Impact of IT investment on firm performance based on IT architecture

Abstract

Since many firms have strengthened their core competencies by using information technology, it is important to understand how IT investment contributes to the achievement of business objectives. This study categorizes the IT investments into five technical areas based on a real-life company’s architecture such as basic infrastructure, security, wireless, collaboration, and datacenter. An empirical model is built to analyze how IT investment in these categories influences the business growth. I found that wireless technology is the main IT driver of revenue growth. Furthermore, our analysis shows that IT paradox exists in some investment categories because of the time lag before full realization.