GAUGING THE QUALITY OF MANAGERIAL DECISIONS REGARDING INFORMATION TECHNOLOGY DEPLOYMENT

Abstract

This paper presents a new approach for evaluating the quality of managerial choices in information technology (IT) deployment. The approach involves measuring the extent to which deployment sites perform in accordance with the firm's objectives, given the constraints of their competitive environment. Our method is to model environmental descriptors as inputs to a production process that yields business outputs. This production process is then evaluated via standard productivity assessment methods to obtain "competitive efficiency” scores. Interpreting why different deployment sites exhibit different levels of competitive efficiency involves estimating regression models in which competitive efficiency scores are the dependent variables and management's IT design choices are the independent variables. Such measurement and interpretative methods provide managers with new tools to improve their IT location and design decisions. Our framework is illustrated in the context of automatic teller machine (ATM) deployment.