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IEEE TRANSACTIONS ON ENGINEERING MANAGEMENT, VOL. 57, NO.

2, MAY 2010 181

The Strategic Implications of Web Technologies:


A Process Model of How Web Technologies
Enhance Organizational Performance
Barney C. C. Tan, Shan L. Pan, and Ray Hackney

AbstractThe lack of knowledge on 1) how Web technologies be identified in the literature. First, as much of existing Web
support the business strategies of an organization and 2) how Web technology research has focused exclusively on the technologi-
technologies enhance organizational performance are gaps in the cal aspects of Web technologies (e.g., [15], [38]), there is little
existing literature that may account for the inability of the ma-
jority of Web-based firms to leverage their investments in Web knowledge on how Web technologies can be used to support
technologies. To address these knowledge gaps, a theoretical lens is the business strategies of an organization. In the absence of this
constructed from five core logics in organizational literature that knowledge, the effective leverage of Web technologies is diffi-
represent the different possible ways of enhancing organizational cult to attain, as Web technologies are unlikely to lead to better
performance. Applying the lens to analyze the case of a successful organizational performance unless it is aligned with the broader
Singaporean dotcom, the ways through which Web technologies
enhance organizational performance are identified. Specifically, strategic objectives of an organization [41], [42]. Second, due
our study reveals that the process through which Web technolo- to the paucity of research on the consequences of using Web
gies enhance organizational performance is contingent on the state technologies [54], [55], and the black box treatment of the
of the organizational environment. When the environment is in a relationship between the use of Web technologies and organiza-
state of equilibrium, Web technologies can enhance organizational tional performance in the existing literature (e.g., [54], [55]),
performance by facilitating the attainment of competitive advan-
tage through three distinct mechanisms: the logics of positioning, our understanding of the underlying process through which
leverage, and opportunity. Conversely, when the environment is in Web technologies enhance organizational performance is lim-
a state of revolution, Web technologies can give rise to performance ited. Similarly, without grasping the nature of this process, it is
gains by supporting the attainment of legitimacy through two dis- difficult, if not impossible, to consistently leverage Web tech-
tinct mechanisms: the logics of optimality and social congruence. nologies for performance gains in the long-term.
Index TermsCase study, e-business strategy, firm perfor- With these knowledge gaps, any response to the skepticism
mance, strategic IT management, Web technologies. on the business value of Web technologies will be less than con-
vincing for the key to a strong argument lies not in merely as-
I. INTRODUCTION certaining the relationship between the use of Web technologies
HE extraordinary success stories of a handful of Web- and organizational performance but in a thorough elucidation
T enabled organizations (such as Google, Amazon, and
eBay) firmly attest to the momentous potential of Web tech-
of how Web technologies enhance organizational performance.
More importantly, these knowledge gaps may account for the
nologies for enhancing organizational performance [24]. Yet, inability of the majority of Web-enabled firms in the global
the phenomenal success of these organizations tends to be the US$3 trillion e-business market [24] to consistently leverage
exception rather than the norm [34]. Even for firms within the their investments in Web technologies for economic returns.
same industry, the business impact of Web technologies tends to Using a case study of Hardwarezone.com (HWZ), an e-
vary widely [28]. This phenomenon has reignited the perennial commerce start-up that revolutionalized the IT publications in-
information technology (IT) productivity paradox debate and dustry in Singapore, the purpose of this article is to address the
has created a new wave of skepticism about the business value two knowledge gaps through an in-depth examination of the
of Web technologies (e.g., [8]). underlying process through which Web technologies enhance
Amidst the furor, proponents of Web technologies are facing organizational performance. By examining how Web technolo-
strong pressure to demonstrate that Web technologies have a gies can support the business strategies of an organization, and
consistently positive impact on organizational performance [55]. opening the black box of the relationship between the use of
Yet, despite a growing body of research, a number of gaps can Web technologies and organizational performance, this study
aims to underscore the need for technology-strategy alignment,
provide e-commerce proponents with a stronger argument in the
Manuscript received June 15, 2008; revised October 29, 2008 and February 7,
2009. First published June 26, 2009; current version published April 21,
perennial IT productivity paradox debate, and serve as a use-
2010. Review of this manuscript was arranged by Department Editor ful reference for practitioners on how to derive business value
T. Ravichandran. from their investments in Web technologies. Corresponding to
B. C. C. Tan and S. L. Pan are with the Department of Information Systems,
School of Computing, National University of Singapore, Singapore 119077,
the two knowledge gaps, the research questions that this study
Singapore (e-mail: barney@nus.edu.sg; pansl@comp.nus.edu.sg). aims to answer are: 1) how do Web technologies support the
R. Hackney is with the Brunel Business School, Brunel University, Middlesex strategies of an organization? and 2) how do Web technolo-
UB8 3PH, U.K. (e-mail: ray.hackney@googlemail.com).
Digital Object Identifier 10.1109/TEM.2009.2023130
gies enhance organizational performance? As organizational

0018-9391/$26.00 2009 IEEE


182 IEEE TRANSACTIONS ON ENGINEERING MANAGEMENT, VOL. 57, NO. 2, MAY 2010

TABLE I
CAPABILITIES OF WEB TECHNOLOGIES: WHAT WEB TECHNOLOGIES CAN DO (REFER TO [41], [49] FOR A REVIEW)

