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RESEARCH ARTICLE A MULTILEVEL MODEL FOR MEASURING FIT BETWEEN A FIRM’S COMPETITIVE STRATEGIES AND INFORMATION SYSTEMS CAPABILITIES Tim S. McLaren Ted...

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RESEARCH ARTICLE

A MULTILEVEL MODEL FOR MEASURING FIT BETWEEN A FIRM’S COMPETITIVE STRATEGIES AND INFORMATION SYSTEMS CAPABILITIES Tim S. McLaren Ted Rogers School of Management, Ryerson University, 350 Victoria Street, Toronto, ON M5B 2K3 CANADA {[email protected]}

Milena M. Head and Yufei Yuan DeGroote School of Business, McMaster University, 1280 Main Street West, Hamilton, ON L8S 4M4 CANADA {[email protected]} {[email protected]}

Yolande E. Chan Queen’s School of Business, Queen’s University, 143 Union Street, Kingston, ON K7L 3N6 CANADA {[email protected]}

Appendix A Prior Approaches for Measuring the Strategic Fit of a Firm’s Information Systems

Authors

Competitive Strategy Measures

Information Systems Measures

Strategic Fit of IS Measures

Insights for Measuring Strategic Fit of IS

Chan et al. • Respondents rate how • Measures apply to • Fit modeled as match • Supports measuring (1997) well they agree to firm’s IS portfolio, not between STROBE fit using multidimenstatements from specific IS items and IS support sional configurations Venkatraman’s • Respondents rate for each STROBE rather than contin(1989b) 6-dimension how well their firm’s dimension. gency relationships. business strategic IS support each of • Results suggest IS • Advocates modeling orientation (STROBE) the 8 STROBE support for STROBE strategies as realized measure of aggresdimensions (e.g., dimensions moderpatterns of activity siveness, analysis, “The systems help us ated impact of rather than intended defensiveness, futurity, monitor changes in STROBE items on plans. proactiveness, risk our market share”). business aversion (e.g., “We performance. sacrifice short-term profitability to gain market share”).

Utility for Measuring Strategic Fit of IS • STROBE measures suitable for measuring fit of firm’s IS portfolio, but not adapted for specific IS. • Requires 40 to 60 questions to operationalize STROBE and IS support for STROBE constructs. • Does not examine prescriptive utility of approach for measuring and improving fit.

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Authors

Competitive Strategy Measures

Information Systems Measures

Strategic Fit of IS Measures

Insights for Measuring Strategic Fit of IS

Utility for Measuring Strategic Fit of IS

Sabherwal • Responses to Venkat- • Measures apply to & Chan raman’s (1989b) 6firm’s IS portfolio, not (2001) dimension STROBE specific IS. measure are used to • Respondents rate assign a firm to one of how well their firm’s Miles et al.’s (1978) IS support four straDefender, Prospector, tegic attributes of IS or Analyzer strategic (monitoring and archetypes. A review controlling operaof literature is used to tions, market sursupport the mapping of veillance, strategic STROBE responses to decision-making, and the strategic interorganizational archetype. coordination).

• Fit modeled as profile • Supports measuring deviation between strategic fit using theoretically ideal IS profile deviation approfile for the firm’s proach to measure strategic archetype misalignment and respondent’s between ideal and ratings of support realized support proprovided by the firm’s vided by a firm’s IS. IS for each of the • Advocates analyzing four strategic attriprevious literature to butes of the IS. determine theore• Results suggest tically ideal IS attristrategic fit of IS butes for a given influenced business Miles and Snow performance for (1978) competitive prospectors and strategy type. analyzers, but not defenders.

Avison et al. (2004)

• Intended strategies are • Intended and inferred from docurealized IS strategies mentation of business are inferred from scope, distinctive comdocumentation of petencies, and busiexisting and proness governance (after posed IS (after Henderson and Henderson et al. Venkatraman 1992). 1996; Luftman 1996; Papp 2001).

• Fit modeled using • Positions strategic fit • Illustrates how SAM strategic alignment of IS as a subset of a could be used to model (SAM) probroader strategic assess strategic fit of posed by Henderson alignment model conIS. Little guidance on et al. (1996) and taining business and determining competiextended by Luftman IS strategies, structive strategies or IS (1996) and Papp tures, and processes, capabilities. (2001). each of which can be • Provides an illus• Fit measured qualitathe focal point for trative example of tively as match initiating alignment. how to apply SAM to between information assess fit. Does not systems and compeexamine prescriptive titive strategies. utility directly.

