Title: Capability diamond - designing IT investments to develop operational capabilities

Authors: Mikko H. Hirvonen

Addresses: School of Business and Management, LUT University, Lappeenranta, Finland

Abstract: This paper presents a new model and a model-based application process to support the design of information technology (IT) investments with complementarities to develop business need-based IT-enabled operational capabilities. The research contributes primarily to the IT business value (ITBV) literature and particularly to the discussion of system variables, their relationships, and complementary investments. The 'Capability diamond' model is built on the resource-based view (RBV) of the firm, systems theory (ST), and well-accepted configurational organisation model. It captures issues relevant for successful capability creation with different types of requirements and helps explain investment success and failure. The model is illustrated with a case example. The presented idea to conceptualise an operational capability with a configurational model, where system elements are seeking towards equilibrium, is novel. Presented 'Capability diamond' model is highly relevant to the practice of IT investment planning and execution.

Keywords: IT investment; investment design; complementary investments; resource-based view; RBV; IT business value research; ITBV; systems theory; system variables; systemic; operational capability; configurational model; equilibrium; case study.

DOI: 10.1504/IJBIS.2026.153635

International Journal of Business Information Systems, 2026 Vol.52 No.1, pp.118 - 144

Received: 04 Oct 2021
Accepted: 02 Jul 2022
Published online: 19 May 2026 *

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