Facilitators and inhibitors for the strategic use of information technology

ELSEVIER

Information

& Management

27 (1994) 71-87

Research

Facilitators and inhibitors for the strategic use of information technology William R. King *, Thompson S.H. Teo Katz Graduate School of Business, University of Pittsburgh, Pittsburgh, PA 15260, USA

Abstract An empirical study was conducted to determine key factors that facilitate and inhibit the development of strategic applications of information technology (IT) in business firms. A comparison was made between companies that have used IT applications for strategic purposes and companies that have not. The “relative strength” of the factors is also assessed. Differences in perceptions exist between the two groups of firms. Generally, factors internal to the organization and those that reflect perceived needs play a stronger facilitating role than external factors for both groups of firms. However, “Perceived Needs” play a stronger facilitating role for those that have utilized strategic applications. “Internal Factors” play the strongest inhibiting role for both groups. Firms that utilized strategic applications place more emphasis on IT-related issues as important facilitators. Firms that have not done so place more emphasis on management issues. Key words: Strategic information

systems; Facilitators;

1. Introduction Research on the use of information technology (IT) applications for strategic purposes has received significant attention in recent years [17] [45] [58]. Although there has been a great deal of research on the strategic use of IT applications, empirical studies on organizational facilitators and inhibitors for the strategic use of IT applications are mainly anecdotal and exploratory in nature. There are a large number of factors that can reasonably be expected to facilitate or inhibit the development of strategic IT applications than those treated previously. This study focuses on the development, through an extensive review of existing literature, of a comprehensive list of potential factors that might function as organizational facilitators and 0378-7206/94/$07.00 0 1994 Elsevier SSDI 0378-7206(94)E0058-C

Science

Inhibitors;

Organizational

characteristics

inhibitors for strategic use of IT applications. From this list, key factors that function as organizational facilitators and inhibitors are identified through a questionnaire survey of a sample of companies that use IT applications for strategic purposes and those that have not. The overall purpose of the study is to determine if companies that have used IT for strategic purposes are different in their perceptions of important facilitating and inhibiting factors from those who have not.

2. Background

literature

review

An IT application is strategic if it changes a firm’s product or the way a firm competes in its

B.V. All rights reserved

12

W.R. King, T.S.H. Teo /Information

industry. Sabherwal and King [50] defined strategic application more broadly as:

a

“One that has a profound effect on a company’s success and destiny, by (a) influencing or ‘shaping’ the company’s strategy or (b) playing a direct role in the implementation or support of the company’s strategy.”

Underlying these definitions are notions that strategic IT applications are being used to gain competitive advantage over rivals, and/or preventing rivals from gaining an advantage. Interest in the strategic use of IT applications has led to numerous frameworks for identifying opportunities; e.g., competitive forces framework [351[42][431,strategic grid [361, strategic opportunity matrix [61, consumer resource life cycle model [20], strategic option generator [46][57][58][59], value chain framework [44], pricing model [4], electronic integration model [7], trigger-inputprocess-output model [21], etc. Despite the frameworks that exist, there has been relatively little empirical study of organizational facilitators and inhibitors of the strategic use of IT applications. Most studies concentrate only on a few organizational facilitators. Organizational inhibitors are studied even less. Organizational facilitators can be broadly defined as factors that positively influence: (a) the ability of an organization to exploit information resources [30] - i.e., both information technology and information; (b) an organization’s decision to use information resources for strategic purposes. Similarly, organizational defined as:

inhibitors can be broadly

(a) detriments to the organization’s ability to exploit information resources; (b) factors that negatively influence an organization’s decision to use information resources applications for strategic purposes. Copeland and McKenney [36] found that the evolution of airline reservation systems is shaped by evolving regulations, changing technology, and the different business strategies of key players. Economies of scale and scope, technical competence, and consistent exploitation of opportuni-

& Management 27 (1994) 71-87

ties were found to significantly influence the strategic use of IT applications. Johnson and Carrico [24] conducted a field study of 11 industries. They found that industry environmental factors influence the direction and the pace of strategic deployment of IT. Internal factors, such as the capability of the IS function and the degree of direct contact between the IS function and business management, helped facilitate the use of strategic IT applications. Neo [39] performed a content analysis of existing literature on fourteen different companies and found ten major factors that had significantly helped the organization’s decision to use IT applications for strategic purposes:

(1) Alignment with business planning (2) Communication between IS and manage(3) (4) (5) (6) (7) (8) (9) (10)

ment Consideration of IS role Competitive pressure Internal needs Customer needs Strength in IT Extensive computer facilities Management vision and support Consultants’ recommendation

A further study [40] used a questionnaire survey of IS managers. In it, Neo found that environmental uncertainty, the business role of the IS function, technical expertise, and distinctive competencies in IS were major facilitators in an organization’s decision to use IT applications for strategic purposes. In one of the few empirical research studying both facilitators and inhibitors, King, et al. [30] identified strong technical support and expertise, the leadership position in IT, competitive pressure, strong financial position, and extensive computer facilities as important organizational facilitators. The relative importance of information resources as a strategic priority, the lack of appropriate planning, the lack of top management support, and the difficulty in assessing tangible contributions were found to be the major organizational inhibitors. Beath [3] conducted a field study on 15 IT “champions” who have been responsible for guid-

W.R. King, T.S.H. Teo /Informalion

ing the development of strategic applications outside the traditional MIS area. She found that IT champions need information support, technical resources, and political support from the IS department. Sabherwal and King [51] examined decision processes for developing strategic IT applications. They found that the external environment affects the adoption of a rational or political decision making process, but the organization structure did not affect any decision process attribute. IS maturity was found to be positively associated with the degree of analysis during decision making and with top management and IS influence on the decision making process preceding strategic IS applications.

