In this paper, we propose a resource-based model to explain how expert systems generate sustained competitive advantage for a firm. Speciftcally, we analyze the extent to which expert systems (ESs) exhibit the attributes of value, rareness, imperfect imitability, and non substitutability associated with a rent-generating resource (e.g., Barney, 1991). Then, we discuss how expert systems yield sustainable competitive advantage through fostering organizational knowledge development and utilization. Finally, we examine the role of ESs in engenden’ng a reciprocal, mutually enhancing relationship with organizational competencies, leading to sustained competitive advantage. Propositions are ofleered to facilitate future research.
Get full access to this article
View all access options for this article.
References
1.
Akerlof, G. A.1970. The market for ‘lemons’: Quality uncertainty and the market mechanism. Quarterly Journal of Economics, 84: 488-500.
2.
Alter, S.1992. Information systems: A management perspective.Reading, MA: Addison-Wesley.
3.
Amit, R., & Schoemaker, P. J. H.1993. Strategic assets and organizational rent. Strategic Management Journal, 14: 33-46.
4.
Arthur, W. B.1989. Competing technologies, increasing returns, and lock-in by historical events. Economic Journal, 97:116-131.
5.
Ashmore, G. M.1989. Applying expert systems to business strategy. Journal of Business Strategy, 10 (5): 46-49.
6.
Barney, J. B.1986a. Strategic factor markets: Expectations, luck, and business strategy. Management Science, 86: 1231-1242.
7.
Barney, J. B.1986b. Organizational culture: Can it be a source of sustained competitive advantage?Academy of Management Review, 11: 656-665.
8.
Barney, J.1991. Firm resources and sustained competitive advantage. Journal of Management, 17: 99-120.
9.
Barney, J. B., & Hansen, M. H.1994. Trustworthiness as a source of sustained competitive advantage. Strategic Management Journal, 15 (Special Issue): 175-190.
10.
Bedard, J., Mock, T. J., & Boritz, J. E.1992. Expert and novice problem-solving behavior in audit planning discussion. Journal of Practice & Theory, 11: l-32.
11.
Beer, S.1981. The brain of tkflrm. New York: Wiley.
12.
Beerel, A. C.1987. Expert systems: Strategic implications and applications. New York: John Wiley.
13.
Bell, D.1979. Communications technology-for better or worse. Harvard Business Review, 57 (3): 20-42.
14.
Ben-David, A., & Pao, Y-H.1992. Self-improving expert systems. Information & Management, 22: 323-331.
15.
Benders, J., & Manders, F.1993. Expert systems and organizational decision-making. Information & Management, 25: 207-213.
16.
Boggs, J. P.1992. Implicit models of social knowledge use. Knowledge: Creation, Diffusion, Chilization, 14: 29-62.
17.
Bouwman, M.1981. The use of accounting information: Expert versus novice behavior. In Decision-Making: An Inter disciplinary Inquiry, Office of Naval Research, Contract No. N00014-80-G-0091.
18.
Bowman, E. H.1974. Epistemology, corporate strategy, and academe. Sloan Management Review, 15 (2): 35-50.
19.
Bowerman, R. G., & Glover, D. E.1988. Putting expert systems intopractice. New York: Van Nostrand Reinhold Company.
20.
Bryant, N.1988. Managing expert systems. New York: John Wiley.
21.
Byrd, T. A.1992. Implementation and use of expert systems in organizations: Perception of knowledge engineers. Journal of Management Information Systems, 8 (4): 97-116.
22.
Chi, M. T. H., Glaser, R., & Rees, E.1982. Expertise in problem solving. In R. Stemberg (Ed.), Advances in the psychology of human intelligence, vol. 1. Hillsdale, NJ: Erlbaum.
23.
Citrenbaum, R., Geissman, J. R., & Schultz, R.1987. Selecting a shell. AlExpert, September, 30-39.
24.
Cleal, D. M., & Heaton, N. O.1988. Knowledge-based systems: Implications for human-computer interfaces. New York: Wiley.
