Information Technology Portfolio Management Research Articles

Constructing information technology (IT) portfolios to achieve enterprise strategic goals in multi-business unit firms

This study aims to develop a new methodology in IT Portfolio Management (ITPM) to address the impact of portfolio priorities on IT strategies in a multi-business unit firm. The methodology includes a new ITPM model and uses simulated scenarios to overcome limitations due to insufficient real-world organizational IT portfolio data. The weight scores generated by the proposed ITPM model can enable the firm to create a rational viewpoint to improve its IT investment efficiency while establishing IT priorities to achieve enterprise strategic goals. Such an approach would enable firms to reduce their reliance on CIO intuition in guiding firms’ technology portfolios.

Effect of data privacy and security investment on the value of big data firms

The use of big data analytics (BDA) and related technologies by firms can raise concerns regarding data privacy and security (DPS). In this study, with stock return and risk as indicators of firm performance, we investigate how DPS investment affects the financial performance of BDA firms (firms with BDA investment) and non-BDA firms (firms without BDA investment). We use a difference-in-differences approach and apply the propensity score matching to 1400 DPS announcements made by 228 US firms whose stocks are publicly traded on US stock markets from 2004 to 2018. The main findings are as follows: (1) On average, DPS investment significantly reduces firms' systematic risk. (2) The risk reduction effects are greater for non-BDA firms than for BDA firms. Our results indicate that DPS investment reduces firm risk and that the business value of specific information technology (IT) investment (e.g., DPS) is influenced by firms' other IT assets (e.g., BDA). The present findings advance the literature on the business value of IT and firms' IT portfolio management in digitized business environments.

Proposta de modelo para seleção de ferramentas de tecnologia da informação baseado nas dimensões da gestão do portfólio

Estudos sobre investimentos em tecnologia da informação (TI) tornaram-se importantes atualmente no mundo dos negócios devido aos altos gastos com TI. Entretanto, as dificuldades em justificar e selecionar os investimentos de TI estão associadas à natureza intangível dos benefícios alcançados com a utilização dessas tecnologias. Este artigo propõe um modelo para o auxílio à tomada de decisão na escolha de ferramentas de TI. O modelo visa analisar as dimensões da gestão do portfólio de TI (GPTI) através de seus benefícios esperados pelos gestores com a aquisição de softwares (soluções/ferramentas) e hardwares. Consiste em um modelo no qual é utilizada uma abordagem multicritério, a fim de criar um ranking das tecnologias, combinada com a aplicação da Programação Inteira zero - um para selecionar as tecnologias que proporcionarão os maiores benefícios esperados, respeitando as restrições financeiras e tecnológicas. Para testar o modelo proposto foi realizado um teste em uma empresa de serviços de médio porte. Testou-se na organização a simplicidade do modelo e obteve-se como resultado quatro ferramentas selecionadas de acordo com as dimensões da GPTI.

Information technology portfolio management implementation: a case study

PurposeThe purpose of this paper is to examine the implementation of IT portfolio management (IT PoM) and develop a framework guided by adaptive structuration theory to describe the key structures, features, and appropriation steps needed to effectively manage IT investments and assets.Design/methodology/approachUsing a longitudinal case study approach, data were collected over an eight-month period from a US Fortune 500 company during its IT PoM implementation effort.FindingsThe case analysis highlights three major IT PoM features appropriated by the organization: creating the portfolio; assessing and analyzing the portfolio characteristics based on risk, benefits, alignment, criticality, and cost; and balancing decisions to start projects or terminate under-performing IT assets such as servers and applications. The spirit of IT PoM was interpreted differently by different stakeholders (data providers, business units, and IT PoM team) leading to resistance to implementation. The case data underscores the importance of establishing a governance steering committee and new internal structures to help push the balancing decisions across the organization.Research limitations/implicationsThe results are useful in developing guidelines and strategies to achieve successful implementation of IT PoM and to highlight critical factors that practitioners need to pay close attention to during an IT PoM implementation.Originality/valueThis study represents one of the first attempts to describe a detailed IT PoM implementation process and how IT PoM appropriation process can lead to improved decision making within the organization.

Analyzing Companies Use of Information Technology Portfolio Management as an Aid to it Investments Management (Case Study)

The ITPM technique has been considered as a new technique that has received little attention in IT research. This research carried out five case studies in different companies from several economic sectors which were using information technology portfolio management (ITPM). In the studied companies, seven persons interviewed and were high-level executives working in the IT department. Result show that ITPM, as one of the information assessment categories for identifying the useful innovations in IT, helps IT and business leaders to identify their priorities and companies to better manage their IT investments. So this technique is significant and useful for companies. So different levels of ITPM use was found to IT investment management. It was observed, that ITPM is used most frequently in IT investment planning, which is the process most discussed and used in analyzed companies. The ITPM technique is used more frequently in Company 2 than in the other cases because the organization of the IT area in the company is structured according to ITPM dimensions.

