Abstract
Much has been learned through IT governance research about the nature of IT-related decisions, the location of decision rights for these decisions, and governance mechanisms applied to facilitate associated decision processes in large organisations. Our knowledge about IT governance structures in small and medium-sized enterprises (SME), on the other hand, is quite limited. Adopting a qualitative and inductive approach, this study examines the nature and influence of IT governance in SMEs through interviews with executives from three SMEs. Our results demonstrate that IT decision authority was centralized in all three SMEs but that senior management involvement in governance procedures and communication practices about governance policies were observed to explain differences in these organisations’ IT use. We propose recommendations based on the findings of this study.
Chapter PDF
References
Bianchi, C.: Introducing SD modeling into planning and control systems to management SME’s growth: a learning-oriented perspective. Systems Dynamics Review 18(3), 403–429 (2002)
Blau, P.M., Schoenherr, R.A.: The Structure of Organisations. Basic Books, New York (1971)
Bourgeois, L.J., Eisenhardt, K.M.: Strategic Decision Processes in High Velocity Environments: Four Cases in the Mircrocomputer Industry. Management Science 34(7), 816–835 (1988)
Brown, A.E.: Framing the frameworks: A review of IT governance research. Communication of the Association for Information Systems 15, 696–712 (2005)
Brown, C.V.: Examining the Emergence of Hybrid IS Governance Solutions: Evidence from a Single Case Site. Information Systems Research 8(1), 69–94 (1997)
Brown, C.V., Magill, S.L.: Reconceptualizing the Context-Design Issue for the Information Systems Function. Organisation Science 9(2), 176–194 (1998)
Carlson, J.R., Zmud, R.W.: Channel Expansion Theory and the Experiential Nature of Media Richness Perceptions. Academy of Management Journal 42(2), 153–170 (1999)
Child, J.: Organisational Structure, Environment and Performance: The Role of Strategic Choice. Sociology 6(1), 1–22 (1972)
Cross, J., Earl, M.J., Sampler, J.L.: Transformation of the IT function at British Petroleum. MIS Quarterly 21(4), 401–424 (1997)
Daft, R.L., Lengel, R.H.: Organisational Information Requirements, Media Richness and Structural Design. Management Science 32(5), 554–571 (1986)
Doll, W.J.: Avenues for top management involvement in successful MIS development. MIS Quarterly 9(1), 17–35 (1985)
Doll, W.J., Torkzadeh, G.: The Relationship of MIS Steering Committeteo Size of Firm and Formalization of MIS Planning. Communications of the ACM 30(11), 7 (1987)
Dubé, L., Paré, G.: Rigor in Information Systems Positivist Case Research: Current Practices, Trends, and Recommendations. MIS Quarterly 27(4), 597–635 (2003)
Earl, M.J., Feeny, D.F.: Is Your CIO Adding Value. Sloan Management Review 35(3), 10 (1994)
Edmondson, A.C., Winslow, A.B., Bohmer, R.M., Pisano, G.P.: Learning How and Learning What: Effects of Tacit and Codified Knowledge on Performance Improvement Following Technology Adoption. Decision Science 34(2), 197–223 (2003)
Ein-Dor, P., Segev, E.: Organisational Context and MIS Structure: Some Empirical Evidence. MIS Quarterly 6(3), 55–68 (1982)
Eisenhardt, K.M.: Building Theories from Case Study Research. Academy of Management Review 14(4), 532–550 (1989)
Feldman, D.C.: The Multiple Socialization of Organisation Members. The Academy of Management Review 6(2), 309–318 (1981)
Foong, S.Y.: Effect of end user personal and systems attributes on computer based information system success in Malaysian SMEs. Journal of Small Business Management 37(3), 81–87 (1999)
Ghobadian, A., Gallear, D.N.: Total quality management in SMEs. Omega 24(1), 83–106 (1996)
Granovetter, M.: Economic Action and Social Structure: The Problem of Embeddedness. American Journal of Sociology 91, 481–510 (1985)
Granovetter, M.: Problems of explanation in economic sociology. In: Nohria, N., Eccles, R.G. (eds.) Networks and Organisations: Structure, Form, and Action, pp. 25–56. Harvard Business School Press, Boston (1992)