25.
Conner, K. R.1991. A historical comparison of resource-based theory and five schools of thought within industrial organization economics: Do we have a new theory of the firm?Journal of Management, 17: 155-171.
26.
Conner, K. R.1995. Obtaining strategic advantage from being imitated: When can encouraging (clones) pay?Management Science, 4 (1): 209-225.
27.
Davis, S., & Botkin, J.1994. The coming of the knowledge-based business. Harvard Business Review, 72 (5): 165-170.
28.
De Gregori, T. R.1987. Resources are not; they become: An institutional theory. Journal of Economic Issues, 21: 1241-1263.
29.
Delbecq, A. L. &Mills, P. K.1985. Managerial practices that enhance innovation. Organizational Dynamics, 14: 24-34.
30.
Diaper, D.1990. An organizational context for expert system design. In D. Berry & A. Hart (Eds.), Expert sysrems: Human issues. New York: Chapman & Hall.
31.
Dierickx, I., & Cool, K.1989. Asset stock accumulation and sustainability of competitive advantage. Management Science, 35: 1504-1511.
32.
Dunn, W. N., Holzner, B., Shahidullah, M., & Hegedus, A. M.1988. The architecture of knowledge systems: Toward policy-relevant science impact indicators. Knowledge: Creation, Diffusion, Utilization, 9 (2): 205-232.
33.
Earl, M. J.1994. Knowledge as strategy: Reflections on Skandia International and Shorko Films. In C. Ciborra & T. Jelassi (Eds.), Strategic information systems: A European perspective: 53-69. Chichester, UK: Wiley & Sons.
34.
Eliot, L. B.1987. The strategic expert systems. Computerworld, 21(8): 77-79.
35.
Fiol, C. M.1991. Managing culture as a competitive resource: An identity-based view of sustainable competitive advantage. Journal of Management, 17: 191-211.
36.
Gevarter, W. B.1987. The nature and evaluation of commercial expert system building tools. Computer, 20 (5): 25-41.
37.
Gilhooly, K. J.1988. Thinking: Directed, undirected, and creative. London, UK: Academic Press.
38.
Gill, T. G.1995. Early expert systems: Where are they now?MIS Quarterly, 19: 51-72.
39.
Glaser, R.1985. Thoughts on expertise. Technical Report No. 8. Learning Research and Development Center, University of Pittsburgh.
40.
Godfrey, P. C., & Hill, C. W. L.1995. The problem of unobservables in strategic management research. Strategic Management Journal, 16: 519-533.
41.
Grant, R. M.1996. Prospering in dynamically-competitive environments: Organizational capability as knowledge integration. Organization Science, 7: 375-387.
42.
Havelock, R. G.1986. The knowledge perspective: Definition and scope of a new study domain. In G. M. Beal, W. Dissanayake & S. Konoshima (Eds.), Knowledge generation, exchange and utilization: 11-34. Boulder, CO: Westview Press.
43.
Hayes-Roth, F., & Jacobstein, N.1994. The state of the knowledge-based systems. Communication of the ACM, 37 (3): 37-49.
44.
Henderson, R. M., & Clark, K. B.1990. Architectural innovation: The reconfiguration of existing product technologies and the failure of established firms. Administrative Science Quarterly, 35: 9-30.
45.
Hofer, C. W., & Schendel, D.1978. Strategy formulation. Analytical concepts. St. Paul, MN: West.
46.
Holsapple, C. W., & Whinston, A. B.1987. Business expert systems. Homewood, IL: Irwin.
47.
Holmstrom, B.1979. Moral hazard and observability. Bell Journal of Economics, 10: 74-91.
48.
Huber, G. P.1990. A theory of the effects of advanced information technologies on organizational design, intelligence, and decision making. Academy of Management Review, 15: 47-71.
49.
Huber, G. P.1991. Organizational learning: The contributing processes and the literatures. Organization Science, 2: 88-115.
50.
