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It Investment Decision Making

In: Computers and Technology

Submitted By sathya8
Words 410
Pages 2
Session 1 Assignments:

1. Why is the “productivity paradox” important in IT investment decision-making?
Productivity paradox will allow companies to justify their investment in IT by showing what was spent on IT and what was the resulting productivity. This will allow companies to make better IT investment as productivity is the fundamental economic measure of a technology's contribution. 2. How does “sequential decisions” add complexity to a particular decision situation?
A sequence could have many levels of decisions, each with multiple and conflicting criteria. This adds complexity to the sequential decision making as it is difficulut to follow a squence when the whole process is so dynamic.

1. How would you describe three IT investment decision-making methodologies? a. Analytical hierarchy process
Calculate the overall score of decision-makers’ pair wise comparisons.The Analytic Hierarchy Process (AHP) is a structured technique for organizing and analyzing complex decisions. Based on mathematics and psychology, it was developed by Thomas L. Saaty in the 1970s and has been extensively studied and refined since then. Rather than prescribing a "correct" decision, the AHP helps decision makers find one that best suits their goal and their understanding of the problem. It provides a comprehensive and rational framework for structuring a decision problem, for representing and quantifying its elements, for relating those elements to overall goals, and for evaluating alternative solutions.
Retrived from http://en.wikipedia.org/wiki/Analytic_Hierarchy_Process

b. Balanced scorecard
Evaluate investment from the user’s, business value, efficiency, and innovatiodlearning perspectives.
The Balanced Scorecard (BSC) is a strategic performance management tool - a semi-standard structured report, supported by proven design methods and…...

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