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tive r, there is more cohesion between the values
assumed by the variables. On the other hand, if
there is no correlation between two variables, the
values are more dispersed in the Monte Carlo
simulation (Rodger, Jason, 1999).
To conclude, performing risk analyses by using
a Monte Carlo simulation is less limitative than
using stress testing or gross sensitivity analysis,
because gross sensitivity analysis only changes
the values of one variable at a time and stress
testing places excessive weight on very unlikely
outcomes (Ross, 2004; Rodger, Jason, 1999).
For this reason, new methodologies that go
beyond the traditional investment analysis, which
are explained in the previous sub-section, are
needed instead of focusing only on cost analysis
and savings. Hence, focusing on intangible ben-
efits as well (Violino, 1997).
However, the problem lays in the fact that
CIOs must quantify these intangibles so as to give
evidence that a certain investment will actually
realize benefits for their organization. But, this is
not an easy task, on the contrary (Violino, 1997).
Nevertheless, some authors defend that it is
indeed possible to measure anything or at least
to reduce the uncertainty about the value of
something, by making assumptions that can help
reaching an estimated value, therefore defending
that the value of intangibles is not so intangible
after all (Hubbard, 2007)
It is important to analyze two well-know
approaches: the benefits management approach
and the Val IT framework, in terms of their main
advantages and disadvantages so as to identify
which situations are more favorable to one ap-
proach in detriment of the other. corresponds to
the outcome of this comparison.
it investment comprehensive
Approaches
Since both IS and ITIL regard organizations/sys-
tems as people, processes and technology (a slight
difference comparing to the Management Informa-
tion System mantra: “organization, management
and technology”), an ITIL implementation can be
considered an IS project. Another reason why ITIL
and IS are akin is the organizational change that
is associated to them, as both of them transform
the organizations where they are implemented
(Laudon & Laudon, 2005).
As a result, the value of ITIL implementations
can be estimated by using IT investment analysis
comprehensive approaches because, similarly
to any IS investment, ITIL investments can be
controlled and measured (Ward & Daniel, 2005).
Therefore, it is crucial to assess the real busi-
ness value of ITIL implementations, which means
that CIOs have to quantify the tangible benefits
(e.g. sales increase, incidents reduction, produc-
tion increase and workforce reduction), as well
as the intangible benefits (e.g. greater insight
into the relationship between users, configuration
items and incidents and customer satisfaction).
Even though intangible benefits are particularly
difficult to quantify and measure, they definitely
bring value to the organization, meaning that they
must be part of the estimation process mentioned
before.
Benefits Management
The benefits management approach is one of the
available solutions for this problem, because it
organizes and manages IS investments so as to
actually realize the potential benefits arising from
the use of IT. In fact, the benefits management
approach goes beyond the aspects of IS evaluation
such as financial metrics. Instead, benefits man-
agement is a comprehensive process that includes
several phases. Indeed, the benefits management
approach encloses the beginning and end of project
management and surrounds each project (Ward
& Daniel, 2005).
The advantages of the benefits management
approach are (Ward & Daniel, 2005):
•
CIOs and executives are able to realize
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