3. Design of the study These empirical studies on organizational facilitators for the strategic use of IT applications are typical, dealing only with a relatively small set of potential factors. Our study was more comprehensive in nature: we first compiled a comprehensive list of organizational facilitators from past research literature; second, from these, key factors that facilitate the strategic use of IT applications were empirically identified. An examination of the list of organizational facilitators and an assessment of similar studies revealed that the factors can be logically grouped into: (1) Internal factors; (2) Perceived needs, and (3) External factors. “Internal Factors” (organizational characteristics) and “External Factors” (environmental characteristics) have traditionally been found to have an influence on the organization’s strategy. The “Perceived Needs” category was treated as distinct from “Internal Factors,” because numerous studies dealing with the strategic uses of IT (e.g., [141) have found that the development of strategic IT applications are often driven by the perceived needs of the firm. These three categories of fac-

& Management 27 (1994) 71-87

73

tors can be taken to influence the strategic use of IT applications. Infernal Factors (e.g., strong IT leadership, experience with IT, and strong market position) are the strengths or resources of the organization that can be used to gain an edge over competitors if they are properly deployed to support business strategy. Perceived Needs for improvement, change, etc. (regardless of whether they are internally or externally driven) can spur the organization to consider the use of IT applications to satisfy these needs. External Factors (e.g., pressure from competition, competitive importance of IT to industry) can make it “mandatory” for organizations who want to survive to seek out opportunities to use IT applications for strategic purposes. It is our thesis that companies who use strategic IT applications are likely to have different perceptions of the relative importance of various facilitating and inhibiting factors from those who do not. These differences in perceptions may explain why some organizations are eager and/or able to use IT applications for strategic purposes whereas others are not. 3.1. Research questions This research tions:

addresses

the following ques-

(1) What are the key factors that facilitate/ inhibit an organization’s decision to use IT applications for strategic purposes? (2) What are the differences in the perceptions of organizational facilitators and inhibitors that might distinguish between companies that have made strategic use of IT and those who have not? (3) What are the differences in the perceptions of organizational facilitators and inhibitors within a group of companies that have made strategic use of IT and also within a group that have not? 3.2. Methodology

A list of organizational facilitators for the strategic use of IT was compiled from review of

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past research literature (Appendix A). A corresponding list of inhibitors can be identified as the absence of factors that make up the organizational facilitators (e.g., if strong market position is an organizational facilitator, then the lack of a strong market position can be considered to be a potential organizational inhibitor). From this list a questionnaire was prepared using a 5-point Likert-type scale ranging from “not facilitative” to “greatly facilitative” for organizational facilitators and “not inhibitive” to “greatly inhibitive” for organizational inhibitors. The scale also has a column marked “not applicable” to allow for items that are not relevant for a particular company. The questionnaire was pretested on seven information systems doctoral students, and modified appropriately. The questionnaire was pretested again with seven experienced IS practitioners who were enrolled in a “Management of Information Systems” graduate degree program. Modifications were again made and the final questionnaire was developed. The questionnaires were mailed to a group of 419 former Executive MBA students (out of 685 students) from a large northeastern university in the United States. The choice of the sample was based on three criteria: (1) the person must hold a management position in the company, (2) during the course of his/her duties, the person should be likely to encounter strategic applications of IT either within the firm or outside of it, and (3) the person is likely to be aware of factors that facilitate or inhibit the strategic use of IT in the firm. The sample was not restricted to IS personnel since we desired an indication of facilitators and inhibitors from different managerial perspectives. Furthermore, we felt that facilitators and inhibitors for the strategic use of IT solely from an IS perspective would be unnecessarily biased. The survey is targeted at two groups of companies: those who have used IT applications for strategic purposes (the ‘SIS’ group) and those who have not (the ‘No SIS’ group). The research design is shown in Table 1. The instrument provides a description of various ways in which firms have used IT for strategic purposes and asked respondents to classify their

Table 1 Research Group

SIS No SIS

design Facilitators Actual *

Potential *

Inhibitors Actual * *

firm into either the ‘SIS’ or ‘No SIS’ category. For purpose of validation, those who classified their firm as having employed strategic IT were asked to describe one prominent strategic IT application and to answer questions concerning the duration of its use and its degree of success. In addition, in order to ensure that both the ‘SIS’ group and the ‘No SIS’ group have similar interpretation of the term “strategic IT application” the following definition was given in the questionnaire together with examples of strategic IT applications: “IT applications are considered strategic if their use enables the firm to gain an edge over competitors or prevents competitors from gaining an edge over the firm.” The “SIS’ group was then asked to respond to factors that, in their experience, had actually facilitated and those that had actually inhibited the use of strategic IT applications. This assumes that organizations in the ‘SIS’ group faced some obstacles prior to the successful use of strategic IT applications. The ‘No SIS’ group was asked to respond to factors that might facilitate (potential facilitators) and also factors that actualfy inhibited the strategic use of IT applications.

4. Analyses and results

Of the 143 respondents, fifteen declined to participate and seven questionnaires were rejected because many items were left blank or marked as “not applicable.” Usable responses totalled 121; 55 from the ‘SIS’ group and 66 from the “No SIS” group. The final usable response rate is~30% [121/(419-15)] which is adequate for studies of this nature.

