From Digital Business Strategy to Market Performance: Insights into Key Concepts and Processes

Abstract

A digital business strategy has become a management priority for firms in several industries. Many firms pursue a digital business strategy to establish a guiding framework for value creation and capture with digital resources. This study develops and tests a research model on how a firm’s digital business strategy transforms into market performance, considering the intervening roles of market intelligence capability and subsequent value creation and value capture. The results of a study with 161 firms from different industries lend support for the proposed effects. These findings add to the current IS and strategic management literature by further illuminating the causal process linking digital business strategy and market performance and by indicating firms’ market intelligence capability as a key component of this process. The findings guide managers by specifying critical mechanisms in the digital business strategy-market performance relationship and by developing an instrument to monitor firms’ market intelligence capability.

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