Evaluating the multidimensional and dynamic nature of IT business value is a continuous challenge. This paper examines how system dynamics can be used in evaluating IT business value in a company level. We approach IT business value as a web of impacts, where benefits and sacrifices are ultimately evaluated against company earnings logic.
This study is based on an action research and covers a pilot project within two co-operating companies. System dynamics was utilised to construct a value creation model for an existing Gaming Management System. This value creation modelling covered two dimensions: 1) structural evaluation of IT impacts with cause-and-effect models, 2) dynamic evaluation and simulation of value realisation over time.
As a result, value creation modelling was able to provide a visual overview of how IT impacts were linked to business value through value paths, and how much and when value was realised. Value creation modelling enabled prototyping of value realisation that can provide value based insights for development activities like requirements elicitation and analysis. The examined approach proved its potential for providing a common language for technology and business parties, thus improving IT business alignment.
Submitted 20.6.2014 to 22nd IEEE International Requirements Engineering Conference 2014
Harri Töhönen (Aalto University), Marjo Kauppinen (Aalto University), Tomi Männistö (University of Helsinki): Evaluating the Business Value of Information Technology – Case study on Game Management System