 Process Improvement Through Software Olli Martikainen Investments in IT Improve Productivity when Connected to Organizational Changes The productivity increases resulting from ICT in the industry and in society are of a rather recent origin as shown by Mika Maliranta and Petri Rouvinen from ETLA (2003). According to their research it seems that the additional productivity achieved typically ranges from 8 to 18%. The effect on services tends to be larger than on manufacturing. The effect is often manifold in younger and can even be negative in older firms. Since organizational changes are easier to implement in younger firms and recently established firms have by definition a new structure, this can be interpreted as evidence for the need for complementary organizational changes. Manufacturing firms seem to benefit from ICT-induced efficiency in internal communication whereas service firms benefit from efficiency in their external communications. Also the results of Maliranta and Rouvinen provide direct and indirect evidence on the importance of competition, education, innovation, organizational change and entrepreneurial dynamics in the adoption and efficient use of ICT. Possible lags in the effects of ICT are not very well known. Furthermore, timing between the imple- mentation of ICT and complementing organizational changes remains an open ques- tion. According to the study, one would expect that the two are implemented simultaneously, but anecdotal evidence would seem to suggest that organizational changes that follow show a considerable time lag. In the literature, only a limited amount of knowledge has SO far been made available about what might be the best practices in organizing ICT-assisted work. O. Martikainen Department of Information Processing Science, University of Oulu, P.O. Box 3000, 90014 Oulu, Finland The Research Institute of the Finnish Economy (ETLA), Lönnrotinkatu 4 B, 00120 Helsinki, Finland e-mail: folli.martikainen@etla.fi P. Tyrväinen and O. Mazhelis (eds.), Vertical Software Industry Ev