A Model of IT-enabled Organizational Integration and Sustained Competitive Advantage

Organizational integration is a phenomenon occurring inexorably in recent years due to rapid advances in IT and intense competition. Past research has found organizational integration, between and within firms, to be positively-related to performance, with IT resources playing a pivotal role in facilitating this trend. In this paper, we argue that IT resources, comprising of IT assets and capabilities, are critical antecedents to organizational integration. We examine the role of service-oriented architecture (SOA) as an IT asset in enabling the integration of organizational resources. As an IT-dependent strategic initiative, IT-enabled organizational integration provides significant barriers to competition and gives rise to sustained competitive advantage. Drawing upon the resource-based theory, we develop a model by conceptualizing both IT assets and IT capabilities as higher-order constructs comprising of IT infrastructure and IT architecture, and IT technical skills and managerial skills respectively. Next, we explore the mediating effects of causal ambiguity to further elucidate the relationship between organizational integration and sustained competitive advantage. Our proposed model provides managers with invaluable insights regarding the nature and application of IT to achieve organizational integration and to sustain their competitive edge in the global marketplace.