Difference between revisions of "Sustained Competitive Advantage, Virtual organizations"

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<ref>Mata, J.M. (1995). Information Technology and Sustained  Competitive Advantage: A resource-Based Analysis. Department of Business Analysis & Research. Graduate School of Business, Texas A&M University
Mata, J.M. (1995). Information Technology and Sustained  Competitive Advantage: A resource-Based Analysis. Department of Business Analysis & Research. Graduate School of Business, Texas A&M University
Jagers, H.P.M. & Jansen, W. (1998). PrimaVera Working Paper 98-02</ref>
Jagers, H.P.M. & Jansen, W. (1998). PrimaVera Working Paper 98-02

Revision as of 04:28, 12 November 2012


Nowadays we are seeing a fast change in the current organization environments. This phenomenon is partly due to the opportunities that information technology (both computer technology and communication technology) has brought. Organizations that want to be successful and want to ensure their existence nowadays must not only be experts in their own business domain. These organizations must be able to respond quickly and adequately to changes. As Charles Darwin already said "It's not the strongest species that survive, nor the most intelligent, but the most responsive to change." Below two articles, which shortly discuss how certain organizations work to achieve their business goals, will be reviewed and a critical reflection will be given.

Information Technology and Sustained Competitive Advantage: A resource-Based Analysis

According to the author it is not enough to just implement a system in an organization to save cost to achieve sustained competitive advantages. The competitor can easily imitate this by also implementing a similar system. In order to achieve a competitive advantage one must therefore focus on things that cannot easily be imitated by the competition such as knowledge, skills, etc. This article mainly discusses the important aspects that IT companies must take into account in order to achieve sustained competitive advantages. The writer has devised a model which could help companies to examine the potency of IT so the cutthroat competition can be surpassed. By using this model, companies can choose the right strategy to properly position themselves. They looked from a resource-based approach at the link between IT and sustained competitive advantages. From different literature studies by the writer there are five specific attributes of IT (customer switching costs, access to capital, proprietary, Technical IT skills and managerial technology IT skills) suggested that could serve as sources of sustained competitive advantages. The writer then examined in which way they actually serve for sustained competitive advantages. From this article emerges that managerial IT skills is the best IT attribute for sustained competitive advantage. This would be the only knowledge that can be obtained on a longer period and therefore cannot just be copied. The idea behind this is that it will cost a lot of time for the competitor to maintain the same knowledge, so the other company has sustained competitive advantage. In here technical IT skills is rated as a non sustained competitive advantage because a competitor would be able to train their own employees or to hire others when they do not have a certain skill themselves. However a company can catch up with the competitor by training their own employees, only when these are employees which are working in the same field. It could cost the competitive company a few years before it maintains the necessary Technical skills which makes sure that the other company still has a sustained competitive advantage. There is also some risk in hiring external staff for Technical IT skills, such as programmers. Hired programmers can perhaps build specific programs but one will not be sure that the same creativity/innovativeness can be reached that own employees have. Creativity is not a skill that can be learned within a minute, so the sustained competitive advantage can be achieved by using this skill. This can also be, as the writer expressed "learning by doing". At this point the writer has only looked at the general view of Technical IT skills. Perhaps with a deeper look at the technical IT skills he might have come to another thought about it.

Characteristics of virtual organizations

In this article the conceptual model of network organizations is mapped. They’ve tried to make a small distinction between virtual organizations and network organizations in general. In addition, the characteristic properties of virtual organizations are explained. From this article, it has become clear that the basis of a virtual organization is based on confidentiality and that technology alone is not enough. Virtual organization is not about using the technological possibilities but about the cooperation of different partners and employees which are working together to achieve the intended purpose. And the only way to achieve this together is to ensure the confidentiality between the different parties. Furthermore, one can conclude that by making use of Virtual organization the current organizations in the field of information provision could save costs. Information can be shared between the cooperating organizations namely by means of information technology. Virtual organization can reduce the operational costs of an organization such as housing, transport and increase the productivity of employees by letting them all use the same data from any place they want to use it without moving around. Because the work of this type of organization is not location dependent one can put their staff based on the competences which they have instead of finding their local skills. By using this approach a shortage of skilled staff in a particular domain can be reduced. Previously organizations could only be present in a number of places, this is no longer the case with virtual organization. Organizations can stay at one place and are reachable at that place from everywhere and are also accessible on each time. Another important point of virtual organization also called ‘’boundary less organization’’ is that people can remain in contact with each other regardless of the organizational boundaries, place or time. Virtual Organization has created many opportunities for current organizations which saves costs and time. However, this organization form also brings some disadvantages. Regard to the fact that with virtual organization there is cooperation between people which are in different geographical areas they must take into account, for example, different working hours. This requires high flexibility. It may be that the parties involved in a real time communication are in different time zones and so perhaps have to work at non-traditional working hours. It is necessary that people get training about the technologies used in virtual organization. Since there is no worldwide standardization for the resources that everyone uses it could be that additional hardware, software or networks will be deployed to get the virtual organization operational. For such a comprehensive cooperation one can assume that the confidentiality can not be guaranteed without the safety of all resources. Cooperating people should make sure that their data is not open and exposed for everyone. Because of this, it is certainly necessary to take additional security measures regarding to the virtual organization.


Mata, J.M. (1995). Information Technology and Sustained Competitive Advantage: A resource-Based Analysis. Department of Business Analysis & Research. Graduate School of Business, Texas A&M University

Jagers, H.P.M. & Jansen, W. (1998). PrimaVera Working Paper 98-02