By Ferdinand Mahr
Information know-how (IT) has the capability to considerably increase company functionality. even though, no longer all companies own the complementary elements that liberate the whole worth of IT. Ferdinand Mahr develops an integrative theoretical version of IT enhances akin to organizational constitution, human source administration, and company technique. additional, he analyzes distinctive datasets accrued via 1,500 mobile interviews with managers. He examines how the association and administration required to permit it really is confident functionality results fluctuate with admire to a firm’s strategic orientation towards potency or innovation. He additionally indicates that using a selected mixture of it may well outweigh the customarily damaging functionality results of hybrid thoughts that blend potency- and innovation-orientation. This publication exhibits that IT does certainly topic if thoroughly aligned with association and strategy.
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Extra info for Aligning Information Technology, Organization, and Strategy: Effects on Firm Performance
Two elements are complementary if the marginal benefit of the first element increases in the levels of the second element, and vice versa (Milgrom and Roberts, 1990; 1995). , 2002; Hitt and Brynjolfsson, 1997). A detailed review of the production function view is available from Brynjolfsson and Hitt (2000). The studies employing a resource-based view focus less on the size of IT investments and more on their scope and properties (Oh and Pinsonneault, 2007). Following the resource-based view of the firm (Barney, 1986a; 1986b; 1991; Wemerfelt, 1984), it is argued that unique and hard-to-imitate bundles ofIT resources have to be established to achieve superior firm performance (Oh and Pinsonneault, 2007).
In turn, the benefits from IT increase with the level of decentralization, as increasing levels of decentralization exploit IT's infonnation processing capabilities better and better. Thus, IT and decentralization may be horizontal complements. , 2002; Hitt and Brynjolfsson, 1997). , 2002). , 2002). , 2002; Hitt and Brynjolfsson, 1997). While this is a first step to analyze the complementarities between the power distribution in a firm and IT, I propose three advancements. First, the allocation of decision rights has to be analyzed in more detail.
This organization design should be vertically aligned with ademanding environment, a corporate strategy that focuses on new product market domains, and an organizational culture that becomes manifest in a low degree of formality. This study contributes to the theoretical and empirical research on IT complements in several ways. First, I provide a structured review of existing studies on IT complements, with an emphasis on empirical research. Second, I provide a consistent theoretical framework to guide future research and facilitate the accumulation of comparable knowledge and wisdom on IT complements.