Does Information Technology Provide Competitive Advantage And Improve Performance? An Empirical Study Of Trading Companies In Brazil

Growing investment in information technology applications creates a need to understand the proper integration of these tools into strategic decision making of the firm. This study discusses the impact of global information and communication technologies on competitiveness and performance of Brazilian trading companies. Using resource based theory as a starting point, we examine how information technology, as an internal resource, can provide competitive advantage and what impact information technology produces on competitiveness of Brazilian export intermediaries. The study implements a replicable model (CAPITA) developed by Sethi and King (1994), to investigate these relationships in the emerging market of Brazil. The empirical findings reveal that superior export performance depends on the ability of managers to interpret and utilize some CAPITA dimensions that have a strong relationship with the trading company’s performance. The results corroborate previous research confirming that information technology application has a strong impact on performance. This research extends previous work on this topic within the North American hemisphere, to the South American hemisphere. The development of a strong network of export intermediaries in the emerging market of Brazil can be enhanced by a better understanding of the impact of technology applications, and corresponding government policies endorsing growth.