Maximizing the positive influence of IT for improving organizational performance

In the analysis of whether information technology (IT) has an impact on organizational performance, focus is usually placed on the relationship between an organization’s investments in IT and that organization’s performance. Therefore, it is standard to devote special attention to the size and complexity of the organization, to the investments in other organizational resources that may affect the performance of IT, and to the manner in which the two variables are measured. However, one area that has not been well explored is the manner in which the relationship between investments in IT and organizational performance develops. In this article, we show empirically that the planning and management of IT influence the organization’s endowment of resources (physical and human), which consequently has positive effects on each of the IT-related areas usually found in organizations (applications, reliable and secure systems and communications, and training and support). In turn, the functioning of these areas influences the impact of IT on the organization, which then has positive effects on organizational performance. We have used data corresponding to IT management in Spanish universities, as well as independent rankings that are useful for evaluating their performance.

► We show how to use investments in IT to improve organizational performance. ► Data corresponding to Spanish Universities have been used. ► Importance of planning and management in the context of technology is shown. ► IT accounts for 13% of the variance in organizational performance.