Oh & Pinsonneault (2007)

• Respondents rate the • Measures apply to • Fit modeled as match • Indicates that rela• IS usage measures relative importance of firm’s IS portfolio, not between importance suitable for detertionship between 34 strategic actions specific IS. of business strategy mining the composistrategic fit of IS and (after Miller and Chen • Respondents indiactions (revenue tion of a firm’s business performance 1996), which are used cate how many growth, quality portfolio of IS and is nonlinear and to determine how different types of IS improvement, and how well it supports requires careful attenstrongly the firm are used at their firm cost reduction) and the three generic tion to measures, follows three generic from a list of 32 types percentage of potenstrategies. contingency theories, strategies: revenue of IS (e.g., order tial IS for supporting and inter-relationships • Does not examine growth, quality management). The each strategy that between variables. prescriptive utility of improvement, and cost percentage of potenare used at the firm. the approach for reduction. tial IS that are used • Results suggest measuring and at the firm is used to usage of cost reducimproving fit. infer how strongly the tion IS moderated firm’s IS portfolio impact of fit on supports revenue business perforgrowth, quality mance in area of cost improvement, and reduction. cost reduction strategies.

• Attributes of a firm’s IS strategies were used to assess fit of firm’s IS portfolio, but did not focus on specific types of IS. • STROBE measure apparently more valid than Miles et al.’s (1978) paragraphstyle measure, but does not operationalize all dimensions of Miles and Snow archetypes.1 • Does not examine prescriptive utility of the approach for measuring and improving fit.

1 Miles et al.’s (1978) strategic archetype construct contains 11-dimensions (product–market breadth, market leadership, market surveillance, growth, process goals, competency breadth, adaptability, administrative focus, planning, organizational structure, and control) which are not fully operationalized in the paragraphstyle measure originally proposed to measure the Miles and Snow archetype (Conant et al. 1990; Segev 1987).

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Authors This study

Competitive Strategy Measures

Information Systems Measures

• Miles and Snow (1978) • Generic IS capaarchetype determined bilities adapted to using responses to measure capabilities Conant et al.’s (1989) of SCM. 11-dimension • Respondents rate questionnaire. how well their firm’s IS support five SCM capabilities (operational efficiency, operational flexibility, planning, internal analysis, and external analysis).

Strategic Fit of IS Measures

Insights for Measuring Strategic Fit of IS

Utility for Measuring Strategic Fit of IS

• Fit modeled as profile • Describes the theore- • Strong theoretical deviation between tical and empirical and empirical support theoretically ideal justification for a more for measures used to SCM capabilities fine-grained model for operationalize profile for the firm’s measuring the strastrategic fit for SCM. strategic archetype tegic fit of a firm’s IS • Utility and content and respondent’s so that the outputs validity of measureratings of support that are more actionment model demonprovided by firm’s able and readily strated through an SCM for each of five corroborated. iterative prototyping SCM capabilities. approach using an • Results suggest analysis of multiple outputs have strong case study interface validity for views, questionassessing strategic naires, and archival fit as multiple levels. documents.

Appendix B Summary of Case Descriptions Case A produces and distributes energy products primarily in Canada. Throughout the firm, a centralized EDI-enabled ERP application is used for supply chain management, financial analysis, and procurement. For the corporate business unit represented by Case A1, the SCMs are primarily used for internal supply chain transactions, planning, and analyses, with some usage for external procurement transactions and analyses. For the retail business unit represented by Case A2, the SCMs are used more for external market scanning, product pricing analyses, and managing relationships and transactions with retail dealers and logistics providers. Case B is a global contract manufacturer of electronic devices and components. Case B fulfils the various manufacturing, design, and supply chain management requirements that its clients desire to outsource. Although Case B tends to have long-term relationships and contracts with its large clients, there are typically several other global contract manufacturers that compete for the same clients. The SCMs used by Case B have advanced capabilities for coordinating and optimizing the supply chain. However, the diversity of product lines, geographic dispersion of the facilities, and frequency of mergers and acquisitions has resulted in Case B having a large number of different SCMs, which are not always well integrated. Case C designs and manufactures integrated circuits (electronics chips) for use in electronics products that are manufactured by other firms. The relatively small size of the company Case C and the limited breadth of products has made it easier for them to deploy a fairly simple, integrated, and centralized SCM portfolio. Although there is interest in collaborative supply chain capabilities, the relatively low-volume, highmargin transactions have not required Case C to invest heavily in supply chain collaboration systems to date.

