A framework for determining IT effectiveness: an empirical approach

A framework has been developed to understand the factors that influence the benefits that an organization attains from the use of information technology (IT). The key elements of this framework included: (a) the linkage between IT objectives and the specific IT investments; (b) the influence of IT investments, market and economic conditions, and the organizational IT capabilities on the IT benefits and impact on an organization; and (c) the influence of the IT benefits and the impact, experienced in the past, on the future IT plans of an organization. This paper discusses the implications of various relationships, as demonstrated through statistical analysis by considering qualitative information on the market and economic conditions within which the firms operate. Our work indicates the need to follow a contingency-based approach in formulating IT objectives and making investment decisions for IT projects.