Gulati, R.: Alliances and networks. Strategic Management Journal 19(4), 293–317 (1998)
Hadjimanoulis, A.: A resource-based view of innovativeness in small firms. Technology Analysis and Strategic Management 12(2), 263–281 (2000)
Hagmann, C., McCahon, C.: Strategic information systems and competitiveness: are firms ready for an IST-driven competitive challenge? Information & Management 25, 183–192 (1993)
Hall, R.H.: Organisations, Structure and Process. Prentice-Hall, Englewood Cliffs (1972)
Hay, M., Kamshad, K.: Small firm growth: intentions, implementation and impediments. Business Strategy Review 5(3), 49–68 (1994)
Huber, G.P.: A Theory of the Effects of Advanced Information Technologies on Organisational Design, Intelligence, and Decision Making. Academy of Management Review 15(1), 47–71 (1990)
Jenkins, J.M., Santos, R.F.: Centralization vs. Decentralization of Data Processing Functions. In: Goldberg, R., Lorin, H. (eds.) The Economics of Information Processing, pp. 62–67. Whiley-Interscience, New York (1982)
Jones, C., Hesterly, W.S., Borgatti, S.P.: A General Theory of Network Governance: Exchange Conditions and Social Mechanisms. Academy of Management Review 22(4), 911–945 (1997)
Kale, P., Singh, H., Perlmutter, H.: Learning and Protection of Proprietary Assets in Strategic Alliances: Building Relational Capital. Strategic Management Journal 21, 217–237 (2000)
Kaplan, B., Maxwell, J.A.: Qualitative Research Methods for Evaluating Computer Information Systems. In: Anderson, J.G., Aydin, C.E. (eds.) Evaluating Health Care Information Systems: Methods and Applications, pp. 45–68. Sage, Thousand Oaks (1994)
Keasey, K., Watson, R.: Small firm management. Blackwell, Cambridge (1993)
Krishnan, M.S., Rai, A., Zmud, R.W.: Editorial Overview: The Digitally Enabled Extended Enterprise in a Global Economy. Information Systems Research 18(3), 233–236 (2007)
Lengel, R.H., Daft, R.L.: The selection of communication media as an executive skill. Academy of Management Executive 2, 225–232 (1988)
Levy, M., Powell, P.: Strategies for growth in SMEs. Elsevier, Burlington (2005)
Lewis, W., Agarwal, R., Sambamurthy, V.: Sources of Influence on Beliefs about Information Technology Use: An Empirical Study of Knowledge Workers. MIS Quarterly 27(4), 657–678 (2003)
Lind, M., Zmud, R.W.: Improving Interorganisational Effectiveness through Voice Mail Facilitation of Peer-to-Peer Relationships. Organisation Science 6(4), 445–461 (1995)
Lybaert, N.: The information use in a SME: its importance and some elements of influence. Small Business Economics 10, 171–191 (1998)
McKeen, J.D., Guimaraes, T.: Selecting MIS Projects by Steering Committee. Communications of the ACM (December 9, 1985)
Meyer, M.W.: Size and the Structure of Organisations: A Causal Model. American Sociological Review 37(4), 434–440 (1972)
O’Reilly, C.A.: Variations in Decision Makers’ Use of Information Sources: The Impact of Quality and Accessibility of Information. Academy of Management Journal 25(4), 756–771 (1982)
Porter, M.E.: Competitive Advantage: Creating and Sustaining Superior Performance. Free Press, New York (1985)
Pugh, D.S., Hickson, D.J., Hinings, C.R., Turner, C.: Dimensions of Organisation Structure. Administrative Science Quarterly 13(1), 65–105 (1968)
Reich, B.H., Benbasat, I.: Factors That Influence the Social Dimension of Alignment between Business and Information Technology Objectives. MIS Quarterly 24(1), 81–113 (2000)
Ross, J.W., Beath, C.M., Goodhue, D.L.: Develop Long-Term Competitiveness through IT Assets. Sloan Management Review 11 (Fall 1996)
Rowley, T., Behrens, D., Krackhardt, D.: Redundant governance structures: an analysis of structural and relational embeddedness in the steel and semiconductor industries. Strategic Management Journal 21(3), 369–386 (2000)
Rumelt, R.P.: How Much Does Industry Matter? Strategic Management Journal 12(3), 167–185 (1991)
Sambamurthy, V., Bharadwaj, A., Grover, V.: Shaping Agility through Digital Options: Reconceptualizing the Role of Information Technology in Contemporary Firms. MIS Quarterly 27(2), 237–263 (2003)
