An economic analysis of strategic information technology investments
MIS Quarterly - Special issue on the strategic use of information systems
Information Technology Effects on Firm Performance As Measured by Tobin's Q
Management Science
Productivity of Information Systems in the Healthcare Industry
Information Systems Research
Information Systems Research
Information Systems Research
Information technology payoff in the health-care industry: a longitudinal study
Journal of Management Information Systems - Special issue: Impacts of information technology investment on organizational performance
Discovering potential and realizing value from information technology investments
Journal of Management Information Systems - Special issue: Impacts of information technology investment on organizational performance
Value Implications of Investments in Information Technology
Management Science
Journal of Management Information Systems
Investment in Enterprise Resource Planning: Business Impact and Productivity Measures
Journal of Management Information Systems
Managing Information Technology Investment Risk: A Real Options Perspective
Journal of Management Information Systems
Journal of Management Information Systems
From Association to Causation via a Potential Outcomes Approach
Information Systems Research
Effects of information technology failures on the market value of firms
The Journal of Strategic Information Systems
Information technology investments and firm value
Information and Management
Market reaction to application service provider (ASP) adoption: An empirical investigation
Information and Management
Information Technology and Firm Boundaries: Impact on Firm Risk and Return Performance
Information Systems Research
The Impact of Automation of Systems on Medical Errors: Evidence from Field Research
Information Systems Research
Information Systems Research
Information Systems Research
Are New IT-Enabled Investment Opportunities Diminishing for Firms?
Information Systems Research
The Impact of IT-Related Spillovers on Long-Run Productivity: An Empirical Analysis
Information Systems Research
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Managers make informed information technology investment decisions when they are able to quantify how IT contributes to firm performance. While financial accounting measures inform IT's influence on retrospective firm performance, senior managers expect evidence of how IT influences prospective measures such as the firm's market value. We examine the efficacy of IT's influence on firm value combined with measures of financial performance for non-publicly traded (NPT) hospitals that lack conventional market-based measures. We gathered actual sale transactions for NPT hospitals in the United States to derive the q ratio, a measure of market value. Our findings indicate that the influence of IT investment on the firm is more pronounced and statistically significant on firm value than exclusively on the accounting performance measures. Specifically, we find that the impact of IT investment is not significant on return on assets (ROA) and operating income for the same set of hospitals. This research note contributes to research and practice by demonstrating that the overall impact of IT is better understood when accounting measures are complemented with the firm's market value. Such market valuation is also critical in merger and acquisition decisions, an activity that is likely to accelerate in the healthcare industry. Our findings provide hospitals, as well as other NPT firms, with insights into the impact of IT investment and a pragmatic approach to demonstrating IT's contribution to firm value.