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Managing Strategic IT Investment Decisions: From IT Investment Intensity to Effectiveness

Author

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  • Tzu-Chuan Chou

    (University of Warwick, UK)

  • Robert Dyson

    (University of Warwick, UK)

  • Philip L. Powell

    (University of Bath, UK)

Abstract

Many information technology projects fail, especially those intended as strategic. Yet, there is little research that attempts to explain the link between the IT investment intensity of strategic investment decisions (SIDs) and organizational decision-making, in order to understand this phenomenon. This paper proposes an analytical model employing a number of constructs: effectiveness of decisions, interaction and involvement in the decision formulating process, accuracy of information and strategic considerations in the evaluation process, rarity of decisions, and the degree of IT intensity of an investment in strategic investment decisions. The model explores the relationships influencing the effectiveness of decisions. Empirical testing is based on a sample of 80 SIDs from Taiwanese enterprises. The results show that interaction, accuracy of information, and strategic considerations are mediators in the linkage of IT investment intensity and the effectiveness of SIDs. The implications of these findings for the management of strategic IT investment decisions are discussed.

Suggested Citation

  • Tzu-Chuan Chou & Robert Dyson & Philip L. Powell, 2000. "Managing Strategic IT Investment Decisions: From IT Investment Intensity to Effectiveness," Information Resources Management Journal (IRMJ), IGI Global, vol. 13(4), pages 34-43, October.
    • Handle: RePEc:igg:rmj000:v:13:y:2000:i:4:p:34-43
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    References listed on IDEAS

    as
    1. Michael A. Hitt & Beverly B. Tyler, 1991. "Strategic decision models: Integrating different perspectives," Strategic Management Journal, Wiley Blackwell, vol. 12(5), pages 327-351, July.
    2. J. Randall Woolridge & Charles C. Snow, 1990. "Stock market reaction to strategic investment decisions," Strategic Management Journal, Wiley Blackwell, vol. 11(5), pages 353-363, September.
    3. Liam Fahey, 1981. "On strategic management decision processes," Strategic Management Journal, Wiley Blackwell, vol. 2(1), pages 43-60, January.
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