Itami, H., & Roehl, T. W.1987. Mobilizing invisible assets. Cambridge, MA: Harvard University Press.
51.
Jih, W. J. K.1990. Unique characteristics and key design consideratons of expert systems: A management perspective. Information Executive, 3 (4): 55-60.
52.
Kazanjian, R. K., & Drazin, R.1986. Implementing manufacturing innovations: Critical choices of structure and staffing roles. Human Resource Management, 25: 385-403.
53.
Kogut, B., & Zander, U.1992. Knowledge of the firm: Combinative capabilities, and the replication of technology. Organizational Science, 3: 383-397.
54.
Kunnathur, A. S., Ahmed, M. U., &Charles, R. J. S.1996. Expert systems adoption: An analytical study of managerial issues and concerns. Information & Management, 30: 15-25.
55.
Lado, A. A., Boyd, N. G., & Hanlon, S. C. in press. Competition, cooperation, and the search for economic rents: A syncretic model. Academy of Management Review.
56.
Lado, A. A., Boyd, N. G., & Wright, P.1992. A competency-based model of sustainable competitive advantage: Toward a conceptual integration. Journal of Management, 18: 77-91.
57.
Lamberti, D. M., & Wallace, W. A.1990. Intelligent interface design: An empirical assessment of knowledge presentation in expert systems. MIS Quarterly, 14: 279-311.
58.
Lawrence, P. R., & Lorsch, J. L.1967. Organization and environment. Cambridge, MA: Harvard University Press.
59.
Lee, D.1988. Expert decision support systems for decision making. Journal of Information Technology, 3 (2): 85-94.
60.
Leonard-Barton, D.1987. The case for integrative innovation: An expert system at Digital. Sloan Management Review, 29 (1): 7-19.
61.
Leonard-Barton, D.1992. Core capabilities and core rigidities: A paradox in managing new product development. Strafegic Management Joumul, 13 (Special Issue): 111-125.
62.
Leonard-Barton, D.1995. Wellsprings of knowledge. Boston: Harvard Business School Press.
63.
Leonard-Barton, D., & Deschamps, I.1988. Managerial influence in the implementation of new technology. Management Science, 34: 1252-1265.
64.
Leonard-Barton, D., & Sviokla, J. J.1988. Putting expert systems to work. Harvard Business Review, 66 (2): 91-98.
65.
Levitt, B. & March, J. G.1988. Organizational learning. Annual Review of Sociology, 14: 319-340.
66.
Licker, P. & Olsen, B.1992. Dimensions of expert system management. Journal of Systems & Software, 19 (2): 171-183.
67.
Lippman, S., & Rumelt, R.1982. Uncertain imitability: An analysis of intertirm differences in efficiency under competition. Bell Journal of Economics, 13: 418-438.
68.
Lu, M.T., & Guimaraes, T.1989. A guide to selecting expert systems applications. Journal of Information Systems Management, 6: 8-15.
69.
Mahoney, J. T.1995. The management of resources and the resource of management. Journal of Business Research, 33: 91-101.
70.
March, J. G.1991. Exploration and exploitation in organizational learning. Organization Science, 2: 71-87.
71.
Mason, R. O.1989. An assessment of expert system technologies. In K. C. Laudon & J. A. Turner (Ed.), Information technology & management strategy. Englewood Cliffs, NJ: Prentice Hall.
72.
Mata, F. J., Fuerst, W. L., & Barney, J. B.1995. Information technology and sustained competitive advantage: A resource-based analysis. MIS Quarterly, 19: 487-505.
73.
McCauley, N., & Ala, M.1992. The use of expert systems in the healthcare industry. Information & Management, 22: 227-235.
74.
McFarlan, F. W.1984. Information technology changes the way you compete. Harvard Business Review, 62 (3): 98-103.
75.
McWilliams, A., & Smart, D. L.1993. Efficiency v. structure-conduct-performance: Implications for strategy research and practice. Journal of Management, 19: 63-78.
76.
