Evaluation of Business Value of IT-System Scenarios: A Case Study at a Large North European Power Company

This paper presents a method, the KTH IT Investment Evaluation Method, to assess the business value of IT-investments. The method aims at a priori and at a relative low cost of investigation assesses the business value of IT- systems scenarios, i.e. alternative combinations of IT-systems intended to support a particular business area. First, the scenarios are evaluated with respect to their technical quality. Second, the technical attributes used for this technical evaluation are related to business value dimensions, i.e. it is determined in what ways certain functions and non-functional attributes generate business value. Third, the business value dimensions are prioritized by the business managers. Finally, the business value of each scenario is established by combining the technical assessments with the relations to the business value dimension found in the second step and the prioritizations done by business managers. All parts of the method have been verified in comprehensive case study at a large European power company and the results are presented in the paper.