The Relationship Between IT Investment and Firm Performance with The Context of The “Sufficiency Economy” Philosophy

Abstract

The objective of this dissertation is to study the relationship between IT investment and firm performance within the context of the Sufficiency Economy Philosophy. Population in this study is manufacturing firms selected from the list of the Department of Business Development, Ministry of Commerce, Thailand. Both qualitative and quantitative methods are employed and the study includes theories behind the Sufficiency Economy Philosophy and IT management, Chief Information Officer (CIO) proxy as IT Moderation, Knowledge Management proxy as IT Self-Immunity, and IT Chargeback proxy as IT Reasonableness. In the quantitative method, data were collected from 373 firms – 23.31 % of 1,600 by means of questionnaire and analyzed by means of Structural Equation Model (SEM) analysis while the Convergent Validity was measured by Confirm Factor Analysis and the value of factor loading used in the study was greater than 0.6. Discriminate Validity was tested by SEM method, comparing fix variance and fix/free covariance. Concerning the qualitative method, data were collected from selected CIO of manufacturing firms by means of an in-depth interview technique. Research findings are as follows: the relationship between IT investment and the firm performance with the context of the Sufficiency Economy Philosophy has a model fit and regression weight significantly supporting all hypotheses (p<.05). Only IT Chargeback has direct relation to firm performance while the Knowledge Management and CIO affect the firm performance through the IT Chargeback.