Why IT Does Matter Essay

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1.0 INTRODUCTION Information technology (IT) is hardware and software applications that are interrelated components that collect or retrieve, store and accessing or distribute information to support business structure, decision-making and competitive advantage (Huff, 1994, Laudon & Laudon, 2006). Since introduction of computer in 1950 to organizations, information technology has been deploying to gain competitive advantage for business organization. According to Ward and Griffiths (1996), that IT has gone through three evolutions. First era, the computer is to automatic labour-intensive processes to reduce labour costs. In the second era, emphasize in development of management information system that provides information for decision-making. Today, in third era, organization view IT to support existing business strategy, create new opportunities for business, competitive advantage and new strategy opportunities leads to new markets and products and survival in this quick and challenge environment. A variety of factors have been shown to have an important impact on the ability of the firms to gain competitive strategy advantage and sustaining competitive advantage, including the relative of cost positioning (Porter, 1980), products differentiation (Caves & Williamson, 1985, Porter, 1980) and the ability of firm to cooperate in strategic alliance (Chen & Chen, 2003, Lee & Vonortas, 2002). The complexity of IT is transforming Porter’s value chain theory and is affecting the competition. It changes the industry structure and rules of competition (Porter & Millar, 1985). IT no longer a competitive advantage (Carr, 2003, Clemons & Knez, 1987 & Lieberman & Montgomery 1988) it had become strategic advantage (Carr, 2003 & Loudon & Loudon, 2007) The purpose of this paper is to explain further whether information technology can or cannot really give a company a

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