IT Capabilities – Quo Vadis?

The successful management of IT capabilities and their complex interdependencies with other organizational capabilities constitutes an important source of competitive advantage for many organizations today. The role of IT capabilities in enabling competitive actions is well-researched. By reviewing a large number of IT capabilities-focused research articles, the authors seek to answer the questions, “What have we learned? What do we still need to learn?” This research-in-progress article presents key findings regarding IT capabilities, highlighting current research limitations, and providing propositions and recommendations regarding future research

IT CAPABILITIES IN GLOBAL ENTERPRISES

Organizations are globalizing rapidly for growth. However, with globalization they constantly struggle with the often competing objectives of global scale and responsiveness to local conditions and global trends. Prior research suggests that IT capabilities are critical to achieving organizational goals; however there has been relatively little research that explicitly examines IT capabilities in the MNC context. This paper examines in-depth the IT capabilities in a global organization. Drawing on recent research that suggests a goal-oriented approach to IT capabilities, we identify MNC capabilities of Global Scale, Global-Local Responsiveness and Global Coordination. The paper also notes the distinction between resources and processes in the conceptualization of capabilities, and provides empirical support for the resources and associated processes that comprise each of the global IT capabilities

Developing Dynamic IT Capabilities - A Systems Perspective

The development of dynamic IT capabilities occurs within a complex social system consisting of many feedback loops. The feedback between loops often means simple remedies to improve dynamic capabilities and IS/business alignment are ineffective. The grounded theory study reported here allows practitioners to understand the impact of some of these loops

Unpacking the Black Box of IT Capabilities

IT Capabilities are vital to the competitive performance of firms in contemporary business environment. Firms can no long have competitive advantages by obtaining affordable information technology resources. Rather organizational IT capabilities are often cited as one of the most important factors that influence firm performance. The purpose of this paper is to enhance the understanding of IT capabilities and find out how the differences in IT capabilities explain the variation of firm performance. By using concepts from resource-based view of firms, this paper argues that IT capabilities influence firm performance through information system-business processes successes and enabling institutional forces and that firms should combine their technical capabilities, sourcing capabilities and implementation capabilities in such a way to generate synergy effect which can be described as assimilation capabilities. Therefore, opening the black box of IT capabilities has implications for both practitioners and researchers

THE EFFECT OF IT CAPABILITIES ON CROSSFUNCTIONAL CAPABILITIES

Research in both the strategy and information systems (IS) areas has identified capabilities as key to competing effectively in dynamic and turbulent environments. Firms realize benefits by adopting complementary combinations of capabilities. We draw on Grant’s hierarchy of capabilities to develop a model that explains how a firm’s information technology (IT) capabilities can enhance the intangible value of the firm through their effect on a set of cross-functional capabilities. Using a sample of 394 firms drawn from industry ranking surveys, our preliminary results suggest that some cross-functional capabilities have a positive impact on the long term, intangible performance of a firm as measured by Tobin’s q

