Organizational Slack and Firm Performance in the Process of IT Investment - An Experimental Study of Manufacturing Firms

Author

Yuanyuan, Chen ; Zhongying, Qi

Author_Institution

Sch. of Manage., Harbin Inst. of Technol., Harbin, China

Volume

2

fYear

2010

fDate

26-28 Nov. 2010

Firstpage

608

Lastpage

612

Abstract

This study considers how organizational slack (unabsorbed and absorbed) changes and affects firm performance in the different stage of IT investment. We test hypotheses using finance data (1994-2008) from 196 manufacturing listed companies in China. The results indicate there is higher unabsorbed slack in the early stage of IT investment, and there is higher absorbed slack in the run-in stage of IT investment. The correlation between unabsorbed slack and firm performance is positive in the process of IT investment. In contrast absorbed slack presents negative correlation with the firm performance. The hypothesis is not supported for the measure of absorbed slack in the run-in stage.

Keywords

financial data processing; information technology; investment; organisational aspects; China; IT investment; finance data; firm performance; information technology; organizational slack; product paradox; firm performance; information technology investment; organizational slack; productivity paradox;

fLanguage

English

Publisher

ieee

Conference_Titel

Information Management, Innovation Management and Industrial Engineering (ICIII), 2010 International Conference on

Conference_Location

Kunming

Print_ISBN

978-1-4244-8829-2

Type

conf

DOI

10.1109/ICIII.2010.312

Filename

5694651