IT and social complexity - Complementary resource combinations in the South African assurance industry

Much of the business literature on competitive advantage investigates corporate effort at the strategic level, and tends to focus on key success factors that sustain advantage. Porter (1980), for instance, used "value chain" analysis as a tool for inter-functional linkage. Alternately, Chamberlin (1933) introduced the notion that assets can be exploited to create value, not only through inter-functional linkages (as in value chains) but also through unique processes, knowledge and cultural values. We have extended resource-based theory (RBT) to include a concept called complementary resource combinations (CRCs). CRCs are not factor inputs (in an economic sense) like tangible and intangible assets; they are complex combinations of assets, people, and processes that firms use to transform somewhat inert resources and assets into unique outputs such as products and services. Through our study of the top four assurance firms in South Africa, we have developed a model called a "Framework for Sustainability" that shows how these firms use CRCs to marketplace advantage. Our research focuses on how information technology (IT) enables CRCs, and indicates that IT hardware and software do not per se possess properties of "rarity"; it is through combinations with an array of processes, actions, strategic intentions and programs within the firm that IT enables the creation of CRCs to sustain a firm's competitive advantage over time. © Kurt April, Marylou Shockley, Kai Peters, 2009.