Understanding ICT Based Advantages: A Techno Savvy Case Study

Introduction Due to the emergence and widespread use of information and communication technologies (ICTs) organisations have faced many changes in their business practices in recent times, in particular the last two decades. In this time period, organisations have invested large amounts of time and money into the adoption of ICTs. While prior research has tended to focus on individual resources and capabilities, such as capital requirement or proprietary technology (Mata, Fuerst, & Barney, 1995), there is an emerging stream of research which recognises that ICTs have limited value when used in isolation. As such, value is significantly enhanced when resources are combined with other organisational resources and capabilities (Mata et al., 1995; Powell & Dent-Micallef, 1997; Ray, Barney, & Muhanna, 2004). So despite large spending it appears that research to date has failed to understand ICT investments and many questions remain unanswered (Rastrick, 2009). Acknowledging the systemic approach required to study ICTs, scholars of information systems have recognised the need for better ways to examine them (Mooney, Gurbaxani, & Kraemer, 1995; Ray et al., 2004). Moreover, there have been calls for further review and testing of ICTs utilising frameworks from other literatures, like the resource based view (RBV) from the strategic management literature (Bharadwaj, 2000; Powell & Dent-Micallef, 1997). The RBV is an appropriate framework to guide this research due to its focus on resources and capabilities. The RBV argues that a firm's source of competitive advantage lies with the resources and capabilities it owns and controls and the unique way in which a firm bundles them together (Barney, 1991; Penrose, 1959; Wernerfelt, 1984). This paper examines ICTs in their environment using an RBV lens to address the gap in current research. The rest of this paper outlines past research, the research design employed in this research, and presents and discusses integrated capabilities leading to sustained success in a New Zealand company. Finally, a summary is provided along with implications for future research. Past Research Current literature shows that there is growing support for the positive relationship between ICTs and advantage (Lin & Lin, 2006; Melville, Kraemer, & Gurbaxani, 2004; Menon, Lee, & Eldenburg, 2000; Porter & Millar, 1998), that is, ICTs have value to organisational advantage. Researchers have attempted to identify sources of advantage and, more importantly, sources of ICT based advantage (Mata et al., 1995; Ray et al., 2004). The RBV asserts that ownership and control of strategic resources and capabilities determines which organisations will earn superior profits and enjoy a position of competitive advantage over others. Moreover current RBV research provides a new lens for examining the combination of resources and capabilities. There has been much discussion of the terms resources and capabilities; see Barney (1991) and Peteraf (1993) for discussion. Hult and Ketchen (2001) posit that it is the combination of resources within organisations that collectively contribute to competitive advantage. The researchers suggest market orientation, entrepreneurship, innovation, and organisational learning collectively contribute to the creation of unique resources. Similarly, Jones and George (1998) have examined cooperation, teamwork, and trust by viewing these resources or capabilities in a coupled way. Newer streams of research linked to the RBV, such as the dynamic capabilities approach and the knowledge based view, also provide insights into new places to look for valuable resource and capability combinations. More specifically, dynamic capabilities research suggest that value is gained when resources are utilised in coupled and innovative ways (Eisenhardt & Martin, 2000; Miller, 2003; Teece, Pisano, & Shuen, 1997). The knowledge based view also offers suggestions of what is valuable to organisations. …