An Agent-Based Simulation toward IT Management
One of the most important issues on the business value
from IT these days is to understand the notion of complementary non-IT factors
such as business strategies, processes, and organizations. Simultaneously,
the corporate IT environment is changing rapidly due to the dramatic proliferation
of the Internet and Internet-based technologies in business. These phenomena
implicate that both of inside and outside of a company influence business
value from IT. Therefore, the key question facing researchers as well as practitioners
is how such complementary factors influence IT contribution in the context
of electronic commerce and electronic business.
In this paper, we develop an agent-based simulation model to describe how
effectively a company creates business value through IT management. In this
model, we consider not only IT investment led by corporate senior managers,
but also the several complementary characteristics of IT management environment,
such as competitiveness of the industry a company belongs to. The objectives
here are to observe what kind of influence will be brought to business value
of IT. For example, through the agent-based simulation model, we compare the
following three conceivable IT investment stances of top managements: IT-driven
(pursuing high IT value opportunities taking high risk), Balanced (pursuing
middle IT value opportunities taking middle risk), and Non-IT-driven (Strategic/process-driven;
pursuing low IT value opportunities taking low risk). Based on the simulation
results, we found that for a company in a growth industry, the Balanced stance
would capture the most efficient business value from IT in three IT investment
stances and that a company in an emerging industry would take the more advantage
of IT investment, the more the company focuses on the IT-driven approach,
etc. Finally, we discuss and interpret the simulation results considering
possible situations of company, competitor, and customer, who are facing
the recent Internet era.
Yasuo Kadono
Tsukuba University
Management Science Institute Inc.
kadono@msi21.co.jp