysis in several of doing thesis work. The study population was composed of Brazilian companies, which were publicly traded, from the industrial sector, with active stocks at BOVESPA, totaling 119 companies. Through a survey, additional data were obtained related to expenditures and investments in IT, the semi-structured questionnaires were sent directly to the Chief Information Officer (CIO). These efforts in collecting data, gave the possibility of obtaining a significant sample, with 53% of the population. Empirical research culminated with the adoption by the Generalized Method of Moments (GMM), a dynamic econometric model, satisfying the requirements of the Arellano-Bond (1991) model. This model was more suitable to treat possible spurious correlations; allowing identify the cost/expenditures and IT investments in two previous periods, (IGTIt-2) impacted in current Operating Income (ROPt), reflecting the lag effect. The main variable of IT research, IGTI is calculated through the sum of expenditures and annual IT investments (OPEX/CAPEX), divided by the annual net Operating Revenue. For future research, there is the possibility of seeking measures of evaluation by types of IT investment, linked to each investment and could also be used time dummies in the regressions, to mitigate the confirmed results and potential interference with the performance.
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In knowledge-based industries, continuous human-capital investments are essential for firms to enhance capabilities and sustain competitive advantage. However, such investments present a dilemma for firms, because human resources are mobile. Using detailed project-level operational, financial, and human-capital data from a leading multinational firm in the global IT services industry, this study finds that deliberate investments in improving general human capital can help firms develop superior capabilities and maintain high profits. This paper identifies two types of capabilities essential for success in this industry—technological and business-domain capabilities—and provides empirical evidence justifying such investments. Theoretical and practical implications of capability-seeking general human-capital investments are discussed. The primary managerial implication of this research is that capability-seeking investments in developing general human capital through strategic learning (training and internal certifications) can enhance firm performance. Although investing in general human capital is risky, the firm considered this a strategic necessity in order to thrive in the fast paced IT services industry. By leveraging general technological skills in combination with business-domain knowledge to address customer's business problems firms can earn and sustain higher profits. Our study also demonstrates how a developing country firm responded to strong competitive challenge from global rivals possessing superior capabilities by upgrading the capabilities of its employees through internal development. In doing so the firm was able to narrow the capability-gap vis-à-vis its foreign peers and expand its business globally.
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We advance the theory pertaining to IT governance and portfolio management. We specifically examine how the portfolio characteristics can influence IT investment allocation. We propose two portfolio characteristics - flexibility and diversity. We define the flexibility as the number of IT investment choice, and the diversity as the dissimilarity of IT investment choice. Using the Monte Carlo simulation and real-world data, we find that 1) if a firm invests in a set of IT initiatives with higher flexibility, it will have greater potentiality to capture a superior IT investment allocation; 2) when a firm invests in a set of IT initiatives with lower flexibility, it will have greater potentiality to capture a superior IT investment allocation, if the set of IT initiatives involves higher diversity. Our findings implicate that a firm can exercise IT initiative flexibility and diversify IT initiative choice to improve portfolio investment allocation. © (2013) by the AIS/ICIS Administrative Office All rights reserved.
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This study presents and tests a model in which the effect of IT investments on firm revenues is associated with the dimensions of IT-business alignment in an emerging market context. We disaggregate firms' IT business alignment into three dimensions: (1) IT investment-business strategy alignment, (2) IT delivery-business priority alignment, and (3) IT change-business change alignment. Using a secondary data set comprising more than two hundred Indian companies, we find that IT delivery-business priority alignment and IT change-business change alignment more strongly moderate the relationship between IT investments and firm revenues. Specifically, firms with IT change-business change alignment and IT delivery-business priority alignment have higher revenue at higher levels of IT investment than firms that display IT investment business strategy alignment. Our additional exploratory analyses demonstrate firms with IT change-business change alignment outperform firms that show alignment at other dimensions of IT-business alignment at the high levels of software and service investments.
