Differential effects of information technology on competitive positioning

Abstract

PurposeInformation technology (IT), combined with complementary resources, can contribute to companies' competitive positioning. However, to assess the contribution of IT to value with respect to the contribution of complementary resources, it is crucial to understand the means by which IT creates value.Design/methodology/approachThis paper synthesizes empirical research on the inherent capabilities of IT and their moderating role to build an integrative model.FindingsWe found that IT creates value through three inherent capabilities: transactional, exchange and codification capabilities. These capabilities can be regarded as moderators of the relationship between IT and competitive advantage. This moderating role of IT in competitive positioning is illustrated by examples from previous empirical publications.Research limitations/implicationsThe paper contributes to IT business value (ITBV) literature by developing an integrative model that (1) conceptualizes an aspect of IT value creation, which, thus far, has received only limited attention (namely, inherent capabilities) and (2) illustrates the moderating role of these capabilities in competitive positioning.Practical implicationsInherent capabilities provide the theoretical foundation for a nuanced understanding of IT contribution with respect to complementary resources. This understanding may support IT executives in deriving adequate measurements and, thus, account for the differential effects of IT.Originality/valueCompared to the literature, the proposed model represents a more coherent and holistic perspective of ITBV. Thus, the model may constitute a foundation for future ITBV research and promote more detailed analytic perspectives of ITBV.