Does successful investment in information technology solve the productivity paradox?

Based on previous empirical research, there seems to he little relation bet ween investment in information technology (IT) and financial performance (o ften referred to as the 'productivity paradox'). We hypothesize that this i s due to the fact that many companies implement IT projects ineffectively. Like any other asset, IT must be utilized effectively to result in increase d financial performance. By comparing successful users of IT and less succe ssful users of IT, we show that successful users of IT have superior financ ial performance relative to less successful users of IT. However, any finan cial performance advantage is short-lived, possibly due to the ability of c ompetitors to copy IT projects. (C) 2000 Elsevier Science B.V. All rights r eserved.