Sambamurthy, V., Zmud, R.W.: Managing IT for success: The empowering business partnership. Financial Executive Research Foundation, New Jersey (1992)
Sambamurthy, V., Zmud, R.W.: Arrangements for Information Technology Governance: A Theory of Multiple Contingencies. MIS Quarterly 23(2), 261–290 (1999)
Schmitz, J., Fulk, J.: Organisational colleagues, media richness, and electronic mail: A test of the social influence model of technology use. Communication of the Association for Information Systems 18, 487–523 (1991)
Segars, A.H., Grover, V.: Strategic Information Systems Planning Success: An Investigation of the Construct and Its Measurement. MIS Quarterly 22(2), 139–163 (1998)
Starbuck, W.H.: Handbook of Organisations. Rand-McNally, Chicago (1965)
Storey, D.: Understanding the Small Business Sector. Routledge, London (1994)
Storey, D., Sykes, N.: Uncertainty, innovation and management. In: Burns, P., Dewhurst, J. (eds.) Small Business and Entrepreneurship, pp. 73–93. Macmillan, London (1996)
Street, C.T., Meister, D.B.: Small Business Growth and Internal Transparency: The Role of Information Systems. MIS Quarterly 28(3), 473–506 (2004)
Tallon, P.P., Kraemer, K.L., Gurbaxani, V.: Executives’ Perceptions of the Business Value of Information Technology: A Process-Oriented Approach. Journal of Management Information Systems 16(4), 145–173 (2000)
Te’eni, D.: Review: A Cognitive-Affective Model of Organisational Communication for Designing IT. MIS Quarterly 25(2), 251–312 (2001)
Thong, J.Y.L.: Resource constraints and information systems implementation in Singaporean small businesses. Omega 29(2), 143–156 (2001)
Thong, Y.L.: An Integrated Model of Information Systems Adoption in Small Businesses. Journal of Management Information Systems 15(4), 187–214 (1999)
Torkzadeh, G., Xia, W.: Managing Telecommunications by Steering Committee. MIS Quarterly 16(2), 13 (1992)
Uzzi, B.: The Sources and Consequences of Embeddedness for the Economic Performance of Organisations: The Network Effect. American Sociological Review 61(4), 674–698 (1996)
Vadapalli, A., Mone, M.A.: Information technology project outcomes: user participation structures and the impact of organisation behavior and human resource management issue. Journal of Engineering and Technology Management 17(2), 25 (2000)
Walker, G., Kogut, B., Shan, W.: Social Capital, Structural Holes and the Formation of an Industry Network. Organisation Science 8(2), 109–125 (1997)
Weill, P.: Don’t just lead, govern: How top-performing firms govern IT. MIS Quarterly Executive 3(1), 1–17 (2004)
Weill, P., Ross, J.W.: IT Governance: How Top Performers Manage IT Decision Rights for Superior Results. Harvard Business School Press, Boston (2004)
Weill, P., Ross, J.W.: A Matrixed Approach to Designing IT Governance. Sloan Management Review 46(2), 9 (2005)
Wilensky, H.: Hierarchical Control and Optimum Firm Size. Journal of Political Economy 75(2), 123–138 (1967)
Yin, R.: Case Study Research. Sage Publications, Beverly Hills (1984)
Zmud, R.W., Boynton, A.C., Jacobs, G.C.: The Information Economy: A New Perspective for Effective Information Systems Management. Data Base 18(1), 17–23 (1986)
Author information
Authors and Affiliations
Editor information
Editors and Affiliations
Rights and permissions
Copyright information
© 2009 IFIP International Federation for Information Processing
About this paper
Cite this paper
Huang, R., Zmud, R.W., Price, R.L. (2009). IT Governance Practices in Small and Medium-Sized Enterprises: Recommendations from an Empirical Study. In: Dhillon, G., Stahl, B.C., Baskerville, R. (eds) Information Systems – Creativity and Innovation in Small and Medium-Sized Enterprises. IFIP Advances in Information and Communication Technology, vol 301. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-642-02388-0_12
Download citation
DOI: https://doi.org/10.1007/978-3-642-02388-0_12
Publisher Name: Springer, Berlin, Heidelberg
Print ISBN: 978-3-642-02387-3
Online ISBN: 978-3-642-02388-0
eBook Packages: Computer ScienceComputer Science (R0)