The competitive impact of information technology: can commodity IT contribute to competitive performance?

Abstract

Despite polarizing arguments on the strategic potential of information technology (IT), academic research has yet to demonstrate clearly that information systems initiatives can lead to sustained competitive performance (CP). We investigate this question using data from 165 hotels affiliated with two brands of an international lodging chain. We study the effect of successful use and unreliability of an incremental IT-enabled self-service channel on overall CP. We find that the effect of the incremental service channel depends on the firm’s organizational resources. We also show that different organizations experience significantly different use and unreliability rates. Further, we find that the positive association between the use of an IT-enabled self-service channel and CP endures over a 2-year period, despite competitors’ widespread adoption of the technology enabling the incremental service channel (self-service kiosks). Our findings corroborate research on the strategic role of IT resources when appropriately coupled with complementary resources. They lead us to question the notion that IT is a strategic commodity. Indeed, the findings suggest that IT-dependent strategic initiatives have the potential to generate sustained CP, even when the technology that enables them appears ‘simple’. These findings suggest the need for a theoretical explanation of the complementarities and interaction among the elements of IT-dependent strategic initiatives.

Keywords:

• strategic information systems
• sustainable competitive advantage
• competitive advantage
• strategic agility
• IT-dependent strategic initiatives

Notes

1 GFLOPS stands for Giga Floating Point Operations per Second and is a rough standard measure of computational performance.

2 Other control variables include the industry RevPAR monthly average by state, property size, and location factors (airport, city center, highway, industrial, resort, suburban, and rural).

3 In other words, an increase of 1% in successful usage of the incremental channel in Brand B results in an increase of 1.93 RevPAR Index points.

4 The American Hotel and Lodging Association (AH&LA) bi-annual lodging survey reported that 65% of respondents in the upscale segment had check-in kiosks operational, including all major chains. The survey polled 10,350 hotels between February and April 2008 (AH&LA, 2008).

Additional information

Notes on contributors

Gabriele Piccoli

About the Authors

Gabriele Piccoli is an Associate Professor of Information Systems (IS) at the University of Pavia (Italy). His current research, teaching, and consulting interests focus on the strategic application of IS and the use of technology to enable customer service. His research has appeared in MIS Quarterly, Journal of AIS, Decision Sciences Journal, MIS Quarterly Executive, Communications of the ACM, Harvard Business Review, as well as other academic and applied journals. He is the author of the textbook Information Systems for Managers: Text and Cases, published by Wiley and Sons.

Tsz-Wai Lui

Tsz-Wai Lui is an Assistant Professor at the School of Hotel and Tourism Management at the Chinese University of Hong Kong. She holds a doctoral degree and a Master of Management in Hospitality from the Cornell University School of Hotel Administration. Her research has been published in The DATABASE for Advances in Information Systems and by the Cornell Center of Hospitality Research (CHR). She has also contributed to the Handbook of Research on Contemporary Theoretical Models in Information Systems and the Global Text Project, the free electronic textbook initiative.