performance is inextricably linked to the business objectives Web technologies, all of them have adopted a factor-oriented,
of a firm, which can conceivably span a wide range of possi- variance theory approach. And, while the positive correlation
bilities, organizational performance is broadly defined in this between the use of Web technologies and various performance
article as the financial and market performance of a firm and the variables has been demonstrated repeatedly (e.g., [54], [55]),
probability of organizational survival [14]. the process through which Web technologies enhance organi-
zational performance is typically treated as a black box and
implicitly assumed to be automatic. Collectively, the lack of
II. LITERATURE REVIEW research on the consequences of using Web technologies, and
A. Existing Perspectives on Web Technologies the black box treatment of the relationship between the use
of Web technologies and organizational performance, indicate
Since their inception in 1993, Web technologies have pro- a lack of knowledge of the underlying process through which
vided organizations with a suite of unprecedented capabilities Web technologies enhance organizational performance.
(refer to Table I for a list of examples) that has fundamentally As it has been repeatedly asserted that technology per se
and irrevocably transformed the basis of competition in todays rarely leads to better organizational performance unless it is
business environment [48]. Yet, although the business potential aligned with the broader strategic objectives of an organiza-
of Web technologies is acknowledged universally [11], most tion [41], [42], knowledge of how Web technologies can sup-
Web-enabled firms have struggled to translate their investments port the business strategies of an organization is crucial to the
in Web technologies into performance gains [28], [34]. The gaps effective leverage of Web technologies. Similarly, without an
in the existing literature provide two likely explanations for this understanding of the underlying process through which Web
phenomenon. First, a large proportion of prior studies on Web technologies enhance organizational performance, the effective
technologies have adopted a technology orientation, focusing on leverage of Web technologies for performance gains is diffi-
specific technical issues such as system characteristics, interface cult to attain on a consistent, long-term basis. To address these
design, presentation and organization of information, and avail- knowledge gaps, our inquiry necessarily begins with a review
able functionalities (e.g., [15], [38]). The implicit assumption of the prescriptions for enhancing organizational performance
of this stream of research is that technical excellence will nec- in the literature. Accordingly, the field of strategic management
essarily translate to e-commerce success. Yet, the comparative provides a particularly appropriate point of origin for our inquiry
neglect of the strategic implications of using Web technologies as the academic discipline is primarily concerned with enhanc-
indicates a lack of knowledge on how Web technologies can ing performance through the use of deliberate and emergent
support the business strategies of an organization. organizational initiatives [36].
Second, much of existing Web technology research has fo-
cused on factors that lead to the adoption and assimilation of
Web technologies (e.g., [11], [55]), with more emphasis on the
antecedents rather than the consequences and strategic implica- B. Three Core Logics of Strategic Management
tions of using Web technologies. This imbalance is largely due Although a myriad of strategies for enhancing organizational
to the difficulty of developing measures and collecting data on performance have been proposed in strategic management liter-
the impact of Web technologies, which in turn, stems from the ature; and the intricacies of each strategy are certainly beyond
lack of an overarching theoretical framework to guide empirical the scope of a single paper, the essence of strategy can be
research [54], [55]. Moreover, of the small handful of stud- distilled into three core logics [20], [43]. Table II provides a
ies in the literature (e.g., [1], [54]) that examine the impact of summary of the three core logics of strategy.
TAN et al.: STRATEGIC IMPLICATIONS OF WEB TECHNOLOGIES 183

TABLE II
CORE LOGICS OF POSITIONING, LEVERAGE, AND OPPORTUNITY

Each of the core logics of strategy provides different pre- basis of two predominant theories [33] that have been repeatedly
scriptions for enhancing organizational performance. Yet, an validated in numerous studies and have amassed a vast amount
important commonality of the three core logics lies in their ad- of research attention over the years [27], [44]. The two theories
vocacy of heterogeneity (e.g., [4], [20], [40]). Heterogeneity are organizational ecology [26] and the neo-institutional theory
along the dimensions of a firms products or services that cus- [16]. Table III provides a summary of the two core logics of
tomers perceive to be important creates competitive advantage, organizational sociology.
defined as a unique value-creating strategy not simultaneously Once again, although the propositions of the two core log-
being offered by existing or potential competitors [4]. Com- ics are evidently dissimilar, an important commonality can be
petitive advantage, in turn, gives rise to better organizational found in their advocacy of conformity. On one hand, organiza-
performance in two ways. First, it enables the firm to charge tional ecology suggests that conformity is a result of adapta-
economic rents for its product and services, as it is able to avoid tion toward an optimal organizational form, the elimination of
market competition or even create a local monopoly [14]. Sec- weaker organizational forms, and the retention of the optimal
ond, given that firms occupying the same organizational niche traits among the organizations that have attained optimality [9].
tend to compete for the same societal resources necessary for On the other hand, the attainment of social fitness as proposed
survival, competitive advantage allows the firm to avoid the by the neo-institutional theory necessitates the adoption of com-
competition for these societal resources, making the resources mon institutions among constituents of the same organizational
easier to acquire and consequently, improve the probability for field [16]. Through conformity, legitimacy, defined as a gen-
organizational survival [6]. eralized perception or assumption that the actions of an entity
In spite of the academic and practical contributions of the are desirable, proper, or appropriate within some socially con-
strategic management theories that advocate heterogeneity, they structed system of norms, values, beliefs, and definitions [46],
do not explain the observation that successful organizations tend is achieved. Legitimacy helps an organization avoid questions
to be broadly similar in terms of assets, structure, and business and actions that challenge an organizations reliability and ra-
processes despite being geographically dispersed [16], [26]. In tionality [14], making it easier for the organization to acquire
a parallel development within the field of organizational soci- the societal resources it requires for its survival from external
ology, important population-level theories emerged in the late parties such as customers, suppliers, and regulators [16]. Thus,
1970s and early 1980s that sought to provide an explanation for organizational performance is improved as the ease of resource
this phenomenon. Accordingly, we include the perspectives of acquisition increases the probability of organizational survival.
organizational sociology in our literature review so as to pro- The five core logics identified in our literature review all rep-
vide a more holistic and, possibly, a more accurate view of how resent possible mechanisms through which Web technologies
organizational performance may be improved. may enhance organizational performance. Yet, when viewed as
a whole, the propositions of the two academic disciplines ap-
C. Two Core Logics of Organizational Sociology pear to be contradictory. On one hand, the three core logics
of strategic management appear to be advocating heterogene-
Similar to strategic management, the essence of the field of
ity, differentiating an organization from its competitors for the
organizational sociology can be distilled into core logics on the
184 IEEE TRANSACTIONS ON ENGINEERING MANAGEMENT, VOL. 57, NO. 2, MAY 2010

TABLE III
CORE LOGICS OF OPTIMALITY AND SOCIAL CONGRUENCE

creation of competitive advantage. On the other hand, the two organization as this allows us to identify a broader range of
core logics of organizational sociology appear to be advocat- possibilities for enhancing performance. The case of HWZ is
ing conformity, becoming similar to the competition for the particularly appropriate for this study as Web technologies were
attainment of legitimacy. This contradiction is referred to in used to facilitate vastly different business strategies that trans-
organizational literature as the paradox of heterogeneity (or ho- formed the humble e-commerce start-up into the dominant mar-
mogeneity) that causes confusion and leaves practitioners and ket leader in Singapores IT publications industry within a short
managers in a void in terms of practical discretion [17, p. 93]. span of seven years. The use of a single case study for our re-
At this point in time, no attempt will be made to integrate search is also advantageous in that many contextual variables
the two opposing perspectives, as any attempt to integrate them are kept constant, which helps to rule out possible alternative
will likely be unwieldy and aesthetically unsatisfying [30, interpretations of the data.
p. 699]. Instead, as the underlying process through which Web Research access was negotiated and granted in September
technologies enhance organizational performance is a complex, 2005 and a total of 19 interviews were conducted. Seventeen
multifaceted phenomenon that involves multitiered interactions interviews were conducted with key members of HWZs top
between a strategic, a social, and a technological dimension [11], management, staff, investors, and community over a period of
the five core logics are combined as parts of a single theoretical almost one and half years. This longitudinal approach in study-
lens so that in tandem, they can provide robustness and greater ing HWZs strategies carries two synergistic advantages. It fa-
accuracy in explaining our data when each core logic is unlikely cilitated both a comprehensive study of its past activities and
to be adequate on its own [30]. decisions, as well as an opportunity to observe current practices,
strategy formulation, and execution within the organization over
an extended period of time. Two additional interviews were also
III. RESEARCH METHODOLOGY conducted with industry insiders to get an unbiased, accurate
The case research methodology is particularly appropriate for picture of the organizational environment across different time
this study for a number of reasons. First, our research questions periods. All interviews were transcribed for data analysis and
are how questions [50] that delve into the underlying process lasted an hour on the average. Secondary data from newspaper
through which Web technologies improve organizational per- articles, company brochures, internal publications, the corpo-
formance, a phenomenon that cannot be easily quantified. Sec- rate Web site, and notes from direct observation were also used
ond, the inherent multifaceted complexity of the phenomenon to corroborate the data obtained.
of interest [11] makes an objective approach to research dif- Data analysis, performed in tandem with data collection, was
ficult, making it more appropriate to construct our theoretical carried out by moving back and forth between empirical data,
arguments from the subjective interpretations of the relevant relevant literature, and the emerging theory [19], [51]. A de-
stakeholders [29]. tailed narrative was first created to condense the voluminous
Based on our research questions, two conditions formed the amount of data into a more manageable form [30]. Next, the rel-
basis for case selection. First, the selected organization must evant findings were organized into themes and analyzed with the
have, of course, effectively leveraged Web technologies for per- theoretical lens to shape the emerging theory [50]. The nascent
formance gains. Second, Web technologies should have been theory was then verified with the research participants and com-
used in support of a wide variety of strategies in the selected pared to the existing literature [29]. This process continued until
TAN et al.: STRATEGIC IMPLICATIONS OF WEB TECHNOLOGIES 185

