Building the Conceptual Model

Building the Conceptual Model

Robert van Wessel (Tilburg University, Netherlands)
DOI: 10.4018/978-1-61520-759-6.ch004
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It is difficult to isolate the business contribution of IT investments, and investments related to IT standardization are no exception, as discussed in the previous chapter. In Chapter 2 literature on standard setting processes and standards was described and in Chapter 3 literature was reviewed on the impact of IT on the process performance of a firm. In this chapter the choice for the research method, as part of the research approach depicted in Chapter 1, Figure 3, will be clarified and an initial conceptual model will be composed. The research method chosen comprises both exploratory and explanatory case study research as this was considered the best way to complement theory in this underdeveloped domain of IS literature (Yin, 1994). The conceptual model integrates aspects of standardization, standards application and standards control, and relates those to the impact of IT standards used in an organization on business process performance.
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Pilot Case Study


Since little scientific literature exists on selection and control of usage of (IT) standards within organizations, a pilot case study was carried out to get insight into these processes with the objective of exploring this aspect in practice and complementing the scarce literature. It may provide some conceptual clarifications for the conceptual model later on. The pilot case study on IT Standardization was carried out at the Corporate Center and at a Strategic Business Unit (SBU) of FINCORP, a global financial services company. Interviews were held with experts in this field (see Appendix II, Table 1). Furthermore, a collection of materials was analyzed such as official documentation on policies and standards, newsletters, presentations and leaflets.

Table 1.
Selection criteria for IT Standards
Selection CriteriaWeighting Factor
Product/Service capability10
Product Supportability10
Commercial considerations, including Total Cost of Ownership (TCO)10
Manufacturer or vendor track record9
Existing installed base29
Implementation considerations9
Product category coverage8
Product Manageability8
Manufacturer or vendor strategy8
Global Supply model7
Manufacturer or vendor partnerships7
Market Research reports7
Manufacturer or vendor references6

Corporate IT standardization

Objectives of the Corporate IT standardization department are listed in one of the policy documents: 1) to save money, 2) to comply with rules from regulators such as the Dutch National Bank and 3) to design IT systems that can react quickly and robustly to changing business needs. In other words standards should:

  • Decrease the total cost of ownership;

  • Assure a secure environment;

  • Comply with regulatory requirements;

  • Increase interoperability;

  • Increase flexibility.

In general the interviewees agree with these consequences, except for flexibility. Some stick to the popular belief of 'the more efficient the less flexible', referring to economies of scale, whereas others perceive standards as tools to enhance flexibility. These individuals mentioned for example that making use of interoperability software (like gateways and middleware) one can link all sorts of idiosyncratic application software. In addition, there was no consensus whether standards should be used as a control tool or not. Nevertheless, what everybody agreed on, is that standards are to meet the business drivers, like cost reductions and to comfort the level of flexibility.

The IT Product Standardization policy of this financial services company consists of the following mandatory rules and is reviewed every two years, like any other policy and standards in this company:

  • 1.

    Preferably open industry standards should be used to enable interaction with the bank's customers and business partners as well as to provide the means to ensure interoperability of IT systems bank-wide.

  • 2.

    Preferably protocols/vendors/products with a wide market support should be adopted to guarantee ample available skills/resources and competitiveness in the market place.

  • 3.

    Preferably IT systems should be based on standard protocols to mitigate the diversity of the bank’s systems.

  • 4.

    Preferably existing investments must be re-used and leveraged and new products must not be introduced where the required functionality is already available.

IT standards are designed and approved by so called Corporate Architecture (Review) Teams.

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