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Case D is involved in the sales, service, manufacturing, and distribution of innovative high-end equipment for long-haul telecommunication networks. Case D outsources much of the product manufacturing to contract manufacturers including Case B and hence utilizes SCM primarily for order management and finance, rather than manufacturing and distribution. A centralized SCM is used throughout the firm to manage purchasing and to aggregate demand for supplied parts from the different business units of the firm. Case E sells, services, manufacturers, and distributes equipment for long haul telecommunication networks. Case E outsources product manufacturing to contract manufacturers including Case B. However, the proportion of manufacturing outsourced by Case E is less than Case D. Although Case E’s SCMs are used primarily for order management and finance, manufacturing and distribution functionality is used more extensively than at Case D. In addition, Case E generally has a larger product and geographic range than Case D and has operated the business for a much longer period. Case E uses a variety of SCM including several different ERP systems, which are partially integrated with an enterprise-wide advanced planning and scheduling SCM. Separate order management, finance, and product life cycle management information systems are used to manage order fulfillment, product development, customer service, and market intelligence. There is some process integration with customers and suppliers; however, the information exchanged is limited mostly to capturing customer requirements and aggregating purchase orders.

Appendix C Questionnaire Items Used in the Measurement of Strategic Fit of SCM C1. Multi-Item Scale for Identification of Realized Competitive Strategies The following measure is adapted from Conant et al. (1990). Test-retest reliability of Conant et al.’s original scale items 1 to 11 and the overall instrument are: 1

2

3

4

5

6

7

8

9

10

11

Intrument

.63

.73

.72

.62

.82

.75

.67

.70

.66

.73

.56

0.74

The letters in italics and brackets identify the response characteristic of a (D) = defender, (P) = prospector, (A) = analyzer, and (R) = reactor. These letters and the item titles are for description and analysis purposes only and were removed from the questions given to respondents. The 11 scale items comprising the instrument correspond to the 11 competitive strategy dimensions in the Miles and Snow (1978) typology. The order presented was 1,5,8,7,4,2,10,3,9,11,6 to decrease the risk of hypothesis guessing and reduce risk of recency effects for related items. 1. Entrepreneurial: Product–Market Focus In comparison to our competitors, the products and services that we provide to our customers are best characterized as (a) More innovative; continually changing; and broader in scope. (P) (b) Fairly stable in certain markets while innovative in other markets. (A) (c) Well focused; relatively stable; and consistently defined throughout the marketplace. (D) (d) In a state of transition, and largely based on responding to opportunities or threats from the marketplace or environment. (R) 2. Entrepreneurial: Market Leadership In contrast to our competitors, my organization has an image in the marketplace as one which (a) Offers fewer, selective products and services that are high in quality. (D) (b) Adopts new ideas and innovations, but only after careful analysis. (A) (c) Reacts to opportunities or threats in the marketplace to maintain or enhance our position. (R) (d) Has a reputation for being innovative and creative. (P) 3. Entrepreneurial: Market Surveillance The amount of time my organization spends on monitoring changes and trends in the marketplace can best be described as (a) Lengthy: We are continuously monitoring the marketplace. (P) (b) Minimal: We really do not spend much time monitoring the marketplace. (D) (c) Average: We spend a reasonable amount of time monitoring the marketplace. (A) (d) Sporadic: We sometimes spend a great deal of time and at other times spend little time monitoring the marketplace. (R)

