How information systems strategy moderates the relationship between business strategy and performance

Abstract

This study analyzes the moderating effect of information systems (IS) strategy on the relationship between a firm's business strategy and organizational performance. From the resource-based view, the study analyzes the support that an innovative IS strategy and a conservative IS strategy can provide to low-cost and differentiation business strategies. Results of analysis for a sample of 166 firms from the Spanish food industry demonstrate the effectiveness of innovative IS strategies in firms with low-cost business strategies. In contrast, innovative IS strategies fail to compensate the risk of innovation in marketing activities and consequently in business strategies that rely on image differentiation. The relationship between IS strategy and business strategies that rely on innovative differentiation is ambiguous, but for the food industry, the innovative IS strategy is counterproductive. Conclusions provide guidance on strategic decision-making for developing information systems in firms according to business goals.