IT Investments and Myopic Behavior in Firms

We examine i myopic behavior exists with respect to a firm\u27s IT investments. Specifically, we examine if the market returns to IT investments are moderated by the investor time horizon, such that investors with shorter time horizons are more likely to reward firms that choose to invest their IT dollars on short-term (maintenance) projects rather than on long-term (new development) projects. our results indicate the possibility of significantly differential returns to the two types of IT expenditures based on the nature of the investor’s timing horizon

A Multi-level Analysis of the Impact of Health Information Technology on Hospital Performance

This paper examines the impact of health information technology (HIT) implementation and meaningful use on hospital productivity and financial performance. Focusing on healthcare affords unique opportunity to understand how individual hospitals implement and utilize the HITs in a meaningful way for better performance. We propose hypotheses predicting a hospital’s operating and financial performance as a function of HIT capital, meaningful use of HIT, and the complementary effect of health information exchange (HIE) coordination with HIT use. Secondary survey data over a three-year period (2007-2009) on various HIT and hospital performance measures collected from 2,557 U.S. hospitals were analyzed by hierarchical linear regression approach. We find reasonably good support for our hypotheses linking HIT capital and meaningful use of HIT to productivity metrics and to financial performance, after controlling for key factors. These findings show that it is important to track and measure meaningful use beyond simply looking at HIT adoption

The Antecedents of Information Systems Development Capability in Firms: A Knowledge Integration Perspective

The linkages between IS and business units are recognized as being critical to information systems development processes and outcomes. Previous research has found that they are associated with better performing ISD teams, stronger alignment between firms’ IT investments and business objectives, and comparatively superior exploitation of information technologies for business ends. What remains lacking in this stream is a coherent theoretical explanation for why and how the linkages between the IS unit and business units in a firm influence ISD processes and outcomes. This study draws on strength-of-ties theory to develop and test a project-level model that links both structural and cognitive IS-business linkages to ISD outcomes and processes. The key premise of this model is that IS-business linkages influence ISD primarily by facilitating integration of business and technical knowledge dispersed across internal business functions and outside the formal boundaries of the firm during the ISD process. Such integration of internal and external knowledge in turn influences ISD processes and outcomes. We tested the model using data on 133 projects collected from CIOs and client-side managers in 133 firms. Our results provide strong support for the hypothesized model

Digital Centricity and Innovation Performance

This paper examines the shift toward more digital-centric innovations experienced by US firms. By digital centricity, we refer to the increasing proportion of ICT patents in the overall patent portfolio of a firm. Using data from U.S public firms between 1980 and 2012, we document the growing digital centricity of firm innovations and test the subsequent impact of this shift on innovation performance and firm valuation. Results show that firms with higher digital-centricity in their innovation portfolio are able to achieve higher innovation efficiency and effectiveness. We further show that innovation efficiency and effectiveness are salient to the market valuation of firms. While innovation effectiveness or the value of new product introductions is completely incorporated in current market valuation, innovation efficiency is not fully priced in current market value, but is accounted for in the long-run abnormal returns for the firm

Efficacy of R&D work in offshore captive centers: An empirical study of task characteristics, coordination mechanisms, and performance

Seizing the latest technological advances in distributed work, an increasing number of firms have set up offshore captive centers (CCs) in emerging economies to carry out sophisticated R&amp;D work. We analyze survey data from 132 R&amp;D CCs established by foreign multinational companies in India to understand how firms execute distributed innovative work. Specifically, we examine the performance outcomes of projects using different technology-enabled coordination strategies to manage their interdependencies across multiple locations. We find that modularization of work across locations is largely ineffective when the underlying tasks are less routinized, less analyzable, and less familiar to the CC. Coordination based on information sharing across locations is effective when the CC performs tasks that are less familiar to it. A key contribution of our work is the explication of the task contingencies under which coordination based on modularization versus information sharing yield differential performance outcomes. </jats:p

Linking Information Technology and Dynamic Capabilities: The Elusive Dancing Partners?

A key question for information systems researchers and practitioners is how IT can build a competitive advantage in turbulent environments (Sambamurthy et al. 2003). The increase in environmental turbulence has made “dynamic IS strategy” all the more challenging; however, this critical topic still remains relatively under-researched (Wade and Hulland 2004). Most important, even if the link between IT and competitive advantage has been extensively examined, there is still a debate about the strategic role of IT (Carr 2003), which may intensify in turbulent environments