Omar A. El Sawy

Building an Information System Design Theory for Vigilant EIS

This paper defines an information system design theory ISDT to be a prescriptive theory which integrates normative and descriptive theories into design paths intended to produce more effective information systems. The nature of ISDTs is articulated using Dubins concept of theory building and Simons idea of a science of the artificial. An example of an ISDT is presented in the context of Executive Information Systems EIS. Despite the increasing awareness of the potential of EIS for enhancing executive strategic decision-making effectiveness, there exists little theoretical work which directly guides EIS design. We contend that the underlying theoretical basis of EIS can be addressed through a design theory of vigilant information systems. Vigilance denotes the ability of an information system to help an executive remain alertly watchful for weak signals and discontinuities in the organizational environment relevant to emerging strategic threats and opportunities. Research on managerial information scanning and emerging issue tracking as well as theories of open loop control are synthesized to generate vigilant information system design theory propositions. Transformation of the propositions into testable empirical hypotheses is discussed.

From IT Leveraging Competence to Competitive Advantage in Turbulent Environments: The Case of New Product Development

A burning question for information systems (IS) researchers and practitioners is whether and how IT can build a competitive advantage in turbulent environments. To address this question, this study focuses on the business process level of analysis and introduces the construct of IT leveraging competence---the ability to effectively use IT functionalities. This construct is conceptualized in the context of new product development (NPD). IT leveraging competence is shown to indirectly influence competitive advantage in NPD through two key mediating links: functional competencies (the ability to effectively execute operational NPD processes) and dynamic capabilities (the ability to reconfigure functional competencies to address turbulent environments). Environmental turbulence is also shown to moderate the process by which IT leveraging competence influences competitive advantage in NPD. Empirical data were collected from 180 NPD managers. Through the construct of IT leveraging competence, the study shows that the effective use of IT functionalities, even generic functionalities, by business units can help build a competitive advantage. The study also shows that the strategic effect of IT leveraging competence is more pronounced in higher levels of environmental turbulence. This effect is not direct: It is fully mediated by both dynamic capabilities and functional competencies. Taken together, these findings suggest that IS researchers should look beyond the direct effects of firm-level IT infrastructures and focus their attention on how business units can leverage IT functionalities to better reconfigure and execute business processes. In turbulent environments, focusing on these aspects is even more vital.

Absorptive capacity configurations in supply chains: gearing for partner-enabled market knowledge creation

The need for continual value innovation is driving supply chains to evolve from a pure transactional focus to leveraging interorganizational partner ships for sharing information and, ultimately, market knowledge creation. Supply chain partners are (1) engaging in interlinked processes that enable rich (broad-ranging, high quality, and privileged) information sharing, and (2) building information technology infrastructures that allow them to process information obtained from their partners to create new knowledge. This study uncovers and examines the variety of supply chain partnership configurations that exist based on differences in capability platforms, reflecting varying processes and information systems. We use the absorptive capacity lens to build a conceptual framework that links these configurations with partner-enabled market knowledge creation. Absorptive capacity refers to the set of organizational routines and processes by which organizations acquire, assimilate, transform, and exploit knowledge to produce dynamic organizational capabilities. Through an exploratory field study conducted in the context of the RosettaNet consortium effort in the IT industry supply chain, we use cluster analysis to uncover and characterize five supply chain partnership configurations (collectors, connectors, crunchers, coercers, and collaborators). We compare their partner-enabled knowledge creation and operational efficiency, as well as the shortcomings in their capability platforms and the nature of information exchange. Through the characterization of each of the configurations, we are able to derive research propositions focused on enterprise absorptive capacity elements. These propositions provide insight into how partner-enabled market knowledge creation and operational efficiency can be affected, and highlight the interconnected roles of coordination information and rich information. The paper concludes by drawing implications for research and practice from the uncovering of these configurations and the resultant research propositions. It also highlights fertile opportunities for advances in research on knowledge management through the study of supply chain contexts and other interorganizational partnering arrangements.

Digital business strategy: toward a next generation of insights

Over the last three decades, the prevailing view of information technology strategy has been that it is a functional-level strategy that must be aligned with the firms chosen business strategy. Even within this so-called alignment view, business strategy directed IT strategy. During the last decade, the business infrastructure has become digital with increased interconnections among products, processes, and services. Across many firms spanning different industries and sectors, digital technologies (viewed as combinations of information, computing, communication, and connectivity technologies) are fundamentally transforming business strategies, business processes, firm capabilities, products and services, and key interfirm relationships in extended business networks. Accordingly, we argue that the time is right to rethink the role of IT strategy, from that of a functional-level strategy--aligned but essentially always subordinate to business strategy--to one that reflects a fusion between IT strategy and business strategy. This fusion is herein termed digital business strategy. We identify four key themes to guide our thinking on digital business strategy and help provide a framework to define the next generation of insights. The four themes are (1) the scope of digital business strategy, (2) the scale of digital business strategy, (3) the speed of digital business strategy, and (4) the sources of business value creation and capture in digital business strategy. After elaborating on each of these four themes, we discuss the success metrics and potential performance implications from pursuing a digital business strategy. We also show how the papers in the special issue shed light on digital strategies and offer directions to advance insights and shape future research.

