Organizational Performance, Size, and the Use of Data Processing Resources
37 Pages Posted: 31 Oct 2008
Date Written: August 1983
Abstract
This study addresses two issues-whether the size ofan organization determines its methods of obtaining,structuring or controlling data processing resources, andwhether organizational performance is influenced by how afirm makes use of these resources. Several propositionsare tested using data from a sample of 58 mutual savingsbanks with a 10:1 range in size. The results suggest that,although no difference is found in the proportion ofoperating expense allocated to data processing, larger banksdo tend to develop in-house computing resources whilesmaller banks obtain these services from other banks orservice bureaus. Consequently large and small banks mustresolve different kinds of managerial issues if they areto provide high quality data processing service to theirorganizations.Unexpectedly, no relationship is found betweenorganizational performance and the relative proportion ofresources allocated to data operating cost and the intensityof data processing use. These findings raise questionsabout the extent of benefits obtained from a data processingintensive strategy as well as questions about the efficiencywith which firms convert capital and labor into applicationsystems.
Keywords: Technological Innovation, Organizational Performance, Data Processing Resources, Computer Resources, Organizational Size, Management
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