Location via proxy:   [ UP ]  
[Report a bug]   [Manage cookies]                
Skip to main content
Springer Nature Link
Log in

Approaches to the Ex-ante Evaluation of Investments into Information Systems

  • WI — State-of-the-Art
  • Published:
Wirtschaftsinformatik

Abstract

This paper critically reviews approaches for the evaluation of investments in information systems prior to their implementation. First, the ground for the review is prepared by examining characteristics of evaluation, information systems and value. A classification of the numerous evaluation approaches identified in English and German literature is then presented. Examples of each class are reviewed and their advantages and drawbacks are discussed. Their use in evaluation practice is analyzed through the examination of empirical studies and directions for future research are given.

This is a preview of subscription content, log in via an institution to check access.

Access this article

Log in via an institution

Subscribe and save

Springer+ Basic
$34.99 /Month
  • Get 10 units per month
  • Download Article/Chapter or eBook
  • 1 Unit = 1 Article or 1 Chapter
  • Cancel anytime
Subscribe now

Buy Now

Price excludes VAT (USA)
Tax calculation will be finalised during checkout.

Instant access to the full article PDF.

Institutional subscriptions

Similar content being viewed by others

References

  1. Agarwal, R.; Tanniru, M. R.; Dacruz, M.: Knowledge-Based Support for Combining Qualitative and Quantitative Judgments in Resource Allocation Decisions. In: Journal of Management Information Systems 9 (1992) 1, pp. 165–184.

    Google Scholar 

  2. Ahituv, N.: A Systematic Approach Toward Assessing the Value of an Information System. In: MIS Quarterly 4 (1980) 4, pp. 61–75.

    Google Scholar 

  3. Alpar, P.; Grob, H. L.; Weimann, P.; Winter, R.: Anwendungsorientierte Wirtschaftsinformatik: strategische Planung, Entwicklung und Nutzung von Informations- und Kommunikationssystemen. 3. ed., Vieweg, Braunschweig 2002.

    Google Scholar 

  4. Anselstetter, R.: Betriebswirtschaftliche Nutzeffekte der Datenverarbeitung: Anhaltspunkte für Nutzen-Kosten-Schätzungen. Springer, Berlin 1984.

    Google Scholar 

  5. Anandarajan, A.; Wen, H. J.: Evaluation of Information Technology Investment. In: Management Decision 37 (1999) 4, pp. 329–337.

    Google Scholar 

  6. Arribas, E. H.; Inchusta, P. J. S.: Evaluation Models of Information Technology in Spanish Companies: A Cluster Analysis. In: Information & Management 36 (1999) 3, pp. 151–164.

    Google Scholar 

  7. Arnold, V.: Discussion of An Experimental Evaluation of Measurements of Information System Effectiveness. In: Journal of Information Systems 9 (1995) 2, pp. 85–91.

    Google Scholar 

  8. Avison, D. E.; Cuthbertson, C. H.; Powell, P.: The Paradox of Information Systems: Strategic Value and Low Status. In: Journal of Strategic Information Systems 8 (1999) 4, pp. 419–445.

    Google Scholar 

  9. Avgerou, C.: Information Systems: What Sort of Science Is It? In: Omega 28 (2000) 5, pp. 567–579.

    Google Scholar 

  10. Avgerou, C.: Evaluating Information Systems by Consultation and Negotiation. In: International Journal of Information Management 15 (1995) 6, pp. 427–436.

    Google Scholar 

  11. Bacon, J. C.: The Use of Decision Criteria in Selecting Information Systems/Technology Investments. In: MIS Quarterly 16 (1992) 3, pp. 335–353.

    Google Scholar 

  12. Baumöl, U.; Frie, T.: Ein integriertes IV-Controlling-Instrumentarium für Investitionsund Betriebsphase. In: von Dobschütz, L.; Baumöl, U.; Jung, R. (eds.): IV-Controlling aktuell: Leistungsprozesse — Wirtschaftlichkeit — Organisation. Gabler, Wiesbaden 1999, pp. 123–152.

    Google Scholar 

  13. Bannister, F.; Remenyi, D.: Acts of Faith: Instinct, Value and IT Investment Decisions. In: Journal of Information Technology 15 (2000) 3, pp. 231–241.

    Google Scholar 

  14. Baumöl, U.; Reichmann, T.: Kennzahlengestütztes IV-Controlling. In: Controlling 8 (1996) 4, pp. 204–211.

    Google Scholar 

  15. Ballantine, J.; Stray, S.: Financial Appraisal and the IS/IT Investment Decision Making Process. In: Journal of Information Technology 13 (1998) 1, pp. 3–14.