Coordinating for Flexibility in e-Business Supply Chains

The widespread use of information technology (IT) to create electronic linkages among supply chain partners with the objective of reducing transaction costs may have unintended adverse effects on supply chain flexibility. Increasing business dynamics, changing customer preferences, and disruptive technological shifts pose the need for two kinds of flexibility that interenterprise information systems must address--the ability of interenterprise linkages to support changes in offering characteristics (offering flexibility) and the ability to alter linkages to partner with different supply chain players (partnering flexibility). This study explores how enterprises in supply chains may forge supply chain linkages that enable both types of flexibility jointly, and allow them to deal with ubiquitous change. Drawing on March and Simons coordination theory, we propose two design principles: (1) advance structuring of interorganizational processes and information exchange that allows partnering organizations to be loosely coupled, and (2) IT-supported dynamic adjustment that allows enterprises to quickly sense change and adapt their supply chain linkages. This study reports on a survey of 41 supply chain relationships in the IT industry. For design principle, our empirical investigation of factors shows (1) that modular design of interconnected processes and structured data connectivity are associated with higher supply chain flexibility, and (2) that deep coordination-related knowledge is critical for supply chain flexibility. Also, sharing a broad range of information with partners is detrimental to supply chain flexibility, and organizations should instead focus on improving the quality of information shared. For industry managers, the study provides clear insights for information infrastructure design. To manage their interdependencies, enterprises need to encapsulate their interconnected processes in modular chunks, and support these with IT platforms for information exchange in structured formats. Enterprises also need to nurture their execution capabilities by putting in place the information systems to process information exchanged with partners, augmenting their understanding of factors such as how partner actions need to trigger adaptive responses. For researchers, the study initiates a new stream of theorizing that focuses on the role of the information infrastructure in managing the tension between competing goals of offering flexibility and partnering flexibility.

Understanding the Elusive Black Box of Dynamic Capabilities

A major challenge for managers in turbulent environments is to make sound decisions quickly. Dynamic capabilities have been proposed as a means for addressing turbulent environments by helping managers extend, modify, and reconfigure existing operational capabilities into new ones that better match the environment. However, because dynamic capabilities have been viewed as an elusive black box, it is difficult for managers to make sound decisions in turbulent environments if they cannot effectively measure dynamic capabilities. Therefore, we first seek to propose a measurable model of dynamic capabilities by conceptualizing, operationalizing, and measuring dynamic capabilities. Specifically, drawing upon the dynamic capabilities literature, we identify a set of capabilities — sensing the environment, learning, coordinating, and integrating — that help reconfigure existing operational capabilities into new ones that better match the environment. Second, we propose a structural model where dynamic capabilities influence performance by reconfiguring existing operational capabilities in the context of new product development (NPD). Data from 180 NPD units support both the measurable model of dynamic capabilities and also the structural model by which dynamic capabilities influence performance in NPD by reconfiguring operational capabilities, particularly in higher levels of environmental turbulence. The study’s implications for managerial decision making in turbulent environments by capturing the elusive black box of dynamic capabilities are discussed.

The “Third Hand”: IT-Enabled Competitive Advantage in Turbulence Through Improvisational Capabilities

