Chapter

The Practice of Enterprise Modeling

Volume 15 of the series Lecture Notes in Business Information Processing pp 138-152

Quantifying IT Impacts on Organizational Structure and Business Value with Extended Influence Diagrams

  • Pia GustafssonAffiliated withIndustrial Information and Control Systems, Royal Institute of Technology
  • , Ulrik FrankeAffiliated withIndustrial Information and Control Systems, Royal Institute of Technology
  • , David HöökAffiliated withIndustrial Information and Control Systems, Royal Institute of Technology
  • , Pontus JohnsonAffiliated withIndustrial Information and Control Systems, Royal Institute of Technology

Abstract

This paper presents a framework for analysis of how IT systems add business value by causally affecting the structure of organizations. The well established theory of organizational behavior developed by Mintzberg combined with more recent research on business value of IT is used to develop a quantitative theoretical framework showing which business values are affected by IT in relation to the organizational structure. This framework, which is based upon a qualitative equivalent developed in an earlier paper, describes relationships in an Extended Influence Diagram for quantified conditional probability tables and open up for an empirical appliance. Hence obtained data can be mathematically expressed for more sound assessments. The intention is to create a fully functioning tool for analyses of what kind of IT system should be used by an organization with a given structure to maximize its business value.

Keywords

IT benefits organizational structure Mintzberg business value