    Google Scholar 

  16. Bedell, E. F.: The Computer Solution. Dow Jones-Irwin, Homewood 1985.

    Google Scholar 

  17. Blackler, F.; Brown, C.: Theory and Practice in Evaluation: The Case of the New Information Technologies. In: BjØrn-Andersen, N.; Davis, G. B. (eds.): Information Systems Assessment: Issues and Challenges. North-Holland, Amsterdam 1988, pp. 351–367.

    Google Scholar 

  18. Brynjolfsson, E.; Hitt, L. M.: Beyond the Productivity Paradox. In: Communications of the ACM 41 (1998) 8, pp. 49–55.

    Google Scholar 

  19. Brealey, R. A.; Myers, S. C.: Principles of Corporate Finance. 7. ed., Irwin McGraw-Hill, Boston 2003.

    Google Scholar 

  20. Buss, M. D. J.: How to Rank Computer Projects. In: Harvard Business Review 61 (1983) 1, pp. 118–125.

    Google Scholar 

  21. Clegg, C.; Axtell, C.; Damodaran, L.; Farbey, B.; Hull, R.; Lloyd-Jones, R.; Nicholls, J.; Sell, R.; Tomlinson, C.: Information Technology: A Study of Performance and the Role of Human and Organizational Factors. In: Ergonomics 40 (1997) 9, pp. 851–871.

    Google Scholar 

  22. Chircu, A. M.; Kauffman, R. J.: Limits to Value in Electronic Commerce-Related IT Investments. In: Journal of Management Information Systems 17 (2000) 2, pp. 59–80.

    Google Scholar 

  23. Computer Sciences Corporation: 14th Annual Survey of IS Management Issues. CSC, El Sugundo 2001.

    Google Scholar 

  24. Davern, M. J.; Kauffman, R. J.: Discovering Potential and Realizing Value from Information Technology Investments. In: Journal of Management Information Systems 16 (2000) 4, pp. 121–143.

    Google Scholar 

  25. Davenport, T. H.: Process Innovation — Reengineering Work through Information Technology. Harvard Business School Press, Boston 1993.

    Google Scholar 

  26. Dehning, B.; Richardson, V. J.: Returns on Investments in Information Technology: A Research Synthesis. In: Journal of Information Systems 16 (2002) 1, pp. 7–30.

    Google Scholar 

  27. Doherty, N.; King, M.: The Treatment of Organisational Issues in Systems Development Projects: The Implications for the Evaluation of Information Technology Investments. http://www.iteva.rug.nl/ejise/vol4/papers/Organisational%20Issues%20Evaluation.htm, 2001-03-01, as of 2004-01-27.

  28. Elliot, S.; Melhuish, P.: A Methodology for the Evaluation of IT for Strategic Implementation. In: Journal of Information Technology 10 (1995) 2, pp. 87–100.

    Google Scholar 

  29. Ezingeard, J.-N.; Irani, Z.; Race, P.: Assessing the Value and Costs Implications of Manufacturing Information and Data Systems: An Empirical Study. In: European Journal of Information Systems 7 (1998) 4, pp. 252–260.

    Google Scholar 

  30. Farbey, B.; Land, F.; Targett, D.: Evaluating Investments in IT. In: Journal of Information Technology 7 (1992) 2, pp. 109–122.

    Google Scholar 

  31. Farbey, B.; Land, F.; Targett, D.: How to Assess Your IT Investment: a Study of Methods and Practice. Butterworth-Heinemann, Oxford et al. 1993.

    Google Scholar 

  32. Farbey, B.; Land, F.; Targett, D.: Moving IS Evaluation Forward: Learning Themes and Research Issues. In: Journal of Strategic Information Systems 8 (1999) 2, pp. 189–207.

    Google Scholar 

  33. Fitzgerald, G.: Evaluating Information Systems Projects: A Multidimensional Approach. In: Journal of Information Technology 13 (1998) 1, pp. 15–27.

    Google Scholar 

  34. Fowler, A.; Walsh, M.: Conflicting Perceptions of Success in an Information Systems Project. In: Journal of Project Management 17 (1999) 1, pp. 1–10.

    Google Scholar 

  35. Goodwin, P.; Wright, G.: Decision Analysis for Management Judgment. 2. ed., Wiley Chichester 2000.

    Google Scholar 

  36. Van Grembergen, W.; Van Bruggen, R.: Measuring and Improving Corporate Information Technology through the Balanced Scorecard. http://www.iteva.rug.nl/ejise/vol1/issue1/paper3/fr_pap.html, 1997-12-01, as of 2004-01-27.