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4. Entrepreneurial: Market Growth In comparison to our competitors, the increase or losses in demand that we have experienced are due most probably to (a) Our practice of concentrating on more fully developing those markets that we currently serve. (D) (b) Our practice of responding to the immediate needs of the marketplace. (R) (c) Our practice of aggressively entering into new markets with new types of product and service offerings. (P) (d) Our practice of assertively penetrating more deeply into markets we currently serve, while offering new products and services only after a very careful review of their potential. (A) 5. Engineering: Process Goals One of the most important goals in this organization in comparison to our competitors is our dedication and commitment to (a) Keep costs under control. (D) (b) Analyze our costs and revenues carefully to keep costs under control and to selectively generate new products and services or enter new markets. (A) (c) Insure that the people, resources, and equipment required to develop new products and services and new markets are available and accessible. (P) (d) Make sure that we guard against critical threats by taking whatever action is necessary. (R) 6. Engineering: Competency Breadth In contrast to our competitors, the competencies (skills) that our managerial employees possess can best be characterized as (a) Analytical: their skills enable them to both identify trends and then develop new product or service offerings or markets. (A) (b) Specialized: their skills are concentrated into one, or a few, specific areas. (D) (c) Broad and entrepreneurial: their skills are diverse, flexible, and enable change to be created. (P) (d) Fluid: their skills are related to the near-term demands of the marketplace. (R) 7. Engineering: Infrastructure Adaptability The one thing that protects my organization from competitive failure is that we (a) Are able to carefully analyze emerging trends and adopt only those that have proven potential. (A) (b) Are able to do a limited number of things exceptionally well. (D) (c) Are able to respond to trends as they arise even though they may possess only moderate potential. (R) (d) Are able to consistently develop new products and services and new markets. (P) 8. Administrative: Administrative Focus More so than many of our competitors, our management staff tends to concentrate on (a) Maintaining a secure financial position through cost and quality control measures. (D) (b) Analyzing opportunities in the marketplace and selecting only those opportunities with proven potential, while protecting a secure financial position. (A) (c) Activities or business functions which most need attention given the opportunities or problems we currently confront. (R) (d) Developing new products and services and expanding into new markets or market segments. (P) 9. Administrative: Planning In contrast to many of our competitors, my organization prepares for the future by (a) Identifying the best possible solutions to those problems or challenges that require immediate attention. (R) (b) Identifying trends and opportunities in the marketplace which can result in the creation of product or service offerings which are new to the marketplace or which reach new markets.(P) (c) Identifying those problems that, if solved, will maintain and then improve our current product and service offerings and market position. (D) (d) Identifying those trends in the industry that other firms have proven possess long-term potential while also solving problems related to our current product and service offerings and our current customers needs. (A) 10. Administrative: Organizational Structure In comparison to our competitors, the structure of my organization is (a) Functional in nature (i.e., organized by department — marketing, accounting, personnel, etc.). (D) (b) Product- or market-oriented (for example, business units are organized by product or market and handle functions like marketing and accounting internally). (P) (c) Primarily functional (departmental) in nature; however, a product- or market-oriented structure does exist in newer or larger product or service offering areas. (A) (d) Continually changing to enable us to meet opportunities and solve problems as they arise. (R)

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11. Administrative: Control Unlike many of our competitors, the procedures my organization uses to evaluate our performance are best described as (a) Decentralized and participatory encouraging many organizational members to be involved. (P) (b) Heavily oriented toward those reporting requirements which demand immediate attention. (R) (c) Highly centralized and primarily the responsibility of senior management. (D) (d) Centralized in more established service areas and more participatory in newer product or service areas. (A)

C2. Paragraph-Style Scale for Identification of Realized Competitive Strategies This measure is from Miles and Snow (1978) and is used as a supplementary measure to the preceding 11-item scale developed by Conant et al. (1990). To reduce hypothesis guessing and biasing the responses with the Miles and Snow competitive strategy type names, the archetype names were removed and the order of presentation was changed. Prospector: A firm with this type of strategy typically operates within a broad product-market domain that undergoes periodic redefinition. The organization values being “first in” in new product and market areas even if some of these efforts prove not to be highly profitable. The organization responds rapidly to early signals concerning areas of productivity, and these responses often leads to a new round of competitive actions. However, a firm with this type of strategy may not maintain market strength in all of the areas it enters. Reactor: A firm with this type of strategy does not appear to have a consistent product-market orientation. The organization is usually not as aggressive in maintaining established products and markets as some of its competitors, nor is it willing to take as many risks as other competitors. Rather, the organization responds in those areas where it is forced to by environmental pressures. Defender: A firm with this type of strategy attempts to locate and maintain a secure niche in a relatively stable product or service area. The organization tends to offer a more limited range of products or services than its competitors, and it tries to protect its domain by offering higher quality, superior service, lower prices, and so forth. Often a firm with this type of strategy is not at the forefront of developments in the industry; it tends to ignore industry changes that have no direct influence on current areas of operations and concentrates instead on doing the best job possible in a limited area. Analyzer: A firm with this type of strategy attempts to maintain a stable, limited line of products or services, while at the same time moving out quickly to follow a carefully selected set of the more promising new developments in the industry. The organization is seldom “first in” with new products or services. However, by carefully monitoring the actions of major competitors in areas compatible with its stable product– market base, the organization can frequently be “second in” with a more cost-efficient product or service.

