IEEE TRANSACTIONS ON ENGINEERING MANAGEMENT, VOL. 57, NO.
2, MAY 2010
The Strategic Implications of Web Technologies:
A Process Model of How Web Technologies
Enhance Organizational Performance
Barney C. C. Tan, Shan L. Pan, and Ray Hackney
AbstractThe lack of knowledge on 1) how Web technologies
support the business strategies of an organization and 2) how Web
technologies enhance organizational performance are gaps in the
existing literature that may account for the inability of the ma-
jority of Web-based firms to leverage their investments in Web
technologies. To address these knowledge gaps, a theoretical lens is
constructed from five core logics in organizational literature that
represent the different possible ways of enhancing organizational
performance. Applying the lens to analyze the case of a successful
Singaporean dotcom, the ways through which Web technologies
enhance organizational performance are identified. Specifically,
our study reveals that the process through which Web technolo-
gies enhance organizational performance is contingent on the state
of the organizational environment. When the environment is in a
state of equilibrium, Web technologies can enhance organizational
performance by facilitating the attainment of competitive advan-
tage through three distinct mechanisms: the logics of positioning,
leverage, and opportunity. Conversely, when the environment is in
a state of revolution, Web technologies can give rise to performance
gains by supporting the attainment of legitimacy through two dis-
tinct mechanisms: the logics of optimality and social congruence.
Index TermsCase study, e-business strategy, firm perfor-
mance, strategic IT management, Web technologies.
I. INTRODUCTION
HE extraordinary success stories of a handful of Web-
T enabled organizations (such as Google, Amazon, and
eBay) firmly attest to the momentous potential of Web tech-
nologies for enhancing organizational performance [24]. Yet,
the phenomenal success of these organizations tends to be the
exception rather than the norm [34]. Even for firms within the
same industry, the business impact of Web technologies tends to
vary widely [28]. This phenomenon has reignited the perennial
information technology (IT) productivity paradox debate and
has created a new wave of skepticism about the business value
of Web technologies (e.g., [8]).
Amidst the furor, proponents of Web technologies are facing
strong pressure to demonstrate that Web technologies have a
consistently positive impact on organizational performance [55].
Yet, despite a growing body of research, a number of gaps can
Manuscript received June 15, 2008; revised October 29, 2008 and February 7,
2009. First published June 26, 2009; current version published April 21,
2010. Review of this manuscript was arranged by Department Editor
T. Ravichandran.
B. C. C. Tan and S. L. Pan are with the Department of Information Systems,
School of Computing, National University of Singapore, Singapore 119077,
Singapore (e-mail: barney@nus.edu.sg; pansl@comp.nus.edu.sg).
R. Hackney is with the Brunel Business School, Brunel University, Middlesex
UB8 3PH, U.K. (e-mail: ray.hackney@googlemail.com).
Digital Object Identifier 10.1109/TEM.2009.2023130
0018-9391/$26.00 2009 IEEE
181
be identified in the literature. First, as much of existing Web
technology research has focused exclusively on the technologi-
cal aspects of Web technologies (e.g., [15], [38]), there is little
knowledge on how Web technologies can be used to support
the business strategies of an organization. In the absence of this
knowledge, the effective leverage of Web technologies is diffi-
cult to attain, as Web technologies are unlikely to lead to better
organizational performance unless it is aligned with the broader
strategic objectives of an organization [41], [42]. Second, due
to the paucity of research on the consequences of using Web
technologies [54], [55], and the black box treatment of the
relationship between the use of Web technologies and organiza-
tional performance in the existing literature (e.g., [54], [55]),
our understanding of the underlying process through which
Web technologies enhance organizational performance is lim-
ited. Similarly, without grasping the nature of this process, it is
difficult, if not impossible, to consistently leverage Web tech-
nologies for performance gains in the long-term.
With these knowledge gaps, any response to the skepticism
on the business value of Web technologies will be less than con-
vincing for the key to a strong argument lies not in merely as-
certaining the relationship between the use of Web technologies
and organizational performance but in a thorough elucidation
of how Web technologies enhance organizational performance.
More importantly, these knowledge gaps may account for the
inability of the majority of Web-enabled firms in the global
US$3 trillion e-business market [24] to consistently leverage
their investments in Web technologies for economic returns.
Using a case study of Hardwarezone.com (HWZ), an e-
commerce start-up that revolutionalized the IT publications in-
dustry in Singapore, the purpose of this article is to address the
two knowledge gaps through an in-depth examination of the
underlying process through which Web technologies enhance
organizational performance. By examining how Web technolo-
gies can support the business strategies of an organization, and
opening the black box of the relationship between the use of
Web technologies and organizational performance, this study
aims to underscore the need for technology-strategy alignment,
provide e-commerce proponents with a stronger argument in the
perennial IT productivity paradox debate, and serve as a use-
ful reference for practitioners on how to derive business value
from their investments in Web technologies. Corresponding to
the two knowledge gaps, the research questions that this study
aims to answer are: 1) how do Web technologies support the
strategies of an organization? and 2) how do Web technolo-
gies enhance organizational performance? As organizational
182 IEEE TRANSACTIONS ON ENGINEERING MANAGEMENT, VOL. 57, NO. 2, MAY 2010
TABLE I
CAPABILITIES OF WEB TECHNOLOGIES: WHAT WEB TECHNOLOGIES CAN DO (REFER TO [41], [49] FOR A REVIEW)
performance is inextricably linked to the business objectives
of a firm, which can conceivably span a wide range of possi-
bilities, organizational performance is broadly defined in this
article as the financial and market performance of a firm and the
probability of organizational survival [14].
II. LITERATURE REVIEW
A. Existing Perspectives on Web Technologies
Since their inception in 1993, Web technologies have pro-
vided organizations with a suite of unprecedented capabilities
(refer to Table I for a list of examples) that has fundamentally
and irrevocably transformed the basis of competition in todays
business environment [48]. Yet, although the business potential
of Web technologies is acknowledged universally [11], most
Web-enabled firms have struggled to translate their investments
in Web technologies into performance gains [28], [34]. The gaps
in the existing literature provide two likely explanations for this
phenomenon. First, a large proportion of prior studies on Web
technologies have adopted a technology orientation, focusing on
specific technical issues such as system characteristics, interface
design, presentation and organization of information, and avail-
able functionalities (e.g., [15], [38]). The implicit assumption
of this stream of research is that technical excellence will nec-
essarily translate to e-commerce success. Yet, the comparative
neglect of the strategic implications of using Web technologies
indicates a lack of knowledge on how Web technologies can
support the business strategies of an organization.
Second, much of existing Web technology research has fo-
cused on factors that lead to the adoption and assimilation of
Web technologies (e.g., [11], [55]), with more emphasis on the
antecedents rather than the consequences and strategic implica-
tions of using Web technologies. This imbalance is largely due
to the difficulty of developing measures and collecting data on
the impact of Web technologies, which in turn, stems from the
lack of an overarching theoretical framework to guide empirical
research [54], [55]. Moreover, of the small handful of stud-
ies in the literature (e.g., [1], [54]) that examine the impact of
Web technologies, all of them have adopted a factor-oriented,
variance theory approach. And, while the positive correlation
between the use of Web technologies and various performance