UCR. King, T.S.H. Tea/Information

4.1. Descriptive results

Respondents held managerial positions in a wide range of industries. Typically, they had been in both their companies and industries for 3-20 years. For both groups, the size of company was commonly less than 1,000 employees or greater than 10,000 employees. However, the ‘SIS’ group had more larger companies than the ‘No SIS’ group. This is as expected, since larger companies tend to have more resources to invest in IT. The IT applications described by those who had implemented a strategic application was most often one that was directed at internal operations and/or customers, with less emphasis on suppliers. This is consistent with the previous results (e.g., [50]) which reported that IT applications directed at suppliers are relatively rare. The duration that the strategic IT applications had been in use ranged from 1 to 10 years. Seventy-eight percent of the relevant respondents Table 2 Results of two sample ‘SK’ Group

Wilcoxon

& Management 27 (1994) 71-87

stated that their IT application is a success; sixteen percent were neutral and the remaining six percent did not claim success. It is interesting to note that the majority of the respondents (78%) felt that their strategic IT application is a success. The means and standard deviations for each factor that make up the list of organizational facilitators and inhibitors for both the ‘SIS’ group and the ‘No SIS’ group are arranged in descending order in Appendices B and C. From Appendix B (Organizational Facilitators);the mean scores for the “Internal Factors” category and “Perceived Needs” category can be seen to be generally higher than the “External Factors” category. This indicates that “Internal Factors” and “Perceived Needs” play a stronger facilitating role than“Externa1 Factors” for both the ‘SIS’ group and ‘No SIS’ group. This finding is in agreement with Busch, et al. [lo] who found that internal factors play a stronger role than external factors. The ‘No SIS’ group has gener-

test (facilitators)

> ‘No SIS’ Group

Internal Factors Extensive Distribution Network Extensive Computer Facilities Favorable Image/Reputation of Company Economies of Scale for Strategic Use of IT

‘No SIS’ Group

> ‘SIS’ Group

Top management Vision and Support Strong Corporate Leadership Well-Defined Management Objectives Able to Identify Strategic Opportunities Integration of IS with Business Planning Communication between IS and Management Strong Corporate Planning Capability Low Potential Start-Up Difficulties

Perceived Needs To Satisfy Customers’ Needs/Demands For Timely/Accurate Information To Improve Customer Service To Improve/Maintain Market Position To Improve/Maintain Image/Reputation To Improve Productivity/Efficiency To Lower Cost To Store/Process Information To Differentiate Products/Services To Improve Distribution Network External Factors None

Note: Refer

to Appendix

Pressure from Competition Consultant’s Recommendations Favorable Government Policies B and C for mean scores.

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W.R. King, T.S. H. Teo /Information

76

ally lower scores in the “Perceived Needs” category. This indicates a stronger facilitating role for the ‘SIS’ group. On the other hand, from Appendix C (Organizational Inhibitors), the mean scores for the “Internal Factors” category is generally higher than the “Lack of Perceived Needs” and “External Factors.” This indicates that “Internal Factors” play a stronger inhibiting role for both the groups. The key factors in each category were considered to be those in the top half with a mean score of 3 or more. Although both groups shared certain key factors, their relative emphasis on other key factors differ. For example, the ‘SIS’ group stressed the importance of factors directly related to IT such as: extensive distribution network, extensive computer facilities, etc. and the importance of internal strengths such as: favorable image/ reputation of company, strong market position, etc. On the other hand, the ‘No SIS’ group was more concerned with management issues such as: being able to identify strategic opportunities, strong

Table 3 Results of two sample ‘SIS’ Group)‘No

Wilcoxon

SIS’ Group

Internal Factors None

Lack of Perceived Needs None External Factors None Note: Refer

to Appendix

& Management 27 (1994) 71-87

corporate planning capability, well-defined management objectives, etc. The relative importance of the key “Perceived Needs” and “External Factors” did not vary much between groups. In terms of organizational inhibitors, both groups shared certain key “Internal Factors”, although the number of key inhibitors for the ‘No SIS’ group is greater. Key inhibitors for the ‘No SIS’ group were both IT and management related. Both groups did not consider the “Lack of Perceived Needs” as major inhibitors to the use of IT applications for strategic purposes. For the “External Factors” category, the ‘SIS’ group did not identify any factors as being major inhibitors. The ‘No SIS’ group identified the lack of favorable opportunities and lack of competitive importance of IT to industry as major inhibitors. 4.2. Between group comparisons The results of the two sample Wilcoxon test for facilitators are shown in Table 2. Note that

test (inhibitors). ‘No SIS’ Group)‘SIS’

Group

Lack of Integration of IS with Business Planning Lack of High Priority Lack of Strong IT Planning Capability Lack of Strong IT Leadership Absence of Champion Lack of Adequate Knowledge about Assets/Opportunities Lack of Experience with IT Lack of Strong Corporate Leadership Lack of Tangible Benefits Lack of Explicit Consideration of IS Role Lack of Perceived Importance Lack of Strong Corporate Planning Capability Lack of Strategic Fit fo Firm’s Objectives Low Information Intensity of Products/Services

None

Lack of Favorable Opportunity Lack of Competitive Importance B and C for mean scores.