C3. Realized SCM Capabilities Assessment Instrument Since an instrument for measuring these constructs did not already exist, this study combined items from preexisting and previously validated measures as shown in the notes following the items. A Likert-type scale was used where 1 = to a much lesser degree, 3 = to the same degree, and 5 = to a much greater degree.

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Evidence of Support for

“My overall perception is that compared to our competitors’, our supply chain management information systems…”

Operational Efficiency

1. improve the efficiency of our day-to-day business operations.1 2. provide timely information for cost control.2

Operational Flexibility

3. provide the flexibility to adapt to unanticipated changes.3 4. make it easy to switch to another supplier or customer to supply or purchase the same product or service.4

Planning

5. facilitate long-term strategic business planning.1 6. provide us with the data we need to support our day-to-day decision-making.1

Internal Analysis

7. enable us to develop detailed analyses of our present business situation.1 8. provide reliable information on the organization’s financial situation.2

External Analysis

9. assist us in setting our prices or value proposition relative to the competition.1 10. provide information on competitive products and services.2

Notes: 1 Adapted from Sabherwal and Chan (2001); the words in italics were added for clarity. 2 Adapted from Zviran (1990). 3 Adapted from Venkatraman and Ramanujam (1987). 4 Adapted from Bensaou (1997).

An additional Likert-type questionnaire item measured the perceived strategic fit of the firm’s IS capabilities (where 1 = very low and 5 = very high). This questionnaire item was used to provide a parsimonious measure for triangulation with the qualitative evidence and the MSF model’s calculated (Euclidean Distance) level of strategic fit for the case studies. 11. “I feel that the degree to which the capabilities of our supply chain management information system support our business needs is....”

Appendix D Excerpts of Reports Prepared from Quantitative Analyses Summary reports were prepared for each case based on the qualitative analysis of interview transcripts and archival documents. The analyses identified the capabilities that appeared to need improvement to increase the overall strategic fit of each case’s SCM. The following excerpts from the reports highlight some of the findings and recommendations for each case. In general, Case A’s information systems appear to have adequate support for the capabilities required for the defender-type competitive strategy of the corporate business unit (Case A1). However, for the retail business unit (Case A2), the level of support for operational flexibility and external analysis capabilities appear to be insufficient for their analyzer-type competitive strategy. Thus, while Case A’s centralized IS infrastructure fits well with the corporate business unit, it has a poor strategic fit for the retail business unit. This highlights the need for IS planners to ensure various business units in a firm share the same competitive strategies before implementing a homogenous IS infrastructure across the firm. Case B’s IS appears to provide the theoretically ideal level of support required for operational flexibility and external analysis. However, the strategic fit of Case B’s IS can be improved by increasing the level of support for operational efficiency, planning, and internal analysis capabilities. It appears that Case B’s IS is poorly suited to a defender-type strategy. This may be because Case B inherited many of its systems from the parent company it was spun off from and from several companies it has acquired. Case C can improve the strategic fit of its IS by focusing on increasing the level of support they provide for operational flexibility and external analysis capabilities. Case C’s IS consists primarily of a commercial ERP package that was implemented to improve operational efficiency and internal information sharing rather than operational flexibility or external analysis. However, the lack of strategic fit with Case C’s prospector-like competitive strategies may be the primary reason why Case C’s users have been unsatisfied with the performance of their organizational IS and have had to rely heavily on the use of less automated information systems such as standalone spreadsheets and databases.

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For Case D, the lack of fit in external analysis capabilities is expected to hinder their prospector-like competitive strategy. Indeed, Case D’s parent firm recently suffered large inventory write-offs due in part to an inability to coordinate supply and demand information with its supply chain partners. The firm is currently making large investments in collaborative SCM to address the shortcomings of their external analysis capabilities. For Case E, the level of support for internal analysis met the theoretically ideal level. However, support for operational flexibility and external analysis capabilities appeared to be insufficient. A respondent noted that although Case E’s IS was adequate when economic conditions were very favorable, the need for improving the ability to integrate and analyze information becomes more apparent during the recent economic downturn. This suggests strategic fit may be more important in lean economic times than in periods of robust profitability. Case E’s SCM consisted primarily of packaged and custom-built ERP and APS software that traditionally have not been designed for the external analysis or operational flexibility capabilities required by Case E’s prospector-type strategy. We expect Case E’s lagging operational performance can be greatly improved by implementing IS that better fit their competitive strategies (Cragg et al. 2002; Henderson et al. 1996).

