Reconceptualizing information systems business value in the non-profit organizational context

The nonprofit sector is an important part of the U.S. economy as an estimated 2.3 million non-profit organizations contributed $804.8 billion to the gross domestic product (GDP), approximately 5.5$1.51 trillion in revenue, $1.45 trillion in expenses, and$2.71 trillion in total assets (Roeger et al., 2012). Many non-profit organizations use donated funds to address complex social problems such as education inequality, financial instability, and limited access to health care services. To impact change in these social areas, non-profit organizations operate within a complex business environment characterized by a significant reliance on volunteers, collaboration with other non-profit organizations, and the pursuit of community-driven strategic objectives. The contextual factors that characterize non-profit organizations can have an impact on the way information systems (IS) are integrated within organizational practices and on how these organizations can use IS effectively to achieve business goals (Zhang et al., 2010). Yet, IS research within the non-profit setting is considerably limited (Zhang et al., 2010) and the extent of the impact of these contextual factors is unknown. Further, understanding how non-profit organizations gain value from IS in the non-profit environment has also been neglected in academic literature. Typical terms associated with IS business value research, such as impact on productivity, on market performance, or on economic growth (Schryen, 2013), are not applicable in the non-profit business environment. Non-profit organizational performance is dualistic in nature, primarily focusing on the attainment of various social goals within a particular community in addition to traditional financial measures (Zmud, Carte, & Te'eni, 2004). Therefore, an alternate conceptualization of IS business value and its relationship to organizational performance is necessary when examining IS in non-profit organizations. This multi-method dissertation aims to address the aforementioned issues by focusing on the role of IS in non-profit organizational practices to examine how IS business value is derived in the non-profit context and its impact on non-profit organizational performance. We employ an alternate approach to examining IS business value through the usage of the knowledge-based view of the firm as the theoretical base. This divergence from previous studies which focus solely on the resource-based view of the firm provides us with an entirely new avenue for examining IS business value in the non-profit organizational context. First, within the Introduction, we provide a detailed explanation of the contextual factors in the non-profit context. Second, we provide a thorough literature review on IS business value and discuss the difficulties in directly applying it in the non-profit organizational context. Third, we argue for reconceptualizing IS business value using the knowledge-based view of the firm as the theoretical base. This provides us with a firm ground upon which we can conduct the three studies of this dissertation. The research detailed was conducted at two organizations: United Way of Greater Greensboro (UWGG) and United Way of Central Carolinas (UWCC). Study 1 employs an action research approach at UWGG where, through collaboration with key employees, practical solutions were developed to address IS related issues faced by the focal organization. More specifically, we focused on the utilization of the Enterprise System in an organizational practice and derived theoretical insights on IS business value through integrating Practice theory and Process Theory in the action research approach. Study 2 employs case study methodology to examine business intelligence (BI) practices at UWCC. We provide background on BI usage in the for-profit organizational context and highlight the lack of research in the non-profit organizational context. We then examine BI from a process perspective and theorize on the value that is derived from the organizational utilization of an integrated data system. We draw from intellectual capital research, a core concept based on the knowledge-based view of the firm, to examine how BI provides UWCC with new knowledge on the impact of their programs in the community. We theorize on non-profit IS business value through examining the relationship between BI-facilitated Intellectual capital and its resultant impact on the non-profit's social goal. Study 3 provides a comparative analysis of the role of IS in the social goal strategies employed at both UWGG and UWCC. Using SWOT (strengths, weaknesses, opportunities, and threats) analysis, we examine the favorable and unfavorable aspects of how information systems are utilized in each organization's social goal strategy and provide prescriptive insight into how non-profit organizations can transition towards better strategic IS utilization. Lastly, we conclude this dissertation with a brief summary of salient points, including the dissertation's contributions to research and practice and a discussion of future research. Overall, this three study dissertation provides a holistic view of the role of IS in non-profit organizational social goal strategies and how non-profits derive value from their information systems. This dissertation fills gaps in research on IS business value by reconceptualizing it from a knowledge-based view of the firm, applying it in the non-profit organizational context, and developing theoretical insights on it from multiple perspectives. We make significant contributions to literature in management, organizational behavior, and information systems through our focus on IS usage and utilization in non-profit organizations. This dissertation is one of the first studies to examine non-profit IS organizational practices in situ, provide practical insight to the role of IS in non-profit social goal strategies, and develop theoretical insights into how non-profits utilize and gain value from information systems