of IT to Industry

W.R. King, T.S.H. Tea/Information Table 4 Results of matched-pair

Wilcoxon

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77

Test

Factors

Category ‘SIS’ Group

‘No SIS’ Group

Internal Factors Extensive Distribution Network Tangible Benefits of IT Application Strategic Fit to Firm’s Objectives Presence of Champion for Strategic Use of IT Perceived Importance of Strategic Use of IT Extensive Computer Facilities Willingness to Explore New Ideas Strong Technical Support Staff Top Management Vision and Support Favorable Image/Reputation of Company Experience with IT Strong Market Position Adequate Knowledge about Information Assets/Opportunities Economies of Scale for Strategic Use of IT Strong IT Leadership Innovation Capability Strong Corporate Leadership Strong Financial Position High Information Intensity of Products/Services Well-Defined Management Objectives Foreseeable Increase in Market Share Able to Identify Strategic Opportunities Integration of IS with Business Planning Innovative Strategic Orientation High Priority for Strategic Use of IT Strong IT Planning Capability Communication between IS and Management Strong Corporate Planning Capability High Information Intensity in Company’s Value Chain Explicit Consideration of IS Role Favorable Power/Politics in Firm Low Potential Start-Up Difficulties

Plus Plus Plus Plus Plus Plus Plus Plus Plus Plus Plus Plus Plus Plus Plus Plus Plus Plus Plus Normal Plus Plus Normal Plus Normal Normal Normal Plus Plus Normal Normal Minus

Plus Plus Plus Minus Normal Plus Plus Plus Plus Plus Normal Plus Normal Plus Normal Plus Normal Plus Plus Plus Plus Plus Normal Normal Normal Normal Plus Normal Plus Minus Normal Normal

Perceived Perceived Perceived Perceived Perceived Perceived Perceived Perceived Perceived Perceived Perceived Perceived Perceived Perceived Perceived Perceived Perceived

Plus Plus Plus Plus Plus Plus Plus Plus Plus Plus Plus Plus Plus Plus Normal Plus

Plus Plus Plus Plus Plus Plus Plus Plus Plus Plus Plus Plus Plus Plus Plus Plus

Needs Need Need Need Need Need Need Need Need Need Need Need Need Need Need Need Need

to Satisfy Customer’s Needs/Demands for Timely/Accurate Information to Improve Customer Service to Improve/Maintain Market Position to Improve/Maintain Image/Reputation to Improve Productivity/Efficiency to Lower Costs to Improve/Monitor Operations to Improve Decision Making to Store/Process Information to Differentiate Products/Services to Improve Distribution Network to Facilitate Paperwork for Change to Keep Up with New Technology for Uniqueness/Innovation

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& Management 27 (1994) 71-87

Table 4 (continued) Factors

External Factors Favorable Opportunity for Strategic Use of IT Favorable Market Growth Favorable Economic Growth Competitive Importance of IT to Industry Favorable Environmental Change in Industry Pressure from Competition Uncertainty in Environment Consultant’s Recommendation for Use of strategic Favorable Government Policies

Category

IT Application

most of the facilitators are directly related to management, though it seems that the ‘SIS’ group places more emphasis on IT related factors whereas the ‘No SIS’ group seems to emphasize management related factors. It is surprising to note that none of the items in the “Perceived Needs” category were given significantly higher scores by the ‘No SIS’ group. This implies that “Perceived Needs” may function as stronger facilitators for the ‘SIS’ group. None of the items in the “External Factors” category were given significantly higher scores by the ‘SIS’ group, thereby indicating that “External Factors” function as stronger facilitators for the ‘No SIS’ group. The results of the two sample Wilcoxon test (Table 3) for inhibitors show that none of the items in the “Internal Factors” category were perceived as more important by the ‘SIS’ group. It is not surprising that the ‘No SIS’ group has more “stronger” inhibitors for the “Internal Factors” category. What is important, however, is that major inhibitors seem to be related to management and the firm’s strength in IT. None of the items in the “Lack of Perceived Needs” category has significantly different scores between the two groups, thereby indicating similarities in perceptions. The lack of favorable opportunity for strategic use of IT, and lack of competitive importance of IT to industry were perceived as more important inhibitors by the ‘No SIS’ group. This perhaps

‘SIS’ Group

‘No SIS’ Group

Plus Plus Normal Plus Plus Normal Normal Normal Normal

Normal Plus Plus Normal Plus Plus Normal Plus Normal

indicate to some degree why they are presently not using IT applications for strategic purposes. 4.3. Within-group comparisons: “relative strength ” To analyze the results further, comparisons are made using a matched-pair Wilcoxon test for each group to determine whether there are any significant differences in perceptions of the relative importance of each facilitator and the corresponding inhibitor. The “relative strength” of each factor in facilitating and inhibiting was assessed. A factor that functions as a facilitator when present may also function as an inhibitor when absent. However, the question is one of degree. If the presence of factor facilitates to a similar degree as it inhibits (measured in terms of the five point Likert scale used), then it can be considered as a “Normal” factor. However, if the presence of factor facilitates to a greater degree, it is called a“Plus” factor and vice versa for a “Minus” factor. From Table 4, it can be seen that “Plus, Minus and Normal” factors are not the same for the two groups. For the ‘No SIS’ group, the “Plus” factors are mainly related to top management and the external environment. It seems that they are stressing both the importance of good top management and conducive external factors in facilitating the use of strategic IT applications. For the ‘SIS’ group, many of the“Plus” factors are related to information technology. It seems that the

W.R. King, T.S.H. Teo /Information

‘SIS’ group is stressing the importance of IT-related factors in facilitating the use of strategic IT applications. This differences in perceptions can helped explain why one group is deploying strategic IT applications and the other is not. Perceived needs for improvement play a major role as “Plus” factors for both the groups. This finding is intuitively appealing since perceived needs are often the precursor to action. Potential start-up difficulty is stressed by the ‘SIS’ group as an important “Minus” factor rather than a “Normal” factor. This indicates that although low potential start-up difficulty might not be a strong facilitator, high potential start-up difficulty significantly inhibits the use of IT applications for strategic purposes. For the ‘No SIS’ group, explicit consideration of the IS role is a “Minus” factor. This indicates that although the IS role might not be a strong facilitator, its absence is a significant inhibitor. It is interesting to note that the ‘SIS’ group considers the presence of a champion a “Plus” factor, whereas the ‘No SIS’ group considers it a “Minus” factor. This shows that the absence of a champion has greater detrimental effect for the ‘No SIS’ group.

