An empirical investigation of the contribution of IS to manufacturing productivity

Next to the financial sector, the manufacturing industry is the second largest investor in information systems (IS) and technologies (IT). However, in recent years, many CEOs have expressed skepticism and disappointment on the returns from investments in IS. There is reluctance on the part of these CEOs to continue to invest in IS because of a nagging feeling that existing systems are often under-utilized. The dissatisfaction of CEOs with returns on them combined with the suspicion that existing IS are under-utilized clearly has serious implications for the IS community. Using empirical survey data of small and large manufacturing firms in the electronics industry, this paper investigates whether, in fact, IS are under-utilized and, if so, explores the underlying reasons for this situation. In particular, we explore the differences, if any, between small and large manufacturing firms in their ability to deploy and utilize IS to achieve organizational excellence.