variables has been demonstrated repeatedly (e.g., [54], [55]),
the process through which Web technologies enhance organi-
zational performance is typically treated as a black box and
implicitly assumed to be automatic. Collectively, the lack of
research on the consequences of using Web technologies, and
the black box treatment of the relationship between the use
of Web technologies and organizational performance, indicate
a lack of knowledge of the underlying process through which
Web technologies enhance organizational performance.
As it has been repeatedly asserted that technology per se
rarely leads to better organizational performance unless it is
aligned with the broader strategic objectives of an organiza-
tion [41], [42], knowledge of how Web technologies can sup-
port the business strategies of an organization is crucial to the
effective leverage of Web technologies. Similarly, without an
understanding of the underlying process through which Web
technologies enhance organizational performance, the effective
leverage of Web technologies for performance gains is diffi-
cult to attain on a consistent, long-term basis. To address these
knowledge gaps, our inquiry necessarily begins with a review
of the prescriptions for enhancing organizational performance
in the literature. Accordingly, the field of strategic management
provides a particularly appropriate point of origin for our inquiry
as the academic discipline is primarily concerned with enhanc-
ing performance through the use of deliberate and emergent
organizational initiatives [36].
B. Three Core Logics of Strategic Management
Although a myriad of strategies for enhancing organizational
performance have been proposed in strategic management liter-
ature; and the intricacies of each strategy are certainly beyond
the scope of a single paper, the essence of strategy can be
distilled into three core logics [20], [43]. Table II provides a
summary of the three core logics of strategy.
TAN et al.: STRATEGIC IMPLICATIONS OF WEB TECHNOLOGIES
TABLE II
CORE LOGICS OF POSITIONING, LEVERAGE, AND OPPORTUNITY
Each of the core logics of strategy provides different pre-
scriptions for enhancing organizational performance. Yet, an
important commonality of the three core logics lies in their ad-
vocacy of heterogeneity (e.g., [4], [20], [40]). Heterogeneity
along the dimensions of a firms products or services that cus-
tomers perceive to be important creates competitive advantage,
defined as a unique value-creating strategy not simultaneously
being offered by existing or potential competitors [4]. Com-
petitive advantage, in turn, gives rise to better organizational
performance in two ways. First, it enables the firm to charge
economic rents for its product and services, as it is able to avoid
market competition or even create a local monopoly [14]. Sec-
ond, given that firms occupying the same organizational niche
tend to compete for the same societal resources necessary for
survival, competitive advantage allows the firm to avoid the
competition for these societal resources, making the resources
easier to acquire and consequently, improve the probability for
organizational survival [6].
In spite of the academic and practical contributions of the
strategic management theories that advocate heterogeneity, they
do not explain the observation that successful organizations tend
to be broadly similar in terms of assets, structure, and business
processes despite being geographically dispersed [16], [26]. In
a parallel development within the field of organizational soci-
ology, important population-level theories emerged in the late
1970s and early 1980s that sought to provide an explanation for
this phenomenon. Accordingly, we include the perspectives of
organizational sociology in our literature review so as to pro-
vide a more holistic and, possibly, a more accurate view of how
organizational performance may be improved.
C. Two Core Logics of Organizational Sociology
Similar to strategic management, the essence of the field of
organizational sociology can be distilled into core logics on the
183
basis of two predominant theories [33] that have been repeatedly
validated in numerous studies and have amassed a vast amount
of research attention over the years [27], [44]. The two theories
are organizational ecology [26] and the neo-institutional theory
[16]. Table III provides a summary of the two core logics of
organizational sociology.
Once again, although the propositions of the two core log-
ics are evidently dissimilar, an important commonality can be
found in their advocacy of conformity. On one hand, organiza-
tional ecology suggests that conformity is a result of adapta-
tion toward an optimal organizational form, the elimination of
weaker organizational forms, and the retention of the optimal
traits among the organizations that have attained optimality [9].
On the other hand, the attainment of social fitness as proposed
by the neo-institutional theory necessitates the adoption of com-
mon institutions among constituents of the same organizational
field [16]. Through conformity, legitimacy, defined as a gen-
eralized perception or assumption that the actions of an entity
are desirable, proper, or appropriate within some socially con-
structed system of norms, values, beliefs, and definitions [46],
is achieved. Legitimacy helps an organization avoid questions
and actions that challenge an organizations reliability and ra-
tionality [14], making it easier for the organization to acquire
the societal resources it requires for its survival from external
parties such as customers, suppliers, and regulators [16]. Thus,
organizational performance is improved as the ease of resource
acquisition increases the probability of organizational survival.
The five core logics identified in our literature review all rep-
resent possible mechanisms through which Web technologies
may enhance organizational performance. Yet, when viewed as
a whole, the propositions of the two academic disciplines ap-
pear to be contradictory. On one hand, the three core logics
of strategic management appear to be advocating heterogene-
ity, differentiating an organization from its competitors for the
184 IEEE TRANSACTIONS ON ENGINEERING MANAGEMENT, VOL. 57, NO. 2, MAY 2010
TABLE III
CORE LOGICS OF OPTIMALITY AND SOCIAL CONGRUENCE
creation of competitive advantage. On the other hand, the two
core logics of organizational sociology appear to be advocat-
ing conformity, becoming similar to the competition for the
attainment of legitimacy. This contradiction is referred to in
organizational literature as the paradox of heterogeneity (or ho-
mogeneity) that causes confusion and leaves practitioners and
managers in a void in terms of practical discretion [17, p. 93].
At this point in time, no attempt will be made to integrate
the two opposing perspectives, as any attempt to integrate them
will likely be unwieldy and aesthetically unsatisfying [30,
p. 699]. Instead, as the underlying process through which Web
technologies enhance organizational performance is a complex,
multifaceted phenomenon that involves multitiered interactions
between a strategic, a social, and a technological dimension [11],
the five core logics are combined as parts of a single theoretical
lens so that in tandem, they can provide robustness and greater
accuracy in explaining our data when each core logic is unlikely
to be adequate on its own [30].
III. RESEARCH METHODOLOGY
The case research methodology is particularly appropriate for
this study for a number of reasons. First, our research questions
are how questions [50] that delve into the underlying process
through which Web technologies improve organizational per-
formance, a phenomenon that cannot be easily quantified. Sec-
ond, the inherent multifaceted complexity of the phenomenon
of interest [11] makes an objective approach to research dif-
ficult, making it more appropriate to construct our theoretical
arguments from the subjective interpretations of the relevant
stakeholders [29].
Based on our research questions, two conditions formed the
basis for case selection. First, the selected organization must
have, of course, effectively leveraged Web technologies for per-
formance gains. Second, Web technologies should have been
used in support of a wide variety of strategies in the selected
organization as this allows us to identify a broader range of
possibilities for enhancing performance. The case of HWZ is
particularly appropriate for this study as Web technologies were
used to facilitate vastly different business strategies that trans-
