Title: Key performance indicators for IS/IT indirect human costs in the service sector

Authors: Souad Mohamed, Matthew Guah

Addresses: Centre for Business Information and Process Management (BIOPoM), Westminster Business School, Westminster University, 35 Marylebone Road, NW1 5LS London, UK. ' Accounting, Auditing and Control Group, Erasmus School of Economics, Erasmus University Rotterdam, Netherlands

Abstract: Information systems (IS) expenditure is necessary for gaining competitive advantage in the service sector and in certain cases mandatory for the effective delivery of services. Many formal processes for IS budgeting and evaluation do not take into consideration the vast amount spent on indirect human costs (IHCs) of IS implementation. The paper reviews existing work on the evaluation of IT investments and identifies a major problem in IS evaluation to be the identification of IHCs. The authors build on the theory of IHCs drivers by proposing key performance indicators (KPIs) that facilitate transparency and better management of these costs. They describe the context and propose a framework, using three cases from the service sector, namely health, financial and retail industries, where expenditures on IS have significantly increased in the past decade.

Keywords: indirect human costs; service sector; information systems expenditure; root causes; KPIs; key performance indicators; competitive advantage; service delivery; budgeting; budgets; evaluation; service implementation; labour costs; transparency; cost management; health services; financial sector; retail industry; food retailing; healthcare industry; United Kingdom; UK; National Health Service; NHS; HSBC; banks; banking; Sainsbury|s; supermarkets; value chain management; ICT investment; information technology; communications technology; culture; socio-technical aspects.

DOI: 10.1504/IJVCM.2010.031800

International Journal of Value Chain Management, 2010 Vol.4 No.1/2, pp.31 - 48

Published online: 24 Feb 2010 *

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