Finding the Virtual Manufacturing Business Case A study of how to assess the value of Virtual Manufacturing

Abstract: This master thesis concerns the problems of IS/IT evaluation. IS/IT evaluation can be viewed as a part of a justification process for investing in IS/IT. Traditionally these evaluations have been performed with a technical or economical approach, focusing on efficiency and productivity expressed in quantitative measures. However, having these approaches increases the risk of not understanding the different social interpretative values of a system. In the light of this, the productivity paradox has evolved; showing fairly static productivity and rising IS/IT expenditures. At the same time more and more businesses get reliant on IS/IT. Researchers talks here about a need to extend the management’s view of how to evaluate their investments. This study is an attempt to create a deeper understanding on how business benefits can be evaluated when investing in new technology. The study has an interpretative approach, aimed to create an understanding for how benefits from concept of Virtual Manufacturing can be evaluated in the justification phase of an investment. Virtual Manufacturing is said to optimize the product development processes within a company, creating great strategic improvements. We have performed six interviews at the Volvo Group in order to understand the problem area and find a solution that can be applied within the product development domain. The result of this study is a model that highlights the various aspects that should be discussed when investing in this kind of technology successfully.