A strategic IT-enabled investment is failing due to unforeseen technology problems.
What should be the board of directors' FIRST course of action?
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A. B. C. D.A.
When a strategic IT-enabled investment fails due to unforeseen technology problems, the board of directors' first course of action should be to assess the business risk and options (answer A).
Here's why:
Assessing the business risk and options will help the board understand the potential impact on the organization and identify alternative courses of action. By assessing the business risk, the board can determine the potential impact of the investment failure on the organization's finances, reputation, and operations. They can also identify potential opportunities to recover from the investment failure and mitigate any negative impact.
Revising the investment selection process (answer B) is not the first course of action because it assumes that the investment selection process was flawed, which may not necessarily be the case. The investment selection process should be reviewed at some point to determine if changes are needed to prevent future failures, but this is not the immediate priority.
Approving an investment budget increase (answer C) is not the first course of action because it assumes that the failure can be resolved by increasing the budget, which may not necessarily be the case. The board should assess the business risk and options before making any decision about increasing the budget.
Terminating the investment (answer D) is not the first course of action because it assumes that there is no way to recover from the investment failure. However, there may be options for salvaging some value from the investment or learning from the failure to improve future investment decisions. Therefore, it is important to assess the business risk and options before deciding to terminate the investment.
In summary, when a strategic IT-enabled investment is failing due to unforeseen technology problems, the board of directors' first course of action should be to assess the business risk and options. This will help the board understand the potential impact on the organization and identify alternative courses of action.