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Information Technology and Organisational Performance: Reviewing the Business Value of IT Literature

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Information Systems Theory

Part of the book series: Integrated Series in Information Systems ((ISIS,volume 28))

Abstract

Managing Information Technology (IT) investments continues to be a challenge for firms due to the difficulty associated with demonstrating IT ­contributions to organisational performance. Many IT contributions are not accounted for because they cannot be easily quantified. Linking IT to organisational performance is a complex problem that is informed by insights from ­multiple theoretical paradigms. The aim of this chapter is to comprehensively review work done by both academic and practitioners, and to explore why new approaches to managing IT investments are needed. To achieve this aim, we will start by defining IT assets and business value and exploring the different dimensions used to measure the business value of IT. Then, we will look at the early research on IT business value and the emergence of the Productivity Paradox. After that, we will delve into the three current theoretical paradigms: economics, management and sociology. The theoretical lenses and models used in these paradigms will also be discussed. Finally, future research directions are suggested.

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Abbreviations

BVI:

Business value index

CobiT:

Control objectives for information and related technology

EDI:

Electronic data interchange

IRR:

Internal rate of return

ISACA:

Information systems audit and control association

IT:

Information technology

ITGI:

IT Governance Institute

NPV:

Net present value

OPMs:

Option pricing models

ROI:

Return on investment

TEI:

Total economic impact

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Authors and Affiliations

  1. Department of Strategy & Operations Management, Bristol Business School, University of the West of England, Bristol, BS16 1QY, UK

    Boumediene Ramdani

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  1. Boumediene Ramdani
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Correspondence to Boumediene Ramdani .

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Editors and Affiliations

  1. , School of Business and Economics, Swansea University, Singleton Park, Swansea, SA2 8PP, United Kingdom

    Yogesh K. Dwivedi

  2. IMD, Ch. de Bellerive 23, Lausanne, 1001, Switzerland

    Michael R. Wade

  3. Principia College, Maybeck Place 1, Elsah, 62028, Illinois, USA

    Scott L. Schneberger

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Ramdani, B. (2012). Information Technology and Organisational Performance: Reviewing the Business Value of IT Literature. In: Dwivedi, Y., Wade, M., Schneberger, S. (eds) Information Systems Theory. Integrated Series in Information Systems, vol 28. Springer, New York, NY. https://doi.org/10.1007/978-1-4419-6108-2_15

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