Prioritizing IT Management Issues and Business Performance

Abstract

We use a novel dataset extracted from the Society of Information Management’s (SIM) survey of chief information officers (CIOs) and top information technology (IT) executives to examine organizations’ most critical IT management issues during 2014-2017 and their effect on firm profitability. According to the SIM surveys, the top two IT issues management prioritizes are security/cybersecurity/privacy and IT alignment with the business. We find that firms that prioritize these two IT management issues exhibit higher profitability than firms that do not. Our study contributes to the Information Systems (IS) and Accounting Information Systems (AIS) literature on IT business value by providing empirical evidence on IT-business alignment – and to some extent, IT security – positively affecting firm financial performance.

The rationality of human behaviour and accuracy in information technology management

“…As there is an increasing number of individuals working in the field (Commission [2017]; Commission [2022]), and workplace usage of IT infrastructure has expanded with time (Commission [2012]; Commission [2014]; Commission [2017]), the field of IT management is considered relevant. Expected annual global IT spending is over $5 trillion and rising (Gartner [2023]), however, not all investments yield the desired results (Flyvbjerg et al [2022]; Zong and Wang [2022]), despite the fact that IT initiatives have the ability to determine an organisation's performance (Hundal et al [2022]; Klaus et al [2022]; Pat ón-Romero et al. [2019]; Zong and Wang [2022]).…”

“…Research not only discusses the existence of cross-organisational cooperation and provides models for optimising it, but it also demonstrates the importance of this cooperation. Business IT alignment is relevant as it can improve IT performance (Raymond et al [2019]), enhance innovation (Heroux and Fortin [2018]), and improve the firms' profitability as measured by the Return on Equity (Klaus et al [2022]). Cooperation between organisational agents is also significant as a requirement for effective and efficient IT utilisation ).…”

“…This study of IT management includes developing new and managing existing Information Technology, as well as utilising Information Technology to achieve organisational goals (Badawy [1998]; Catalin and Alina [2011]; Danesh et al [2018]; Hundal et al [2022]; Reichstein [2019]; Turban et al [2012]). The field of IT management is considered relevant given the increasing number of individuals working in the field (Commission [2017]; Commission [2022]), the expending workplace usage of IT infrastructure (Commission [2012]; Commission [2014]; Commission [2017]), the high annual IT spending (Gartner [2023]), and the impact to the organisation's performance (Hundal et al [2022]; Klaus et al [2022]; Pat ón-Romero et al. [2019]; Zong and Wang [2022]).…”