HOW DOES INFORMATION TECHNOLOGY AFFECT BUSINESS VALUE - A REASSESSMENT AND RESEARCH PROPOSITIONS

Because of the tremendous growth in the investment in information technology (IT), senior management has begun to demand that the value of this investment be assessed. This assessment is not possible without measurement. As a result, many feel that the measurement of IT value will be the critical management task of the next decade. The purpose of this paper is threefold First, it reviews current research on the value,of IT with the hope of understanding the reason for the equivocal results which have been obtained It does this by examining the assumptions and measures which have been used in framing this research. Second, it looks at how organizational performance is measured and how performance is presumed to be affected by information technology. Finally, it explores a new set of assumptions, measures, and research propositions which may yield more fruitful results in assessing the value of information technology. While the paper is theoretical, it develops the groundwork for future empirical studies by establishing the necessary quantitative measures for such investigation.