Digital Ecodynamics in Small Firms: Using Information Technology to Compete

Today, digital technologies and content are integrated into almost all aspects of business and society. However, the Internet and related digital technologies continuously evolve, and businesses are hard pressed to fully utilize technology-related opportunities. The technologies in themselves do not necessarily provide business advantages but must be combined and coordinated with other firm resources to address business problems in innovative ways (Bharadwaj 2000; Mata et al. 1995). Used imaginatively, digital technology can “rapidly create new sources of competitive advantage, and concatenate a series of temporary advantages over time” (Tanriverdi et al. 2010, p. 822). Technology investments can spur innovation and increase competitiveness. Some firms use digital technologies (in particular, information technology or IT) to drive their business strategies, facilitating innovation and creating business value. As business activities are digitized or performed electronically, firms can share information with, and respond flexibly to, suppliers and customers; they can reduce cycle times, control quality, and improve customer satisfaction (Barua et al. 2004). Digital technology, along with other management, organizational, and environmental resources, can create business value (Barua et al. 2004; Bharadwaj 2000; Mata et al. 1995). It enables complementary strategic, operational and tactical initiatives (Sambamurthy and Zmud 2000).