Essays on Manufacturers’ IT Capabilities for Digital Servitization

Over the last decades, studies have found that transformational drivers affect how firms innovate their business models (Chesbrough, 2010; Massa et al., 2016). In markets in which physical products become commodities, the servitization of business models is a transformational driver for firms (Wise & Baumgartner, 1999). For its part, digitalization increases the potential to reshape business models through novel use cases of technology (Yoo et al., 2010). Recently, digitalization was found to extend the opportunities from servitization through digital technologies as digital servitization (Paschou et al., 2020). Digital servitization describes a firm’s shift from product-centric offerings to service-centric offerings with the help of novel IT assets (Naik et al., 2020). The manufacturing industry provides promising examples of firms with portfolios of physical offerings that might undergo such a transformational shift (Baines et al., 2017). So far, digital servitization research focuses primarily on four topics: re-defining the notion of servitization in the context of digitalization, identifying digital servitization value drivers, linking the transformation to specific technologies, and deriving how novel service offerings arise (Paschou et al., 2020; Zhou & Song, 2021). Despite the breadth of digital servitization research, how firms can shift to service-centric offerings remains unclear (Kohtamäki et al., 2019). Specifically, research lacks studies on the prerequisites and mechanisms that link theory with evidence on achieving IT-enabled service innovation (Paschou et al., 2020). Further, how firms must organize to build and operate IT-enabled services around these technologies remains unclear (Paschou et al., 2020). In a recent report on the manufacturing industry, practitioners confirm these gaps and associate them with a lack of managerial and technical knowledge (Illner et al., 2020). A theoretical lens that helps to address these shortcomings is the knowledge-based theory. It suggests that knowledge is the primary rationale, so that a firm benefits from its assets (Grant, 1996b; Nonaka, 1994). The knowledge-based theory understands a capability as a directed application of knowledge in a firm’s activities (Grant, 1996b; Nonaka, 1994). In the context of digitalization, firms require IT capabilities based on knowledge of how to capitalize on IT assets (Lee et al., 2015). Digital servitization research finds that IT capabilities are critical for identifying, adapting, and exploiting IT-enabled service innovations (Johansson et al., 2019). Still, little extant research informs firms that undergo digital servitization about which IT capabilities can help to strengthen their competitive advantage (Coreynen et al., 2017). Even though IT capabilities may be necessary for success in innovating IT-enabled services, the required knowledge needs to be disseminated effectively throughout an organization (Foss et al., 2014; Grant, 1996a; Nonaka, 1994). The organizational control theory offers a theoretical perspective about knowledge dissemination mechanisms, which can be horizontal or vertical (Ouchi, 1979). Horizontal knowledge dissemination mechanisms depend on codifying processes in rules or measuring process outputs through indicators, while the locus of exerting these rules and indicators determines the vertical knowledge dissemination. The IT innovation and IT governance literature refers to these knowledge dissemination mechanisms as formalization of IT activities and centralization of IT decision-making (Weill, 2004; Winkler & Brown, 2013; Zmud, 1982). However, how to orchestrate knowledge, particularly for IT capabilities, in firms that undergo digital servitization is not yet clear (Kohtamäki et al., 2019; Münch et al., 2022; Sjödin et al., 2020). Against this background, this dissertation addresses how manufacturers organize their IT capabilities while encountering the transformational drivers of digital servitization by answering the following overarching research question: How can manufacturers organize their IT capabilities to capitalize on digital servitization? (References to be found in the full text):List of abbreviations in synopsis............................................................................................................V Part I: Synopsis of the dissertation..........................................................................................................11 Motivation.......................................................................................................................................12 Research design...............................................................................................................................22. 1Conceptual approach and research objectives....................................................................22. 2Research methodologies and methods................................................................................4 3Structure of the dissertation.............................................................................................................5 3.1Systematization of the papers.............................................................................................5 3.2Paper1: Revisiting the concept of IT capabilities in the era of digitalization....................7 3.3Paper2: Short and sweet –Multiple mini case studies as a form of rigorous case studyresearch...............................................................................................................................9 3.4Paper3: Linking IT capabilities and competitive advantage of servitized business models..........................................................................................................................................11 3.5Paper4: From selling machinery to hybrid offerings –Organizational impact of digitalservitization on manufacturing firms................................................................................11 3.6Paper5: Manufacturers’ IT-enabled service innovation success as a multifacetedphenomenon: A configurational study..............................................................................13 3.7Paper6: The missing piece –Calibration of qualitative data for qualitative comparativeanalyses in IS research......................................................................................................14 3.8Paper7: Prerequisites and causal recipes for manufacturers’ success in innovating ITenabled services................................................................................................................16 4Conclusion.....................................................................................................................................19 4.1Resultssummary...............................................................................................................19 4.2Contributions....................................................................................................................20 4.2.1Theoretical contributions......................................................................................20 4.2.2Methodological contribution................................................................................21 4.2.3Practical contribution............................................................................................21 4.3Limitations and future research........................................................................................22 5References.....................................................................................................................................24 Part II: Papers of the dissertation...........................................................................................................29 Paper1: Revisiting the concept of IT capabilities in the era of digitalization.......................................30 Paper2: Short and sweet –Multiple mini case studies as a form of rigorous case study research.......41 Paper3: Linking IT capabilities and competitive advantage of servitized business model..................64 Paper4: From selling machinery to hybrid offerings –Organizational impact of digital servitization on manufacturing firms......................................................................................................................80 Paper5: Manufacturers’ IT-enabled service innovation success as a multifaceted phenomenon: A configurational study...................................................................................................................108 Paper6: The missing piece –Calibration of qualitative data for qualitative comparative analyses in IS research........................................................................................................................................119 Paper7: Prerequisites and causal recipes for manufacturers’ success in innovating IT-enabled services.....................................................................................................................................................136 Overview of the digital appendix on CD.............................................................................................17

The Interface of IT Capabilities and Disruptive Innovations

This paper presents a collection of behaviours for gaining insights in projects of small, innovating organisations. An explorative study of 12 informants and their subject matter expertise are used to inform this work. The paper draws on three bodies of literature – Innovation Management, Knowledge Management and Project Management to inform the theoretical background. So far no framework has been developed that are tailored to the unique situation of Small Innovators as they aim to foster innovation within the organisation. A number of propositions is offered based on the qualitative data analysis and hermeneutic literature appraisal that address potential heuristics processes that could enhance a Small Innovator’s ability to gain better insights while pursuing innovative project outcomes

Juggling Paradoxical Strategies: The Emergent Role of IT Capabilities

The simultaneous pursuit of paradoxical strategies is an emergent means of attaining competitive advantage. By nature, exploration and exploitation are fundamentally different and contradictory, thus reflecting an instance of organizational ambidexterity. We assert that IT capabilities act through different mechanisms to influence ambidexterity. To test our model, we selected to gather data from 352 manufacturing firms in high growth sectors in India – a setting that provides an exemplar for the world’s enterprises undergoing rapid changes in the 21st century. Through OLS analysis we find strong support for our assertion that an organization’s IT capabilities individually and jointly influence organizational ambidexterity, hitherto a challenging competitive possibility. We are thus also able to account for previously unexplained variance in IT payoffs in the emerging economy and small and medium enterprise contexts. Overall, through this research, we validate the emergent role of IT capabilities in juggling paradoxical strategies in the 21st century