Meyer, M. H., & Curley, K. F.1991a. Putting expert systems technology to work. Sloan Management Review, 32 (2): 21-31.
77.
Meyer, M. H., & Curley, K. F.1991b. An applied framework for classifying the complexity of knowledge-based systems. MIS Quarterly15: 455-472.
78.
Meyer, A. D., Tsui, A. S., & Hinings, C. R.1993. Configurational approaches to organizational analysis. Academy of Management Journal, 36: 1175-1196.
79.
Meyerson, D. & Martin, J.1987. Cultural change: An integration of three different views. Journal of Management Studies, 18: l-26.
80.
Miller, D.1986. Configurations of strategy and structure: Towards a synthesis. Strategic Management Journal, 7: 233-249.
Miller, D., & Shamsie, J.1996. The resource-based view of the firm in two environments: The Hollywood film studios from 1936-1965. Academy of Management Journal, 39: 519-543.
83.
Morgan, G.1986. Images of organizations. Beverly Hills, CA: Sage.
84.
Nelson, R. R.1991. Why do firms differ and how does it matter?Strategic Management Journal, 12 (Special Issue): 61-74.
85.
Nelson, R., & Winter, S.1982. An evolutionary theory of economic change. Cambridge, MA: Harvard University Press.
86.
Nonaka, I.1991. The knowledge-creating company. Harvard Business Review, 69 (6): 312-319.
87.
Nonaka, I.1994. A dynamic theory of knowledge creation. Organization Science, 5: 14-37.
88.
Olsen, J. R., & Rueter, H. H.1987. Extracting expertise from experts: Methods for knowledge acquisition. Expert Systems, 24 (4): 152-169.
89.
Parsons, G. L.1983. Information technology: A new competitive weapon. Sloan Management Review, 24 (1): 3-13.
90.
Penrose, E. T.1959. The theory of the growth of thefirm. New York: Wiley.
Peteraf, M. A.1993. The cornerstones of competitive advantage: A resource-based view. Strategic Management Journal, 14: 179-191.
93.
Peteraf, M. A.1994. Commentary: The two schools of thought in resource-based theory: Definition and implications for research. In P. Shrivastava, A. Huff & J. Dutton (Eds.), Advances in strategic management, vol.1OA. Greenwich, CT: JAI Press.
94.
Pinder, C. C., & Moore, L. F.1979. The resurrection of taxonomy to aid the development of middle-range theories of organizational behavior. Administrative Science Quarterly, 24: 99-118.
95.
Polanyi, M.1967. Personal knowledge. Chicago: University of Chicago Press.
96.
Poo, C. D., & Lu, H.1991. Multi-domain expert systems. Expert Systems, 8 (2): 67-73.
97.
Porter, M.1980. Competitive strategy. New York: Free Press.
98.
Porter, M.1981. The contribution of industrial organization to strategic management. Academy of Management Review, 6: 609-620.
99.
Porter, M. E.1990. Competitive advantage of nations. New York: Free Press.
100.
Porter, M. E., & Millar, V. E.1985. How information gives you competitive advantage. Harvard Business Review, 63 (4): 149-160.
101.
Prahalad, C. K., & Hamel, G.1990. The core competence of the corporation. Harvard Business Review, 68 (3) 79-91.
102.
Pucik, V.1988. Strategic alliances, organizational learning and competitive advantage: The HRM agenda. Human Resource Management, 27 (1): 77-93.
103.
Quinn, R. E., & Cameron, K.1983. Organizational life cycles and some shifting criteria of effectiveness: Some preliminary evidence. Management Science, 29: 33-51.
104.
Reed, R., & DeFillippi, R.1990. Causal ambiguity, barriers to imitation, and sustainable competitive advantage. Academy of Management Review, 15: 88-102.
105.
Rothman, A.1980. Social R&D. Englewood Cliffs, NJ: Prentice Hall.
106.
Rumelt, R.1984. Towards a strategic theory of the firm. In R. Lamb (Ed.), Competitive strategic management: 556-570Englewood Cliffs, NJ: Prentice Hall.
