Information systems resources, competitive advantage and Zimbabwe's firm performance

Abstract

In many developing countries, information commutation technologies (ICT) resources and capabilities are no longer perceived as business assets but as means for achieving sustainable competitive advantage and superior firm performance. In particular, ICTs support a firm's core competencies and enable firms to exploit market opportunities, neutralise competitive threats, reduce costs and increase performance. The study uses the dynamic capabilities theory and the resource-based view to illustrate how a firm's ICT resources may support and develop its core competencies. The study employed a cross-sectional case study design where data was collected using a structured questionnaire administered to a stratified sample of 983 respondents. Structured equation models (SEM) were used to analyse quantitative data for the disaggregated test model. Our findings reveal that ICT resources are required, but not sufficient, to achieve competitive advantage and increase a firm's performance. ICT-enabled core competencies and tacit, path-dependent, firm-specific ICT management capacities explain variation in business performance. ICT can improve company performance if capabilities focus on creating distinctive core competencies. The study recommends strategies that enable firms to build human capital to develop innovative processes. Such strategies might help minimise switching costs, boost complementarities between business practices and ICT usage, streamline business processes, and improve managerial decisions and dynamic organisational structure. This study found that educating ICT managers maximises ICT investment. The study's contribution is using SEM to explain factors that determine competitive advantage and firm performance. Management must capitalise on aggregate demand-generating operations, including ICT infrastructure development, proprietary value-adding core activities, and networking with various vital alliances. The study adds resource-based ideas to Zimbabwe's empirical literature, unlike previous studies that only used innovation adoption theories. This study's test model could examine industry levels in dynamic, competitive markets.