IT Reputation and Firm Performance: Antecedents and Consequences

• In Event: Enterprise Systems, IT Reputation and Software Quality

Abstract

Motivated by a growing academic body of research and professional evidence showing a rising interest among senior executives on corporate reputation, this study examines antecedents and consequences of IT capability related reputation. Building on IT strategic leadership and IT business value literature we propose the following antecedents: 1) congruity in IT related expert power (i.e., IT related- knowledge, expertise, or experience) of CEO and IT executives, 2) congruity between IT related expert power of CEO and structural position (i.e., hierarchical position) of IT executives, 3) the prominence of a firm’s business strategy as product differentiator or cost leader, and 4) interaction between congruity and business strategy. Results based on over 1300 large US firms from a wide spectrum of industries show that these antecedents increase the likelihood that external stakeholders, such as business press, will recognize these firms for the quality of their IT capability. These findings combined with our evidence, that markets seem to value companies that develop and sustain their IT reputation substantially higher than firms that develop but cannot sustain their IT reputation, have important practical implications for CEOs and IT executives.

Authors

• Jee-Hae Lim, University of Waterloo

• Theophanis C Stratopoulos, University of Waterloo

• Tony Wirjanto, University of Waterloo