  37. Guba, E. G.; Lincoln, Y. S.: Fourth Generation Evaluation. Sage, Beverly Hills 1989.

    Google Scholar 

  38. Hares, J.; Royle, D.: Measuring the Value of Information Technology. Wiley, Chichester 1994.

    Google Scholar 

  39. Haufs, P.: DV-Controlling: Konzeption eines operativen Instrumentariums aus Budgets-Verrechnungspreisen-Kennzahlen. Physica, Heidelberg 1989.

    Google Scholar 

  40. Heinrich, L. J.: Informationsmanagement: Planung, Überwachung und Steuerung der Informationsstruktur. Oldenbourg, München 1996.

    Google Scholar 

  41. Hogarth, R. M.: Judgement and Choice. Wiley, Chichester 1980.

    Google Scholar 

  42. Hochstrasser, B.; Griffiths, C.: Controlling IT Investment: Strategy and Management. Chapman & Hall, London 1991.

    Google Scholar 

  43. Huber, H.: Die Bewertung des Nutzens von IV-Anwendungen. In: von Dobschütz, L.; Baumöl, U.; Jung, R. (eds.): IV-Controlling aktuell: Leistungsprozesse-Wirtschaftlichkeit-Organisation. Gabler, Wiesbaden 1999, pp. 107–122.

    Google Scholar 

  44. Irani, Z.: Information Systems Evaluation: Navigating Through the Problem Domain. In: Information & Management 40 (2002) 1, pp. 11–24.

    Google Scholar 

  45. Irani, Z.; Love, P. E. D.: Developing a Frame of Reference for Ex-Ante IT/IS Investment Evaluation. In: European Journal of Information Systems 11 (2002) 1, pp. 74–82.

    Google Scholar 

  46. Ives, B.; Learmonth, G. P.: The Information System as Competitive Weapon. In: Communications of the ACM 27 (1984) 12, pp. 1193–1201.

    Google Scholar 

  47. Jones, S.; Hughes, J.: Understanding IS Evaluation as a Complex Social Process: A Case Study of a UK Local Authority. In: European Journal of Information Systems 10 (2001) 4, pp. 189–203.

    Google Scholar 

  48. Kaplan, R. S.; Norton, D. P.: The Balanced Scorecard-Measures That Drive Performance. In: Harvard Business Review 70 (1992) 2, pp. 71–79.

    Google Scholar 

  49. King, W. R.; Rodriguez, J. I.: Evaluating Management Information Systems. In: MIS Quarterly 2 (1978) 3, pp. 43–51.

    Google Scholar 

  50. Kleijnen, J. P.: Computers and Profits: Quantifying Financial Benefits of Information. Addison-Wesley, Reading 1980.

    Google Scholar 

  51. Krcmar, H.: Informationsmanagement. 3. ed., Springer, Berlin 2003.

    Google Scholar 

  52. Kütz, M.: Ein Konzept für das IV-Bench-marking. In: von Dobschütz, L.; Baumöl, U.; Jung, R. (eds.): IV-Controlling aktuell: Leistungsprozesse-Wirtschaftlichkeit-Organisation. Gabler, Wiesbaden 1999, pp. 23–52.

    Google Scholar 

  53. Lincoln, T.: Retrospective Appraisal of Information Technology Using SESAME. In: BjØrn-Andersen, N.; Davis, G. B. (eds.): Information Systems Assessment: Issues and Challenges. North-Holland, Amsterdam 1988, pp. 299–312.

    Google Scholar 

  54. Lundeberg, M.; Goldkuhl, G.; Nilson, A.: A Systematic Approach to Information Systems Development — Part I: Introduction. In: Information Systems 4 (1979), pp. 1–12.

    Google Scholar 

  55. Marsh, L.; Flanagan, R.: Measuring the Costs and Benefits of Information Technology in Construction. In: Engineering, Construction and Architectural Management, 7 (2000) 4, pp. 423–435.

    Google Scholar 

  56. MacFarlan, F. W.; MacKenney, J. L.: Corporate Information Systems Management: The Issues Facing Senior Executives. Dow Jones-Irwin, Homewood 1983.

    Google Scholar 

  57. Mahmood, M. A.; Szewczak, E. J.: Measuring Information Technology Investment Payoff: Contemporary Approaches. Idea Group Publishing, Hershey 1999.

