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

See all articles by Lewis Davis

Lewis Davis

affiliation not provided to SSRN

Bruce Dehning

Chapman University - The George L. Argyros School of Business & Economics

Theophanis C. Stratopoulos

University of Waterloo - School of Accounting and Finance

Date Written: August 1, 2003

Abstract

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

Davis, Lewis and Dehning, Bruce and Stratopoulos, Theophanis C., Does the Market Recognize IT-Enabled Competitive Advantage? (August 1, 2003). Information & Management, Vol. 40, No. 7, pp. 705-716, August 2003. Available at SSRN: https://ssrn.com/abstract=1306187

Lewis Davis

affiliation not provided to SSRN

No Address Available

Bruce Dehning (Contact Author)

Chapman University - The George L. Argyros School of Business & Economics ( email )

333 N. Glassell
Orange, CA 92866
United States

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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