the state of theoretical saturation is reached, where it was pos- locally, and the prices were often outdated or listed in foreign
sible to comprehensively explain the findings of the case study currency. On the other hand, while local IT publications in-
and no additional data can be collected, developed, or added to cluded localized content, they were often not comprehensive as
improve the developed model [19]. they lacked the required funding, credibility, and market reach.
Based on this insight, HWZ moved quickly to fulfill the unmet
IV. CASE DESCRIPTION need and differentiate itself from the existing offerings in the
industry by positioning itself as a comprehensive provider of
A. Organizational Background free, localized IT content. Table IV describes the market condi-
HWZ is the most popular IT media Web site in Singapore. Its tions, HWZs business objective, and the key strategy adopted
business centers on providing localized news and information by HWZ to capitalize on the opportunity in the market during
on the latest IT products, as well as numerous services, which this period.
include consolidated price lists of the major IT vendors in Singa- To facilitate the objective of heterogeneity, Web technologies
pore, a classified ads directory and an online discussion forum. were leveraged in three different ways (refer to Table V). First,
HWZ attracts 330 000 unique browsers and more than 32 mil- by using Web technologies as the means of interacting with cus-
lion page visits every month, a considerable achievement given tomers and collecting customer information and feedback [49],
that Singapore, with its small domestic market, is a country that Web technologies were used to facilitate a logic of positioning
has seen little success in the e-commerce arena. The unprece- by helping HWZ identify an attractive market position. In addi-
dented nature of HWZs success even prompted the most widely tion, Web technologies were used as the conduit for delivering
circulated business newspaper in Singapore to compare its two HWZs proprietary content and the information received from
founders to Larry Page and Sergey Brin of Google, enthusias- an unprecedented number of IT vendors to their customers free
tically proclaiming HWZs founders as Singapores very own of charge and in the timeliest possible fashion. By embedding
Google Guys. By 2004, it was estimated that HWZ controlled Web technologies in the processes of the organizational value
29.7% of the Singapore IT publications industry. In comparison, chain [41], Web technologies formed part of an integrated activ-
CNET Asia, in second place, only had a 9.9% market share. ity system [40] for value creation and served to defend HWZs
The phenomenal success of HWZ belies its humble origins. adopted position from imitation.
HWZ began as a special interest group known as the Singa- Second, when HWZ formed strategic alliances with the ma-
pores Overclockers Group (SOG) hosted by SingaporeOne, an jor IT vendors in Singapore, Web technologies were used to
e-commerce initiative spearheaded by the Singapore govern- deliver the information gained from the IT vendors to the cus-
ment. The SOG was targeted at a niche community of CPU tomers in real time and free of charge [49]. By enhancing the
overclockers, allowing members to post their hardware configu- strategic value of the alliances formed, Web technologies were
rations and overclocking results on an online discussion forum. used to support a logic of leverage by serving as a comple-
Although the size of the community was relatively small, the mentary resource that enhanced the value potential of existing
SOG generated such heavy Web traffic that it throttled its parent resources and capabilities [18]. Finally, by enabling the solic-
Web site, taking up 90% of SingaporeOnes bandwidth alloca- itation of customer information and feedback [49] through the
tion within a month of its launch, leaving the management of use of online polls, surveys, and open-ended feedback forms,
SingaporeOne with no choice but to dissolve the SOG. Aided Web technologies facilitated the logic of opportunity by helping
by the management of SingaporeOne, the founders of HWZ ap- HWZ sense the existing needs of its customers. In addition, Web
plied for and were eventually awarded a US$13 000 grant from technologies enabled the cultivation of a strong virtual commu-
the Singapore government. With this grant and US$650 of cap- nity (VC) [49], and the close interaction between community
ital contributed by its founders, HWZ was founded on August members provided HWZ with clear indications of their existing
9, 1998 in a small factory space, running on home equipment and future needs. Many knowledgeable community members
contributed by friends and family members. The initial capital were also leveraged in the coproduction of new content and fea-
at the time was only enough for one server and six months of tures [32] for HWZ, enhancing the organizational aptitude for
bandwidth charges. rapid, effective, and relentless innovations [13].
By facilitating the logic of positioning, the logic of leverage,
and the logic of opportunity, Web technologies enabled HWZ
B. Entering the Market (Late 1998Late 1999) to differentiate itself from its competitors. Consequently, HWZ
At the time of HWZs entry, the Singapore IT publications was able to produce localized content that was more relevant
industry was in a state of saturation with numerous foreign and than its foreign competitors, provide a more comprehensive
local IT publications available both in print and online (refer coverage of local IT products that was perceived to be more
to Appendix). Yet, despite the wide variety of product offer- credible than its local competitors, and provide its content free
ings available, feedback from its existing members made the of charge as compared to printed magazines. HWZs unique
founders of HWZ realize that there was an unmet need among value proposition as a comprehensive provider of free, local-
local IT enthusiasts. Specifically, foreign IT publications in the ized IT content allowed the organization to achieve competitive
market were not targeted at the local market as their content advantage. Competitive advantage in turn, led to better organi-
was generated primarily for the US or European audience. The zational performance by facilitating 1) the creation of economic
products reviewed in these publications were often unavailable rents in the form of increased advertising revenue and 2) reduced
186 IEEE TRANSACTIONS ON ENGINEERING MANAGEMENT, VOL. 57, NO. 2, MAY 2010