5. Limitations One of the major reasons for conducting this study was to compare differences between the ‘SIS’ group and the ‘No SIS’ group. In order to make this comparison, it was necessary to ask those firms in the ‘No SIS’ groups to identify potent&l facilitators and actual inhibitors. It might therefore be argued that these potential facilitators are mere speculations. However, we have tried to mitigate this limitation by: (1) ensuring that the ‘No SIS’ group understands what a strategic IT application is (by giving examples of strategic uses of IT and the definition of a strategic IT application); and (2) controlling the characteristics of the sample such that respondents are people who are likely to be aware of the strategic uses of IT within or outside the firm. The second limitation is the exploratory nature of this study. We have chosen to make single item

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79

comparisons rather than defining specific constructs with multiple item measures as we wanted to investigate differences in perceptions of individual facilitators and inhibitors.

6. Conclusions

This study extends past research efforts on organizational facilitators to build a cumulative tradition as stressed by Keen [25]. It is more comprehensive than previous empirical research in the area as an attempt is made to compile a comprehensive list of factors from past research literature from which key factors were empirically identified through a questionnaire survey. The methodology extends prior studies in that:

(1) The set of items for organizational facilitators and inhibitors is more comprehensive;

(2) A “not applicable” response was permitted in order to permit the explicit assessment of the relevance of every item to every respondent firm; (3) Both users of strategic systems and non-users were sampled; (4) Inhibitors are identified as the absence of a corresponding facilitator; and (5) The research design allows comparisons to be made both between groups and between factors within each group. This assessment of the relative strength of factors in playing the role of facilitator and inhibitor is potentially important. The results show that the differences in perceptions of the relative importance of each facilitating or inhibiting factor exist between the groups. An understanding of these differences can help explain why some companies are able and/or eager to exploit IT whereas others are not. The main findings are that:

(1) “Internal

Factors” and “Perceived Needs” play a stronger facilitating role than “External Factors,” both for firms that have developed strategic systems and those who have not. In addition, “Perceived Needs” are per-

W.R. King, T.S.H. Teo /Information

80

ceived to play a stronger facilitating role for those that have employed strategic systems than for those who have not done so. (2) “Internal Factors” play a stronger inhibiting role than “Perceived Needs” and “External Factors” for both groups. (3) The ‘SIS’ group places more emphasis on IT-related issues as important facilitators. On the other hand, the ‘No SIS” group places more emphasis on management issues as important facilitators. (4) The presence of champion is perceived by the ‘SIS’ group as an important “Plus” factor in facilitating the strategic use of IT applica-

& Management 27 (1994) 71-87

tions. The absence of champion is perceived by the ‘No SIS’ group as an important “Minus” factor in inhibiting the strategic use of IT applications. Such results as (4) suggest interactive effects among factors. These results should be of interest to both researchers and practitioners in identifying potentially important factors that may facilitate or inhibit the development of strategic systems. Firms that have not developed strategic systems, but wish to do so might consider taking appropriate steps to mitigate their inhibitors and to encourage the presence of appropriate facilitators.

Appendix A References

for items used in auestionnaire References

Factors 1. Strong Market Position 2. Strong corporate Leadership 3. Strong

IT Leadership

4. Strong 5. Strong

Corporate Planning Capability IT Planning Capability

6. Strong Technical

Support

Staff

7. Strong Financial Position 8. Extensive Distribution Network 9. Extensive Computer Facilities

10. Experience

with IT

11. Top Management

12. Communication

Vision and Support

between

IS and Management

13. Well-Defined Management Objectives 14. Integration of IS with Business Planning

King et al. [301 Johnston & Carrico [24] King et al. [301 King et al. [301 Neo [39] King et al. [301 King et al. [301 Neo [39] Dewar & Dutton [15] King et al. [30] Neo [39][40] King et al. [301 Porter & Millar [45] King et al. [301 Neo [39][40] Sullivan [52] King et al. [301 Neo [39][40] Reich & Benbasat 1471 Sullivan [52] Keen [26] King et al. [301 Neo [39][40] Zmud 1611 Bakos & Treaty [2] Lederer & Mendelow [32] Neo [39] Nilakanta & Scamell[41] King et al. 1301 Johnston & Carrico [24] King [29] Neo [39][40] Vitale et al. [56]

