Date Log
IT VALUE ESTIMATION USING PARTIAL ADJUSTMENT VALUATION WITH MVA DYNAMIC FACTOR
Corresponding Author(s) : Maiziah Azka Nurhakim
Proceedings Universitas Muhammadiyah Yogyakarta Undergraduate Conference,
Vol. 1 No. 2 (2021): Engaging Youth in Community Development to Strengthen Nation's Welfare
Abstract
This paper discusses the substance of the value of IT in an IT-based company, namely PT. Telkom Indonesia. IT value is a value in financial benefits when capital expenditures include IT factors compared with capital expenditures that do not include IT. Nowadays, IT has become a business enabler that can improve the performance of business organizations efficiently and effectively in the company. The method used in this study is Partial Adjustment Valuation (PAV), which states that changes in output that occur in the production process are usually not exactly the desired one, so a Speed of Adjustment coefficient is needed to bridge the desired output with the actual output. This paper uses Dynamic Speed of Adjustment to calculate the fluctuates in IT values and the Market Value Added (MVA) factor to measure its dynamics. This study uses two calculation models: a three-factor model (K, L, and I) and a two-factor model (K and L) to prove the benefits of the IT value within a company. These measurements are split into two units: the currency unit (Performance Value) and the ratio unit (Performance Ratio). This paper leads to an understanding that the value of IT is real in improving business performance and refutes the paradox that states there is no relationship between IT investment and the size of the profits received by the company. Thus, the results of this study are open to studies that discuss the value of IT to develop further.
Keywords
Download Citation
Endnote/Zotero/Mendeley (RIS)BibTeX
- Abdurrahman, L. (2019). Valuasi Bisnis Teknologi Informasi. Bandung: Informatika Bandung.
- Abdurrahman, L., Langi, A. Z. R., & Simatupang, T. M. (2018). Information technology value engineering model and cost efficiency in IT - Based firms. IEEE Systems Journal, 12(3). https://doi.org/10.1109/JSYST.2017.2663418
- Abdurrahman, L., Langi, A. Z. R., & Suhardi. (2014). Development of methodologies for measuring IT capability in the information and communication industries. 2014 International Conference on Information Technology Systems and Innovation, ICITSI 2014 - Proceedings. https://doi.org/10.1109/ICITSI.2014.7048262
- Abdurrahman, L., Suhardi, & Langi, A. Z. R. (2014). Information Technology (IT) value model using variance-based structural equation modeling: Towards IT value engineering. 2014 2nd International Conference on Information and Communication Technology, ICoICT 2014. https://doi.org/10.1109/ICoICT.2014.6914112
- Abdurrahman, L., Suhardi, & Langi, A. Z. R. (2016a). Engineering information technology value in IT-based industries using partial adjustment valuation and resource-based view approach. International Journal of Information and Communication Technology, 8(4), 420–435. https://doi.org/10.1504/IJICT.2016.076824
- Abdurrahman, L., Suhardi, & Langi, A. Z. R. (2016b). Methodology development of information technology value engineering using systems engineering approach. 2015 International Conference on Information Technology Systems and Innovation, ICITSI 2015 - Proceedings. https://doi.org/10.1109/ICITSI.2015.7437742
- Abdurrahman, L., Suhardi, & Langi, A. Z. R. (2016c). Valuation methodology of information technology (IT) value in the IT-based business: A case study at a leading telecommunication company. International Journal on Electrical Engineering and Informatics, 8(4). https://doi.org/10.15676/ijeei.2016.8.4.12
- Bharadwaj, A. S. (2000). A resource-based perspective on information technology capability and firm performance: An empirical investigation. MIS Quarterly: Management Information Systems, 24(1). https://doi.org/10.2307/3250983
- Brigham, E., & Ehrhardt, M. (2017). Financial Management - Theory and Practice, 15e. In Cengage Learning.
- Cardeal, N. (2012). Valuable, rare, inimitable resources and organization (VRIO) resources or valuable, rare, inimitable resources (VRI) capabilities: What leads to competitive advantage? AFRICAN JOURNAL OF BUSINESS MANAGEMENT, 6(37). https://doi.org/10.5897/ajbm12.295
References
Abdurrahman, L. (2019). Valuasi Bisnis Teknologi Informasi. Bandung: Informatika Bandung.
Abdurrahman, L., Langi, A. Z. R., & Simatupang, T. M. (2018). Information technology value engineering model and cost efficiency in IT - Based firms. IEEE Systems Journal, 12(3). https://doi.org/10.1109/JSYST.2017.2663418
Abdurrahman, L., Langi, A. Z. R., & Suhardi. (2014). Development of methodologies for measuring IT capability in the information and communication industries. 2014 International Conference on Information Technology Systems and Innovation, ICITSI 2014 - Proceedings. https://doi.org/10.1109/ICITSI.2014.7048262
Abdurrahman, L., Suhardi, & Langi, A. Z. R. (2014). Information Technology (IT) value model using variance-based structural equation modeling: Towards IT value engineering. 2014 2nd International Conference on Information and Communication Technology, ICoICT 2014. https://doi.org/10.1109/ICoICT.2014.6914112
Abdurrahman, L., Suhardi, & Langi, A. Z. R. (2016a). Engineering information technology value in IT-based industries using partial adjustment valuation and resource-based view approach. International Journal of Information and Communication Technology, 8(4), 420–435. https://doi.org/10.1504/IJICT.2016.076824
Abdurrahman, L., Suhardi, & Langi, A. Z. R. (2016b). Methodology development of information technology value engineering using systems engineering approach. 2015 International Conference on Information Technology Systems and Innovation, ICITSI 2015 - Proceedings. https://doi.org/10.1109/ICITSI.2015.7437742
Abdurrahman, L., Suhardi, & Langi, A. Z. R. (2016c). Valuation methodology of information technology (IT) value in the IT-based business: A case study at a leading telecommunication company. International Journal on Electrical Engineering and Informatics, 8(4). https://doi.org/10.15676/ijeei.2016.8.4.12
Bharadwaj, A. S. (2000). A resource-based perspective on information technology capability and firm performance: An empirical investigation. MIS Quarterly: Management Information Systems, 24(1). https://doi.org/10.2307/3250983
Brigham, E., & Ehrhardt, M. (2017). Financial Management - Theory and Practice, 15e. In Cengage Learning.
Cardeal, N. (2012). Valuable, rare, inimitable resources and organization (VRIO) resources or valuable, rare, inimitable resources (VRI) capabilities: What leads to competitive advantage? AFRICAN JOURNAL OF BUSINESS MANAGEMENT, 6(37). https://doi.org/10.5897/ajbm12.295