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The effect of generalized competition and strategy on the business value of information and communication technologies

Euripidis Loukis (University of the Aegean, Karlovassi, Samos, Greece)
Ioakim Sapounas (University of the Aegean, Karlovassi, Samos, Greece)
Konstantinos Aivalis (ICAP, Athens, Greece)

Journal of Enterprise Information Management

ISSN: 1741-0398

Article publication date: 1 January 2008

3325

Abstract

Purpose

This paper aims to investigate the effect of two external factors – the “generalized” competition an organization faces, and the strategy it follows in response to its external environment – on the business value generated by its ICT investment.

Design/methodology/approach

For achieving these research objectives econometric models of output are constructed, using firm‐level data from Greek companies, which have been collected through a survey through a structured questionnaire. These econometric models are based on the microeconomic production theory (Cobb Douglas production function). For operationalizing the “generalized competition” an organization faces are used the five dimensions of the generalized competition of M. Porter's “five forces framework”.

Findings

Concerning the above generalized competition dimensions it is concluded that higher level of bargaining power of suppliers results in higher ICT business value generation. Also, concerning strategy it is concluded that in organizations following a strategy of frequent introduction of new innovative products and services is generated higher ICT business value.

Originality/value

This paper investigates the effect of external environment related factors on the business value generated by ICT investment. The conclusions constitute of first evidence that there are external conditions that result in higher business value from ICT investment by necessitating a more efficient and effective use of ICT.

Keywords

Citation

Loukis, E., Sapounas, I. and Aivalis, K. (2008), "The effect of generalized competition and strategy on the business value of information and communication technologies", Journal of Enterprise Information Management, Vol. 21 No. 1, pp. 24-38. https://doi.org/10.1108/17410390810842237

Publisher

:

Emerald Group Publishing Limited

Copyright © 2008, Emerald Group Publishing Limited

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