WR. King, T.S. H. Teo /Information Appendix

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A (continued) References

Factors 15. Innovation

Capability

16. Innovative

Strategic

17. Perceived

Importance

18. Tangible

19. Explicit

Benefits

Orientation

of Strategic

Use of IT

of IT Application

Consideration

of IS Role

20. Favorable Image/Reputation of Company 21. Economies of Scale for Strategic Use of IT

22. Favorable

Power/Politics

in Firm

23. Foreseeable Increase in Market Share 24. Strategic Fit to Firm’s Objectives

25. Adequate

Knowledge

26. Willingness

to Explore

27. Able to Identify 28. High Priority

about

Information

Assets/Opportunities

New Ideas

Strategic

for Strategic

Opportunities Use of IT

29. Low Potential Start-Up Difficulties 30. High Information Intensity of Products/Services

31. High Information

32. Presence

33. Perceived 34. Perceived

Intensity

of Champion

in Company’s

for Strategic

Need to Improve/Maintain Need to Improve/Maintain

Value Chain

Use of IT

Market Position Image/Reputation

Clemons [ll] Clemons & Kimbrough 1121 Copeland & McKenney 1141 Ghemawat 1181 Copeland & McKenney [14] Millar and Friesen [37] Neo 1401 Venkatraman [54] Jarvenpaa and Ives [22][23] King et al. [30] Zmud [61] Bakos & Treaty [2] Copeland & McKenney [14] King et al. 1301 Mahmood & Soon [33] King 1291 McFarlan & McKenney 1361 Neo [39][40] Ives & Learmonth [20] Copeland & McKenney 1141 Kimberly & Evanisko [28] Porter & Millar [45] Beath [3] King et al. [30] Manross & Rice [34] Zmud 1601 Copeland & McKenney 1141 Cooper & Zmud [13] Copeland & McKenney 1141 Neo [40] Bakos & Treaty [2] Copeland & McKenney [14] Jarvenpaa & Ives 1221 Nilakanta & Scamell [41] Beath [3] Copeland & McKenney [14] Copeland & McKenney [14] Morone [38] King et al. 1301 McFarlan & McKenney 1361 King et al. [30] Johnston & Carrico [24] Neo [40] Porter [44] Porter & Millar [45] Johnston & Carrico [24] Neo 1401 Porter [44] Porter & Millar [45] Beath & Ives [5] Runge 1481 Van de Ven [53] Copeland & McKenney [14] Copeland & McKenney 1141

81

82 Appendix

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A (continued) References

Factors 35. Perceived

Need to Improve

Customer

36. Perceived

Need to Improve

Distribution

37. Perceived

Need to Improve

Productivity/Efficiency

38. Perceived

Need to Improve/Monitor

39. Perceived

Need for Change

40. Perceived

Need to Lower Costs

41. Perceived

Need to Facilitate

42. Perceived

Need to Store/Process

43. Perceived

Need to Satisfy Customers’

44. Perceived 45. Perceived 46. Perceived

Need to Keep Up with New Technology Need for Uniqueness/Innovation Need for Timely/Accurate Information

47. Perceived

Need to Improve

48. Perceived

Need to Differentiate

49. Pressure

Service

Network

Operations

Paperwork Information

Decision

Needs/Demands

Making

Products/Services

from Competition

50. Favorable Government Policies 51. Competitive Importance of IT to Industry

52. Favorable 53. Favorable 54. Favorable

Market Growth Economic Growth Opportunity for Strategic

Use of IT

55. Favorable Environmental Change in Industry 56. Consultant’s Recommendation for Use of Strategic

IT Application

Copeland & McKenney [14] Ives & Learmonth [20] Kim & Michelman [27] Porter & Millar [45] Copeland & McKenney 1141 Ives & Learmonth [20] Porter & Millar [45] Bakos & Treaty [2] Copeland & McKenney [14] Ives & Learmonth [20] Porter & Millar [45] Copeland & McKenney [14] Ives & Learmonth [20] Kim & Michelman [27] Anderson & Paine [l] Copeland & McKenney [14] Neo [40] Zmud [61] Copeland & McKenney [14] Porter [44] Wiseman [57][58] Copeland & McKenney [14] Porter & Millar [45] Copeland & McKenney [14] King & Sabherwal[31] Porter & Millar [4.5] Copeland & McKenney 1141 Ives & Learmonth [20] Copeland & McKenney [14] King et al. 1301 Copeland & McKenney [14] Kim & Michelman [27] Porter & Millar [45] Kim & Michelman [27] Porter & Millar [45] Copeland & McKenney [14] Neo [39] Porter [44] Porter & Millar [45] Benjamin et al. [6] Johnston & Carrico [24] King et al. [30] Neo [39] Gurbaxani et al. [19] Copeland & McKenney [14] Porter & Millar [45] Vitale [55] Copeland & McKenney 1141 King et al. [30] Copeland & McKenney 1141 Wiseman [57][58] Copeland & McKenney [14] Neo [39]

WR. King, T.S.H. Tea/Information Appendix

& Management 27 (1994) 71-87

83

A (continued)

Factors

References

57. Uncertainty

in Environment

Note: Due to space constraints,

Appendix

Burns & Stalker [9] Busch et al. [IO] Galbraith [16] Sabherwal[49] a maximum

of four references

are shown for each item.

B

Organizational

facilitators

Facilitators

No SIS

SIS Mean

Internal Factors Extensive Distribution Network Tangible Benefits of IT Application Strategic Fit to Firm’s Objectives Presence of Champion for Strategic Use of IT Perceived Importance of Strategic Use of IT Extensive Computer Facilities Willingness to Explore New Ideas Strong Technical Support Staff Top Management Vision and Support Favorable Image/Reputation of Company Experience with IT Strong Market position Adequate Knowledge about Information Assets/Opportunities Economies of Scale for Strategic Use of IT Strong IT Leadership Innovation Capability Strong Corporate Leadership Strong Financial Position High Information Intensity of Products/Services Well-Defined Management Objectives Foreseeable Increase in Market Share Able to Identify Strategic Opportunities Integration of IS with Business Planning Innovative Strategic Orientation High Priority for Strategic Use of IT Strong IT Planning Capability Communication between IS and Management Strong Corporate Planning Capability High Information Intensity in Company’s Value Chain Explicit Consideration of IS Role Favorable Power/Politics in Firm Low Potential Start-Up Difficulties