Appendix E Design Knowledge for the Multilevel Strategic Fit Measurement Model In order to generate the design knowledge for a new measurement model, the design science research approach cycled through the following steps: clarifying the purpose and scope of the design, identifying the theoretical basis or justificatory knowledge for the design as well as the underlying theoretical constructs, determining the principles of form and function of successive prototypes, and developing testable propositions and evaluating each prototype (Gregor and Jones 2007). These six core components of the design knowledge for the MSF measurement model are shown in the columns in Table E1. The purpose and scope explains why strategic fit is measured the way it is. The constructs describe how the strategic fit of a firm’s IS is conceptualized in the MSF model. The justificatory knowledge is the theoretical basis for the components of the model and is described in the section called the “MSF Measurement Model.” The principles of form and function of the MSF model are the steps used to obtain the assessments of strategic fit at any of the three levels (see Table E1). Artifact mutability outlines the extent to which the measurement instruments generated using the MSF measurement model can be changed. For example, the relevant set of IS capabilities to be analyzed can readily be changed according to the type of IS. Finally, the testable propositions are statements that can be tested to ensure the MSF model fulfills its intended purpose.

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Table E1. Core Components of the Design Knowledge for a Multilevel Strategic Fit Measurement Model Purpose and Scope

Assess how well a firm’s realized IS capabilities support the firm’s realized competitive strategies.

Constructs

Strategic fit is conceptualized as the match between a firm’s realized IS capabilities and theoretically ideal IS capabilities.

Justificatory Knowledge (Theoretical Basis for Design)

A firm’s realized IS capabilities may differ from intended designs due to constant readjustments to design and implementation (Markus and Robey 1998; Truex et al. 1999). A firm’s competitive strategies emerge from the interplay between intended and realized strategies (Mintzberg 1978). Configurational theories can reduce the complexity of measuring fit between two multidimensional profiles, while providing a more holistic analysis than contingency theories (Doty et al. 1993). Prior research can be used to prescribe theoretically ideal levels of a variable such as IS capabilities according to the firm’s competitive strategy type (Venkatraman 1989a). A profile deviation approach is useful for both researchers and practitioners for assessing the overall fit between two multidimensional constructs such as a firm’s realized and ideal IS capabilities profiles (Venkatraman 1989a).

Principles of Form and Function

Step (1) Step (2) Step (3) Step (4)

Identify the set of IS capabilities to be measured according to the type of IS. Measure the firm’s realized level of support for each IS capability. Identify the firm’s realized competitive strategy archetype. Determine the theoretically ideal level of support for each IS capability according to the firm’s competitive strategy archetype. Step (5) Calculate the overall (Type B) strategic fit of the firm’s IS as the overall deviation between the firm’s ideal and realized level of support for each IS capability. Step (6) Calculate the detailed (Type C) strategic fit of the firm’s IS as the difference between the firm’s ideal and realized level of support for each IS capability . Step (7) Check for corroboration of the overall and detailed assessment of strategic fit of the firm’s IS using interviews and archival documents

Artifact Mutability (how it handles changes)

The relevant set of IS capabilities to be analyzed can readily be changed according to the type of IS and the needs of the firm. A firm’s realized competitive strategies could be described in more precise terms than Miles and Snow’s (1978) generic strategic archetypes. For example, a firm could be described as having a specific mix of strategic archetypes or patterns. The theoretically ideal IS capabilities prescribed for a given realized strategy type could be expanded if more research is done on other types of IS or other types of strategic patterns. The method of calculating overall fit could be refined with further study. For example, different weights could be assigned to each capability depending on its relative impact on performance.

Testable Propositions

The overall assessment of strategic fit of a firm’s IS (Step 5) has utility for explaining or predicting relationship between strategic fit and organizational performance. The detailed overall assessment of strategic fit of a firm’s IS (Step 6) has utility for describing and prescribing the IS capabilities that a firm needs to improve to support the firm’s realized competitive strategies.

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