This paper reports on the development and application of an instrument to evaluate the overall IT fitness of medium sized enterprises. The instrument was designed in 1997 as part of an applied research project with the close co-operation of scientists and consultants, as well as various market and technology experts. The resulting toolset has by now been applied to approximately one thousand enterprises mainly in Germany, Switzerland and Austria. This paper discusses the underlying framework for the measurement of IT fitness and describes the basic decisions involved in instrument design. A basic problem for developing such an evaluation instrument is the so called 'IT productivity paradox': Empirical studies do not yield direct positive relationships between the intensity of IT-usage and business productivity. The paper introduces explanations for the productivity paradox and discusses assumptions on the productive use of IT. This discussion serves as a basis for the formulation of a number of hypotheses on IT-fitness that have entered the framework underlying the IT21 Toolset. The fundamental hypotheses of the framework are finally reassessed statistically based on the data collected with the instrument during the years from 1998 to 2002.
IT fitness IT evaluation benchmarking IT productivity paradox strategic alignment information management information infrastructure