Impact of Analytics in Financial Decision Making: Evidence from a Case Study Approach

Objectives: This study seeks to investigate the impact of analytics in financial decision making in organizations. Prior work: Analytics has emerged as a critical business enabler in today’s competitive market place. Its application has provided businesses with the opportunity to gain a competitive advantage by leveraging the vast amount of data they have available. Analytics is not limited to a particular tool or method however; it encompasses a range of combinations and it is this element that has made analytics such a success factor. Approach: This study uses a case study approach to identify critical areas of business where analytics have played a vital role in financial decision making. Results: Application of analytics in financial decision making is shown to streamline information resulting in making decisions more efficiently and effectively. Implications: This study provides insights in financial decision making using statistical backing which has a vast number of applications in finance functions. As such, areas such as such detecting fraud, budgeting and forecasting, risk management and customer insights need to actively apply analytical tools to better manage and enhance the information gained from these areas. Value: This study integrates the use of information technology tools and packages with financial management with the view of enhancing financial decision flow in organizations

Influence of Information Technology on Organization Strategy

The exponential development of information technology has presented many opportunities to organizations; however, it has also presented several challenges. A key challenge is how do organizations effectively use information technology and incorporate it into their strategies to make full use of its capabilities as an enabler. The fast-changing nature of information technology has resulted in little empirical evidence on how it influences organization strategy. The Strategic Alignment Model was a popular model created to assist organizations to align their information technology and their business strategy; however, the growth of technology may have made this model irrelevant in this age. Therefore, organizations need to determine what factors drive this alignment. Using hermeneutic phenomenology, 12 in-depth interviews were conducted within IBM South Africa to determine real-life drivers that help create this alignment. The themes derived from the interview texts reveal that consumers are becoming more empowered; therefore, organizations need to be more flexible in their business models and strategies. Furthermore, the integration of cross-functional roles in the organization at the management level allow for improved alignment between information technology and strategy as better integrated roles bring a combination of these two elements

Does Information Technology Spend Impact On Company Performance? Evidence From Accounting And Market-Based Measures

This study investigates the association between information technology spend and future company performance for a sample of companies where accounting and market value measures are used as proxies for performance. While the earnings measure indicated a strong positive relationship initiating early on, the profit margin and asset turnover measures provided some unexpected and mixed findings. However, Tobin’s q, a market valuation measure, indicated a strong positive relationship that supported the notion that investment in information technology can improve future company performance

Impact of Analytics in Financial Decision Making: Evidence from a Case Study Approach

This study seeks to investigate the impact of analytics in financial decision making in organizations in a rapidly growing knowledge economy. Analytics has emerged as a critical business enabler in today‟s competitive market place. Its application has provided businesses with the opportunity to gain a competitive advantage by leveraging the vast amount of data they have available. Analytics is not limited to a particular tool or method however; it encompasses a range of combinations and it is this element that has made analytics such a success factor. This study uses a case study approach to identify critical areas of business where analytics have played a vital role in financial decision making. Application of analytics in financial decision making is shown to streamline information resulting in making decisions more efficiently and effectively. This study provides insights in financial decision making using statistical backing which has a vast number of applications in finance functions. As such, areas such as such detecting fraud, budgeting and forecasting, risk management and customer insights need to actively apply analytical tools to better manage and enhance the information gained from these areas. This study integrates the use of information technology tools and packages with financial management with the view of enhancing financial decision flow in organizations