Information technology investments in purchasing: An empirical study of dimensions and antecedents

Abstract Despite the fact that U.S. companies have made substantial investments in information technology (IT), there is a paucity of empirical research on the nature of IT investments and boundary conditions that determine the extent of these investments. This study reviews the extant IT literature, develops a series of propositions related to the multidimensional nature of IT investments and their relationship with several antecedent conditions, and presents the results of an empirical test of the propositions in the context of the purchasing function of U.S. firms. Our results support the premise that IT used in purchasing is not a homogeneous phenomenon, but can, instead, be represented by three dimensions: base computer systems and support, purchasing-specific applications, and vender communications. Our findings further indicate that IT dimensions respond in a varying fashion to different antecedent conditions. Support was also found for the building-block nature of IT investments.

[1]  Marion G. Sobol,et al.  The relationship between computerization and performance: A strategy for maximizing the economic benefits of computerization , 1983, Inf. Manag..

[2]  Sunder Kekre,et al.  Business Value of Information Technology: A Study of Electronic Data Interchange , 1995, MIS Q..

[3]  P. Bentler,et al.  Comparative fit indexes in structural models. , 1990, Psychological bulletin.

[4]  F. Webster.  Industrial Marketing Strategy , 1991 .

[5]  Blake Ives,et al.  In Search of Sustainability: Reaping Long-term Advantage from Investments in Information Technology , 1990, J. Manag. Inf. Syst..

[6]  Wilbur B. England,et al.  Purchasing and materials management , 1980 .

[7]  Paul A. Strassmann,et al.  The Business Value of Computers: An Executive's Guide , 1990 .

[8]  Yannis Bakos,et al.  Dependent Variables for the Study of Firm and Industry-Level Impacts of Information Technology , 2013, ICIS.

[9]  Varun Grover,et al.  DO STRATEGIC SYSTEMS REALLY PAY OFF?An Analysis of Classic Strategic IT Cases , 1995 .

[10]  R. Bagozzi,et al.  On the evaluation of structural equation models , 1988 .

[11]  W. R. Dillon,et al.  Some Results on the Behavior of Alternate Covariance Structure Estimation Procedures in the Presence of Non-Normal Data , 1989 .

[12]  Izak Benbasat,et al.  Electronic Data Interchange and Small Organizations: Adoption and Impact of Technology , 1995, MIS Q..

[13]  Michael J. Ginzberg,et al.  Key Recurrent Issues in the MIS Implementation Process , 1981, MIS Q..

[14]  Varun Grover,et al.  Using information and information technology for sustainable competitive advantage: Some empirical evidence , 1989, Inf. Manag..

[15]  John Seidler,et al.  On Using Informants: A Technique for Collecting Quantitative Data and Controlling Measurement Error in Organization Analysis , 1974 .

[16]  Bradley R. Hertel.  Minimizing Error Variance Introduced By Missing Data Routines in Survey Analysis , 1976 .

[17]  Rodney L. Stump,et al.  Employing information technology in purchasing: Buyer-supplier relationships and size of the supplier base , 1997 .

[18]  Ven Sriram,et al.  The impact of electronic data interchange on purchasing: an empirical investigation , 1995 .

[19]  Peter Weill,et al.  The Relationship Between Investment in Information Technology and Firm Performance: A Study of the Valve Manufacturing Sector , 1992, Inf. Syst. Res..

[20]  Robert J. Kauffman,et al.  An evaluative framework for research on the performance effects of information technology investment , 1989, ICIS '89.

[21]  Thomas V. Bonoma,et al.  Segmenting the industrial market , 1983 .

[22]  Jae-On Kim,et al.  The Treatment of Missing Data in Multivariate Analysis , 1977 .

[23]  Tawfik Jelassi,et al.  SIM Paper Competition: Competing Through EDI at Brun Passot: Achievements in France and Ambitions for the Single European Market , 1994, MIS Q..

[24]  Glenn E. Mangurian,et al.  The changing value of communications technology , 1990 .

[25]  Patricia J. Daugherty,et al.  PREDICTING EDI TECHNOLOGY ADOPTION IN LOGISTICS MANAGEMENT: THE INFLUENCE OF CONTEXT AND STRUCTURE , 1995 .

[26]  F. W. McFarlan,et al.  Portfolio approach to information systems , 1989 .

[27]  David Targett,et al.  The great IT benefit hunt , 1994 .

[28]  C. James Bacon,et al.  The Use of Decision Criteria in Selecting Information Systems/Technology Investments , 1992, MIS Q..

[29]  Gilbert A. Churchill.  A Paradigm for Developing Better Measures of Marketing Constructs , 1979 .

[30]  M Broadbent,et al.  Business and technology agenda for information systems executives , 1994 .

[31]  James D. McKeen,et al.  Computerization and management: A study of conflict and change , 1992, Inf. Manag..

[32]  David K. Goldstein,et al.  Information support for sales and marketing: A case study at a small grocery manufacturer , 1990, Inf. Manag..

[33]  Wanda J. Orlikowski,et al.  Studying Information Technology in Organizations: Research Approaches and Assumptions , 1991, Inf. Syst. Res..

[34]  Richard E. Plank,et al.  The impact of computer usage by purchasing , 1992 .

[35]  David W. Gerbing,et al.  An Updated Paradigm for Scale Development Incorporating Unidimensionality and Its Assessment , 1988 .

[36]  John Fernie,et al.  International Comparisons of Supply Chain Management in Grocery Retailing , 1995 .

[37]  P. Strassmann.  Information Payoff: The Transformation of Work in the Electronic Age , 1985 .

[38]  Henry C. Lucas,et al.  Implementation: The Key to Successful Information Systems , 1981 .

[39]  William L. Fuerst,et al.  Information technology and sustained competitive advantage: a resource-based analysis , 1995 .

[40]  M. Morton,et al.  Electronic data interchange: How much competitive advantage? , 1990 .

[41]  S. Harris,et al.  Organizational Performance and Information Technology Investment Intensity in the Insurance Industry , 1991 .

[42]  Badie N. Farah,et al.  The status of marketing information systems, decision support systems and expert systems in the marketing function of U.S. firms , 1991, Inf. Manag..

[43]  Eric K. Clemons,et al.  Sustaining IT Advantage: The Role of Structural Differences , 1991, MIS Q..