Developments in IT affect both an$$ organization's strategy and the design of its AIS. How can a company determine whether it is spending too$$ much, too$$ little, or just enough on$$ IT$?$

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Part $1$

A$.$

This is a simple analysis. A company has to identify the benefits of a new IT initiative and compare those benefits to the associated costs. If the benefits exceed the$$ costs, the company should proceed with the initiative. If the costs exceed the$$ benefits, the company should not proceed.

B$.$

In order to determine if they are spending too$$ much, too$$ little, for just enough on$$ IT$,$ a company must review the costs associated with the IT initiatives but more importantly they need to obtain feedback from the employees that use the IT systems.

C$.$

There is no easy answer to this question. Although a company can try to identify the benefits of a new IT initiative and compare those benefits to the associated$$ costs, this is often easier said than done.$$ Usually, it is difficult to measure precisely the benefits of new uses of IT$.$ Nevertheless, companies should gather as much data as possible about changes in market$$ share, sales$$ trends, cost$$ reductions, and other results that can plausibly be associated with an IT initiative and that were predicted in the planning process.

D$.$

It is impossible for a company to determine whether it is spending too$$ much, too$$ little, or just enough on IT because the company do not know all the costs associated with IT initiatives.