In the rapidly evolving industrial sector, companies must leverage digital technologies to enhanceoperational efficiency and maintain a competitive edge. This study investigates the economic evaluationof IT investments, focusing on the integration of digital order processing systems within the supplychain management of Tetra Pak. Driven by the need to understand the direct financial impacts andstrategic benefits of such investments, the research aims to analyze a hypothetical future implementationusing historical data to determine its financial viability. The primary problem addressed in this thesis isthe economic viability and strategic benefits of integrating digital order processing systems in a firm'ssupply chain, specifically within the context of Tetra Pak. The challenge also lies in evaluating theseinvestments when not all data is known or readily available, which necessitates an adaptable evaluationframework. The study employs a mixed-methods approach, combining qualitative and quantitativeresearch techniques. Data was collected through a literature review, semi-structured interviews, andanalysis of financial documents. Quantitative models, such as Cost/Benefit (C/B) analysis, DiscountedCash Flow (DCF), and Net Present Value (NPV), were utilized to assess the financial impact and overallvalue of the IT investment. This methodological framework was designed to provide an evaluationdespite incomplete data. The results indicate that the potential IT investment would significantlyenhance operational efficiency and reduce costs. The application of NPV and return on investment (ROI)models demonstrated a positive economic outcome, with an annual net benefit of 457 600 SEK per year,over five years, confirming that the benefits of digital system integration surpass the initial investmentcosts. The findings highlight not only cost reductions but also possible improvements in customersatisfaction and internal process efficiencies. The discussion section addresses the implications of thefindings, emphasizing the relevance of traditional financial models like NPV and DCF whileacknowledging their limitations in handling uncertainties. It suggests that, among other things,incorporating probabilistic methods and scenario analyses can enhance the accuracy and reliability offinancial evaluations. This approach ensures that investment decisions are aligned with strategic goalsand adapt to dynamic market conditions. In conclusion, the developed framework provides a solidfoundation for evaluating IT investments within firms, even when data is incomplete. By integratingC/B analysis, quantitative modeling, and advanced financial evaluation techniques, the studydemonstrates that such investments are economically viable and strategically beneficial and that thereis much future work to be done in economics to better evaluate IT-investments.
| Identifer | oai:union.ndltd.org:UPSALLA1/oai:DiVA.org:bth-26328 |
| Date | January 2024 |
| Creators | Psajd, Philip, Elhassen, Zahid |
| Publisher | Blekinge Tekniska Högskola, Institutionen för industriell ekonomi |
| Source Sets | DiVA Archive at Upsalla University |
| Language | English |
| Detected Language | English |
| Type | Student thesis, info:eu-repo/semantics/bachelorThesis, text |
| Format | application/pdf |
| Rights | info:eu-repo/semantics/openAccess |
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