A Systematic Literature Review on 30 Years of Empirical Research on Information Systems Business Value

A Systematic Literature Review on 30 Years of Empirical Research on Information Systems Business Value

Ahad ZareRavasan, Michal Krčál
Copyright: © 2021 |Pages: 37
DOI: 10.4018/JGIM.288894
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Information Systems Business Value (ISBV) has been a key research topic for the IS research community. While the vast majority of ISBV research demonstrates the positive relationship between IS and firm performance, the fundamental question of the causal relationships between IS and business value remains partly unexplained. Moreover, researchers do not share a unified understanding of ISBV concepts. Therefore, this research intends to synthesize the past 30 years of empirical ISBV research, identify the gaps and shortcomings, conceptualize the ISBV concepts, and propose possibilities for further research that will widen the current narrowly shared ISBV bottom line. We aim to synthesize (1) different operationalization of concepts in existing ISBV research; (2) IS determinants, consequences, and the relations among the variables; (3) the role of contextual factors; and (4) the adopted theoretical views.
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The Information Systems1 Business Value (ISBV) has been one of the major research topics for IS researchers. ISBV is “the impact of investments, particularly IS assets on the multidimensional performance and capabilities of economic entities at various levels, complemented by the ultimate meaning of performance in the economic environment” (Schryen, 2013, p. 141). ISBV commonly refers to the impacts of IS, at both the intermediate process level and the organization-wide level, and comprises of efficiency and competitive impacts (Melville et al., 2004). Early ISBV empirical studies and popular Harvard Business Review article by Carr (2003), entitled “IT doesn’t matter,” were doubting ISBV (e.g., Hitt & Brynjolfsson, 1996; Hu & Plant, 2001; Weill, 1992). Gradually, arguments supporting the existence of ISBV have been observed (e.g., Kohli & Devaraj, 2004; Lee et al., 2015; Santhanam & Hartono, 2003). Early ISBV research has predominantly targeted the direct positive relationship between IS and firm performance (e.g., Barua et al., 1995; Mahmood & Mann, 1993a; Marshall & Byrd, 1997). Even though later research attempted to provide evidence about ISBV creation mechanisms (e.g., the effect of IS on business processes (e.g., Dehning et al., 2007; Shahzad et al., 2020), decision making performance (e.g., Aydiner et al., 2019; Mishra et al., 2018; Yichuan Wang & Byrd, 2017), or strategic orientation (e.g., Aydiner et al., 2019; Yeh et al., 2012)) and thus “unlocking the gray box”, it is not covered sufficiently in the history of ISBV research (Schryen, 2013). Despite this, based on our review, the basket of eight IS journals have published only 18 ISBV papers during the last decade. Schryen (2013) believes that the general decreasing attention to the ISBV topic is not rooted in any declining interest on the journals’ side, but is based on the declining activities of ISBV researchers. Providing new perspectives in the ISBV domain through fresh literature reviews can reactivate researchers’ interests and activities by highlighting the research gaps. This is very important in the ISBV domain as the ISBV research body is unbalanced.

On the one hand, some aspects of ISBV have been over-researched. For instance, even though it is well established in the recent literature that IS measures do not directly affect firm performance, most ISBV literature is dedicated to examining this relationship (Schryen, 2013). On the other hand, several aspects of the causal relationship between IS and business value and the mechanisms through which IS creates business value remain partially unaddressed. For instance, according to Schryen (2013, p. 149), “the particular relationships between IS assets and complementary capabilities, their roles in the value generation process, and the conditions under which competitive value is created remain unclear.” The effect of the time lag between IS investment and created business value and the role of different IS, management, and organizational theories while investigating ISBV research are also less explored areas (Rajiv Sabherwal & Jeyaraj, 2015).

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