Information Technology and Sales & Operations Planning (S&OP) – An Event Study

Abstract

IT has lost its magical power to provide competitive advantages and that corporations would be better off focusing on the risk of IT rather than looking at IT as a strategic asset – such was the conclusion of Carr (Carr, 2003). However, IT champion, Metcalfe, views IT investment as a source of competitive advantage that determines a path of sustainable excellence for a corporation. This paper explores the weight of evidence for both camps using event study and proposes that there is an optimal level investment in IT as a strategic asset beyond which it will cease to be a strategic asset in Sales and operations planning (S&OP).