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Information systems, competitive dynamics, and firm performance: an interpretive and centering resonance analysis

UNCG Author/Contributor (non-UNCG co-authors, if there are any, appear on document)
Sandra A. Vannoy (Creator)
The University of North Carolina at Greensboro (UNCG )
Web Site:
Al Farooq Salam

Abstract: Researchers have endeavored to increase understanding of the relationships between investments in information systems (IS), competitive advantage, and firm performance. While the extant IS literature provides important insights on information systems and competitive strategy, the answer to how information systems contribute to competitive advantage and firm performance remains unclear. This dissertation examines, from a managerial interpretive perspective, how information systems contribute to firms‘ specific competitive actions and responses, and the resultant impacts upon firm performance. The findings from this research suggest that the answer may well lie within the role of information systems in firms‘ competitive dynamics or the specific competitive actions and/or responses in which firms engage. This dissertation comprises two studies. Study I examines managerial interpretations of the role played by information systems in firms‘ competitive dynamics and firm performance. Study II examines the role of social computing and communication technologies in intrafirm social networks and digitally-mediated aggregate cognitive maps at each stage of a competitive dynamics process.

The results of Study I in this dissertation suggest a process model, grounded in data from in-depth interviews with executive- and operational-level organizational managers, industry experts and from relevant organizational and industry documents. The relationships inherent in a firm‘s information systems, competitive dynamics and firm performance can be traced through four interrelated grounded theoretical categories –IT- enhanced Organizational Information Processing and Competitive Action, Information-driven Competitive Action Decision, Execution/Abandonment, and Firm Performance. Thus, the first study contributes to understanding how information systems enable a process of knowledge dissemination and sharing among managerial decision-makers, how information systems enable a collective and rational competitive action decision-making process, how information systems facilitate and create message channeling systems and create the platform toward competitive actions enactment, and thus, how firm performance is impacted by information systems. This study shows the way in which information systems impact firm performance through the competitive actions and reactions undertaken by a dominant firm. Dominant firms have shown the ability to attain and retain superior performance and exhibit sustained competitive advantage. Thus, the study of the role of information systems in the context of the competitive activity of a dominant firm should be of value to both academics and practitioners.

The research methodology employed in Study I of this dissertation is grounded theory. Grounded theory was chosen, as it is an appropriate method for studying complex, little understood phenomena. However, this study goes beyond many existing grounded theory studies, as each category is supported by and related toward prevailing theory and existing literature. In doing so, this dissertation builds upon existing work by emphasizing both the strengths and weaknesses inherent in extant research, thus encouraging a cumulative tradition. Specifically, this research makes significant and important contributions to the areas of cognition, information processing, decision- making, information systems and firm performance in the context of competitive dynamics.

The second study in this dissertation examines the role of social computing and communications technologies in intrafirm social networks and digitally-mediated aggregate cognitive maps embedded within the process of conceiving, enacting and executing firms‘ competitive actions and responses and resulting impacts upon firm performance. The role of information systems in this context raises important new issues that have not been addressed by current information systems research. By examining the role of internal managerial social networks formed around social computing and communications technologies that are used in the conception, enactment and execution of firms‘ competitive dynamics, it is possible to unearth a more complex and integrated role of information systems in organizations.

Study II builds upon the literature in the following areas of research: information systems and firm performance, competitive dynamics in the specific context of the awareness-motivation-capability perspective, social computing, social network theory, and organizational communication in the specific areas of collective and distributed cognition, information seeking and sharing, and organizational memory and learning.

the general role of information systems in competitive actions and firm performance. In Study II, Social Network Analysis and Centering Resonance Analysis have been used to build upon Grounded Theory by examining the collective and interactive nature of organizational communication and decision-making in the context of social computing. Specifically, social relationships and organizational communication processes are examined in this research in the context of social computing and communications technologies embedded within the conception, enactment, and execution of competitive actions and responses toward impacts on firm performance. The two studies are synthesized to provide a novel perspective about a very complex and multifaceted phenomenon: understanding the impact of information systems on firm performance through the lens of competitive dynamics. Specifically, the findings from this dissertation suggest that to account for the impact of information systems upon firm performance, researchers should consider the organizational context, the intentions and actions of key players, and the process of conceiving, enacting and executing competitive actions or responses carried out by the organization. Findings also suggest that practitioners will be better able to leverage IT investments if they understand the embedded role of information systems within the competitive actions or responses undertaken by the firm to maintain or improve relative performance.

Additional Information

Language: English
Date: 2010
centering resonance analysis, competitive dynamics, firm performance, grounded theory, information systems, social network analysis
Organizational effectiveness $x Information technology.
Information resources management $x Evaluation.
Strategic planning.
Business $x Evaluation.