Author(s)

Niv Ahituv, Gil Greenstein

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This paper suggests a new normative model that attempts to analyze why improvement of versions of existing decision support systems do not necessarily increase the effectiveness and the productivity of decision making processes. Moreover, the paper suggests some constructive ideas, formulated through a normative analytic model, how to select a strategy for the design and switching to a new version of a decision support system, without having to immediately run through a mega conversion and training process while temporarily losing productivity. The analysis employs the information structure model prevailing in Information Economics. The study analytically defines and examines a systematic informativeness ratio between two information structures. The analysis leads to a better understanding of the performances of decision support information systems during their life-cycle. Moreover, this approach explains normatively the phenomenon of “leaks of productivity”, namely, the decrease in productivity of information systems, after they have been upgraded or replaced with new ones. Such an explanation may partially illuminate findings regarding the phenomenon known as the Productivity Paradox. It can be assumed that the usage of the methodology that is presented in this paper to improve or replace information structure with systematically more informative versions of information structures over time may facilitate the achievement of the following major targets: increase the expected payoffs over time, reduce the risk of failure of new versions of information systems, and reduce the need to cope with complicated and expensive training processes.

Decision Analysis, Decision Support Systems, Productivity and Competitiveness, Information Technology Productivity, the Productivity Paradox

N. Ahituv and G. Greenstein, "Evolution or Revolution of Organizational Information Technology – Modeling," Journal of Service Science and Management, Vol. 3 No. 1, 2010, pp. 51-66. doi: 10.4236/jssm.2010.31006.