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Information systems security has become a critical topic both academically and in industry due to its importance in today's organizational environment. But while its criticality is undeniable, information systems security continues to be viewed reactively, as a "necessary evil," or, worse, as a black hole with little or no ROI. Researchers and practitioners alike have generally been reticent to acknowledge the strategic potential of information systems security. This paper provides a first step towards helping managers justify their investments in information systems security by identifying its strategic potential. In doing so, we address three basic questions; why is information systems security important, what is strategic information systems security, and how does the strategic potential of information system security affect firm performance. Dynamic capabilities theory is utilized to propose a theoretical framework for strategic information systems security. We propose that information systems security provides the infrastructure necessary for agility, which in turn impacts firm performance. Specifically, information systems security enables sensing and responding to customer, partner/supplier, and internal organizational opportunities to positively impact firm performance. We also propose that the trust generated by solid security and security policy can enhance relationships with both customers and partners/suppliers. © (2013) by the AIS/ICIS Administrative Office All rights reserved.
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Despite the important roles chief information officers (CIOs) play in developing information technology (IT) strategies and carrying out IT plans, prior research has not examined the impact of having a formal CIO position on IT investments and firm performance. Drawing on the upper echelons theory and using data from over 250 US firms over the 1999-2003 period, we address how a firm's CIO position influences the level of the firm's IT investments and the returns to IT investments. We find that CIO position in organizational hierarchy has a significant impact on IT investments: firms with a formal CIO position make higher levels of IT investments, compared to firms without a formal CIO position. We also find that returns to IT investments are greater for firms whose CIOs possess additional titles and/or expanded responsibilities, compared to firms without CIOs or CIOs in less senior management positions. In addition, examining the role of industry characteristics, we find that the impact of CIO's position on IT investments is much greater in "transform" industries compared to "automate" and "informate" industries. In transform industries, alignment of strategic IT roles leads to improved financial performance. Further, we find that CIO position has significantly stronger impacts in IT intensive firms than in non-IT intensive firms, in terms of both its impact on IT investments and the moderating effect on returns to IT investments. © (2013) by the AIS/ICIS Administrative Office All rights reserved.
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IT application maturity is related to enterprise resources. Enterprise resources will be wasted if IT application maturity is too high or too low. Therefore, how to select the IT application maturity that matches enterprise resources to optimize IT investment is a key question for enterprises. This paper constructs an earnings game model of enterprises for a homogenous industry. We obtain the relationship between IT application maturity and management capability under the conditions of the optimal income. Our theoretical model can be used to explain why IT applications do not bring about the expected revenue in spite of heavy investments made Chinese enterprises and suffer a high rate of failure.
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This research investigates the relationship between IS investment and IS success and the moderating effects of IS maturity. We find the moderating role of IS maturity between IS investment and IS success with a contingency perspective. As administering a group survey of about 300 business executives across multiple industries, the results of this study indicate that IS investment is a critical antecedent of IS success, and IS maturity has a positive moderating effect on this relationship. The implication of the findings implies that global companies should consider the maturity of their IS management: as a crucial factor in maximising the effectiveness of IS investment.
Chapter
Bis heute gibt es keine eindeutige Theorie zum Projektmanagement. Auf der Suche nach konzeptioneller Klarheit zieht Söderlund (2004) einen Vergleich zu den Theorien der Organisationsforschung, in denen durchgehend die Meinung vertreten wird, dass jede der Organisationstheorien letztendlich eine Abstraktion der reellen Welt darstellt und einen Erklärungsansatz für Teilaspekte der Realität liefert. Entsprechend kann es nach Söderlund auch nicht das Ziel sein, eine einzelne Projektmanagement-Theorie als Bezugspunkt zu entwickeln. Die gleiche Ansicht vertreten auch Autoren, die sich mit Forschungsfragen nahe der Thematik des Projektmanagements auseinander setzen. Mit Blick auf die Forschung zur inter- und intra-organisationalen Zusammenarbeit führen beispielsweise Smith, Carroll und Ashford (1995) fünf Theoriestränge auf, die alle zur Erklärung der Zusammenarbeit herangezogen werden können, da jede Theorie für sich nur Teilaspekte abdeckt. Levitt et al. (1999) bestätigen ebenfalls den notwendigen Theorie-Pluralismus aus dem Blickwinkel simultan laufender Projekte. Folglich soll in dieser Arbeit nicht das Ziel verfolgt werden, eine breite theoretische Grundlage für das Multiprojektmanagement abzuleiten oder gar zu entwickeln. Vielmehr soll der konzeptionelle Fokus auf zwei zentrale Themenaspekte gelenkt werden, um die sich die Fragestellungen des Multiprojektmanagements immer wieder drehen. Zum einen ist dies die optimale strategiekonforme Allokation der Mitarbeiter auf Projekte und zum anderen die effiziente Durchführung der ausgewählten Projekte, wobei speziell auf die Herausforderungen eingegangen werden soll, die sich durch die simultane Abwicklung zahlreicher miteinander in Beziehung stehender Projekte ergeben.
