Abstract

"Information System Flexibility and the Performance of Business Processes"

Judith Gebauer and Franz Schober

First Author :

Judith Gebauer
Business Administration
University of Illinois at Urbana-Champaign
1206 S. Sixth Street
M/C 706
Champaign, IL 61820
USA

gebauer@uiuc.edu

http://www.business.uiuc.edu/faculty/gebauer.html

Second Author :

Franz Schober
Albert-Ludwigs-Universitat Freiburg, Germany

franz.schober@vwl.uni-freiburg.de

Abstract :

While insufficient flexibility of an information system to support a business process precludes the use of the system in certain cases, excessive flexibility of an information system can limit the usability of the system (Silver 1991), in addition to presenting an unnecessary investment. Despite a wealth of research on flexibility and its impacts on organizations and business processes (esp. manufacturing), the value of flexibility of an information system and the price at which it comes have rarely been included into the analysis, with the result that guidelines to manage the flexibility of an information system to support a given business process have not been developed.
To support decisions regarding information system flexibility, the current paper presents an optimization model to relate business process characteristics (uncertainty, variability, and time-criticality) with two basic types of information system flexibility (flexibility to use the information system and flexibility to change the information system). Based on an analysis of the model, we conclude that the focus of information system management should be on flexibility to change the information system in order to support processes of high uncertainty, while situations of low uncertainty call for a focus on flexibility to use the information system. The model also shows that high process variability can limit the value of investments in an information system altogether, thus, improving the importance of careful flexibility management, while a high level of time-criticality generally tends to increase the benefits of using an information system over manual processing.

Keywords :

business process performance, information system design and development decision support, information system flexibility, optimization model

Footnotes & Acknowledgements :

This research was supported by the University of Illinois at Urbana-Champaign Campus Research Board and the College of Business at the University of Illinois at Urbana-Champaign. Valuable input was received from participants at a research seminar at the University of Illinois at Urbana-Champaign, at two theory development workshops sponsored by the Journal of the AIS, at the 3rd Big Ten MIS Research Symposium, from Frank Zehnle, Billag AG/Switzerland, and from a number of anonymous reviewers. We also thank University of Illinois at Urbana-Champaign Doctoral Student Fei Lee for her help to prepare this paper. All errors remain our own.

Manuscript Received : 2005

Manuscript Published : 9/30/05

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