Measuring Organizational IS Effectiveness: An Overview and Update of Senior Management Perspectives

Abstract

This paper reports the views of 80 senior IT managers about IT evaluation approaches, and the benefits that IT provides for their organizations. Their views were obtained through a survey mailed to medium to large organizations in both Europe and the US. The survey sought answers to three questions: How does the senior IT manager's organization assess the value of its (1) overall IT investment portfolio? (2) individual IT projects and applications? (3) IT function? Questions for the survey were based on a thorough review of prior research into IT evaluation. The paper provides a summary of that prior work and compares current findings to prior research. Consistent with prior research, the paper concludes that many firms do not conduct rigorous evaluations of all their IT investments, and offers a tentative explanation of why it might be rational to skip formal evaluations in some circumstances. It also posits five push factors to explain occasions when more lasting improvements in IT evaluation practice have occurred. © 2002, Authors. All rights reserved.