Value Frame, Paradox and Change: The Constructive Nature of Information Technology Business Value

Abstract

The role of IT in the creation of business value has been considered from various perspectives, such as strategic alignment, sustained advantage, and infrastructure capability. In this paper, we try to extend these previous perspectives by describing a flexible sensemaking framework for valuing complex technological resources. This framework assumes that the nature of IT business value is pluralistic, paradoxical, and dynamic. We describe four modes of valuation that comprise this framework: Routinizing, Cost-structuring, Positioning, and Learning, and illustrate them using historical lessons from airline reservation systems. Findings suggest that IT-derived business value can be characterized by competing tensions across diverse value frames that are paradoxically structured and change over time. We propose that such a pluralistic approach will extend the vocabulary of IT-derived business value and will improve managerial capability for sensemaking across multiple frames.

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