TABLE IV
STRATEGIES EMPLOYED BY HWZ UPON MARKET ENTRY

TABLE V
HOW WEB TECHNOLOGIES FACILITATED THE STRATEGIES OF HWZ (LATE 1998LATE 1999)

competition for societal resources in the form of advertisers and C. Surviving the Dotcom Crisis (Early 2000Late 2004)
community members [14]. By 2000, online advertising revenue
The onset of the dotcom crisis, which coincided with the peak
was close to US$200 000 per annum, while the official mem-
of the Asian financial crisis in the year 2000 plunged the Singa-
bership for the community had soared beyond 40 000 with a pore IT publications industry into great turmoil and uncertainty.
Web page impression count of over 16 million per month. Up
The severe economic conditions, coupled with the revolution
to this point in time, HWZ had been a resounding success. But
that HWZ was effecting in the industry forced the closure of nu-
new challenges were to emerge as the IT publications industry merous competitors, both online and offline, foreign and local
was about to undergo a dramatic transformation.
alike. Due to its dependency on online advertising, HWZ was
TAN et al.: STRATEGIC IMPLICATIONS OF WEB TECHNOLOGIES 187

TABLE VI
STRATEGIES EMPLOYED BY HWZ DURING THE DOTCOM CRISIS

also badly affected as confidence in viability of online advertis- multiproduct, onlineoffline business model of their established
ing was shattered. The abundance of venture capital in the days foreign competitors that had been repeatedly validated in IT
of the dotcom bubble had all but vanished, and several venture publications industries worldwide.
capitalists who had pledged funding for HWZ had to withdraw Second, Web technologies were used to facilitate a logic
even as HWZs fundamentals remained sound. The new chal- of social congruence that aligns HWZ with the social pres-
lenges caused by the adverse environmental conditions made sures exerted by key actors in the external environment. In par-
the management of HWZ realize that the competitive landscape ticular, mimetic pressures [16] were exerted on HWZ by 1)
had fundamentally changed, and that HWZs dependency on a the group of conservative advertisers, who expected a printed
single revenue stream from a single market made the company product, 2) the members of its existing community, who ex-
vulnerable to any form of turbulence that affected that particular pected a wider product range, and 3) the existing investors,
source of income. Based on this revelation, new strategies were who expected HWZ to demonstrate its continued viability
formulated with the aim of conforming to the tried-and-tested at the height of the dotcom crisis. By facilitating HWZs
organizational form of their established foreign competitors to new strategies, Web technologies enabled HWZ to imitate the
create new streams of revenue for financial stability and orga- business model of their established competitors, which was
nizational survival. The market conditions, the new business aligned to the different expectations of the three stakeholder
objective, and the key strategies employed by HWZ during the groups.
dotcom crisis are summarized in Table VI. Through the logics of optimality and social congruence, HWZ
To facilitate the new strategic objective of conformity, attained an organizational form with a range of products that
Web technologies were used in two different ways (refer to was comparable to their well-established foreign counterparts.
Table VII). First, by capitalizing on the capabilities of Web By conforming to the organizational form best suited for sur-
technologies that enable an organization to 1) transcend geo- vival [9] and the expectations of the key resource owners in
graphical and temporal boundaries, 2) reinforce offline business the external environment [44], legitimacy challenges to its new
processes, and 3) reduce the capital outlay of expanding a busi- initiatives were avoided. This made it easier for HWZ to acquire
ness [41], [49], Web technologies were in support of a logic the societal resources necessary for its survival [14] in the form
of optimality that enabled HWZ to attain the multinational, of community members, investors, and conservative-minded
188 IEEE TRANSACTIONS ON ENGINEERING MANAGEMENT, VOL. 57, NO. 2, MAY 2010

TABLE VII
HOW WEB TECHNOLOGIES FACILITATED THE STRATEGIES OF HWZ (EARLY 2000LATE 2004)

advertisers who previously eschewed its online advertising was leveraged as a strategic resource [4] that HWZ utilized to
model. By the end of 2004, official membership figures of HWZ create awareness, promote, and generate demand for its new
had exceeded 230 000 while the combined revenue from all products. Finally, Web technologies were also used to support a
revenue streams had grown to US$2.65 million approximately. logic of opportunity. Feedback from the existing VC was once
The easier acquisition of societal resources eventually facilitated again used to shape the new products features and content,
HWZs survival during the revolution in the IT publications in- while some community members were once again involved in
dustry. the coproduction of the new products [32]. This ensured that
HWZ was highly responsive and able to innovate rapidly and
effectively according to their customers needs.
D. After the Dotcom Crisis (Early 2005Present) Through the logics of positioning, leverage, and opportu-
With online advertising back on the uptrend and a discernible nity that were similarly invoked during the market entry phase,
decrease in organizational mortality rates, the aftershocks of the Web technologies enabled HWZ to differentiate itself from its
dotcom crisis have subsided as the market returns to a state of competitors with the development of a complementary suite
normalcy. Having established a firm dominance in the IT pub- of products that catered to the needs of its primary customer
lications industry, HWZ is now looking to replicate its success segment. This facilitated the attainment of competitive advan-
in other industries that offer opportunities for the organization tage [4] as HWZs synergistic suite of products provided the
to use their existing assets and competencies synergistically. organization with a unique value proposition and opportunities
By leveraging the existing resources and capabilities developed for cross-marketing. In turn, competitive advantage led to bet-
from running HWZ, the diversification strategy would allow ter organizational performance by facilitating 1) the creation
HWZ to differentiate itself from the potential competitors in the of economic rents in the form of increased online and offline
new industries. In addition, by developing a synergistic suite of advertising revenue and 2) reduced competition for societal re-
products that catered to the same customer segment, the diversi- sources in the form of new members, advertisers, and investors
fication strategy would offer opportunities for cross-marketing [14].
and help to differentiate HWZ from the existing competitors While HWZs latest strategy has not arrived at fruition, the
in the IT publications industry. The market conditions, HWZs latest financial and market statistics have provided early indica-
latest business objective, and the key strategy adopted toward tions of its effectiveness. By 2006, HWZs annual revenue had
the attainment of its objective are summarized in Table VIII. reached levels of around US$3.95 million per annum, while of-
To facilitate the attainment of HWZs latest business objec- ficial membership for the community was estimated at close to
tive, Web technologies were leveraged in three different ways 260 000. The success of HWZ attracted the attention of a num-
(refer to Table IX). First, by examining the profiles of their cus- ber of potential investors, and HWZ was eventually acquired
tomers; constructed with customer information collected with by the leading media conglomerate in Singapore, on September
the help of Web technologies, and the feedback received, Web 29th 2006 for US$4.6 million. To summarize, Fig. 1 provides
technologies were used to support a logic of positioning by a chronology of the specific actions taken by the organization
helping HWZ identify attractive market positions in the new in- since its inception, while Table X tracks three performance in-
dustries. Second, by placing prominent links, announcements, dicators (revenue, profits, and community size) over time to
and advertisements on both the existing Web site and the dis- provide an overview of HWZs evolving strategies and its per-
cussion forums, the VC, enabled by Web technologies [49], formance for the period of study.
TAN et al.: STRATEGIC IMPLICATIONS OF WEB TECHNOLOGIES 189

