Measurement of the intensity of global information technology usage: quantitizing the value of a firm’s information technology

A new instrument measuring IT investment, strategic importance of the IT and degree of IT training is constructed and a pilot test of a holistic model of the relationship between the intensity of global information technology usage and a firm’s global strategy and performance is submitted.

Abstract

With the increasing convergence of international markets, a greater number of firms are entering the global arena. As these firms compete in the global marketplace, they utilize information technology to formulate and implement strategies and to control and coordinate their resources. This increased dependence on information technology by the firm leads to the following question: how do firms measure the value of a global information system to the performance of the firm? Ideally, information technology would be evaluated based on its degree of strategic use through a firm’s performance. However, the resulting benefits of IT as a utility in performance are generally difficult to identify. First, this paper attempts to conceptualize the intensity of global information technology usage by constructing a new instrument measuring IT investment, strategic importance of the IT and degree of IT training. Second, the paper formulates and submits a pilot test of a holistic model of the relationship between the intensity of global information technology usage and a firm’s global strategy and performance.