Information Systems Project Management Risk

Abstract

Over the last three decades, much IS research has focused on information systems development (ISD) risk and its impacts on ISD success. While these studies have greatly advanced the understanding of the nomological network of ISD risk and success, the literature is still not sufficiently clear on the firm performance impacts of these concepts. Linking ISD risk and success to firm performance is important so as to better understand whether ISD projects can have broader firm-level implications, for example, in terms of providing firms with a competitive advantage. To address this research need, the present research note advances propositions regarding the linkage between ISD risk, success, and firm-level performance (conceptualized as competitive advantage). This linkage sheds light on the broader effects of ISD risk, and it helps ISD research overcome the isolation in which it is often conducted. Using the concept of residual risk (i.e., the risk present in the later stages of a project that remains after appropriate actions have been taken to mitigate initial risks in the early stages of a project), the authors propose that ISD risk impacts firm performance by reducing ISD success and that the value arising from ISD projects is higher when IT and business plans are synchronized (i.e., when they are in alignment).