TABLE VIII
STRATEGIES EMPLOYED BY HWZ AFTER THE DOTCOM CRISIS

TABLE IX
HOW WEB TECHNOLOGIES FACILITATED THE STRATEGIES OF HWZ (EARLY 2005PRESENT)

V. DISCUSSION try [40]. Based on the empirical evidence uncovered at HWZ,


Web technologies can facilitate the two sequential steps in the
A. How Do Web Technologies Support the Strategies
following ways. First, by using Web technologies to facilitate the
of an Organization?
process of collecting customer information and feedback [49],
In our literature review, we had identified five existing pre- organizations can utilize the gathered information to help them
scriptions for enhancing firm performance based on five core with the identification of an attractive market position. In the
logics in organizational literature. The question then was, which case of HWZ, direct feedback from their members alerted them
of these core logics could Web technologies support? The events of the unmet need in the IT publications industry despite the
that transpired at HWZ clearly reveal that Web technologies can stagnated and saturated market at the point of market entry. In
support all of the five core logics. The following stream of re- addition, to join HWZ as a member, customers must, and were
porting discusses how Web technologies can support each of the generally willing to, provide personal information as part of
core logics in turn to address our first research question. the signup process. This information was used to profile the
1) Supporting the Logic of Positioning: The logic of posi- customers, and the customer profiles were eventually leveraged
tioning advocates two sequential steps to differentiate a firm after the dotcom crisis to help HWZ identify attractive market
from its competitors for competitive advantage: 1) identifying positions in the new industries.
an attractive market position, and subsequently, 2) occupying Second, by creatively embedding Web technologies in the
and defending the market position by erecting barriers of en- core business processes of the organizations value chain [41],
190 IEEE TRANSACTIONS ON ENGINEERING MANAGEMENT, VOL. 57, NO. 2, MAY 2010

Fig. 1. Timeline of the key actions taken by HWZ. A chronological depiction of the key organizational actions of HWZ for the period under study, categorized
according to the business strategies that they were in support of.

TABLE X
HWZS PERFORMANCE FROM 1999 TO 2005

organizations can develop or strengthen a tightly integrated ac- stitutable [4] and 2) developing (or acquiring) and leveraging
tivity system [40] that helps defend the adopted market position complementarities that enhance the value-creating potential of
from the competitive actions of rivals within the industry. In the the strategic resources [18]. Based on the case evidence, Web
case of HWZ, Web technologies were used to amass information technologies can facilitate the two mechanisms in the follow-
from an unprecedented number of IT vendors, as well as deliver ing ways. First, while the easy availability of Web technologies
the information on pricing and availability of local IT prod- makes it difficult for an organization to leverage them uniquely
ucts and the proprietary content generated in HWZs laboratory as strategic resources without a competitive response that vio-
to the market in the timeliest possible fashion. Consequently, lates the criterion of inimitability [8], it is nevertheless, possible
by amalgamating information from a vast array of sources and to apply Web technologies creatively so as to create an enduring
enhancing the process of content delivery, Web technologies im- advantage. The story of HWZ highlights one such possibility:
posed a formidable barrier of entry for potential market entrants the VC [49]. Proponents of VCs have always maintained that
as it became more difficult to match HWZ in terms of scale a vibrant community that has attained self-sustaining critical
of content and efficiency of delivery. In summary, by provid- mass can be a strategic resource for an organization (e.g., [2]).
ing an effective means of collecting customer information and Evidence from the HWZ story certainly supports this asser-
feedback [49] and facilitating improvements to processes in an tion. For example, HWZs discussion forums and Web site were
organizations value chain [41], Web technologies can facilitate leveraged to create awareness and demand in its VC for their
a logic of positioning by supporting the identification, adoption motoring, golf and travel publications. To build a customer base
and defense of an attractive strategic position that offers unique from scratch would have been difficult. Instead, HWZ used its
opportunities relative to the competitive environment. existing community as a strategic resource to seed new bases
2) Supporting the Logic of Leverage: The logic of leverage of customers for their new products, resulting in a high rate of
proposes two mechanisms toward the attainment of competitive initial take-up to get them off to a running start. The HWZ story
advantage: 1) developing (or acquiring) and leveraging strate- further provides a powerful illustration of the measures an orga-
gic resources that are valuable, rare, inimitable, and nonsub- nization can adopt to generate the positive network externalities
TAN et al.: STRATEGIC IMPLICATIONS OF WEB TECHNOLOGIES 191

