| The importance of information systems (IS) and information technology (IT) as strategic business tools has been widely acknowledged by both practitioners and academics. In fact, IT has become ubiquitous in today's business environment to the point that IT applications are viewed as strategic necessities (Barua & Lee, 1997; Clemons, 1986; Clemons & Kimbrough, 1986). Hence, researchers have long been interested in the business value of IT and its influence on gaining and sustaining competitive advantage.; Many claim that IT is subject to easy duplication and lack of protection (Clemons & Row, 1991; Mata, Fuerst, & Barney, 1995; Sethi & King, 1994) and therefore sustained competitive advantage from IT is not a reality. However, other researchers have been able to show that the strategic use of IT applications can lead to longer term superior performance (Brown, Gatian, & Hicks Jr., 1995; Kettinger, Grover, Guha, & Segars, 1994; Santhanam & Hartono, 2003).; A recent call for research (Mykytyn, Mykytyn Jr., Bordoloi, McKinney, & Bandyopadhyay, 2002) brought to light the possibility that business method software patents could be the missing link between the strategic use of IT and sustained competitive advantage. Software patents have become much more valuable and enforceable in recent years providing protection for the patent owner that has not been considered by academicians.; In this study, 48 patenting firms were matched with 48 nonpatenting competitors and their performance was compared through a variety of measures and methods in order to explore patent-protected IT-enabled sustained competitive advantage. The ownership of business method patents was not found to be a significant contributor to competitive advantage. However, patent owning firms that were able to gain an initial performance improvement were more likely to maintain that advantage over time.; This study extends the current theory of IS-enabled competitive advantage by introducing business method patents to the existing body of knowledge. In addition to its contribution to IS research, this study also benefits practitioners. The results may cause firms to question the strategic value of business method patents and the tradeoffs that are made in the process of obtaining such patents. |
