The new productivity paradox

Mark C. Anderson, Rajiv D. Banker, Suryanarayanan Ravindran

Research output: Contribution to journalArticle

65 Citations (Scopus)

Abstract

An identification and evaluation of the possible explanations for the high market valuation of Y2K spending is presented. A market-valuation model is used to determine the valuation multiple on Y2K spending of the sample fortune 1000 firms on March 31, 1999. The multiple on Y2K spending of 62.10 for March 31, 1999 indicates that about $60 of firm value was associated with each $1 of Y2K spending. Due to the high costs of remediating and maintaining legacy systems, many companies were also found to use the Y2K opportunity to replace an existing cluster of legacy systems with an enterprise resource planning (ERP) system integrating various internal applications through a common data base.

Original languageEnglish (US)
Pages (from-to)91-94
Number of pages4
JournalCommunications of the ACM
Volume46
Issue number3
DOIs
StatePublished - Mar 2003
Externally publishedYes

Fingerprint

Legacy systems
Paradox
Valuation
Productivity
Legacy Systems
Enterprise resource planning
Enterprise Resource Planning
Internal
Costs
Industry
Evaluation
Market
Model

ASJC Scopus subject areas

  • Hardware and Architecture
  • Computer Graphics and Computer-Aided Design
  • Software
  • Theoretical Computer Science
  • Computational Theory and Mathematics

Cite this

The new productivity paradox. / Anderson, Mark C.; Banker, Rajiv D.; Ravindran, Suryanarayanan.

In: Communications of the ACM, Vol. 46, No. 3, 03.2003, p. 91-94.

Research output: Contribution to journalArticle

Anderson, Mark C. ; Banker, Rajiv D. ; Ravindran, Suryanarayanan. / The new productivity paradox. In: Communications of the ACM. 2003 ; Vol. 46, No. 3. pp. 91-94.
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