AlphaIC

AlphaIC^[1] is a method for assessing the value of information technology (IT) investments that surpasses banal ROI analyses and looks at how IT affects an organization's intellectual capital.

The methodology was developed in 2003-2004 by technologist Paolo Magrassi and economist Alessandro Cravera, based on the observation of two ongoing trends:

• On one side, research on the information technology (IT) 'productivity paradox’ and the quantitative assessment of IT’s impact as a general purpose technology. This was mainly stimulated by Erik Brynjolfsson’s works in 1998-2002;^[2][3]
• On the other side, research and practitioners’ work on intangible assets (a.k.a. a company’s ‘intellectual capital’ ^[4]), such as that by Karl-Erik Sveiby at Skandia AV in 1986, Baruch Lev at NYU’s Stern in 1996, and Cravera in 1999-2000.^[5]

The two trends were merged in order to develop a ‘value of IT’ assessment methodology that go beyond simple return on investment (ROI) analyses as well as other existing methodologies, all unable to capture the true advantage provided by IT.

The methodology is copyrighted, however a simple and concise description, including that of its application in real-world organizations, is to be found in.^[1]

References

1. P.Magrassi, “The AlphaIC Method: Assessing the Business Impact of IT in the Knowledge Economy”, Proceedings 12th European Conference on Information Technology Evaluation, Turku, Finland, 29–30 September 2005.
2. E.Brynjolfsson, L.Hitt, "Beyond the Productivity Paradox: Computers are the Catalyst for Bigger Changes", CACM, August 1998
3. E. Brynjolfsson, S. Yang, “The Intangible Costs and Benefits of Computer Investments: Evidence from the Financial Markets,” MIT Sloan School of Management, December 1999
4. P.Magrassi, “How IT Helps Leveraging Intellectual Capital”, Gartner Strategic Analysis Report, Stamford, USA, 2002
5. A. Cravera, M. Maglione, R. Ruggeri, “La valutazione del capitale intellettuale. Le risorse intangibili“, Edizioni Il Sole 24 Ore, Milano, 2000