Reviewing Interpretive Approaches for Evaluation of Information Systems Investments

Abstract

As information systems/technologies (IS/IT) become embedded in organizations, these systems cannot be isolated from important issues such as human intellect, culture, philosophy, politics and socio-organizational changes. Limited business resources on one hand and the various concerns and demands from different stakeholders on the other hand have led to an evergrowing need to evaluate IS/IT investments. In other words, due to the heavy rise of IS/IT costs IS/IT investments must be justified. Evaluation of IS/IT investments is generally taken to mean the identification and the measurement of capital expenditures spent on and the initial anticipated revenues gained from the deployments of these systems (IS/IT). Based on a large body of IS/IT evaluation literature, there exists a plethora of diverse, mostly financial, evaluation approaches proposed to be used for evaluation of IS/IT investments. But there has long been dissatisfaction with these traditional evaluation approaches argued to not capture the intangible business benefits of IS/IT investments. The underlying positivistic paradigm on which much of the traditional IS/IT evaluation has been carried out is believed not to take into account the pluralistic nature of IS/IT and is therefore an inappropriate basis on which to address particularly a variety of social outcomes generated by IS/IT investments. This literature review reports that the calls for interpretive evaluation approach (IEA) that incorporates the recognition of IS/IT as socio-technological entities have increased since the beginning of 1990s. Many interpretive IS/IT evaluation authors argue that the prevailing financial approaches and thus their related evaluation methodologies fail to consider IS/IT as complex multi-faceted socio-technological entities. This master’s thesis concludes that evaluation is always a political process, with differing interests, priorities and consequences. The main objective of this thesis has been to explore the basic philosophical assumptions and some key theoretical concepts underpinned IEA. It is widely recognized that utilization of IEA will allow and thus encourage stakeholders to be involved in the whole evaluation process. IEA emphasizes the distinctive constructions created by different group of stakeholders must be valued and taken into account through an interative negotiation process in order to achieve maximum value from and legitimatize evaluation. This will enrich both evaluators and stakeholders’ different interpretations and understandings of deployments of IS/IT, and also raise their awareness of the multifaceted complex task of IS/IT evaluation. One of the main fundamental characteristics of interpretive approach (IA) is to highlight and facilitate evaluation as an interative learning process. Interpretive approach concentrates on the lifecycle perspective of IS/IT investments argued to be a complex managerial issue. Interpretive IS/IT evaluation authors argue that one of the logical rationale reasons behind the use of IEA is its ability to address the intangible business benefits or social outcomes of IS/IT investments. Moreover, it is crucial to notice that stakeholders, their claims, concerns and issues are at the core of IEA. This master’s thesis can also conclude that there is consensus about the interpretive contextual framework termed CCP (i.e., content, context and process). This interpretive contextual IS/IT evaluation framework has been used by many interpretive IS/IT evaluation papers for evaluation of IS/IT investments but needs to be further developed. As a contribution to the interpretive IS/IT evaluation discourse, this thesis suggests a set of three interrelated factors aimed at determining success or failure of conducting effectively IEA.