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Information Technology and Corporate Strategy: A View from the Top

Author

Listed:
  • Sirkka L. Jarvenpaa

    (Assistant Professor, Graduate School of Business, University of Texas at Austin, Austin, Texas 78712-1175)

  • Blake Ives

    (Constant Distinguished Professor of MIS, Edwin L Cox School of Business, Southern Methodist University, Dallas, Texas 75275-0333)

Abstract

Letters to shareholders in 649 annual reports published between 1972 and 1987 were analyzed for CEOs' views about information technology. Significant differences were found across industries—banking, publishing, petroleum, and retailing—in the number of times information technology was mentioned, the types of applications discussed, and the content of the discussion. The results of the industry analysis were in keeping with expectations based on the relative information intensity of the various industries. An analysis of the letters over time suggests that the position of IT in the firm, at least as seen by the CEO, was not much different in 1987 than it had been in 1982, but has expanded considerably from its position in 1972 and 1973. Reassuringly, we also found that the number of IT related phrases in the CEOs' letters to the shareholders was positively correlated with the firm's yearly net profits as a percentage of sales. A lagged analysis on profitability data could not, however, resolve the competing explanations for the correlation between profits and the number of IT-related phrases. These findings contribute new insights concerning strategic information systems and support the use of annual report data in analyzing organizational information technology phenomena.

Suggested Citation

  • Sirkka L. Jarvenpaa & Blake Ives, 1990. "Information Technology and Corporate Strategy: A View from the Top," Information Systems Research, INFORMS, vol. 1(4), pages 351-376, December.
    • Handle: RePEc:inm:orisre:v:1:y:1990:i:4:p:351-376
    DOI: 10.1287/isre.1.4.351
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    Citations

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    Cited by:

    1. Shafer, Scott M. & Byrd, Terry A., 2000. "A framework for measuring the efficiency of organizational investments in information technology using data envelopment analysis," Omega, Elsevier, vol. 28(2), pages 125-141, April.
    2. Zubin R. Mulla & R. K. Premarajan, 2008. "Strategic Human Rfesource Management in Indian it Companies: Development and Validation of a Scale," Vision, , vol. 12(2), pages 35-46, April.
    3. Kathuria, Ravi & Anandarajan, Murugan & Igbaria, Magid, 1999. "Selecting IT applications in manufacturing: a KBS approach," Omega, Elsevier, vol. 27(6), pages 605-616, December.
    4. Kun Shin Im & Kevin E. Dow & Varun Grover, 2001. "Research Report: A Reexamination of IT Investment and the Market Value of the Firm—An Event Study Methodology," Information Systems Research, INFORMS, vol. 12(1), pages 103-117, March.
    5. Sunil Mithas & Jonathan Whitaker, 2007. "Is the World Flat or Spiky? Information Intensity, Skills, and Global Service Disaggregation," Information Systems Research, INFORMS, vol. 18(3), pages 237-259, September.
    6. Ingrid E. Fisher & Margaret R. Garnsey & Mark E. Hughes, 2016. "Natural Language Processing in Accounting, Auditing and Finance: A Synthesis of the Literature with a Roadmap for Future Research," Intelligent Systems in Accounting, Finance and Management, John Wiley & Sons, Ltd., vol. 23(3), pages 157-214, July.
    7. Anandhi S. Bharadwaj & Sundar G. Bharadwaj & Benn R. Konsynski, 1999. "Information Technology Effects on Firm Performance as Measured by Tobin's q," Management Science, INFORMS, vol. 45(7), pages 1008-1024, July.
    8. Štemberger, Mojca Indihar & Manfreda, Anton & Kovačič, Andrej, 2011. "Achieving top management support with business knowledge and role of IT/IS personnel," International Journal of Information Management, Elsevier, vol. 31(5), pages 428-436.
    9. Zachary R. Steelman & Taha Havakhor & Rajiv Sabherwal & Sanjiv Sabherwal, 2019. "Performance Consequences of Information Technology Investments: Implications of Emphasizing New or Current Information Technologies," Service Science, INFORMS, vol. 30(1), pages 204-218, March.
    10. Arleta A Majoch & Andreas G F Hoepner & Tessa Hebb, 2014. "Sources of Stakeholder Salience in the Responsible Investment Movement: Why Do Investors Sign the Principles for Responsible Investment?," ICMA Centre Discussion Papers in Finance icma-dp2014-13, Henley Business School, University of Reading.

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