necessary for transforming their VC into a strategic resource: the strongest assurance that the innovations pursued by the or-
1) the initial active participation of the top management in the ganization are effective and in-line with the needs of the cus-
community; 2) the organization of outings that give the VC a tomers [32]. In summary, by providing an effective means of
physical presence; and 3) the use of appropriate incentives such collecting customer information and feedback and enabling the
as free gifts and moderator privileges for the discussion forum. development of VCs [49], Web technologies can facilitate a
Second, Web technologies can be bundled with existing re- logic of opportunity by enhancing 1) the organizational abil-
sources and capabilities within a firm and leveraged as com- ity to sense existing or anticipate future customer needs and
plementarities that enhance value creation [18]. In the case of 2) the organizational aptitude for rapid and relentless innova-
HWZ, the strategic alliances with the major IT vendors provided tions. This subsequently improves the organizational ability to
the organization with the most up-to-date information about the continuously disrupt the competitive equilibrium for transitory
IT products available in the local market. Yet, without the use competitive advantages [13], [20].
of Web technologies, which provided the means of delivering 4) Supporting the Logic of Optimality: The logic of optimal-
this content quickly to their customers [49], the value of the ity advocates two mechanisms for enhancing organizational per-
information is limited. The overriding lesson for Web-enabled formance: 1) adapting toward the optimal organizational form
firms here is that Web technologies possess powerful character- that is best suited for survival in the environment for weaker
istics that can transform the value potential of existing assets organizational forms and 2) retaining the optimal traits for firms
and competencies, and a thorough analysis of the organizations that have attained the optimal organizational form [9]. Based
business processes may help to identify the ways in which Web on the empirical evidence uncovered at HWZ, Web technolo-
technologies can be applied. To summarize, by enabling the de- gies can facilitate the mechanism of adaptation by facilitating
velopment of VCs [49], Web technologies can facilitate a logic the attainment of three organizational traits: 1) an increased
of leverage by serving as the basis of a strategic resource that geographical reach; 2) an extended product range; and 3) an
can be leveraged directly for competitive advantage [4]. In ad- integrated clicks-and-mortar business model. In particular, or-
dition, by exploiting the capabilities of Web technologies, such ganizations can leverage the capability of Web technologies
as its ability to enhance the timeliness of organizational infor- that enable them to transcend spatial and temporal boundaries
mation [49], Web technologies can serve as complementarities to break into new geographical markets and the relatively lower
that enhance the value-creating potential of existing firm assets setup costs for online businesses to experiment with product
and competencies [18]. line extensions [49]. In addition, Web technologies can also
3) Supporting the Logic of Opportunity: The logic of op- reinforce offline business models [41], which can help both a
portunity prescribes two sequential steps toward the attainment traditional offline business go online, or a pure-play dotcom to
of competitive advantage: 1) sensing existing or anticipating go offline, to achieve an integrated clicks-and-mortar business
future needs of customers and 2) disrupting the competitive model.
equilibrium through rapid and relentless innovations for transi- While it must be acknowledged that the three organizational
tory competitive advantages [13]. The events that transpired at traits are not invariably salient across all contextual conditions,
HWZ demonstrate that Web technologies can facilitate the two the three traits tend to be perceived as indicators of growth and
sequential steps in the following ways. First, through the use success (e.g., [7], [25]), particularly in todays global digital
of online polls, surveys, and open-ended feedback forms [49], economy. Nevertheless, the lesson for practitioners here is that
Web technologies make it easier for an organization to col- Web technologies can provide powerful capabilities that facili-
lect information and feedback from its customers, thereby en- tate the acquisition of the organizational traits that are optimal
hancing the organizational ability to sense existing and antic- for survival in a given environment, and it is important to con-
ipate future customer needs. For example, in the context of sider the demands of the environment to determine how they
HWZ, it was noted how the feedback collected from these elec- can be exploited effectively.
tronic means served as the source of many of HWZs early If Web technologies can support the adaptation mechanism
innovations. proposed by the logic of optimality, then they can certainly
Second, by enabling the development of VCs [49], Web tech- support the retention mechanism as well. Assuming that the
nologies enhance both the organizational ability to sense exist- attainment of the optimal organizational form necessitates the
ing and anticipate future customer needs, as well as the orga- use of Web technologies, and like HWZ, an organization uses
nizational aptitude for rapid and relentless innovation. In the Web technologies to acquire the optimal traits, then the only
case of HWZ, monitoring the interactions between community way the organization can lose these traits is if it discontinues its
members provided the organization with clear indications of use of Web technologies. Therefore, in summary, by exploiting
the existing and expressed needs, and hinted at the future or the capabilities of Web technologies, such as its ability to 1)
unexpressed needs of their customers. In addition, HWZ went enable an organization to transcend geographical and temporal
beyond extrapolating information from interactions in their VC boundaries, 2) reduce the capital outlay involved in business ex-
to engaging their members in the coproduction of products and pansion [49], and 3) reinforce offline business models [41], Web
services. For example, the members of HWZs VC were lever- technologies can facilitate the logic of optimality by support-
aged to generate product reviews, Web site features and a con- ing the adaptation toward the optimal for weaker organizational
tent management system for their new products. Coproduction forms, and the retention of optimal traits for organizations that
enhances the speed of organizational innovation and provides have attained the optimal organizational form [9].
192 IEEE TRANSACTIONS ON ENGINEERING MANAGEMENT, VOL. 57, NO. 2, MAY 2010

5) Supporting the Logic of Social Congruence: The logic of 1999) and after (Early 2005Present) the dotcom crisis to be in
social congruence prescribes three mechanisms for enhancing a state of equilibrium, characterized by low organizational mor-
organizational performance: Achieving congruence with 1) co- tality rates, as well as low rates and magnitude of change in the
ercive, 2) mimetic, and 3) normative isomorphic pressures [16]. industry. Similarly, we define the external environment during
In the context of the case study, the same capabilities of Web the period of the dotcom crisis (Early 2000Late 2004) to be
technologies that facilitated the logic of optimality were also in a state of revolution, where organizational mortality rates, as
used to align an organization with the social pressures exerted well as the rates and magnitude of change are high.
by key actors in the external environment [44]. In particular, the By making a distinction between the two states of external
untapped segment of conservative advertisers expected a printed environment and integrating the different patterns of how Web
product, the members of HWZs VC expected a wider product technologies were used to support the strategies of HWZ across
range, while existing investors expected HWZ to demonstrate the three temporal phases (refer to Table XI), a model of the
its continued viability in the adverse economic conditions. Al- underlying process through which Web technologies enhance
though the expectations of each of the stakeholder groups were organizational performance can be inductively derived (refer to
clearly different, when taken together, the three social forces Fig. 2). In particular, empirical evidence from the case study
applied a concerted mimetic pressure [16] that pushed HWZ suggests that the way to better organizational performance is
toward conformity to the multiproduct, multinational, online contingent on the fit between the use of Web technologies, the
offline business model of their established foreign counterparts. organizational strategy, and the state of the external environ-
But, the aligning influence of Web technologies is not solely ment.
limited to mimetic social pressures. Existing research on Web More specifically, when the external environment is in a state
technologies has shown that Web technologies can align an or- of equilibrium, Web technologies should be used to facilitate
ganization with coercive and normative social pressures as well the logics of positioning, leverage, and opportunity to help dif-
(e.g., [23]). The key lesson for Web-enabled organizations here ferentiate a firm from its competitors. By aligning the use of
is that the capabilities of Web technologies can also help to align Web technologies to the three core logics of strategy, firm het-
the organization to the various social pressures exerted on the erogeneity is achieved to create competitive advantage. Com-
organization by actors in the external environment. A thorough petitive advantage, in turn, leads to the creation of economic
consideration of these social forces is therefore necessary in rents [14], reduced competition for the societal resources neces-
order to identify the ways in which Web technologies can be sary for organizational survival [6], and consequently, better or-
creatively applied. In summary, by exploiting the capabilities of ganizational performance. Conversely, when the organizational
Web technologies (e.g., [49]), Web technologies can facilitate environment is in a state of revolution, Web technologies should
the logic of social congruence by helping an organization at- be aligned to the logics of optimality and social congruence to
tain social fitness [44] that makes an organization congruent help the organization become isomorphic to the optimal organi-
with the coercive, mimetic, and normative social pressures in zational form [26] or the coercive, mimetic, and normative pres-
the external environment. sures from the institutional environment [16]. By facilitating the
two logics, conformity is achieved which leads to legitimacy.
Legitimacy, in turn, helps an organization avoid challenges to its
B. How Do Web Technologies Enhance Organizational reliability and rationality, making it easier for the organization
Performance? to acquire the societal resources necessary for organizational
Now that we have established that Web technologies can be survival from resource owners in the external environment [16].
used to support each of the five core logics identified in organi- The easier acquisition of societal resources increases the prob-
zational literature, we address the second research question by ability of organizational survival and consequently, improves
examining how aligning the use of Web technologies to each of organizational performance [14].
the core logics enhances organizational performance. What is Theoretical support for the propositions that 1) the way to bet-
particularly striking about the HWZ story is the cyclical tran- ter organizational performance is contingent on the fit between
sition of the external environment: From a steady, predictable technology, strategy, and the environment, 2) Web technologies
phase at the time of HWZs inception, to a tumultuous phase should be aligned to strategies that support the objective of het-
during the dotcom crisis where change was discontinuous and erogeneity when the environment is in a state of equilibrium,
unpredictable, and back again with the subsidence of the dotcom and 3) Web technologies should be aligned to strategies that
crisis. As the nature of how Web technologies enhance organi- support the objective of conformity when the environment is in
zational performance appears to be different in each of the two a state of revolution, can be found in the literature. In critiques of
cyclic phases, it is necessary to distinguish between the phases the strategic approaches that represent the logics of positioning,
in order to examine how Web technologies led to performance leverage, and opportunity, it is often noted that the approaches
gains in different ways under different contextual conditions. are only appropriate in an industry context of low complexity.
As the cyclical transition of the external environment adhered For example, it has been asserted that the logic of positioning
to the generic pattern of punctuated equilibria, the punctuated is useful only if the competitive forces . . . are relatively stable
equilibrium paradigm [22] provides a useful framework for dis- and independent [10, p. 75], while the logic of leverage is of-
tinguishing between the two cyclic phases. Accordingly, we ten criticized for its inability to explain superior performance in
define the external environment in the years before (Late 1998 complex and unpredictable environments [18], [43]. Likewise,
TAN et al.: STRATEGIC IMPLICATIONS OF WEB TECHNOLOGIES 193