formed the humble e-commerce start-up into the dominant mar-
ket leader in Singapores IT publications industry within a short
span of seven years. The use of a single case study for our re-
search is also advantageous in that many contextual variables
are kept constant, which helps to rule out possible alternative
interpretations of the data.
Research access was negotiated and granted in September
2005 and a total of 19 interviews were conducted. Seventeen
interviews were conducted with key members of HWZs top
management, staff, investors, and community over a period of
almost one and half years. This longitudinal approach in study-
ing HWZs strategies carries two synergistic advantages. It fa-
cilitated both a comprehensive study of its past activities and
decisions, as well as an opportunity to observe current practices,
strategy formulation, and execution within the organization over
an extended period of time. Two additional interviews were also
conducted with industry insiders to get an unbiased, accurate
picture of the organizational environment across different time
periods. All interviews were transcribed for data analysis and
lasted an hour on the average. Secondary data from newspaper
articles, company brochures, internal publications, the corpo-
rate Web site, and notes from direct observation were also used
to corroborate the data obtained.
Data analysis, performed in tandem with data collection, was
carried out by moving back and forth between empirical data,
relevant literature, and the emerging theory [19], [51]. A de-
tailed narrative was first created to condense the voluminous
amount of data into a more manageable form [30]. Next, the rel-
evant findings were organized into themes and analyzed with the
theoretical lens to shape the emerging theory [50]. The nascent
theory was then verified with the research participants and com-
pared to the existing literature [29]. This process continued until
TAN et al.: STRATEGIC IMPLICATIONS OF WEB TECHNOLOGIES
the state of theoretical saturation is reached, where it was pos-
sible to comprehensively explain the findings of the case study
and no additional data can be collected, developed, or added to
improve the developed model [19].
IV. CASE DESCRIPTION
A. Organizational Background
HWZ is the most popular IT media Web site in Singapore. Its
business centers on providing localized news and information
on the latest IT products, as well as numerous services, which
include consolidated price lists of the major IT vendors in Singa-
pore, a classified ads directory and an online discussion forum.
HWZ attracts 330 000 unique browsers and more than 32 mil-
lion page visits every month, a considerable achievement given
that Singapore, with its small domestic market, is a country that
has seen little success in the e-commerce arena. The unprece-
dented nature of HWZs success even prompted the most widely
circulated business newspaper in Singapore to compare its two
founders to Larry Page and Sergey Brin of Google, enthusias-
tically proclaiming HWZs founders as Singapores very own of charge and in the timeliest possible fashion. By embedding
Google Guys. By 2004, it was estimated that HWZ controlled
29.7% of the Singapore IT publications industry. In comparison,
CNET Asia, in second place, only had a 9.9% market share.
The phenomenal success of HWZ belies its humble origins.
HWZ began as a special interest group known as the Singa-
pores Overclockers Group (SOG) hosted by SingaporeOne, an
e-commerce initiative spearheaded by the Singapore govern-
ment. The SOG was targeted at a niche community of CPU
overclockers, allowing members to post their hardware configu-
rations and overclocking results on an online discussion forum.
Although the size of the community was relatively small, the
SOG generated such heavy Web traffic that it throttled its parent
Web site, taking up 90% of SingaporeOnes bandwidth alloca-
tion within a month of its launch, leaving the management of
SingaporeOne with no choice but to dissolve the SOG. Aided
by the management of SingaporeOne, the founders of HWZ ap-
plied for and were eventually awarded a US$13 000 grant from
the Singapore government. With this grant and US$650 of cap-
ital contributed by its founders, HWZ was founded on August
9, 1998 in a small factory space, running on home equipment
contributed by friends and family members. The initial capital
at the time was only enough for one server and six months of
bandwidth charges.
B. Entering the Market (Late 1998Late 1999)
At the time of HWZs entry, the Singapore IT publications
industry was in a state of saturation with numerous foreign and
local IT publications available both in print and online (refer
to Appendix). Yet, despite the wide variety of product offer-
ings available, feedback from its existing members made the
founders of HWZ realize that there was an unmet need among
local IT enthusiasts. Specifically, foreign IT publications in the
market were not targeted at the local market as their content
was generated primarily for the US or European audience. The
products reviewed in these publications were often unavailable
185
locally, and the prices were often outdated or listed in foreign
currency. On the other hand, while local IT publications in-
cluded localized content, they were often not comprehensive as
they lacked the required funding, credibility, and market reach.
Based on this insight, HWZ moved quickly to fulfill the unmet
need and differentiate itself from the existing offerings in the
industry by positioning itself as a comprehensive provider of
free, localized IT content. Table IV describes the market condi-
tions, HWZs business objective, and the key strategy adopted
by HWZ to capitalize on the opportunity in the market during
this period.
To facilitate the objective of heterogeneity, Web technologies
were leveraged in three different ways (refer to Table V). First,
by using Web technologies as the means of interacting with cus-
tomers and collecting customer information and feedback [49],
Web technologies were used to facilitate a logic of positioning
by helping HWZ identify an attractive market position. In addi-
tion, Web technologies were used as the conduit for delivering
HWZs proprietary content and the information received from
an unprecedented number of IT vendors to their customers free
Web technologies in the processes of the organizational value
chain [41], Web technologies formed part of an integrated activ-
ity system [40] for value creation and served to defend HWZs
adopted position from imitation.
Second, when HWZ formed strategic alliances with the ma-
jor IT vendors in Singapore, Web technologies were used to
deliver the information gained from the IT vendors to the cus-
tomers in real time and free of charge [49]. By enhancing the
strategic value of the alliances formed, Web technologies were
used to support a logic of leverage by serving as a comple-
mentary resource that enhanced the value potential of existing
resources and capabilities [18]. Finally, by enabling the solic-
itation of customer information and feedback [49] through the
use of online polls, surveys, and open-ended feedback forms,
Web technologies facilitated the logic of opportunity by helping
HWZ sense the existing needs of its customers. In addition, Web
technologies enabled the cultivation of a strong virtual commu-
nity (VC) [49], and the close interaction between community
members provided HWZ with clear indications of their existing
and future needs. Many knowledgeable community members
were also leveraged in the coproduction of new content and fea-
tures [32] for HWZ, enhancing the organizational aptitude for
rapid, effective, and relentless innovations [13].
By facilitating the logic of positioning, the logic of leverage,
and the logic of opportunity, Web technologies enabled HWZ
to differentiate itself from its competitors. Consequently, HWZ
was able to produce localized content that was more relevant
than its foreign competitors, provide a more comprehensive
coverage of local IT products that was perceived to be more
credible than its local competitors, and provide its content free
of charge as compared to printed magazines. HWZs unique
value proposition as a comprehensive provider of free, local-
ized IT content allowed the organization to achieve competitive
advantage. Competitive advantage in turn, led to better organi-
zational performance by facilitating 1) the creation of economic
rents in the form of increased advertising revenue and 2) reduced
186 IEEE TRANSACTIONS ON ENGINEERING MANAGEMENT, VOL. 57, NO. 2, MAY 2010