Organizations are increasingly engaged in competitive dynamics that are enabled or induced by information technology (IT). A key competitive dynamics question for many organizations is how to build a competitive advantage in turbulence with digital IT systems. The literature has focused mostly on developing and exercising dynamic capabilities for planned reconfiguration of existing operational capabilities in fairly stable environments with patterned “waves,” but this may not always be possible, or even appropriate, in highly turbulent environments with unexpected “storms.” We introduce improvisational capabilities as an alternative means for managing highly turbulent environments; we define this as the ability to spontaneously reconfigure existing resources to build new operational capabilities to address urgent, unpredictable, and novel environmental situations. In contrast to the planned role of dynamic and operational capabilities and the ambidexterity that they jointly offer, improvisational capabilities are proposed to operate distinctly as a “third hand” that facilitates reconfiguration and change in highly turbulent environments. First, the paper develops the notion of improvisational capabilities and articulates the key differences between the two “reconfiguration”---improvisational and dynamic---capabilities. Second, the paper compares the relative effects of improvisational and dynamic capabilities in the context of new product development in different levels of environmental turbulence. Third, the paper shows how IT-leveraging capability in new product development is decomposed into its three digital IT systems: project and resource management systems, organizational memory systems (OMS), and cooperative work systems---and how each of these IT systems enhances improvisational capabilities, an effect that is accentuated in highly turbulent environments. The results show that although dynamic capabilities are the primary predictor of competitive advantage in moderately turbulent environments, improvisational capabilities fully dominate in highly turbulent environments. Besides discriminant validity, the distinction between improvisational and dynamic capabilities is evidenced by the differential effects of IT-leveraging capability on improvisational and dynamic capabilities. The results show that the more the IT-leveraging capability is catered toward managing resources (through project and resource management systems) and team collaboration (through cooperative work systems) rather than relying on past knowledge and procedures (through organizational memory systems), the more it is positively associated with improvisational capabilities, particularly in more turbulent environments. The paper draws implications for how different IT systems can influence improvisational capabilities and competitive advantage in turbulent environments, thereby enhancing our understanding of the role of IT systems on reconfiguration capabilities. The paper discusses the theoretical and practical implications of building and exercising the “third hand” of improvisational capabilities for IT-enabled competitive dynamics in turbulence.

IT-intensive value innovation in the electronic economy: insights from Marshall industries

The emerging electronic economy is bringing with it new forms of IT-enabled intermediation, virtual supply chains, rapidly changing electronic commerce technologies, increasing knowledge intensity, and unprecedented sensitivity for time-to-market by customers. Customers are demanding more value, customized to their exact needs, at less cost, and as quickly as possible. The enterprises that will survive in such a demanding environment will need to innovate and invent new ways of creating value, and will require different enterprise architectures and different IT infrastructures. This article focuses on providing a framework for guiding an enterprise as it transforms itself to function more effectively in the electronic economy. Using the distribution industry in general and Marshall Industries in particular as a context, the article draws insights for transforming an extended enterprise’s architecture and its IT infrastructure to enable new ways of creating value in the electronic economy. The article provides a staged junction box model for guiding the transformation, and also articulates the elements of the new value logic for enterprises in the electronic economy.

Personal information systems for strategic scanning in turbulent environments: can the CEO go on-line?

As the business environment becomes more complex and dynamic, it becomes increasingly vital for top executives to scan the information environment to identify strategic threats and opportunities. This article seeks to understand the strategic scanning behaviors of top executives in order to provide some guidelines for the possibility of designing computer-based systems to support and enhance these scanning processes. The characteristics of the strategic scanning process are investigated through an empirical study of 37 chief executive officers of small to medium-sized high technology companies. Results show that they are very systematic scanners when it comes to strategic information, and that their information sources are limited, mostly personal, and external to the organization. This suggest that a computer-based system for strategic scanning would probably have to be a customized personal system, not tightly coupled to the organizational information system.

Leveraging Standard Electronic Business Interfaces to Enable Adaptive Supply Chain Partnerships

Adaptive supply chain partnerships are a key factor in driving the ability of extended enterprise partners to achieve long-term goals in an environment characterized by disruptive environmental shifts. Adaptive extended enterprise arrangements allow participating enterprises to leverage their combined assets for collective exploration and exploitation. In the context of extended enterprises, where significant investments have been directed toward instituting common interfaces, this study examines the question: How does the use of standard electronic business interfaces (SEBIs) enable supply chain partnerships to become more adaptive? This study conceptualizes the use of SEBIs as a boundary-spanning mechanism that helps overcome boundaries that impede knowledge transfer between enterprises in supply chains. SEBIs enables partners to gain insight into their broader environments, enriching each partners perspective (enhanced bridging). SEBIs also help strengthen the cooperative ties between partners, motivating each partner to adapt for collective gain (enhanced bonding). Our research model is empirically tested using data collected from 41 demand-side supply chain partnerships (between original equipment manufacturers (OEMs), distributors, and retailers) in the information technology (IT) industry. The results show that collaborative information exchange (CIE) between supply chain partners mediates the relationship between use of SEBIs and mutual adaptation (MA) and adaptive knowledge creation between supply chain partners. Interestingly, the use of SEBIs is found to be directly associated with MA but only indirectly associated with adaptive knowledge creation. The study points out that the strategic impacts of SEBIs go well beyond the exchange of transaction information and process integration. It also shows that multilateral, quasi-open, and information exchange--and process linkage--oriented SEBIs can result in both bonding and bridging across supply chain partners without binding them inflexibly to specific partners. Based on the model and results, the study offers practical implications for how SEBIs should be developed, adopted, and used.