Does More IT Investment Lead to Higher Productivity or Return on Investment?

The conventional wisdom is that investment in information technology is correlated with business outcomes. But correlation is not causation. 

“We’ve found that investing in remote, LAN, and WAN services correlated with collaboration investment success, defined as above-average ROI or productivity gains,” says Metrigy. 

source: Metrigy 

Other studies likely show the same correlation: firms with better outcomes generally invest in more technology. There are other correlations. 

It also is likely that industries with higher profitability; faster growth rates and higher gross revenues invest more heavily in technology. Industries challenged in terms of revenue, growth or profit tend to invest less than average. 

In other words, it is hard to conclude whether “better-performing firms apply technology” or whether “applying technology makes firms perform better.” Perhaps firms that use more technology perform better for all sorts of other reasons.