4.11 4.00 4.00 3.94 3.92 3.88 3.82 3.81 3.80 3.78 3.72 3.71 3.70 3.70 3.63 3.63 3.60 3.58 3.57 3.56 3.56 3.55 3.54 3.54 3.40 3.37 3.35 3.19 3.19 3.15 3.10 2.53

**

Perceived Perceived Perceived Perceived Perceived Perceived Perceived Perceived Perceived Perceived

4.35 4.31 4.28 4.18 4.04 3.96 3.88 3.82 3.79

** ** ** * ** * *

Needs Need Need Need Need Need Need Need Need Need

to Satisfy Customers’ Needs/Demands for Timely/Accurate Information to Improve Customer Service to Improve/Maintain Market Position to Improve/Maintain Image/Reputation to Improve Productivity/Efficiency to Lower Costs to Improve/Monitor Operations to Improve Decision Making

**

** **

*

*

* * *

* **

**

S.D.

Mean

S.D.

1.02 0.90 0.85 1.17 1.00 1.16 0.93 1.03 1.02 1.21 1.31 1.17 0.99 1.07 1.08 1 .oo 1.04 1.07 1.32 1.06 1.25 0.91 1.01 1.05 0.99 1.15 1.12 1.16 1.21 1.02 1.19 1.04

3.11 4.03 3.86 3.82 3.92 3.25 3.94 3.58 4.32 2.95 3.80 3.58 3.69 3.31 3.71 3.48 3.92 3.58 3.54 3.94 3.92 4.02 3.89 3.59 3.65 3.67 3.81 3.95 3.41 3.20 2.93 3.03

**

0.93 0.96 0.88 0.87 0.99 1.12 1.11 1.16 0.99

3.88 3.67 3.85 3.84 3.43 3.65 3.43 3.64 3.61

** ** ** * ** * *

**

** **

*

*

* * *

* **

**

1.31 0.99 0.90 1.12 1.04 1.21 0.85 1.09 0.81 0.99 1.08 1.11 0.97 1.09 1.20 1.15 1.07 1.01 1.15 0.92 1.04 0.76 1.02 1.16 1.08 1.03 1.03 1.03 1.15 0.95 1.10 1.02

1.02 0.98 1.04 0.98 1.00 1.05 1.17 0.91 0.99

W.R. King, T.S.H. Tea/Information

84 Appendix

B (continued)

Facilitators

Perceived Perceived Perceived Perceived Perceived Perceived Perceived

& Management 27 (1994) 71-87

No SIS

SIS

Need Need Need Need Need Need Need

to Store/Process Information to Differentiate Products/Services to Improve Distribution Network to Facilitate Paperwork for Change to Keep Up with New Technology for Uniqueness/Innovation

External Factors Favorable Opportunity for Strategic Use of IT Favorable Market Growth Favorable Economic Growth Competitive Importance of IT to Industry Favorable Environmental Change in Industry Pressure from Competition Uncertainty in Environment Consultant’s Recommendation for Use of Strategic Favorable government Policies

IT Application

Mean

S.D.

Mean

S.D.

3.78 ** 3.77 ** 3.73 * 3.45 3.33 3.27 3.19

1.24 1.10 1.18 1.31 1.17 1.29 1.33

3.35 ** 3.25 ** 3.23 * 3.17 3.28 3.12 3.02

1.03 1.02 1.09 1.02 1.08 1.15 1.07

3.56 3.47 3.30 3.09 3.09 2.89 * 2.60 2.20 * 1.87 **

1.11 1.06 1.08 1.23 1.29 1.22 1.06 1.45 1.10

3.68 3.30 3.25 3.27 2.82 3.27 * 2.50 2.67 * 2.36 **

1.03 1.06 0.95 1.14 0.95 1.27 1.11 1.21 1.01

Scale: 1 - Not Facilitative; 5 - Greatly Facilitative * p < 0.05 (Two Sample Wilcoxon Test) ** p < 0.01 (Two Sample Wilcoxon Test)

Appendix Organizational

C inhibitors

Inhibitors

No SIS

SIS Mean

Internal Factors Lack of Integration of IS with Business Planning Lack of Well-Defined Management Objectives Lack of High Priority for Strategic Use of IT Lack of Communication between IS and Management Lack of Top Management Vision and Support Lack of Strong IT Planning Capability High Potential Start-Up Difficulties Lack of Strong IT Leadership Lack of Willingness to Explore New Ideas Absence of Champion for Strategic Use of IT Lack of Adequate Knowledge about Information Assets/Opportunities Unable to Identify Strategic Opportunities Lack of Foreseeable Increase in Market Share Lack of Experience with IT Lack of Strong Technical Support Staff Lack of Favorable Power/Politics in Firm Lack of Strong Corporate Leadership Lack of Tangible Benefits of IT Application Lack of Innovation Capability Lack of Innovative Strategic Orientation Lack of Explicit Consideration of IS Role Lack of Perceived Importance of Strategic Use of IT Lack of Economies of Scale for Strategic Use of IT Lack of Strong Corporate Planning Capability

3.42 3.34 3.26 3.18 3.16 3.13 3.07 3.00 3.00 2.97 2.97 2.97 2.97 2.95 2.95 2.94 2.91 2.87 2.87 2.86 2.83 2.78 2.77 2.68

* **

* ** ** **

**

* **

** ** **

S.D.

