What is knowledge and the technology to support it worth to the firm?

Journal of Information Technology Theory and Application, 2002 by See-To, Eric W K, Xin, Xu

Implications for Research

Valuing Technology presents a state-ofthe-art discussion on valuing IT and knowledge capital, a major topic in the academic world. Researchers could find the four types of "scaling" a good framework for research on the valuation of knowledge business. Furthermore, a number of interesting ideas can also be extracted from each of these four "building blocks." For example, the acceleration of converging technology may serve as a potential research project. More efforts, both theoretical and empirical, are necessary for detailing out and justifying the new valuation techniques proposed by the author.

The book also gives a very good review of traditional valuation approaches like discounted cash flow. Traditionally we base valuation from ownership of assets. Unfortunately, this is becoming less and less relevant. Nowadays businesses generate values from processes. A better knowledge in critical business processes is the key to success and hence the main source of values. The author discusses some promising directions to go for business valuation.

How can we value an IT project? What are the best value metrics for businesses competing with processes and knowledge? What guides us in making business decisions about whether to acquire technology/knowledge or to develop it in house? These are just a few questions that come to the minds of managers in the age of knowledge economy from time to time. This book sheds lights and provides useful insights on them.

ERIC W. K. SEE-TO, Hong Kong University of Science and Technology Department of Information and Systems Management, Hong Kong University of Science and Technology, Clear Water Bay, Kowloon, Hong Kong SAR, Tel: (852)2358-8142 E-mail: xuxin@ust.hk

XU XIN, Hong Kong University of Science and Technology Department of Information and Systems Management, Hong Kong University of Science and Technology, Clear Water Bay, Kowloon, Hong Kong SAR Tel: (852)2358-8056 Email: xuxin@ust.hk

AUTHORS

Eric W. K. See-To is currently a PhD student at Hong Kong University of Science and Technology. He has an MBA degree from University of Hong Kong and a Bachelor degree in Information Engineering from Chinese University of

Hong Kong. He worked several years as an IT consultant for firms, such as Citibank and

BNP. His research interests fall into two main areas: valuation of technology and knowledgeintensive businesses, and information and network economics.

Xu Xin is currently a PhD student at the Department of Information and Systems Management, Hong Kong University of Science and Technology. He obtained a Master's degree in Economics from Nankai

University in 2000 and a Bachelor's degree in Economics from Nanjing University in 1997. His research interests include valuation of knowledge business and IT, IT outsourcing, Ecommerce, and mobile commerce.