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Measuring the Business Value of IT: A Resource-Based View of Leading Indicators

Measuring the Business Value of IT: A Resource-Based View of Leading Indicators
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Author(s): Penelope Sue Greenburg (Widener University, USA), Ralph H. Greenberg (Temple University, USA), Kevin Dow (Kent State University, USA) and Jeffrey Wong (Oregon State University, USA)
Copyright: 2006
Pages: 2
Source title: Emerging Trends and Challenges in Information Technology Management
Source Editor(s): Mehdi Khosrow-Pour, D.B.A. (Information Resources Management Association, USA)
DOI: 10.4018/978-1-59904-019-6.ch191
ISBN13: 9781616921286
EISBN13: 9781466665361

Abstract

The business value of IT is a topic of importance to both IT and business sides of the organization. However, despite the growing body of research on assessing the value of IT, there are still issues and debates concerning the appropriate approach. Most of the research has focused on ex post measurements, which are dependent on factors that influence the measurements in innumerable identified and unidentified ways. This paper contributes to this literature by proposing a set of metrics that focus on leading indicators of value as opposed to ex post measurements. To develop these leading indicators, we use the resource-based theory of the firm and resource dependency theory to adapt and extend two previously identified sets of metrics. The first is the balanced scorecard, which is widely used by business managers to align internal performance measures with strategic goals. The second is DeLone and McLean’s measures of IS success. The extension focuses on two additional areas. The first is measuring system and business flexibility, which critical in today’s fast-changing environment. The second addresses inter-organization and network IT measurement issues.

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