A company's Information Technology (IT) infrastructure is a key factor in its sustainability and ongoing success and profitability. This paper explores the relationship between a company's investment in IT and its performance. Performance is measured, with the help of a Balanced Scorecard (BSC), in four ways; financial, internal business processes, innovation & learning and customer perspective. The relationship between each BSC category serves as indicators of the effect of IT investment on a company's performance. This will help establish the benefits of both financial and non-financial indicators. We focus on the Electrical and Electronic manufacturing performance of companies Malaysia. System Resource Theory (SRT) is used as the background theory to explain the concepts of organizational effectiveness, efficiency, productivity and multidimensional performance measurements and to link the variables used in this study. We conduct an empirical study in order to confirm the moderating effects of decentralized decision making. The results suggest that IT investment produces a significant relationship with all BSC perspectives, but the moderating effect is only significant only from a customer perspective.
Article
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RESUMEN El ámbito educativo ha incorporado gradualmente las oportunidades ofrecidas por las Tecnologías de la Información y Comunicación (TIC). Si bien este dato resulta positivo, desde el punto de vista organizativo, es necesario complementar la implantación de las TIC con una estrategia global e integradora que aporte coherencia entre los aspectos puramente tecnológicos y los modelos educativos, para alcanzar resultados superiores. El presente trabajo ofrece una revisión de la importancia de las TIC en el ámbito educativo, centrando la atención en la necesidad de ajuste estratégico en el contexto universitario, como elemento de mejora en la adaptación a las necesidades competitivas de las universidades. Para alcanzar este objetivo, se lleva a cabo una revisión de la literatura sobre las TIC y su impacto, se resumen las principales recomendaciones para su óptima utilización en el proceso de enseñanza aprendizaje y se ofrece una reflexión sobre el papel estratégico de estas herramientas.
Chapter
The use of Information and Communication Technologies (ICT) has allowed for the creation of new business models since the last century. There is a tendency nowadays to digitalize everything that surrounds the company due to the ICT revolution. These actions are generating a great difference in the performance between digitalized and non-digitalized companies, causing great differences between them. Therefore, this paper analyzes how the company’s digitalization influences and the innovation its performance, providing a new business performance factor. To do so, the literature on the digital company was reviewed, as well as the business models used by digital companies. In addition, research has allowed us to detect the level of digitalization of the company, its strengths and weaknesses, and even show that as a result of this work, we can conclude that it is necessary to incorporate the digitalization of the company into its performance models, since it represents more than twenty percent of its economic performance.
Article
To better assist decision-makers (e.g., enterprise executives) in selecting the most desirable IT portfolio, this study proposes a new IT Portfolio Efficient Frontier model that incorporates the decision-maker's risk tolerance levels. The proposed model, built on portfolio optimization along with experimental design and simulation data, considers three IT portfolio scenarios: even distribution-based IT portfolios, uneven distribution-based IT portfolios, and dominant IT portfolios. Our findings show that the IT portfolio efficient frontiers derived from both an even distribution-based IT portfolio and an uneven distribution-based IT portfolio have a relatively positive relationship between IT portfolio risk and return. Our findings also indicate that if IT investments are part of a dominant IT portfolio, an inflection point of the IT portfolio efficient frontier appears under the decision-maker's medium risk tolerance level, and the most desirable IT portfolio is generated when a decision maker's risk tolerance level is medium or higher.
Article
In order to investigate the relationship between IT application maturity and management capabilities, the authors conducted a survey study to collect related company information for analysis. Data processing was conducted to obtain valid and reliable variables representing IT application maturity, management institutional capability, and process management capability. Then, they adopted a partial differential equation approach to capture the time dynamics of these variables. The equations were solved analytically, and further empirically estimated through our processed survey data. The validated model demonstrates that both management capabilities have direct enhancement effects on IT application maturity. In addition, process management capability has a greater influence on IT application maturity in comparison with management institutional capability. Furthermore, it is found that there exist local maximums for both enhancement effects, provided that the two management capabilities are well balanced. The findings not only offer practical implications, but also supplement the literature of factors for IS success in light of the dynamic relationship between IT application maturity and management capabilities.