    Google Scholar 

  58. Nagel, K.: Nutzen der Informationsverarbeitung: Methoden zur Bewertung von strategischen Wettbewerbsvorteilen, Produktivitäts-verbesserungen und Kosteneinsparungen. 2. ed., Oldenbourg, München 1990.

    Google Scholar 

  59. Ott, H. J.: Wirtschaftlichkeitsanalyse von EDV-Investitionen mit dem WARS-Modell am Beispiel der Einführung von CASE. In: Wirtschaftsinformatik 35 (1993) 6, pp. 522–531.

    Google Scholar 

  60. Parker, M. M.; Benson, R. J.: Information Economics: Linking Business Performance to Information Technology. Prentice-Hall, Englewood 1988.

    Google Scholar 

  61. Perridon, L.; Steiner, M.: Finanzwirtschaft der Unternehmung. 12. ed., Vahlen, München 2003.

    Google Scholar 

  62. Picot, A.: Bürokommunikation: Leitsätze für den Anwender. 3. ed., AIT, Hallbergmoos 1987.

    Google Scholar 

  63. Powell, P.: Information Technology Evaluation: Is It Different? In: Journal of the Operational Research Society 43 (1992) 1, pp. 29–42.

    Google Scholar 

  64. Retter, G.; Bastian, M.: Kombination einer Prozess- und Wirkungskettenanalyse zur Aufdeckung der Nutzenpotentiale von Informations- und Kommunikationssystemen. In: Wirtschaftsinformatik 37 (1995) 2, pp. 117–128.

    Google Scholar 

  65. Renkema, T. J.; Berghout, E.: Methodologies for Information Systems Investment Evaluation at the Proposal Stage: A Comparative Review. In: Information and Software Technology 39 (1997) 1, pp. 1–13.

    Google Scholar 

  66. Renkema, T. J.: The IT Value Quest: How to Capture the Business Value of IT-Based Infrastructure. Wiley, Chichester 2000.

    Google Scholar 

  67. Retter, G.: Ein prozeßorientiertes Wirtschaftlichkeitsanalyseverfahren zur Bewertung von Informationssystemen anhand strategischer Wirkungen. Rheinisch-Westfälische Technische Hochschule, Aachen 1996.

    Google Scholar 

  68. Reichwald, R.; Möslein, K.; Sachenbacher, H.; Engelberger, H.: Telekooperation: Verteilte Arbeits- und Organisationsformen. 2. ed., Springer, Berlin et al. 2000.

    Google Scholar 

  69. Rockart, J. F.: Chief Executives Define Their Own Data Needs. In: Harvard Business Review 57 (1979) 2, pp. 81–93.

    Google Scholar 

  70. Röthing, P.: WiBe21 — Empfehlung zur Durchführung von Wirtschaftlichkeitsbetrachtungen in der Bundesverwaltung, insbesondere beim Einsatz der IT. http://www.kbst.bund.de/Anlage300441/KBSt-Schriftenreihe+-Band+52+(1%2c3+MB).pdf, 2001-05-01, as of 2004-01-27.

  71. Ryan, S. D.; Harrison, D. A.: Considering Social Subsystem Costs and Benefits in Information Technology Investment Decisions: A View from the Future of Anticipated Payoffs. In: Journal of Management Information Systems 16 (2000) 4, pp. 11–40.

    Google Scholar 

  72. Dos Santos, B. L.: Justifying Investments in New Information Technologies. In: Journal of Management Information Systems 7 (1991) 4, pp. 71–90.

    Google Scholar 

  73. Sassone, P. G.; Schaffer, W. A.: Cost-Benefit Analysis. Academic Press, New York 1978.

    Google Scholar 

  74. Sassone, P. G.; Schwartz, A. P.: Cost-Justifying OA. In: Datamation 1986-02-15, pp.83–88.

    Google Scholar 

  75. Schulz, H.; Bölzing, D.: Erfassung des indirekten Nutzens von CIM-Investitionen. In: Die Betriebswirtschaft 49 (1989) 5, pp. 611–621.

    Google Scholar 

  76. Schä fer, G. (ed.): Functional Analysis of Office Requirements: A Multiperspective Approach. Wiley, Chichester 1988.

    Google Scholar 

  77. Schumann, M.: Wirtschaftlichkeitsbeurteilung für IV-Systeme. In: Wirtschaftsinformatik 35 (1993) 2, pp. 167–178.

    Google Scholar 

  78. Serafeimidis, V.; Smithson, S.: Information Systems Evaluation in Practice: A Case Study of Organizational Change. In: Journal of Information Technology 15 (2000) 2, pp. 93–105.

