The Study of Competitive Priorities and Information Technology Selection: Exploring Buyer and Supplier Performance

INTRODUCTION Competitive priorities are the critical operational dimensions a process or supply chain must possess to satisfy its internal or external customers, both now and in the future (Krajewski, Ritzman, & Malhotra, 2013). The concept of competitive priorities is very important to organizations because it helps set up achievable goals when implementing corporate plans into operational plans. The competitive priorities help organizations set the right course of actions for process selection. When process capabilities fall short of the predetermined competitive priorities, they must be re-determined and re-focused to close the gap or else revise the priority. There are five common groups of competitive priorities namely cost, quality, time, flexibility and innovation. Finding the right competitive priorities does not happen overnight, many companies struggle for years when making decisions regarding different competitive priorities. Nowadays, large organizations such as Wal-Mart employ information technology (IT) to help achieve competitive priority strategy. Wal-Mart embraced the Retail Link System technology (a mammoth database located in Bentonville, Arkansas) to become an innovator in the way stores track inventory and restock their shelves. Through a global satellite system, Retail Link is connected to analysts who forecast supplier demands to the supplier network, which displays real-time sales data from cash registers and to Wal-Mart's distribution centers. In the buyer-supplier relationships, information technology is changing the way organizations operate. The competitive priority strategy of Wal-Mart provides a good example to describe how organizations' technology selection may affect the changes in competitive priorities. Technology selection is an imperative decision for organizations to gain competitive advantage over their rivals. Organizations must choose the right technology to either achieve low cost operations or find ways to differentiate themselves through the latest innovation. Firms choose to implement information technology (IT) to connect with customers, enabling them to recognize individual preferences, tailor products accordingly, produce in a timely manner, and sell at a reasonable price (Sophie Lee et al., 2000). Through information networks, organizations work closely with suppliers, sharing accurate and timely information (Tracey et al., 1999; Dean et al., 2009). Unfortunately, current literature provides limited support for what constitutes IT selection and how it affects competitive priorities and eventually organizational performance. Although there are several attempts to understand the link between IT selection and competitive priorities, opportunity remains to extend scholarly research to delineate the relationships between IT selection and competitive priorities within the buyer-supplier relationship. The intention of this research is to formulate general ideas portraying how IT selection relates to competitive priority adaptation and in turn leads organizational performance. There has not been much research for this attempt; therefore, this research should be considered exploratory in nature. Hopefully, the results will be useful to provide a new platform for practitioners and academicians trying to have a deeper understanding of competitive priorities. In the next section of the paper, the literature on competitive priorities and IT selection will be reviewed. Based on the literature, the conceptual model will be developed and research hypotheses will be discussed. The data is gathered using a questionnaire survey. Rigorous research methodologies will be employed to ensure measurement reliability and validity. The structural equation modeling (SEM) will be used to test hypotheses. The results will be presented along with implications. LITERATURE REVIEW Competitive Priorities and Competitive Priority Measures Regarding the measurement of competitive priorities, there is broad agreement that competitive priorities can be expressed in terms of at least five basic components: low cost, quality, delivery time, flexibility, and innovativeness (e. …