The impact of investment evaluation in information systems on the performance
IS investments nowadays have an impact on firms performance as they can reduce costs, improve product quality; provide firms with a competitive advantage. Having such an impact on firms each investment should be carefully assessed by appraisal techniques before implementation. As these different techniques are an important determining factor of the IS performance the question arising is what is the impact of the selection of one of these different techniques on the information systems performance.
Bacon (1992) stresses the importance of selection the appropriate technique for the investment decision making, as these methods significantly impact the effectiveness of the decision making, provide consequences on the project implementation and return. Onsongo et al. (2009) suggests that there are five important stages of an investment project in which the appraisal of an investment should be carried out: “feasibility, development, implementation, post implementation an in rerouting operations”. Renkema and Berghout (1995) provide us with the following formal appraisal techniques: “financial, multi-criteria, ratio and portfolio approach”. Whereas Farbey et. al (1992) provide information’s that make it possible to see which evaluation method is suitable in which circumstance, taking the factors that influence the investments decision into account. Several researchers complain that managers often rely on methods that do not fall within these boundaries. H1: Gut feeling has ultimately a negative impact on the information system performance. As Onsongo et al. (2009) suggests: there is not one “best” method for justifying investment projects but multiple methodologies, used to overcome the limitations of one technique. H2: Formal appraisal techniques such as ROI and CBA have a positive effect on the information system performance.
The objective of this paper is to determine the importance of the connection between the organizational culture and the information system which can be vital to achieve essential business goals. However the proper definition of information system (IS) is important, as different people create confusion in this respect, which according to Anderson (1992) it is the system which captures, records, and ...
The data necessary to research the above listed research question and hypothesis will be collected by the means of a quantitative research. Specific managers of interest will be selected on the basis of the researchers judgment. After having decided on a company and sector, information on their used techniques and performance has to be gathered. Statements on these information need to be collected via the use of a questionnaire where managers opinion and the results are being collected.
Bacon, C.J. (1992).
“The use of decision criteria in selecting information systems/technology
Investments”, MIS Quarterly, September 335-53.
Onsongo, E. and Ateya, I. (2009).
“Evaluating Information Technology Investments – A Survey of Kenyan Commercial Banks”. Proceedings of the International Academy of African Business and Development (IAABD) Conference, 19 – 23 May 2009, Kampala, Uganda.
Farbey, B., Land, F., Targett, D. (1992).
“Evaluating Investments in IT”, Journal of Information Technology, 7, 109-122.
Renkema, T., Berghout, E. (1995).
“Methodologies for Information Systems Investment Evaluation at the Proposal Stage”, Eindholfen University of Technology, The Netherlands.