    Google Scholar 

  79. Siegwart, H.: Kennzahlen für die Unter-nehmungsführung. Haupt. Bern 1990.

    Google Scholar 

  80. Smithson, S.; Hirschheim, R.: Analysing Information System Evaluation: Another Look at an Old Problem. In: European Journal of Information Systems 7 (1998) 3, pp. 158–174.

    Google Scholar 

  81. Spitta, T.: Kostenrechnerische Grundlagen für das IV-Controlling. Kostenrechnungspraxis 44 (2000) 5, pp. 279–288.

    Google Scholar 

  82. Stickel, E.; Groffmann, H.-D.; Rau, K.-H. (eds.): Gabler-Wirtschaftsinformatik-Lexikon. Gabler, Wiesbaden 1997.

    Google Scholar 

  83. Stickel, E.: Informationsmanagement. Oldenbourg, München 2001.

    Book  Google Scholar 

  84. Symons, V.; Walsham, G.: The Evaluation of Information Systems: a Critique. In: Veryard, R. A. (ed.): The Economics of Information Systems and Software. Butterworth-Heinemann, Oxford 1991, pp. 71–88.

    Google Scholar 

  85. Taudes, A.; Feuerstein, M.; Mild, A.: Options Analysis of Software Platform Decisions: A Case Study. In: MIS Quarterly 24 (2000) 2, pp. 227–243.

    Google Scholar 

  86. Tam, K. Y.: Capital Budgeting in Information Systems Development. In: Information & Management 23 (1992) 3, pp. 345–357.

    Google Scholar 

  87. Tewald, C.: Die Balanced Scorecard fü r die IV. In: von Dobschütz, L. (ed.): IV-Controlling. Gabler, Wiesbaden 2000, pp. 621–640.

    Google Scholar 

  88. Ward, J.; Griffith, P.; Whitmore, P.: Strategic Planning for Information Systems. Wiley, Chichester 1990.

    Google Scholar 

  89. Walsham, G.: The Emergence of Interpretivism in IS Research. In: Information Systems Research 6 (1995) 4, pp. 376–394.

    Google Scholar 

  90. Walter, S. G.: The Practical Use of IS Evaluation Approaches. Excerpt from: Walter, S. G.: Approaches to the Ex-ante Evaluation of Information Systems. Diploma Thesis, University of Bielefeld, Faculty of Business and Economics, May 2003. http://www.wiwi.uni-bielefeld.de/~spitta/download/s-walter03.pdf, 2003-05-16, as of 2004-04-19.

    Google Scholar 

  91. van Wegen, B.; de Hoog, R.: Measuring the Economic Value of Information Systems. In: Journal of Information Technology 11 (1996) 3, pp. 247–260.

    Google Scholar 

  92. Wilner, N.; Koch, B.; Klammer, T.: Justification of High Technology Capital Investments- an Empirical Study. In: The Engineering Economist 37 (1992) 4, pp. 341–353.

    Google Scholar 

  93. Willcocks, L.; Lester, S.: Information Systems Investments: Evaluation at the Feasibility Stage of Projects. In: Technovation 11 (1991) 5, pp. 283–302.

    Google Scholar 

  94. van der Zee, J. T. M.; de Jong, B.: Alignment is Not Enough: Integrating Business and Information Technology Management with the Balanced Business Scorecard. In: Journal of Management Information Systems 16 (1999) 2, pp. 137–156.

    Google Scholar 

Download references

Author information

Authors and Affiliations

  1. Graduiertenkolleg “Betriebswirtschaftliche Aspekte lose gekoppelter Systeme und Electronic Business”, Christian-Albrechts-Universität Kiel, 24098, Kiel, Deutschland

    Sascha G. Walter

  2. Fakultät für Wirtschaftswissenschaften Angewandte Informatik/Wirtschaftsinformatik, Universität Bielefeld, 33501, Bielefeld, Deutschland

    Thorsten Spitta

Authors
  1. Sascha G. Walter
    View author publications

    You can also search for this author in PubMed Google Scholar

  2. Thorsten Spitta
    View author publications

    You can also search for this author in PubMed Google Scholar

Corresponding author

Correspondence to Sascha G. Walter.

Rights and permissions

Reprints and permissions

About this article

Cite this article

Walter, S.G., Spitta, T. Approaches to the Ex-ante Evaluation of Investments into Information Systems. Wirtschaftsinf 46, 171–180 (2004). https://doi.org/10.1007/BF03250934

Download citation

  • Issue Date:

  • DOI: https://doi.org/10.1007/BF03250934

Keywords

Search

Navigation