Chapter
This chapter explains the theory behind and the practice of strategic program planning and program management. The authors first describe two contrasting approaches to IT strategic planning, namely: the Cassidy Model and the Spewak Enterprise Architecture Planning (EAP) methodology. The authors then describe the principles and methods for enterprise architecture-driven strategic planning and the related IT project portfolio management principles. They conclude the chapter by explaining the basic principles of product/service portfolio strategic planning by describing a couple of recent approaches in the literature.
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These years increasing interest is put on IT project portfolio management (IT PPM). Considering IT PPM an interdisciplinary practice, this paper conducts a concept-based literature review of relevant articles across various research disciplines. It finds and classifies a stock of 107 relevant articles into four scientific discourses: the normative, the interpretive, the critical, and the dialogical discourses, as formulated by Deetz (1996). It finds that the normative discourse dominates the IT PPM literature, and few contributions represent the three remaining discourses, which unjustifiably leaves out issues that research could and most probably should investigate. In order to highlight research potentials, limitations, and underlying assumptions of each discourse, this paper develops four IT PPM metaphors. Its metaphors can be used by practitioners to articulate and discuss underlying and conflicting assumptions in IT PPM, serving as a basis for adjusting organizations' IT PPM practices.
Chapter
In this chapter, the authors discuss the critical success factors of IT strategy holistically across four dimensions of the strategic management process from strategy formulation to planning to execution and to value delivery monitoring, end-to-end. The most basic requirement for the success is that IT must be regarded as being part of the business, devoid of the “us” vs. “them” chasm (separating IT from the business) found in most traditional organizations where IT is viewed as a subservient role performing basically a “back office” function. Case examples are used to illustrate the alignment processes and the resulting business value accrued. Because IT leaders have to manage alignment in all four dimensions in order to maximize the strategic value of information technology deployment, the chapter also examines the evolutionary CIO leadership roles in value creation.
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Travel fears and restrictions, imposed capacity limitations, and the inability to hold events and large group gatherings have stifled hotel demand and caused devastating revenue losses for the hotel industry during the COVID-19 pandemic. The financial losses will undoubtedly affect hotel firms’ information technology (IT) investments in the long run. This paper aims to develop a framework to assist hotel executives in capturing more insights regarding the relationship between input resources and desired outputs throughout the production process. Accordingly, hotel executives will be able to evaluate and make appropriate IT investment decisions to strategically and effectively allocate scare financial resources in order to improve firm performance.
Article
This study aims to develop a new methodology in IT Portfolio Management (ITPM) to address the impact of portfolio priorities on IT strategies in a multi-business unit firm. The methodology includes a new ITPM model and uses simulated scenarios to overcome limitations due to insufficient real-world organizational IT portfolio data. The weight scores generated by the proposed ITPM model can enable the firm to create a rational viewpoint to improve its IT investment efficiency while establishing IT priorities to achieve enterprise strategic goals. Such an approach would enable firms to reduce their reliance on CIO intuition in guiding firms’ technology portfolios.
Purpose – The purpose of this paper is to analyze some Brazilian companies’ use of the information technology portfolio management (ITPM) technique as an aid to their information technology (IT) investments management. Design/methodology/approach – It was carried out in five case studies in different Brazilian companies from several economic sectors which were using ITPM or were in the initial implementation phase. Eight interviews were conducted. The persons interviewed were high-level executives working in the IT department in the studied companies. Findings – Different levels of ITPM use was found with respect to IT investment management (planning, control and evaluation). It was observed, in the analyzed cases, that ITPM is used most frequently in IT investment planning, which is the process most discussed and used in analyzed companies. The ITPM technique is used more frequently in Company 2 than in the other cases because the organization of the IT area in the company is structured according to ITPM dimensions. Research limitations/implications – The ITPM technique has received little attention in IT research and research in this area identifying the use and applicability of ITPM in companies is still very limited in the information systems literature. Originality/value – The paper presents IT investment management in different Brazilian companies and how ITPM was used to help companies in this process compose by planning, control and evaluation.
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