A taxonomy of information systems applications: the benefits' evaluation ladder

Abstract

One of the prime reasons for the deployment of information technology in organizations is the expectation of a positive return on the investment. But the returns from different types of application vary both in terms of the ability to provide straightforward measurement of the costs and benefits, and in the degree of certainty with which estimates of costs and benefits will be realised. This paper provides a framework for classifying applications in the form of an eight-rung ladder, each rung of which represents a class of application. The way in which applications need to be handled and the methods by which their impact can be evaluated changes from rung to rung. Moving up the ladder increases the complexity of evaluation and the degree of risk and uncertainty, but at the same time also increases the potential returns on the investments. The ladder is different from conventional ‘strategic IT’ frameworks: it is a framework for action as well as understanding; it specifically relates to evaluation; and it does not imply any predetermined or time-based sequence of progress.