Title:	PYRAMID MODEL - CONCEPTUALIZING AN ORGANIZATIONAL CAPABILITY TO DESIGN IT INVESTMENTS
Author(s):	Mikko H. Hirvonen
ISBN:	978-989-8704-37-5
Editors:	Miguel Baptista Nunes, Pedro Isaías and Philip Powell
Year:	2022
Edition:	Single
Keywords:	IT Investment, Complementary Investments, Organizational Capability, IT Business Value (ITBV), Configurational Model
First Page:	135
Last Page:	142
Language:	English
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Full Contents:	click to dowload
Paper Abstract:	In this paper, a configurational framework to conceptualize an organizational capability, to design IT investments, is presented. IT is seen as a main driver of productivity and an enabler of digital innovations. At the same time, companies are struggling how to design IT investments. Based on Resource Based View of the firm and Dynamic Capabilities Framework, an organizational capability is considered as a basic unit, and a building block, of a competitive advantage. By building on those theories and systems thinking, Leavitt's 'Diamond model', and Parsons' model of an organization with 'three levels of responsibility', a 'Pyramid model' to conceptualize an organizational capability is developed. Suggested framework provides a foundation for business need-driven IT investment design at any level of an organization. In the 'Pyramid model' the recent understanding how IT can generate business value, is brought together and further developed. The model is expected to be highly valuable in practice helping to design and justify investments to drive productivity and e.g., to scale digital innovations.
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