TABLE XI
HOW WEB TECHNOLOGIES SUPPORTED THE STRATEGIES OF HWZ ACROSS THE THREE TEMPORAL PHASES

Fig. 2. How Web technologies enhance organizational performance. The process model depicts five mechanisms, contingent on the state of the external
environment, through which the use of Web technologies enhances organizational performance.

critics have labeled the primary driver of the logic of opportunity increases the likelihood of organizational mortality [47], and
as strategic soothsaying [10, p. 77] and have suggested that it resource owners, such as customers, investors, and suppliers,
(i.e., the prediction of future customer needs) is impossible in a will not provide any resources to a firm if they are unsure of
truly unpredictable environment. the exchange partners continued viability [14]. Consequently,
Conversely, in a complex, unpredictable environment, the when the organizational environment is in a state of revolu-
importance of legitimacy for organizational survival increases tion characterized by complexity and unpredictability, it has
greatly [5], [52]. This is because a high level of uncertainty been suggested that organizations should instead be pursuing
194 IEEE TRANSACTIONS ON ENGINEERING MANAGEMENT, VOL. 57, NO. 2, MAY 2010

conformity by going with the flow [10, p. 79] to achieve the der conditions of high environmental uncertainty (i.e., during
requisite legitimacy for organizational survival. an revolution [22]).
The discourse on communal strategies also provides some In terms of real world instances, further support for the propo-
support for the propositions of our process model. For exam- sitions of our process model can be found in the example of
ple, citing the examples of revolutions that have occurred in Microsoft. When Microsoft was formulating its online strategy,
the nuclear utilities, petroleum, and the apparel and footwear it perceived the Internet as a competitor to its proprietary Mi-
industries, Barnett [3] suggests that when the organizational en- crosoft Network (MSN). However, when the Internet revolution-
vironment imposes constraints on a firms profitability, it is more alized the information and communications industry, Microsoft
valuable for a firm to attain conformity with other firms in the realized that an MSN-centric approach would isolate MSN from
industry and pursue a communal strategy for collective gains, the rest of the Internet world, and it acted quickly to attain con-
than to pursue individual gains with a competitive strategy. A formity by embracing the Internet and adopting its standard.
communal strategy refers to a firms allocation of resources to And, while Microsoft is unable to achieve the same dominance
collective efforts to influence the institutions governing its in- of the Internet as of the PC markets today, the act of conformity
dustry in its favor [3], and a necessary precondition for a firm contributed to the survival of MSN and gave the company the
pursuing a communal strategy is conformity to a common set of opportunity to compete with Netscape and Sun [10].
institutions. On the other hand, when the environmental effects
on a firms performance are low, firms are more likely to pursue a VI. CONCLUSION
competitive strategy through self-interested activities that dis-
tinguishes itself from its rivals in order to achieve competitive A. Limitations and Future Research
advantage [3, p. 1762]. This is because conformity demands This article is not without its limitations. Although the study
managerial attention and other organizational resources while of a single setting is a typical and legitimate endeavor in
limiting profit potential, discretion, and control. qualitative research [31, p. 231], a particular criticism that is
Beyond the case study presented in this paper, empirical sup- commonly directed at studies based on the single case research
port for the propositions of our process model can also be found methodology is the problem of generalizability [51]. However,
in the literature. For example, in their study of the Chinese although it must be readily acknowledged that statistical gen-
electronics industry, Tan and Litschert [47] found that envi- eralization is impossible from a single case study, we contend
ronmental uncertainty was positively related to the adoption of that our study is generalizable beyond its singular context for
defensive-oriented strategies that emphasize conformity and re- two reasons. First, our process model was constructed by theo-
inforcing the status quo and negatively related to the adoption rizing from the empirical evidence uncovered in our case study
of proactive, future-oriented, or risky strategies that empha- and the propositions of some of the most established theories
size differentiation and innovation. More importantly, the study in organizational literature. In developing a process model that
also found that the adoption of defensive-oriented strategies in is both theoretically and empirically supported by the existing
the context of environmental uncertainty was related to better literature, this study invokes the principles of analytic gener-
overall performance and profitability. Similarly, in a study of alization [53, p. 32] or what Lee and Baskerville [31, p. 235]
the strategies of the largest film studios in Hollywood between refers to as generalizing from description to theory. Second,
1936 and 1965, Miller and Shamsie [35] discovered that both empirical evidence gathered from a variety of contexts, such
the extent of organizational effect uncertainty, defined as the in- as 1) the electronics industry in China [47], 2) the film studios
ability to predict the effects of the environment on the firm, and in Hollywood [35], and 3) the account of MSN at Microsoft,
decision response uncertainty, defined as the inability to predict the largest IT firm in the information and communications in-
the consequences of a firms actions, were positively related to dustry [10], appears to corroborate the propositions of our pro-
the extent of product similarity as both forms of uncertainty dis- cess model. This gives us some measure of confidence that the
courage innovation and compel managers to focus their limited findings of this study are not constrained to a specific type of
resources on the few familiar product varieties and customers organization (i.e., a small e-commerce start-up), operating in
that they understand best. a specific industry within a specific country (i.e., the IT pub-
Collectively, the results of these studies suggest that 1) strate- lications industry in Singapore). Nevertheless, future research
gies that lead to heterogeneity tend to be employed when en- can be directed at statistically validating the propositions of this
vironmental uncertainty is low, 2) strategies that lead to con- study, so that the boundary conditions of the proposed theory
formity tend to be employed when environmental uncertainty can be better defined.
is high, and 3) strategies that lead to conformity gives rise A second limitation is that despite our efforts to be as in-
to better organizational performance when environmental un- clusive as possible, we acknowledge that it is impossible to
certainty is high. In tandem with the generally accepted and exhaustively describe all the possible ways through which Web
empirically well-supported notion that strategies that lead to technologies enhance organizational performance within a sin-
heterogeneity ordinarily gives rise to better organizational per- gle study. While we are bounded by feasibility concerns and the
formance (e.g., [12], [20], [40]), it necessarily follows that Web limits of the data collected, future research can certainly investi-
technologies should be used to support 1) strategies that lead gate other ways in which Web technologies can enhance organi-
to heterogeneity under ordinary circumstances (i.e., during an zational performance that have not been examined in this study.
equilibrium [22]) and 2) strategies that lead to conformity un- One might begin by looking at other organizational theories
TAN et al.: STRATEGIC IMPLICATIONS OF WEB TECHNOLOGIES 195

