Strategic Flexibility and IT Infrastructure Investments - Empirical Evidence in two Case Studies

This paper presents an empirical study to explore how firms invest in their IT infrastructure to support strategic flexibility. It investigates how IT infrastructure capabilities relate to strategic flexibility, how firms build flexibility into their IT investment decisions, and how the firms use IT to support strategic flexibility. Our cases indicate that different types of needed flexibility at the organizational level, ask for different types of IT infrastructure capabilities. In both cases, flexibility is supported by centrally organized management-oriented IT infrastructure capabilities. In the IT investment process, flexibility in the investment decision-making process is implicitly taken into account, whereas IT infrastructure flexibility is explicitly valued for. In both cases, management expects more explorative use of applications supported by IT infrastructure investments to better enhance strategic flexibility than exploitative use does. The implications for further research are discussed.