107.
Rumelt, R. P.1987. Theory, strategy, and entrepreneurship. In D. J. Teece (Ed.), The competitive challenge:137-158. Cambridge, MA: Ballinger.
108.
Schulze, W. S.1994. The two schools of thought in resource-based theory: Definitions and implications for research. In P. Shrivastava, A. Huff & J. Dutton (Eds.), Advances in strategic management, vol. 10A. Greenwich, CT: JAI Press.
109.
Schumpeter, J. A.1934. The theory of economic development. Cambridge, MA: Harvard University Press.
110.
Selznick, P.1957. Leadership in administration. New York: Harper & Row.
111.
Spender, J-C.1992. Knowledge management: Putting your technology strategy on track. In T. M. Khalil & B. A. Bayraktar (Ed), Management of technology HI, vol. 1: 404-413. Miami, FL: Industrial Engineering and Management Press.
112.
Spender, J-C. 1993. Competitive advantage from tacit knowledge? Unpacking the concept and its strategic implications. Academy of Management Best Papers Proceedings, August: 37-41.
113.
Stalk, G., Evans, P., & Shulman, L. E.1992. Competing on capabilities: The new rules of corporate strategy. Harvard Business Review, 70 (2): 57-69.
114.
Stein, E. W., & Zwass, V.1995). Actualizing organizational memory with information systems. Information Systems Research, 6: 85-117.
115.
Sullivan, J. J.1990. Experts, expert systems, and organizations. In M. Masuch (Ed.), Organization, Management, and Expert Systems: 13-33. New York: Walter de Gruyter.
116.
Teece, D. J.1986. Profiting from technological innovations: Implications for integration, collaboration, licensing, and public policy. Research Policy, 15: 285-305.
117.
Teece, D. J., Pisano, G., & Shuen, A.1990. Firm capabilities, resources, and the concept of strategy. Working paper, University of California at Berkerley.
118.
Thompson, J. D.1967. Organizations in acrion. New York: McGraw-Hill.
119.
Trice, H. M., & Beyer, J. M.1991. Cultural leadership in organizations. Organization Science, 2: 149-169.
120.
Turban, E.1990. Decision support and expert systems. New York: Macmillan.
121.
Vargas, J. E., & Raj, S.1993. Developing maintainable expert systems using case-based reasoning. Expert Systems, 10 (4): 219-225.
122.
von Hippel, E.1988. The sources of innovation. Cambridge, MA: MIT Press.
123.
Walsh, J. P., & Ungson, G. R.1991. Organizational memory. Academy of Management Review, 16: 57-91.
124.
Waterman, D. A.1986. A guide to expert systems. Reading, MA: Addison-Wesley.
125.
Weick, K. E.1979. Social psychology of organizing. Reading, MA: Addison-Wesley
126.
Weick, K. E.1991. The nontraditional quality of organizational learning. Organization Science, 2: 116-124.
127.
Weill, P., & Olson, M. H.1989. An assessment of the contingency theory of management information systems. Journal of Management Information Systems, 6: 59-85.
128.
Wells, F. S., & Guimaraes, T.1992. End-user development of expert systems. In M. Khosrowpour (Ed.), Emerging information technologies for competitive advantage and economic development:133-140. Harrisburg, PA: Idea Group Publishing.
129.
Wernerfelt, B.1984. A resource based view of the firm. Strategic Management Journal, 5: 171-180.
130.
Williams, J. R.1995. Strategy and the search for rents: The evolution of diversity among firms. In R. P. Rumelt, D. E. Schendel & D. J. Teece (Eds.), Fundamental issues in strategy: 229-246. Boston: Harvard Business School Press.
131.
Williamson, O. E.1985. The economic institutions of capitalism. New York: Free Press.
132.
Winter, S. G.1987. Knowledge and competence as strategic assets. In D. J. Teece (Ed.), The compefitive challenge:159-184. Cambridge, MA: Ballinger.
