IT Innovation Persistence and Financial Performance

28 Pages Posted: 15 Jan 2008

See all articles by Jee-Hae Lim

Jee-Hae Lim

University of Hawaii, Manoa

Theophanis C. Stratopoulos

University of Waterloo - School of Accounting and Finance

Date Written: January 11, 2008

Abstract

Prior studies have shown that the IT innovation capability, a company's ability to systematically innovate with IT, is not easily replicated (persistent), and the persistence tends to be stronger during periods when the IT budgets are declining (hard IT budgets), such the post Y2K period. Building on resource based view we argue that companies that systematically innovate with IT have a sustained competitive advantage versus their competitors who are adopting an opportunistic approach to IT innovation or choose not to innovate with IT, and the advantage is stronger during periods of hard IT budgets. Both or these arguments were strongly supported when tested on a sample of 1057 large US firms.

Keywords: IT Innovation Capability, Firm Performance, Competitive Advantage

JEL Classification: L86, M40

Suggested Citation

Lim, Jee-Hae and Stratopoulos, Theophanis C., IT Innovation Persistence and Financial Performance (January 11, 2008). (CAAA) 2008 Annual Conference Paper. Available at SSRN: https://ssrn.com/abstract=1082982 or http://dx.doi.org/10.2139/ssrn.1082982

Jee-Hae Lim (Contact Author)

University of Hawaii, Manoa ( email )

2404 Maile Way
Honolulu, HI Honolulu 96822
United States
(808) 956-8503 (Phone)
(808) 956-9888 (Fax)

HOME PAGE: http://shidler.hawaii.edu/directory/jee-hae-lim/soa

Theophanis C. Stratopoulos

University of Waterloo - School of Accounting and Finance ( email )

200 University Avenue West
Waterloo, Ontario N2L 3G1 N2L 3G1
Canada
519-888-4567 x35943 (Phone)

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