For Prof. MGK Onlyy

MIS 346

1. Discuss how information systems can create business value and enhance a company’s competitive advantage from a resource-based view.  (10 points)

Major points in the answer:

Based on the resource-based view of firm, information resources include information assets and information capabilities.  Information assets include IT physical infrastructure and information repository.  Information capabilities include technical skills, IT management skills and relationship skills.  From the resource-based view, a company gains competitive advantage with information systems when the information resources are valuable and rare.  A resource is considered valuable when it enables the firm to become more efficient or effective. It is rare when other firms do not possess it simultaneously.  In the long term, the sustainability of the competitive advantage is dependent on the imitability, substitutability and transferability.  The company’s competitive advantage lasts longer when the information resource can not be imitated easily, a strategically equivalent resource is not readily available, and the resource can not be acquired through markets.