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Finance for IT Decision Makers - A practical handbook by Michael Blackstaff

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4 WHEN IS A BENEFIT NOT A BENEFIT?

OBJECTIVES

The purposes of this chapter are:

  • to allow you to experience, step by step, building an IT financial case in incremental cash flow form;
  • to show you that it can sometimes be quite difficult to decide whether a particular benefit or cost is really attributable to a proposed IT investment or project;
  • to derive some rules that will help overcome those difficulties;
  • to introduce a set of data that will be used for illustration in subsequent chapters.

When is a benefit not a benefit; when is a cost not a cost, especially in evaluating IT investment? We are now in a position to apply the principles of cash flow-based financial cases to the kind of situation typical in IT decision-making. To do so we ...

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