TABLE IV
STRATEGIES EMPLOYED BY HWZ UPON MARKET ENTRY

TABLE V
HOW WEB TECHNOLOGIES FACILITATED THE STRATEGIES OF HWZ (LATE 1998LATE 1999)

competition for societal resources in the form of advertisers and
community members [14]. By 2000, online advertising revenue
was close to US$200 000 per annum, while the official mem-
bership for the community had soared beyond 40 000 with a
Web page impression count of over 16 million per month. Up
to this point in time, HWZ had been a resounding success. But
new challenges were to emerge as the IT publications industry
was about to undergo a dramatic transformation.
C. Surviving the Dotcom Crisis (Early 2000Late 2004)
The onset of the dotcom crisis, which coincided with the peak
of the Asian financial crisis in the year 2000 plunged the Singa-
pore IT publications industry into great turmoil and uncertainty.
The severe economic conditions, coupled with the revolution
that HWZ was effecting in the industry forced the closure of nu-
merous competitors, both online and offline, foreign and local
alike. Due to its dependency on online advertising, HWZ was
TAN et al.: STRATEGIC IMPLICATIONS OF WEB TECHNOLOGIES
TABLE VI
STRATEGIES EMPLOYED BY HWZ DURING THE DOTCOM CRISIS
also badly affected as confidence in viability of online advertis-
ing was shattered. The abundance of venture capital in the days
of the dotcom bubble had all but vanished, and several venture
capitalists who had pledged funding for HWZ had to withdraw
even as HWZs fundamentals remained sound. The new chal-
lenges caused by the adverse environmental conditions made
the management of HWZ realize that the competitive landscape
had fundamentally changed, and that HWZs dependency on a
single revenue stream from a single market made the company
vulnerable to any form of turbulence that affected that particular
source of income. Based on this revelation, new strategies were
formulated with the aim of conforming to the tried-and-tested
organizational form of their established foreign competitors to
create new streams of revenue for financial stability and orga-
nizational survival. The market conditions, the new business
objective, and the key strategies employed by HWZ during the
dotcom crisis are summarized in Table VI.
To facilitate the new strategic objective of conformity,
Web technologies were used in two different ways (refer to
Table VII). First, by capitalizing on the capabilities of Web
technologies that enable an organization to 1) transcend geo-
graphical and temporal boundaries, 2) reinforce offline business
processes, and 3) reduce the capital outlay of expanding a busi-
ness [41], [49], Web technologies were in support of a logic
of optimality that enabled HWZ to attain the multinational,
187
multiproduct, onlineoffline business model of their established
foreign competitors that had been repeatedly validated in IT
publications industries worldwide.
Second, Web technologies were used to facilitate a logic
of social congruence that aligns HWZ with the social pres-
sures exerted by key actors in the external environment. In par-
ticular, mimetic pressures [16] were exerted on HWZ by 1)
the group of conservative advertisers, who expected a printed
product, 2) the members of its existing community, who ex-
pected a wider product range, and 3) the existing investors,
who expected HWZ to demonstrate its continued viability
at the height of the dotcom crisis. By facilitating HWZs
new strategies, Web technologies enabled HWZ to imitate the
business model of their established competitors, which was
aligned to the different expectations of the three stakeholder
groups.
Through the logics of optimality and social congruence, HWZ
attained an organizational form with a range of products that
was comparable to their well-established foreign counterparts.
By conforming to the organizational form best suited for sur-
vival [9] and the expectations of the key resource owners in
the external environment [44], legitimacy challenges to its new
initiatives were avoided. This made it easier for HWZ to acquire
the societal resources necessary for its survival [14] in the form
of community members, investors, and conservative-minded
188 IEEE TRANSACTIONS ON ENGINEERING MANAGEMENT, VOL. 57, NO. 2, MAY 2010
TABLE VII
HOW WEB TECHNOLOGIES FACILITATED THE STRATEGIES OF HWZ (EARLY 2000LATE 2004)
advertisers who previously eschewed its online advertising
model. By the end of 2004, official membership figures of HWZ
had exceeded 230 000 while the combined revenue from all
revenue streams had grown to US$2.65 million approximately.
The easier acquisition of societal resources eventually facilitated
HWZs survival during the revolution in the IT publications in-
dustry.
D. After the Dotcom Crisis (Early 2005Present)
With online advertising back on the uptrend and a discernible
decrease in organizational mortality rates, the aftershocks of the
dotcom crisis have subsided as the market returns to a state of
normalcy. Having established a firm dominance in the IT pub-
lications industry, HWZ is now looking to replicate its success
in other industries that offer opportunities for the organization
to use their existing assets and competencies synergistically.
By leveraging the existing resources and capabilities developed
from running HWZ, the diversification strategy would allow
HWZ to differentiate itself from the potential competitors in the
new industries. In addition, by developing a synergistic suite of
products that catered to the same customer segment, the diversi-
fication strategy would offer opportunities for cross-marketing
and help to differentiate HWZ from the existing competitors
in the IT publications industry. The market conditions, HWZs
latest business objective, and the key strategy adopted toward
the attainment of its objective are summarized in Table VIII.
To facilitate the attainment of HWZs latest business objec-
tive, Web technologies were leveraged in three different ways
(refer to Table IX). First, by examining the profiles of their cus-
tomers; constructed with customer information collected with
the help of Web technologies, and the feedback received, Web
technologies were used to support a logic of positioning by
helping HWZ identify attractive market positions in the new in-
dustries. Second, by placing prominent links, announcements,
and advertisements on both the existing Web site and the dis-
cussion forums, the VC, enabled by Web technologies [49],
was leveraged as a strategic resource [4] that HWZ utilized to
create awareness, promote, and generate demand for its new
products. Finally, Web technologies were also used to support a
logic of opportunity. Feedback from the existing VC was once
again used to shape the new products features and content,
while some community members were once again involved in
the coproduction of the new products [32]. This ensured that
HWZ was highly responsive and able to innovate rapidly and
effectively according to their customers needs.
Through the logics of positioning, leverage, and opportu-
nity that were similarly invoked during the market entry phase,
Web technologies enabled HWZ to differentiate itself from its
competitors with the development of a complementary suite
of products that catered to the needs of its primary customer
segment. This facilitated the attainment of competitive advan-
tage [4] as HWZs synergistic suite of products provided the
organization with a unique value proposition and opportunities
for cross-marketing. In turn, competitive advantage led to bet-
ter organizational performance by facilitating 1) the creation
of economic rents in the form of increased online and offline
advertising revenue and 2) reduced competition for societal re-
sources in the form of new members, advertisers, and investors
[14].
While HWZs latest strategy has not arrived at fruition, the
latest financial and market statistics have provided early indica-
tions of its effectiveness. By 2006, HWZs annual revenue had
reached levels of around US$3.95 million per annum, while of-
ficial membership for the community was estimated at close to
260 000. The success of HWZ attracted the attention of a num-
ber of potential investors, and HWZ was eventually acquired
by the leading media conglomerate in Singapore, on September
29th 2006 for US$4.6 million. To summarize, Fig. 1 provides
a chronology of the specific actions taken by the organization
since its inception, while Table X tracks three performance in-
dicators (revenue, profits, and community size) over time to
provide an overview of HWZs evolving strategies and its per-
formance for the period of study.
TAN et al.: STRATEGIC IMPLICATIONS OF WEB TECHNOLOGIES 189

TABLE VIII
STRATEGIES EMPLOYED BY HWZ AFTER THE DOTCOM CRISIS

TABLE IX
HOW WEB TECHNOLOGIES FACILITATED THE STRATEGIES OF HWZ (EARLY 2005PRESENT)

V. DISCUSSION try [40]. Based on the empirical evidence uncovered at HWZ,

A. How Do Web Technologies Support the Strategies
of an Organization?
In our literature review, we had identified five existing pre-
scriptions for enhancing firm performance based on five core
logics in organizational literature. The question then was, which
of these core logics could Web technologies support? The events
that transpired at HWZ clearly reveal that Web technologies can
support all of the five core logics. The following stream of re-
porting discusses how Web technologies can support each of the
core logics in turn to address our first research question.
1) Supporting the Logic of Positioning: The logic of posi-
tioning advocates two sequential steps to differentiate a firm
from its competitors for competitive advantage: 1) identifying
an attractive market position, and subsequently, 2) occupying
and defending the market position by erecting barriers of en-
Web technologies can facilitate the two sequential steps in the
following ways. First, by using Web technologies to facilitate the
process of collecting customer information and feedback [49],
organizations can utilize the gathered information to help them
with the identification of an attractive market position. In the
case of HWZ, direct feedback from their members alerted them
of the unmet need in the IT publications industry despite the
stagnated and saturated market at the point of market entry. In
addition, to join HWZ as a member, customers must, and were
generally willing to, provide personal information as part of
the signup process. This information was used to profile the
customers, and the customer profiles were eventually leveraged
after the dotcom crisis to help HWZ identify attractive market
positions in the new industries.
Second, by creatively embedding Web technologies in the
core business processes of the organizations value chain [41],
190 IEEE TRANSACTIONS ON ENGINEERING MANAGEMENT, VOL. 57, NO. 2, MAY 2010

Fig. 1. Timeline of the key actions taken by HWZ. A chronological depiction of the key organizational actions of HWZ for the period under study, categorized
according to the business strategies that they were in support of.

