Proceedings of the 3rd International Conference on Big Data Economy and Digital Management, BDEDM 2024, January 12–14, 2024, Ningbo, China

Research Article

Building Sustainable Competitive Advantage: Matching IT Capabilities by Network Externalities

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  • @INPROCEEDINGS{10.4108/eai.12-1-2024.2347231,
        author={Li  Cheng and Libo  Yang},
        title={Building Sustainable Competitive Advantage: Matching IT Capabilities by Network Externalities},
        proceedings={Proceedings of the 3rd International Conference on Big Data Economy and Digital Management, BDEDM 2024, January 12--14, 2024, Ningbo, China},
        publisher={EAI},
        proceedings_a={BDEDM},
        year={2024},
        month={6},
        keywords={standardized it capabilities; non-standardized it capabilities; network externalities; competitive advantage},
        doi={10.4108/eai.12-1-2024.2347231}
    }
    
  • Li Cheng
    Libo Yang
    Year: 2024
    Building Sustainable Competitive Advantage: Matching IT Capabilities by Network Externalities
    BDEDM
    EAI
    DOI: 10.4108/eai.12-1-2024.2347231
Li Cheng1,*, Libo Yang1
  • 1: Chongqing Youth Vocational & Technical College
*Contact email: 563821606@qq.com

Abstract

IT capability based on RBV cannot provide firms with sustainable competitive advantage. IT capability consists of standardized IT capability and non-standardized IT capability. This paper applied Stackelberg model to research match of IT capabilities factors based on network externalities. Network externalities from IT technology standards can bring about sustainable competitive advantage for the incumbent firms. When difference of non-standardized IT capability between two types of firms is significant, the incumbent firms should control compatibility of standardized IT capability, which enable him to achieve differentiation competitive advantage; when difference of non-standardized IT capability between firms is insignificant, incumbent firm should release IT standards absolutely, which can increase consumers’ anticipation to achieve installed-base for technological innovation.