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Actor - Network Theory

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IT projects frequently have numerous intangible costs and benefits, and significant impcts on many aspects within an organisation. Despite of the existance of a large number of enhanced methods especiall geared to evaluating IT, research shows that the traditional cost- benefit analysis still dominate in IT evaluation.

ANT Perspective:

The associations that exists and that are created between the evaluation method and its surrounding actors drives the employment of the Evaluation method. Such a perspective brings us to the choice of actor -network theory (ANT) for the analysis since it focuses on the associations between the actors that can be both social and tehnical; both uman and non- hman.

ANT , or the 'sociology of the translations' , is concerned with studying the construction and transformation of heterogenou networks comprised of people , organisations, agents, machines etc. , studying the networks that constitutes the world of humans and nonhumans. ANT examines how these actors enlist other actors into their world and how they bestow qualities, desires, visions and motivations on these actors.

ANT argues that there is no reason to assume that either objects or people in general determine the character of social change or stability. To understand the driving behaviour, we should take all of these into account where none of the elements is beforehand more influential than the others. Though ANT had been criticised for its disregard for social structures, its lack of political analysis, its poor capabilit of explanations,and the equality of humans and non- humans. ANT might be too 'flattening'. Relying solely on the configuration of actor networks is not enough to explain why and how some actors are more empowered while others are disempowered.


According to Walsham(1993) case studies are peraps the most appropriate strategy for conductingempirical research from an interpretive stance. It has been an accepted methd for research in IS for some time. "The construction of the IT Evaluation method at IIC" shows that an economic climate of growth, and not only recession , in this case in the Netherlands, can also lead to the perceived need for adoption of new IT evaluation.

The heated insurace market was demanding more products and with the marketers selling all kinds of innovative products, the process, skill and technologies involvedto produce the products was being put to test.For its products the insurance industries depends heavily on IT for collection, manipulation, storage, retrieval and updating of consideable amounts of data. At the base of insurance products lay complex IS. The lack of insight into numerous serious failuresin running IT projects led at this critical time to a search for more control over Itprojects and related costs and benefits. Different conceptual developments strenghthend the demand for a new IT evaluation method.

Moreover, several developments in late 1990s had increased IT costs, (owing to shortage of IT resources, high demand of IT professionals, higher with rise of salaries of the IT employees, large turnover in IT staff, increased invstments in training, newness of technology increased the training cost), without directly improving benefits. Finally, a large number of IT projects had no or little obvious return on investment at this time. These projects were considered inescapable and vital to organisations even though they did not produce direct benefits, other than avoiding future problems.There was growing awareness that IT projects frequently, last much longer and cost much more than initially planned. These diffeent sourcesraised awareness of IT evaluation in general and specifically in financial sector with its high and increasing IT costs.

This case focusses on the development at IIC in the Netherlands. With a manpower of 5000 employees , its primary distribution channel is based on ntermediaries. Secondary distribution channel include internet and bank offices. IIC's insurance products covered life, property, health insurance, pension insurance, disablement insurance, loss of income insurance and organisatioal insurance such as , insurance for company cars, technical insuranceand all kinds of liability insurance.

IT development had played a dominant role within IIC in cost reduction and adressing a tight labour market. It played a key role in communication with IIC's intermediaries and dealing with complex insurance products.These lead to the creation at Iic of a Project Mnagement Department in 1996, with the initial task of improving the management of the IT projects and deal with the unplaned , adhoc projects wherehigh IT budgetoverruns were the norm rather than the exception.

The list of projects when prepared raised questions as to why these projects being carried out and what did they contribute. To answer this a Project Characteristics Template (PCT), on which the projects could be summarisd in few criteria, was prepared. Not only did the PCT give a quick overviewof all projects, it also made projects more comparable. An IT Evaluation Method (ITEM) was constructed out of the PCT,designed on what was generally known as IT Economics Principles and was based on the concepts from Information Economics and the Balanced Score Card.

The ITEM Report:

Now, the projects were to be recorded using an ITEM report covering financial costs and benefits, impacts on different criteria and possible risks in carrying out the project. It included a aprticular view on how projects nad criteria should be scored, how the projects should be prioritised and how a decision on the projects could be reached. Scoring was envisioned to take place by means of a board group of people who could value the effect of each individual proposals. Prioritising was done intially by the PM, and general management made the final decision on prioritisation of proposals they granted budgets.

ITEM entailed both a process (of scoring, prioritising and decision - making) and several artefacts, such as documents and automated datbase. The complete ITEM comprised of :

* ITEM Report

* An Internal Rate of Return Report

* A scoring process

* An automated database

* A prioritisation process

* Advice to general management about the priority decision

* A decision process by general management.

By the end of 1999 use of ITEM Report was widely spread througout the organisation, and it had been used in allocationg the IT budget eversince.It



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