offering competing prescriptions for improving organizational While this contingency solution departs significantly from the
performance. Possible theories include the resource dependence propositions found in existing literature (e.g., [14]), it does not
theory [39] and the complexity theory [45]. contradict the existing empirical evidence. Given that the or-
ganizational environment of any industry can vacillate between
equilibrium and revolution [22], it is unlikely that an organiza-
tion that pursues heterogeneity or conformity exclusively will
B. Theoretical and Practical Implications consistently outperform its competitors in the long run, which
By addressing the research questions set forth at the begin- is in accord with Deephouses [14] findings that organizations
ning of this paper, this study has made a number of important with a moderate amount of differentiation have the best orga-
theoretical contributions. First, by demonstrating how Web tech- nizational performance. By validating the propositions of the
nologies can support the business strategies of an organization, contingency solution and testing the influence of a wider array
and how this leads to achieve better organizational performance, of contingency variables on the heterogeneity-performance re-
this article underscores the importance of technology-strategy lationship in future studies, a conclusive solution to the paradox
alignment in the context of Web technologies. The majority of may yet emerge. The contribution of this article thus lies in
existing Web technology research has emphasized the techno- laying the foundation of a bridge that may bring together two
logical dimension of Web technologies (e.g., [15], [38]) and vibrant, yet divergent schools of thought. By synthesizing the
neglected its alignment with the broader business objectives of vast cumulative knowledge of the opposing schools, researchers
an organization. In reiterating the importance of technology- on either sides of the divide can only benefit from the rich cross-
strategy alignment, this article urges for a thorough considera- fertilization of ideas.
tion of business objectives in future technology-oriented studies In terms of practical contributions, the utility of the paper lies
and suggests the need to look beyond a monolithic set of de- in the indications it provides for e-commerce practitioners. None
sirable technical qualities to specific technical qualities of Web of the ways in which Web technologies were used at HWZ are
technologies that are most appropriate for facilitating particu- particularly novel or groundbreaking. This underscores the cen-
lar business strategies. In addition, this article may serve as a tral premise of this paper that e-business success, or the effective
catalyst for more business-oriented research seeking to identify leverage of Web technologies, is not dependent on technical ex-
ways of applying Web technologies to a wider array of business cellence but rather the intricate fit between technology, strategy,
objectives. In itself and in its implications for future research, and the external environment. By tracing the underlying pro-
this article contributes toward balancing the technology-oriented cess through which Web technologies enhance organizational
and business-oriented perspectives of the phenomenon, so that performance in its entirety, and providing prescriptions on how
by mutual reinforcement, theoretical advancement and clarity to achieve the requisite technology-strategy-environment fit, it
may be achieved. is hoped that if existing investments in Web technologies have
Second, little research has been conducted on the conse- not translated to better organizational performance, the process
quences of using Web technologies [54], [55], and of the hand- theory developed in this article can be used as a roadmap to
ful of studies we found, all of them have adopted a variance help managers and practitioners to identify the missing link
theory approach and treated the relationship between Web tech- in the process, so that they may adopt the appropriate remedial
nologies and organizational performance as a black box. By measures to realign their investment to the path of success.
opening up the black box of the relationship and describing
the underlying mechanism, this article complements the existing APPENDIX
factor-oriented studies that demonstrate a statistical association
THE SINGAPORE IT PUBLICATIONS INDUSTRY
between the use of Web technologies and organizational perfor-
mance (e.g., [54], [55]). In doing so, a more convincing response The market offerings in the saturated Singapore IT publica-
to the skepticism about the value of Web technologies is possi- tions industry around the time of HWZs entry can be classified
ble as we are able to move beyond simply demonstrating that into a two-by-two matrix (refer to Fig. 3) according to two
the correlation between Web technologies and organizational dimensions: Place of origin (Local vs. Foreign) and delivery
performance exist to explaining how Web technologies enhance media (Printed vs. Online). This classification, however, is not
organizational performance. mutually exclusive and an organization, particularly the estab-
Third, the article also contributes to organizational research lished foreign publications, can operate in two or more of the
by hinting at a possible contingency solution to the paradox of quadrants. For example, PC World, published by the Interna-
heterogeneity. In particular, the process model developed in the tional Data Group based in the United States, was operating in
paper reconciles the conflicting perspectives of both strategic quadrants I (PC World) and II (PCWorld.com) in 1998, while by
management and organizational sociology literature on hetero- 2003, PC Magazine, published by Ziff-Davis Publishing Hold-
geneity by suggesting that 1) the effectiveness of strategies that ings Inc. based also in the United States, was operating in all four
lead to either heterogeneity or conformity is contingent on the quadrants. HWZ entered the industry in quadrant IV (local on-
organizational environment, 2) strategies that lead to hetero- line publications). However, the competitive impact of HWZs
geneity are more effective when the environment is in a state of entry and its subsequent actions were not restricted to the quad-
equilibrium, and 3) strategies that lead to conformity are more rant but instead reverberated across the entire industry. Fig. 3
effective when the environment is in a state of revolution. provides a nonexhaustive list of publications for each quadrant
196 IEEE TRANSACTIONS ON ENGINEERING MANAGEMENT, VOL. 57, NO. 2, MAY 2010

Fig. 3. Singapore IT Publications Industry. The 2 2 matrix classifies the existing offerings in the Singapore IT publications industry around the time of HWZs
entry into four distinct quadrants along two dimensions. A nonexhaustive list of publications for each quadrant of the matrix and a brief description of how the
publications in each quadrant fared in the industry since the inception of HWZ are provided.

of the matrix and a brief description of the performance of the [14] D. L. Deephouse, To be different, or to be the same? Its a question
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