Does the Market Recognize IT-Enabled Competitive Advantage?
Information & Management, Vol. 40, No. 7, pp. 705-716, August 2003
Posted: 26 Feb 2009 Last revised: 13 Mar 2009
Date Written: August 1, 2003
There is a belief that the payoffs from investments in information technology (IT) are difficult to recognize, and therefore a sustained competitive advantage from an IT-enabled strategy is difficult to distinguish from a temporary competitive advantage. We develop a model to test whether market participants are able to recognize a sustained competitive advantage due to an IT-enabled strategy, and test the model empirically. We find that a competitive advantage due to an IT-enabled strategy is discernable by market participants, and as apparent as a competitive advantage obtained through other means.
Keywords: Information technology, IT strategy, IT resources, Competitive advantage, Sustainability, Firm performance, Market measures
JEL Classification: M15, M41, O14
Suggested Citation: Suggested Citation