TABLE X
HWZS PERFORMANCE FROM 1999 TO 2005

organizations can develop or strengthen a tightly integrated ac-
tivity system [40] that helps defend the adopted market position
from the competitive actions of rivals within the industry. In the
case of HWZ, Web technologies were used to amass information
from an unprecedented number of IT vendors, as well as deliver
the information on pricing and availability of local IT prod-
ucts and the proprietary content generated in HWZs laboratory
to the market in the timeliest possible fashion. Consequently,
by amalgamating information from a vast array of sources and
enhancing the process of content delivery, Web technologies im-
posed a formidable barrier of entry for potential market entrants
as it became more difficult to match HWZ in terms of scale
of content and efficiency of delivery. In summary, by provid-
ing an effective means of collecting customer information and
feedback [49] and facilitating improvements to processes in an
organizations value chain [41], Web technologies can facilitate
a logic of positioning by supporting the identification, adoption
and defense of an attractive strategic position that offers unique
opportunities relative to the competitive environment.
2) Supporting the Logic of Leverage: The logic of leverage
proposes two mechanisms toward the attainment of competitive
advantage: 1) developing (or acquiring) and leveraging strate-
gic resources that are valuable, rare, inimitable, and nonsub-
stitutable [4] and 2) developing (or acquiring) and leveraging
complementarities that enhance the value-creating potential of
the strategic resources [18]. Based on the case evidence, Web
technologies can facilitate the two mechanisms in the follow-
ing ways. First, while the easy availability of Web technologies
makes it difficult for an organization to leverage them uniquely
as strategic resources without a competitive response that vio-
lates the criterion of inimitability [8], it is nevertheless, possible
to apply Web technologies creatively so as to create an enduring
advantage. The story of HWZ highlights one such possibility:
the VC [49]. Proponents of VCs have always maintained that
a vibrant community that has attained self-sustaining critical
mass can be a strategic resource for an organization (e.g., [2]).
Evidence from the HWZ story certainly supports this asser-
tion. For example, HWZs discussion forums and Web site were
leveraged to create awareness and demand in its VC for their
motoring, golf and travel publications. To build a customer base
from scratch would have been difficult. Instead, HWZ used its
existing community as a strategic resource to seed new bases
of customers for their new products, resulting in a high rate of
initial take-up to get them off to a running start. The HWZ story
further provides a powerful illustration of the measures an orga-
nization can adopt to generate the positive network externalities
TAN et al.: STRATEGIC IMPLICATIONS OF WEB TECHNOLOGIES
necessary for transforming their VC into a strategic resource:
1) the initial active participation of the top management in the
community; 2) the organization of outings that give the VC a
physical presence; and 3) the use of appropriate incentives such
as free gifts and moderator privileges for the discussion forum.
Second, Web technologies can be bundled with existing re-
sources and capabilities within a firm and leveraged as com-
plementarities that enhance value creation [18]. In the case of
HWZ, the strategic alliances with the major IT vendors provided
the organization with the most up-to-date information about the
IT products available in the local market. Yet, without the use
of Web technologies, which provided the means of delivering
this content quickly to their customers [49], the value of the
information is limited. The overriding lesson for Web-enabled
firms here is that Web technologies possess powerful character-
istics that can transform the value potential of existing assets
and competencies, and a thorough analysis of the organizations
business processes may help to identify the ways in which Web
technologies can be applied. To summarize, by enabling the de-
velopment of VCs [49], Web technologies can facilitate a logic
of leverage by serving as the basis of a strategic resource that
can be leveraged directly for competitive advantage [4]. In ad-
dition, by exploiting the capabilities of Web technologies, such
as its ability to enhance the timeliness of organizational infor-
mation [49], Web technologies can serve as complementarities
that enhance the value-creating potential of existing firm assets
and competencies [18].
3) Supporting the Logic of Opportunity: The logic of op-
portunity prescribes two sequential steps toward the attainment
of competitive advantage: 1) sensing existing or anticipating
future needs of customers and 2) disrupting the competitive
equilibrium through rapid and relentless innovations for transi-
tory competitive advantages [13]. The events that transpired at
HWZ demonstrate that Web technologies can facilitate the two
sequential steps in the following ways. First, through the use
of online polls, surveys, and open-ended feedback forms [49],
Web technologies make it easier for an organization to col-
lect information and feedback from its customers, thereby en-
hancing the organizational ability to sense existing and antic-
ipate future customer needs. For example, in the context of
HWZ, it was noted how the feedback collected from these elec-
tronic means served as the source of many of HWZs early
innovations.
Second, by enabling the development of VCs [49], Web tech-
nologies enhance both the organizational ability to sense exist-
ing and anticipate future customer needs, as well as the orga-
nizational aptitude for rapid and relentless innovation. In the
case of HWZ, monitoring the interactions between community
members provided the organization with clear indications of
the existing and expressed needs, and hinted at the future or
unexpressed needs of their customers. In addition, HWZ went
beyond extrapolating information from interactions in their VC
to engaging their members in the coproduction of products and
services. For example, the members of HWZs VC were lever-
aged to generate product reviews, Web site features and a con-
tent management system for their new products. Coproduction
enhances the speed of organizational innovation and provides
191
the strongest assurance that the innovations pursued by the or-
ganization are effective and in-line with the needs of the cus-
tomers [32]. In summary, by providing an effective means of
collecting customer information and feedback and enabling the
development of VCs [49], Web technologies can facilitate a
logic of opportunity by enhancing 1) the organizational abil-
ity to sense existing or anticipate future customer needs and
2) the organizational aptitude for rapid and relentless innova-
tions. This subsequently improves the organizational ability to
continuously disrupt the competitive equilibrium for transitory
competitive advantages [13], [20].
4) Supporting the Logic of Optimality: The logic of optimal-
ity advocates two mechanisms for enhancing organizational per-
formance: 1) adapting toward the optimal organizational form
that is best suited for survival in the environment for weaker
organizational forms and 2) retaining the optimal traits for firms
that have attained the optimal organizational form [9]. Based
on the empirical evidence uncovered at HWZ, Web technolo-
gies can facilitate the mechanism of adaptation by facilitating
the attainment of three organizational traits: 1) an increased
geographical reach; 2) an extended product range; and 3) an
integrated clicks-and-mortar business model. In particular, or-
ganizations can leverage the capability of Web technologies
that enable them to transcend spatial and temporal boundaries
to break into new geographical markets and the relatively lower
setup costs for online businesses to experiment with product
line extensions [49]. In addition, Web technologies can also
reinforce offline business models [41], which can help both a
traditional offline business go online, or a pure-play dotcom to
go offline, to achieve an integrated clicks-and-mortar business
model.
While it must be acknowledged that the three organizational
traits are not invariably salient across all contextual conditions,
the three traits tend to be perceived as indicators of growth and
success (e.g., [7], [25]), particularly in todays global digital
economy. Nevertheless, the lesson for practitioners here is that
