The dualism of the IT department : the agency problem and uncertainty reduction in corporations
The relationship between corporation owners and top management can generally be described in terms of the agency model. This situation usually has a negative impact on the company value. In such an environment, access to information, its processing and reporting, become critical. Therefore, it should also be noted that a similar principal-agent phenomenon is present between the CEO and the IT management which controls data availability In this paper we discuss some issues associated with the role of Information Technology (IT) and the IT manager (CIO). There is an interesting duality: on the one hand the CIO is involved in the principal-agent problem and on the other - his responsibility domain is a basic tool for the organization in dealing with uncertainty and asymmetry of information. The CEO and other members of the C-suite should be more involved in information management (not just information technology) as well as the board enticing the managers in charge of IT to share company business objectives so as they can become conscious and active partners in growing the business value. Information flow, access and monitoring should be designed in a transparent way and understood by all members of the interdisciplinary management team so that the CEO should be able to require innovation, strategy supporting indicators and IT can be capable of influencing business enhancement. This is especially consequential if we take into account the progress in information technology and its changing role from process automation into business information management. (original abstract)
- Can the IT Department Keep Up With Exponential Growth?, 2012, The Economist Intelligence Unit and sponsored by Juniper Networks in September.
- Carr N., 2009, The big switch: Rewiring the world, from Edison to Google, WW Norton & Company
- Dąbrowski I. K., 2011, Klasyczna i ewolucyjna koncepcja przedsiębiorstwa po kryzysie hipotecznym, "Studia i Prace Kolegium Zarządzania i Finansów" nr 48.
- Davies H., Pun-Lee L., 2001, Managerial economics: an analysis of business issues, Pearson Education
- Earl M. J., Feeny D., 2012, Is your CIO adding value? "Sloan Management Review", vol 35, no 3
- Gleick J., 2011, The information: A history, a theory, a flood, HarperCollins UK.
- Grover V., Cheon M., Teng J., 1995, Theoretical perspectives on the outsourcing of information systems, "Journal of information Technology", pp. 209-219.
- Hunter R., Westerman G., 2009, The Real Business of IT: How CIOs Create and Communicate Value, Harvard Business Press, Boston.
- IBM looks beyond the IT department for fresh growth, 2013, "Financial Times", Richard Waters in San Francisco, 19 June
- IT Metrics: IT Spending and Staffing Report, 2013, Gartner G00248502 - 2013/02/01.
- Kobylecki K., 2008, Wynagradzać informatyków za wyniki sprzedaży? Czemu nie!, "Harvard Business Review Polska"
- Laffont J. J., Martimort D., 2009, The theory of incentives: the principal-agent model, Princeton University Press.
- Outperforming in a data-rich, hyper-connected world, 2012, IBM Center for Applied Insights study conducted in cooperation with the Economist Intelligence Unit and the IBM Institute of Business Value, IBM Corporation, Armonk.
- Rockart J. F., 1988, The Line Takes the Leadership - IS Management in a Wired Society, "Sloan Management Review", Summer, pp. 57-64.
- Ross J. W., Woerner S. L., Scantlebury S., Beath C., 2010, The IT organization of the Future. Driving Business Change, Boston Consulting Group, March 15.
- Sappington D. E., 1991, Incentives in principal-agent relationships, "The Journal of Economic Perspectives", pp. 45-66.
- Tapscott D., 2008, Grown up digital, Tata McGraw-Hill Education.