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In 1987, Michael Hammer and Glenn Mangurian offered the Impact/Value framework that can be used to consider the value of information technology. There are two different axis of the impact/value framework, the vertical and horizontal axis.

Vertical axis of the impact/value framework

1. Time: as for time, in particular time compression is important.
2. Distance: overcoming geographical limitations are significant for distance in particular.
3. Relationships: as for relationships, organizational relationships can be redefined.

Horizontal axis of the impact/value framework

1. Efficiency: It is doing the things right, for example increased productivity.
2. Effectiveness: It is doing the right thing, for example better management.
3. Innovation: It is doing new things. For example, improve products and services.

Alternatively, the benefits of information technology can be classified as:

Strategic benefits which include:

1. Competitive advantage: Competitive advantage is a position that allows the company earning return on investments higher than the cost of investments. It should be relevant, sustainable and unique.
2. Alignment: It is adjustment of an object in relation with other objects.
3. Customer relations: Good customer service and relations are the basic elements, which drive business.

Informational benefits which include:

1. Information access: Information access is a term used to describe an area of research. It is to find the information regardless of format, channel, or location.
2. Information quality: Information quality (IQ) is a term to describe the quality of the content of information systems. It is often practically defined as: “The fitness for use of the information provided.”
3. Information flexibility: Information, in its most restricted technical sense, is an ordered sequence of symbols. It must be flexible.

Transactional benefits include:

1. Communications efficiency: communication efficiency is a key factor.
2. System development efficiency: Software must be developed competently and efficiently.
3. Business efficiency: It is defined in simple terms as expenses as a percentage of revenue with a few variations

Written by: Matt

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Tagged as basic elements, benefits of information technology, better management, communication efficiency, development efficiency, geographical limitations, Glenn Mangurian, good customer service, horizontal axis, impact value, information access, information quality, management innovation, michael hammer, ordered sequence, organizational relationships, return on investments, technical sense, time compression, value framework, vertical axis + Categorized as Economy articles, Ladership & Management