Web technologies can provide powerful capabilities that facili-
tate the acquisition of the organizational traits that are optimal
for survival in a given environment, and it is important to con-
sider the demands of the environment to determine how they
can be exploited effectively.
If Web technologies can support the adaptation mechanism
proposed by the logic of optimality, then they can certainly
support the retention mechanism as well. Assuming that the
attainment of the optimal organizational form necessitates the
use of Web technologies, and like HWZ, an organization uses
Web technologies to acquire the optimal traits, then the only
way the organization can lose these traits is if it discontinues its
use of Web technologies. Therefore, in summary, by exploiting
the capabilities of Web technologies, such as its ability to 1)
enable an organization to transcend geographical and temporal
boundaries, 2) reduce the capital outlay involved in business ex-
pansion [49], and 3) reinforce offline business models [41], Web
technologies can facilitate the logic of optimality by support-
ing the adaptation toward the optimal for weaker organizational
forms, and the retention of optimal traits for organizations that
have attained the optimal organizational form [9].
192
5) Supporting the Logic of Social Congruence: The logic of
social congruence prescribes three mechanisms for enhancing
organizational performance: Achieving congruence with 1) co-
ercive, 2) mimetic, and 3) normative isomorphic pressures [16].
In the context of the case study, the same capabilities of Web
technologies that facilitated the logic of optimality were also
used to align an organization with the social pressures exerted
by key actors in the external environment [44]. In particular, the
untapped segment of conservative advertisers expected a printed
product, the members of HWZs VC expected a wider product
range, while existing investors expected HWZ to demonstrate
its continued viability in the adverse economic conditions. Al-
though the expectations of each of the stakeholder groups were
clearly different, when taken together, the three social forces
applied a concerted mimetic pressure [16] that pushed HWZ
toward conformity to the multiproduct, multinational, online
offline business model of their established foreign counterparts.
But, the aligning influence of Web technologies is not solely
limited to mimetic social pressures. Existing research on Web
technologies has shown that Web technologies can align an or-
ganization with coercive and normative social pressures as well
(e.g., [23]). The key lesson for Web-enabled organizations here
is that the capabilities of Web technologies can also help to align
the organization to the various social pressures exerted on the
organization by actors in the external environment. A thorough
consideration of these social forces is therefore necessary in
order to identify the ways in which Web technologies can be
creatively applied. In summary, by exploiting the capabilities of
Web technologies (e.g., [49]), Web technologies can facilitate
the logic of social congruence by helping an organization at-
tain social fitness [44] that makes an organization congruent
with the coercive, mimetic, and normative social pressures in
the external environment.
B. How Do Web Technologies Enhance Organizational
Performance?
Now that we have established that Web technologies can be
used to support each of the five core logics identified in organi-
zational literature, we address the second research question by
examining how aligning the use of Web technologies to each of
the core logics enhances organizational performance. What is
particularly striking about the HWZ story is the cyclical tran-
sition of the external environment: From a steady, predictable
phase at the time of HWZs inception, to a tumultuous phase
during the dotcom crisis where change was discontinuous and
unpredictable, and back again with the subsidence of the dotcom
crisis. As the nature of how Web technologies enhance organi-
zational performance appears to be different in each of the two
cyclic phases, it is necessary to distinguish between the phases
in order to examine how Web technologies led to performance
gains in different ways under different contextual conditions.
As the cyclical transition of the external environment adhered
to the generic pattern of punctuated equilibria, the punctuated
equilibrium paradigm [22] provides a useful framework for dis-
tinguishing between the two cyclic phases. Accordingly, we
define the external environment in the years before (Late 1998
IEEE TRANSACTIONS ON ENGINEERING MANAGEMENT, VOL. 57, NO. 2, MAY 2010
1999) and after (Early 2005Present) the dotcom crisis to be in
a state of equilibrium, characterized by low organizational mor-
tality rates, as well as low rates and magnitude of change in the
industry. Similarly, we define the external environment during
the period of the dotcom crisis (Early 2000Late 2004) to be
in a state of revolution, where organizational mortality rates, as
well as the rates and magnitude of change are high.
By making a distinction between the two states of external
environment and integrating the different patterns of how Web
technologies were used to support the strategies of HWZ across
the three temporal phases (refer to Table XI), a model of the
underlying process through which Web technologies enhance
organizational performance can be inductively derived (refer to
Fig. 2). In particular, empirical evidence from the case study
suggests that the way to better organizational performance is
contingent on the fit between the use of Web technologies, the
organizational strategy, and the state of the external environ-
ment.
More specifically, when the external environment is in a state
of equilibrium, Web technologies should be used to facilitate
the logics of positioning, leverage, and opportunity to help dif-
ferentiate a firm from its competitors. By aligning the use of
Web technologies to the three core logics of strategy, firm het-
erogeneity is achieved to create competitive advantage. Com-
petitive advantage, in turn, leads to the creation of economic
rents [14], reduced competition for the societal resources neces-
sary for organizational survival [6], and consequently, better or-
ganizational performance. Conversely, when the organizational
environment is in a state of revolution, Web technologies should
be aligned to the logics of optimality and social congruence to
help the organization become isomorphic to the optimal organi-
zational form [26] or the coercive, mimetic, and normative pres-
sures from the institutional environment [16]. By facilitating the
two logics, conformity is achieved which leads to legitimacy.
Legitimacy, in turn, helps an organization avoid challenges to its
reliability and rationality, making it easier for the organization
to acquire the societal resources necessary for organizational
survival from resource owners in the external environment [16].
The easier acquisition of societal resources increases the prob-
ability of organizational survival and consequently, improves
organizational performance [14].
Theoretical support for the propositions that 1) the way to bet-
ter organizational performance is contingent on the fit between
technology, strategy, and the environment, 2) Web technologies
should be aligned to strategies that support the objective of het-
erogeneity when the environment is in a state of equilibrium,
and 3) Web technologies should be aligned to strategies that
support the objective of conformity when the environment is in
a state of revolution, can be found in the literature. In critiques of
the strategic approaches that represent the logics of positioning,
leverage, and opportunity, it is often noted that the approaches
are only appropriate in an industry context of low complexity.
For example, it has been asserted that the logic of positioning
is useful only if the competitive forces . . . are relatively stable
and independent [10, p. 75], while the logic of leverage is of-
ten criticized for its inability to explain superior performance in
complex and unpredictable environments [18], [43]. Likewise,
TAN et al.: STRATEGIC IMPLICATIONS OF WEB TECHNOLOGIES 193

TABLE XI
HOW WEB TECHNOLOGIES SUPPORTED THE STRATEGIES OF HWZ ACROSS THE THREE TEMPORAL PHASES

Fig. 2. How Web technologies enhance organizational performance. The process model depicts five mechanisms, contingent on the state of the external
environment, through which the use of Web technologies enhances organizational performance.