Managing an IT portfolio on a synchronised level, or: The costs of partly synchronised investment valuation

Information technology (IT) investments are usually risky by nature and account for a considerable part of annual investment budgets. Though value-based information technology portfolio management (ITPM) aims at sustained economic growth and long-term value creation regarding IT investments, companies often fail to implement a synchronised ITPM approach that considers all relevant risk-/return components within IT investment valuation. In this paper, we compare a synchronised and an only partly synchronised valuation of IT investments within a company’s ITPM by means of an optimisation model. We show that an only partly synchronised IT investment management leads to sub-optimal investment decisions as especially stochastic interdependency structures are neglected. Furthermore, we analyse how different risk-/return structures of IT investment opportunities affect the valuation error resulting from an only partly synchronised IT investment valuation, and conduct a comprehensive simulation study to further validate our findings.

Strategic Integration of IT and Business Service Management

INTRODUCTION IT Industry Background The computer software development industry is comprised of businesses that design, develop, and market support systems and application software used in personal computers, servers, embedded systems, and mobile devices. The software industry started during the personal computer revolution in the mid 1970s and includes software services such as training and consulting. Proprietary or commercial software and open source software are the predominant types of businesses in the software industry. The software industry segment includes IT giants such as Microsoft, IBM, Hewlett-Packard (HP), Oracle, and SAP. The domestic software market is expected to grow at an annual rate of 5.7% from 2007 to 2012 with combined revenue of about $180 billion involving approximately 50,000 companies (Hoovers.com, 2009). The IT management industry consists of information technology and management which focuses on the management of a collection of systems, infrastructure and information that originated from the practice of IT Portfolio Management. IT management focuses on the management of information technologies as a business function that originated from the formation of the IT Infrastructure Library (ITIL) (http://www.itil.co.uk/). ITIL is a customizable framework of best practices for managing IT infrastructure, development, and operations. ITIL is an industry best practice for Business Service Management (Lindquist, Madduri, Paul, & Rajaraman, 2007). Business Service Management (BSM) (http://www.best-management-practice.com/) is a method created to automate and simplify the management of the various business processes, based on a service-oriented architecture. The IT management technology vendors who dominate the market are BMC Software, CA, IBM, and HP whose combined market share grew from 34 % in 2005 to 40% in 2006 and will reach approximately 45% in 2007 (Garbani & Mendal, 2007). There is little academic research in BSM (and ITIL) in the information systems, as well as the management and marketing literature (Cater-Steel & Toleman, 2007). Only a handful of journal articles (e.g. Davern & Wilkin, 2008; Fisher, 2006; Lindquist, Madduri, Paul, & Rajaraman, 2007) have researched the implications of BSM (and ITIL). Moreover, the literature does little to investigate the strategic and marketing-related impacts, reflecting the unique contribution of this current research case study. This paper is also written from an applied research viewpoint to emphasize the pragmatic aspects of the technologies. Therefore, the study adds the practitioner's perspective, since one of the co-authors is a Lead Software Quality Assurance Engineer at BMC Software. Not to mention, there is an increasing interest in the adoption of these technologies and solutions (e.g. ITIL) in corporate America today to enhance service delivery, support, and overall business efficiency (Cannon & Raisinghani, 2007; Fisher, 2006). Consequently, college business programs should train students in these emerging new technologies to stay competitive in the job market and apply classroom concepts in a hands-on approach (Beachboard & Beard, 2005; Cater-Steel & Toleman, 2007). Description of the Company's Business Pioneering the concept of Business Service Management, BMC Software, Inc. is a leading global provider of enterprise management solutions (systems, applications, databases, and service management) that empower companies to automate Information Technology (IT) and align it to the needs of the business. BMC Software is the 8th largest independent software vendor with 26 years of leadership and holds 94 software technology patents. BMC Software has international headquarters located in Amsterdam, The Netherlands and Singapore, Singapore. It also operates international offices in countries such as the Australia, England, Germany, China, France, India, Israel, Japan, and the Philippines. …

IT investment management and information technology portfolio management (ITPM)

Purpose – The purpose of this paper is to analyze some Brazilian companies’ use of the information technology portfolio management (ITPM) technique as an aid to their information technology (IT) investments management. Design/methodology/approach – It was carried out in five case studies in different Brazilian companies from several economic sectors which were using ITPM or were in the initial implementation phase. Eight interviews were conducted. The persons interviewed were high-level executives working in the IT department in the studied companies. Findings – Different levels of ITPM use was found with respect to IT investment management (planning, control and evaluation). It was observed, in the analyzed cases, that ITPM is used most frequently in IT investment planning, which is the process most discussed and used in analyzed companies. The ITPM technique is used more frequently in Company 2 than in the other cases because the organization of the IT area in the company is structured according to ITPM dimensions. Research limitations/implications – The ITPM technique has received little attention in IT research and research in this area identifying the use and applicability of ITPM in companies is still very limited in the information systems literature. Originality/value – The paper presents IT investment management in different Brazilian companies and how ITPM was used to help companies in this process compose by planning, control and evaluation.

Structural Models that Manage IT Portfolio Affecting Business Value of Enterprise Architecture

This paper examines the structural relationships between Information Technology (IT) governance and Enterprise Architecture (EA), with the objective of enhancing business value in the enterprise society. Structural models consisting of four related hypotheses reveal the relationship between IT governance and EA in the improvement of business values. We statistically examined the hypotheses by analyzing validated questionnaire items from respondents within firms listed on the Japanese stock exchange who were qualified to answer them. We concluded that firms which have organizational ability controlled by IT governance are more likely to deliver business value based on IT portfolio management.