IT Value Analysis by Resource-Based View Theory: The Case Study of PT. Telekomunikasi Indonesia, Tbk.

IT Value Analysis by Resource-Based View Theory: The Case Study of PT. Telekomunikasi Indonesia, Tbk.

Author        : LUKMAN ABDURRAHMAN; Suhardi; Armein Z.R. Langi
Published on    : LEARNING ORGANIZATION: Management and Business International Journal (Bandung)

Abstract

“It???s believed that IT spending has influenced business performance. This departs from a theory, which stated that resources owned by business organizations have close relationship to levels of the business competitive advantage as Resource-Based View (RBV) theory proposes. To confirm this theory, a case study is performed for PT. Telekomunikasi Indonesia, Tbk., the largest telcos industry in Indonesia. Researched data refer to Telkom Annual Report published between 2005 and 2012. The study focuses on data reflecting the relationship between IT spending and business performance. Findings show that IT spending has had a positive correlation to Telkom IT revenue. Likewise, metric-based performances such as ROA, ROE, Tobin???s q, and MVA have shown positive values, which strengthen the hypothesis above that the managed resources are in line with firm???s profitability, effectiveness, and total-amount value created. Telkom IT resources referring to RBV are then analyzed in terms of IT capability, IT competence, and competitive advantage that lead to be the IT value model. To sum up, the case study result indicates that IT value has definitely affected Telkom business performance. However, it is necessary to enlarge the case study to the other similar industry or the different one.”