critics have labeled the primary driver of the logic of opportunity
as strategic soothsaying [10, p. 77] and have suggested that it
(i.e., the prediction of future customer needs) is impossible in a
truly unpredictable environment.
Conversely, in a complex, unpredictable environment, the
importance of legitimacy for organizational survival increases
greatly [5], [52]. This is because a high level of uncertainty
increases the likelihood of organizational mortality [47], and
resource owners, such as customers, investors, and suppliers,
will not provide any resources to a firm if they are unsure of
the exchange partners continued viability [14]. Consequently,
when the organizational environment is in a state of revolu-
tion characterized by complexity and unpredictability, it has
been suggested that organizations should instead be pursuing
194
conformity by going with the flow [10, p. 79] to achieve the
requisite legitimacy for organizational survival.
The discourse on communal strategies also provides some
support for the propositions of our process model. For exam-
ple, citing the examples of revolutions that have occurred in
the nuclear utilities, petroleum, and the apparel and footwear
industries, Barnett [3] suggests that when the organizational en-
vironment imposes constraints on a firms profitability, it is more
valuable for a firm to attain conformity with other firms in the
industry and pursue a communal strategy for collective gains,
than to pursue individual gains with a competitive strategy. A
communal strategy refers to a firms allocation of resources to
collective efforts to influence the institutions governing its in-
dustry in its favor [3], and a necessary precondition for a firm
pursuing a communal strategy is conformity to a common set of
institutions. On the other hand, when the environmental effects
on a firms performance are low, firms are more likely to pursue a
competitive strategy through self-interested activities that dis-
tinguishes itself from its rivals in order to achieve competitive
advantage [3, p. 1762]. This is because conformity demands
managerial attention and other organizational resources while
limiting profit potential, discretion, and control.
Beyond the case study presented in this paper, empirical sup-
port for the propositions of our process model can also be found
in the literature. For example, in their study of the Chinese
electronics industry, Tan and Litschert [47] found that envi-
ronmental uncertainty was positively related to the adoption of
defensive-oriented strategies that emphasize conformity and re-
inforcing the status quo and negatively related to the adoption
of proactive, future-oriented, or risky strategies that empha-
size differentiation and innovation. More importantly, the study
also found that the adoption of defensive-oriented strategies in
the context of environmental uncertainty was related to better
overall performance and profitability. Similarly, in a study of
the strategies of the largest film studios in Hollywood between
1936 and 1965, Miller and Shamsie [35] discovered that both
the extent of organizational effect uncertainty, defined as the in-
ability to predict the effects of the environment on the firm, and
decision response uncertainty, defined as the inability to predict
the consequences of a firms actions, were positively related to
the extent of product similarity as both forms of uncertainty dis-
courage innovation and compel managers to focus their limited
resources on the few familiar product varieties and customers
that they understand best.
Collectively, the results of these studies suggest that 1) strate-
gies that lead to heterogeneity tend to be employed when en-
vironmental uncertainty is low, 2) strategies that lead to con-
formity tend to be employed when environmental uncertainty
is high, and 3) strategies that lead to conformity gives rise
to better organizational performance when environmental un-
certainty is high. In tandem with the generally accepted and
empirically well-supported notion that strategies that lead to
heterogeneity ordinarily gives rise to better organizational per-
formance (e.g., [12], [20], [40]), it necessarily follows that Web
technologies should be used to support 1) strategies that lead
to heterogeneity under ordinary circumstances (i.e., during an
equilibrium [22]) and 2) strategies that lead to conformity un-
IEEE TRANSACTIONS ON ENGINEERING MANAGEMENT, VOL. 57, NO. 2, MAY 2010
der conditions of high environmental uncertainty (i.e., during
an revolution [22]).
In terms of real world instances, further support for the propo-
sitions of our process model can be found in the example of
Microsoft. When Microsoft was formulating its online strategy,
it perceived the Internet as a competitor to its proprietary Mi-
crosoft Network (MSN). However, when the Internet revolution-
alized the information and communications industry, Microsoft
realized that an MSN-centric approach would isolate MSN from
the rest of the Internet world, and it acted quickly to attain con-
formity by embracing the Internet and adopting its standard.
And, while Microsoft is unable to achieve the same dominance
of the Internet as of the PC markets today, the act of conformity
contributed to the survival of MSN and gave the company the
opportunity to compete with Netscape and Sun [10].
VI. CONCLUSION
A. Limitations and Future Research
This article is not without its limitations. Although the study
of a single setting is a typical and legitimate endeavor in
qualitative research [31, p. 231], a particular criticism that is
commonly directed at studies based on the single case research
methodology is the problem of generalizability [51]. However,
although it must be readily acknowledged that statistical gen-
eralization is impossible from a single case study, we contend
that our study is generalizable beyond its singular context for
two reasons. First, our process model was constructed by theo-
rizing from the empirical evidence uncovered in our case study
and the propositions of some of the most established theories
in organizational literature. In developing a process model that
is both theoretically and empirically supported by the existing
literature, this study invokes the principles of analytic gener-
alization [53, p. 32] or what Lee and Baskerville [31, p. 235]
refers to as generalizing from description to theory. Second,
empirical evidence gathered from a variety of contexts, such
as 1) the electronics industry in China [47], 2) the film studios
in Hollywood [35], and 3) the account of MSN at Microsoft,
the largest IT firm in the information and communications in-
dustry [10], appears to corroborate the propositions of our pro-
cess model. This gives us some measure of confidence that the
findings of this study are not constrained to a specific type of
organization (i.e., a small e-commerce start-up), operating in
a specific industry within a specific country (i.e., the IT pub-
lications industry in Singapore). Nevertheless, future research
can be directed at statistically validating the propositions of this
study, so that the boundary conditions of the proposed theory
can be better defined.
A second limitation is that despite our efforts to be as in-
clusive as possible, we acknowledge that it is impossible to
exhaustively describe all the possible ways through which Web
technologies enhance organizational performance within a sin-
gle study. While we are bounded by feasibility concerns and the
limits of the data collected, future research can certainly investi-
gate other ways in which Web technologies can enhance organi-
zational performance that have not been examined in this study.
One might begin by looking at other organizational theories
TAN et al.: STRATEGIC IMPLICATIONS OF WEB TECHNOLOGIES
offering competing prescriptions for improving organizational
performance. Possible theories include the resource dependence
theory [39] and the complexity theory [45].
B. Theoretical and Practical Implications
By addressing the research questions set forth at the begin-
ning of this paper, this study has made a number of important
theoretical contributions. First, by demonstrating how Web tech-
nologies can support the business strategies of an organization,
and how this leads to achieve better organizational performance,
this article underscores the importance of technology-strategy
alignment in the context of Web technologies. The majority of
existing Web technology research has emphasized the techno-
logical dimension of Web technologies (e.g., [15], [38]) and
neglected its alignment with the broader business objectives of
an organization. In reiterating the importance of technology-
strategy alignment, this article urges for a thorough considera-
tion of business objectives in future technology-oriented studies
and suggests the need to look beyond a monolithic set of de-
sirable technical qualities to specific technical qualities of Web
technologies that are most appropriate for facilitating particu-
lar business strategies. In addition, this article may serve as a
catalyst for more business-oriented research seeking to identify
ways of applying Web technologies to a wider array of business
objectives. In itself and in its implications for future research,
this article contributes toward balancing the technology-oriented
and business-oriented perspectives of the phenomenon, so that
by mutual reinforcement, theoretical advancement and clarity
may be achieved.
Second, little research has been conducted on the conse-
quences of using Web technologies [54], [55], and of the hand-
ful of studies we found, all of them have adopted a variance
theory approach and treated the relationship between Web tech-
nologies and organizational performance as a black box. By
opening up the black box of the relationship and describing
the underlying mechanism, this article complements the existing
factor-oriented studies that demonstrate a statistical association
between the use of Web technologies and organizational perfor-
mance (e.g., [54], [55]). In doing so, a more convincing response
to the skepticism about the value of Web technologies is possi-
ble as we are able to move beyond simply demonstrating that
the correlation between Web technologies and organizational
performance exist to explaining how Web technologies enhance
organizational performance.
Third, the article also contributes to organizational research
by hinting at a possible contingency solution to the paradox of
heterogeneity. In particular, the process model developed in the
paper reconciles the conflicting perspectives of both strategic
management and organizational sociology literature on hetero-
geneity by suggesting that 1) the effectiveness of strategies that
lead to either heterogeneity or conformity is contingent on the
organizational environment, 2) strategies that lead to hetero-
geneity are more effective when the environment is in a state of
equilibrium, and 3) strategies that lead to conformity are more
effective when the environment is in a state of revolution.
195
While this contingency solution departs significantly from the
propositions found in existing literature (e.g., [14]), it does not
contradict the existing empirical evidence. Given that the or-
ganizational environment of any industry can vacillate between
equilibrium and revolution [22], it is unlikely that an organiza-
tion that pursues heterogeneity or conformity exclusively will
consistently outperform its competitors in the long run, which
is in accord with Deephouses [14] findings that organizations
with a moderate amount of differentiation have the best orga-
nizational performance. By validating the propositions of the
contingency solution and testing the influence of a wider array
of contingency variables on the heterogeneity-performance re-
lationship in future studies, a conclusive solution to the paradox
may yet emerge. The contribution of this article thus lies in
laying the foundation of a bridge that may bring together two
vibrant, yet divergent schools of thought. By synthesizing the
vast cumulative knowledge of the opposing schools, researchers
on either sides of the divide can only benefit from the rich cross-
fertilization of ideas.
In terms of practical contributions, the utility of the paper lies
in the indications it provides for e-commerce practitioners. None
of the ways in which Web technologies were used at HWZ are
particularly novel or groundbreaking. This underscores the cen-
tral premise of this paper that e-business success, or the effective
leverage of Web technologies, is not dependent on technical ex-
cellence but rather the intricate fit between technology, strategy,
and the external environment. By tracing the underlying pro-
cess through which Web technologies enhance organizational
performance in its entirety, and providing prescriptions on how
to achieve the requisite technology-strategy-environment fit, it
is hoped that if existing investments in Web technologies have
not translated to better organizational performance, the process
theory developed in this article can be used as a roadmap to
help managers and practitioners to identify the missing link
in the process, so that they may adopt the appropriate remedial
measures to realign their investment to the path of success.
APPENDIX
THE SINGAPORE IT PUBLICATIONS INDUSTRY
The market offerings in the saturated Singapore IT publica-
tions industry around the time of HWZs entry can be classified
into a two-by-two matrix (refer to Fig. 3) according to two
dimensions: Place of origin (Local vs. Foreign) and delivery
media (Printed vs. Online). This classification, however, is not
mutually exclusive and an organization, particularly the estab-
lished foreign publications, can operate in two or more of the
quadrants. For example, PC World, published by the Interna-
tional Data Group based in the United States, was operating in
quadrants I (PC World) and II (PCWorld.com) in 1998, while by
2003, PC Magazine, published by Ziff-Davis Publishing Hold-
ings Inc. based also in the United States, was operating in all four
quadrants. HWZ entered the industry in quadrant IV (local on-
line publications). However, the competitive impact of HWZs
entry and its subsequent actions were not restricted to the quad-
rant but instead reverberated across the entire industry. Fig. 3
provides a nonexhaustive list of publications for each quadrant
196 IEEE TRANSACTIONS ON ENGINEERING MANAGEMENT, VOL. 57, NO. 2, MAY 2010

