Deriving Business Value from IT Applications in Product Development: A Complementarities-Based Model - Information Technology and Product Development - page 38

Table 2.3 Modern organizational architecture, IT deployment, and business value

How the practice reinforces
relationships Practice Examples from the Cisco case

Automation of routine
tasks

Reinforcement of IT investment ⇒
IT deployment:
Routine tasks, which require little
human judgment, are
particularly suitable for
automation, thus reinforcing the
link between IT investment and
IT deployment.
Reinforcement of IT deployment
⇒

Cisco's web-enablement initiative
allowed automation of virtually
any routine task. This can be
seen in how Cisco's architecture
supports extensive self-service
by both employees and
customers. None of this
self-service would be possible
without automating the
underlying tasks. business value

Automation of routine tasks, when
it can be accomplished
successfully, provides a very
direct route to business value. IT
systems are the means by which
white-collar work is automated.

Highly skilled labor,
training, and
recruitment

Reinforcement of IT investment ⇒ Cisco is a high-technology

company with a particularly
high ratio of white-collar
workers (due to outsourcing of
manufacturing).
It used its web-enabled
architecture to implement a
robust world-wide program of
distance learning, thus
reinforcing the value of its
skilled workforce.

IT deployment:
Modern IT is complex and requires
higher skill to understand and
implement than prior
technologies. This suggests that
a more highly skilled labor force
will increase the level of
deployment achieved for any
given level of IT investment.
Reinforcement of IT deployment
⇒ business value:
Much of modern IT can be seen as
a tool to amplify human skill by
“informating” processes. The
more skill that exists to begin
with, the greater the productivity
benefits that will accrue from
amplifying that skill. Also, IT
itself is an important tool to
facilitate skill acquisition.

More decentralized
decision making

Reinforcement of IT deployment
⇒

Senior Cisco managers are
equipped with “digital
dashboards” that allow them to
monitor key performance
indicators at lower levels of the
organization. All employees are
given a personalized “my
Yahoo” page that “pushes”

business value:
Decentralized decision making has
the advantage of being more
responsive, and it allows
decisions to take into account
local conditions. Modern IT
enhances the value of
decentralization by moving