IT & Organizational Performance:

An Integrative Model of Business Value

Miniproject#2MOIS 433

Presented bySara Maamoun

Presented toDr. Dina Rateb

About Review

Authors:Nigel MelvilleKenneth KraemerVijay Gurbaxani

Journal:

Vol.28 No.2/ June 2004

I. Introduction

Topic Overview

IT Business Value• Impacts of IT on organizational performance

Knowledge Perspectives & Computing Paradigms• Pre-Internet Era

– Mainframes, minicomputers

– Used for storing and processing information within one organization

• Network Era– Electronic linkages

– Within & among multiple organizations

Objectives of Review

Develop a model of IT business value based in theory and informed by existing IT business value research

Use the model to synthesize & unify what is known about IT value

Guide future research by developing propositions and putting forward a research agenda

II. IT Business Value Research:Definition

Conceptualizing Information Technology

1. Tool View: IT viewed as an engineered tool doing what its designers intended

2. Proxy View: Conceptualized by its essential characteristics, which are defined bya) Individual perception of its usefulness or value

b) Its investment or capital stock denominated in financial units

3. Ensemble View: Interaction of people and technology in both the development and use of IT

Defining IT Business Value Research

IT Business Value refers to the organizational performance impacts of IT including Productivity enhancement Cost reductionCompetitive advantage Inventory reduction and other measures of performance

Formulations of performanceEfficiencyEffectiveness

III. Integrative Model of IT Business Value

Theoretical Paradigms Used in IT Business Value

Research Microeconomic Theory

Industrial Organization Theory

Sociology & Socio-Political Perspectives

Chosen Theory base: Resource-Based View of the

Firm RBV & IT Business Value

Prior Models IT impacts orgnl. performance via intermediate business processes

Other orgnl. resources such as workplace practices interact with IT, whether as mediator or moderator, in the attainment if orgnl. performance impacts.

External environment plays a role in IT business value generation

It is important to disaggregate the IT construct into meaningful subcomponents

IT Business Value Model

Model Constructs

IBM IT Value Model

IV. Literature Synthesis

Research Questions

Summary of Propositions

Sources

“IT & Organizational Performance: An Integrative Model of Business Value.” MIS Quarterly. PDF: http://web.gsm.uci.edu/~gurbaxan/itbv.pdf

“The IT Value Model: Winning the Business “Battle” with the right IT “Nails””. IBM Global Services. PDF:

http://www-1.ibm.com/services/us/its/pdf/g510-3887-00.pdf

Thank You