Mean

1.11 1.35 1.07 1.34 1.38 1.28 1.16 1.37 1.31 1.40 1.37 1.25 1.22 1.45 1.56 1.15 1.42 1.26 1.30 1.33 1.23 1.37 1.19 1.12

3.86 3.30 3.94 3.46 3.59 3.63 2.95 4.00 3.05 4.13 3.67 3.27 3.13 3.72 3.05 2.79 3.41 3.71 3.03 3.34 3.58 3.86 2.45 3.67

S.D. * **

* ** ** **

**

* **

** ** **

1.13 1.23 0.94 1.10 1.38 1.16 1.30 1.18 1.33 1.16 1.16 1.19 1.24 1.19 1.19 1.32 1.50 1.11 1.28 1.21 1.08 1.13 1.12 1.19

WR. King, T.S.H. Tea/Information Appendix

& Management

27 (1994) 71-87

85

C (continued)

Inhibitors

SIS

No SIS

Mean

S.D.

Mean

SD.

Lack Lack Lack Lack Low Low Lack Lack

of Strategic Fit to Firm’s Objectives of Extensive Computer Facilities of Extensive Distribution Network of Strong Financial Position Information Intensity in Company’s Value Chain Information Intensity of Products/Services of Strong Market Position of Favorable Image/Reputation of Company

2.67 * 2.66 2.61 2.58 2.54 2.38 * 2.38 2.17

1.21 1.34 1.41 1.42 1.12 1.16 1.27 1.34

3.21 * 2.81 2.27 2.68 2.91 2.96 * 2.20 1.90

1.09 1.33 1.11 1.21 1.15 1.32 1.11 1.01

Lack Lack Lack Lack Lack Lack Lack Lack Lack Lack Lack Lack Lack Lack Lack Lack Lack

of of of of of of of of of of of of of of of of of

3.00 2.92 2.83 2.83 2.68 2.68 2.67 2.63 2.61 2.56 2.55 2.52 2.51 2.50 2.47 2.42

1.41 1.20 1.39 1.48 1.47 1.21 1.09 1.48 1.22 1.41 1.42 1.44 1.20 1.21 1.28 1.34

2.73 2.59 2.97 2.70 2.49 2.47 2.46 2.42 2.86 2.52 2.63 2.34 2.82 2.68 2.72 2.35

1.30 1.19 1.39 1.30 1.30 1.22 1.16 1.32 1.33 1.37 1.45 1.22 1.35 1.18 1.34 1.34

2.86 2.84 2.75 ** 2.61 2.60 ** 2.58 2.56 1.89 1.75

1.33 1.30 1.18 1.20 1.01 1.15 1.05 1.13 0.90

2.64 2.72 3.51 ** 2.60 3.38 ** 2.64 2.51 2.19 2.17

1.14 1.18 1.09 1.18 1.24 1.22 1.14 1.08 1.27

Perceived Needs Perceived Need to Store/Process Information Perceived Need to Keep Up with New Technology Perceived Need to Improve Decision Making Perceived Need for Timely/Accurate Information Perceived Need to Improve/Maintain Market Position Perceived Need for Uniqueness/Innovation Perceived Need to Improve Distribution Network Perceived Need to Improve Customer Service Perceived Need to Differentiate Products/Services Perceived Need to Satisfy Customers’ Needs/Demands Perceived Need to Improve Productivity/Efficiency Perceived Need to Improve/Maintain Image/Reputation Perceived Need for Change Perceived Need to Facilitate Paperwork Perceived Need to Improve/Monitor Operation Perceived Need to Lower Costs

External Factors Lack of Favorable Economic Growth Lack of Favorable Market Growth Lack of Favorable Opportunity for Strategic Use of IT Uncertainty in Environment Lack of Competitive Importance of IT to Industry Lack of Pressure from Competition Lack of Favorable Environmental Change in Industry Lack of Favorable Government Policies Lack of Consultant’s Recommendation for Strategic Use of IT Scale: 1 - Not Inhibitive; 5 - Greatly Inhibitive * p < 0.05 (Two Sample Wilcoxon Test) ** p < 0.01 (Two Sample Wilcoxon Test)

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87

C. Strategy and computers: Information sys]571 Wiseman, tems as competitive weapons, Dow Jones-Homewood, IL: Jones-Irwin, 1985. C. Strategic information systems, Homewood, ]581 Wiseman, IL: Jones-Irwin, 1988. C., & MacMillan, I.C. Creating competitive ]591 Wiseman, weapons from information systems. The Journal of Business Strategy, 1984, 5(2), 42-49. of modern software practices: ]601 Zmud, R.W. Diffusion Influence of centralization and formalization. Munagement Science, 1982, 28(12), 1421-1431. of ‘push-pull’ theory ap]611 Zmud, R.W. An examination plied to process innovation in knowledge work. Management Science. 1984, 30(6), 727-738. William R. King is University Professor in the Katz Graduate School of Business at the University of Pittsburgh. He has served as President of the Institute of Management Sciences (TIMS), as Senior Editor of the MIS Quarterly, and as Chair of the International Conference on Information Systems (ICIS). He is the author of more than 200 papers in the areas of IS, strategic planning and management science.

Thompson Teo is a Senior Tutor in the Faculty of Business Administration at the National University of Singapore. He is currently pursuing a Ph.D. degree in Management Information Systems at the University of Pittsburgh. His research interests include strategic impacts of information technology, information systems planning, and management control systems.