Information technology (IT) investment and the role of a firm: an exploratory study

Authors:
Thompson S. H. Teo;Poh Kam Wong;Ee Hui Chia
Affiliations:
Department of Decision Sciences, Faculty of Business Administration, National University of Singapore, 10 Kent Ridge Crescent, Singapore 119260, Singapore;Centre for Management of Innovation and Technopreneurship, Faculty of Business Administration, National University of Singapore, 10 Kent Ridge Crescent, Singapore 119260, Singapore;Department of Decision Sciences, Faculty of Business Administration, National University of Singapore, 10 Kent Ridge Crescent, Singapore 119260, Singapore
Venue:
International Journal of Information Management: The Journal for Information Professionals
Year:
2000

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Abstract

This study extends Weill's (Do computers payoff? A study of information technology investments and manufacturing performance. Washington, DC: International Center for Information Technologies, Information Systems Research, 3(4), 307-333) work by categorizing IT investment into four types of management objectives: transactional, strategic, informational and threshold. The relationships between these management objectives and firm's role (defined in terms of traditional, evolving and strategic) are investigated through a questionnaire survey of managers in the service sector. As expected, firms adopting a traditional role seem to favor investment in transactional IT. However, there appears to be an increasing emphasis on strategic IT investment for all three types of firms, regardless of the role of IT. Implications of the results are discussed.