Fig. 3. Singapore IT Publications Industry. The 2 2 matrix classifies the existing offerings in the Singapore IT publications industry around the time of HWZs
entry into four distinct quadrants along two dimensions. A nonexhaustive list of publications for each quadrant of the matrix and a brief description of how the
publications in each quadrant fared in the industry since the inception of HWZ are provided.

of the matrix and a brief description of the performance of the [14] D. L. Deephouse, To be different, or to be the same? Its a question
publications in each quadrant from the inception of HWZ to (and theory) of strategic balance, Strateg. Manag. J., vol. 20, no. 2,
pp. 147166, 1999.
date. [15] W. H. DeLone and E. R. McLean, Measuring e-commerce success: Ap-
plying the DeLone & McLean information systems success model, Int.
J. Electron. Commerce, vol. 9, no. 1, pp. 3147, 2004.
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197
Barney C. C. Tan is currently working toward the
Ph.D. degree at the Department of Information Sys-
tems, School of Computing, National University of
Singapore, Singapore.
His work has been published in information sys-
tems and management conferences such as the Inter-
national Conference on Information Systems (ICIS),
Academy of Management Meeting (AOM), and Eu-
ropean Conference on Information Systems (ECIS).
His research interests include electronic commerce,
large-scale systems implementation, and the strategic
management of information systems.
Shan L. Pan received the Ph.D. degree in industrial
and business studies from the University of Warwick,
Coventry, U.K., in 2000.
He is currently the Coordinator of the Asian
IT Case Series, Department of Information Sys-
tems, School of Computing, National University
of Singapore, Singapore. His work has been pub-
lished in Information Systems Research, MISQ
Executive, IEEE TRANSACTIONS ON SYSTEMS,
MAN, AND CYBERNETICS, IEEE TRANSACTIONS ON
ENGINEERING MANAGEMENT, IEEE TRANSACTIONS
ON IT IN BIOMEDICINE, Journal of the American Society for Information Systems
and Technology, Journal of Academy of Marketing Science, European Journal
of Operations Research, European Management Journal, Communications of
ACM, Information and Organization, Journal of Strategic Information Systems,
Information Systems Journal, and European Journal of Information Systems.
Ray Hackney received the Ph.D. degree in manage-
ment from Cranfield University, Cranfield, UK, in
1994.
He is currently the Chair in business systems
within the Business School, Brunel University, UK.
He has contributed extensively to research in the field
with publications in numerous national and interna-
tional conferences and journals. He has taught and
examined on a number of Doctoral and MBA pro-
grams including Manchester Business School and the
Open University. He led the organizing committee for
the annual BIT and BITWorld Conference series. His research interests are the
strategic management of information systems within a variety of organizational
context, with an increasing specialty in government sectors and he has con-
tributed to a number of EPSRC and European funded research projects.
Dr. Hackney was the President of the Information Resource Management
Association (IRMA) during 2001/2002 and has served on the Board of the UK
Academy for Information Systems since 1997. He is currently an Associate
Editor of the JGIM, JEUC, JLIM, ACITM, EJIS, a Case Editor for IJIM, and an
Executive Member of the Information Institute (www.information-institute.org).
He is a member of the Strategic Management Society and Association of Infor-
mation Systems.