Modeling Information Systems planning benefits using Alternating Conditional Expectations

This paper addresses the dearth of research on the determinants of IS planning benefits. Data were collected using a questionnaire survey of top IS executives from 450 companies in Singapore. Of the 103 responses (representing a response rate of 23%), 65 companies undertook IS planning. To test the hypothesis that the determinant–benefit relationships are likely to be nonlinear, the Alternating Conditional Expectations (ACE) algorithm was used. This appears to be the first use of ACE in IS planning research. IS sophistication, communications culture, technology forecasting, top management support, and firm size were found to be nonlinearly related to IS planning benefits (e.g., improved competitiveness, operations, and resource management). For example, IS sophistication affects improved competitiveness positively, and improved resource management negatively. It seems that IS sophistication is directed more at improving competitiveness, even though this may result in less efficient resource management due to bureaucratic procedures. However, at higher levels of IS sophistication, competitiveness stagnates and may even decrease, possibly due to bureaucratic bottlenecks. Implications of our results are discussed.