From Framework to Organization-Specific Process Model for IT Investment Justification and Evaluation: An Experience of Action Research

This paper presents the preliminary results of an action research project in a large Norwegian oil and petrochemical company. It focuses on the pilot phase of the project for testing the feasibility and practicality of the unified justification and evaluation framework (UJEF) developed by the authors based on extant IT investment justification and evaluation theories and frameworks. The UJEF framework emphasizes the alignment between corporate competitive strategies and the objectives of IT investments and the integration between project justification and its subsequent evaluation. It builds on the strength of the recent theoretical development on competitive strategies, resource based view of IT value, real options analysis, and the balanced scorecard management system. The experience of the research shows that when dealing with theoretically complex, yet practically significant, issues such as IT investment justification and evaluation, action research methods can be valuable alternatives to traditional positivist approaches. The researchers and practitioners have benefited greatly from each other in this collaborative effort and consequently both theoretical and practical knowledge of IT investment justification and evaluation have been advanced. Areas of potential improvement are identified and future activities on this project are outlined.