Information Technology and the Performance of the Customer Service Process: A Resource-Based Analysis1

Delivering quality customer service has emerged as a strategic imperative, one that is increasingly tied to a firm’s information technology resources and capabilities. This paper presents an empirical study that examines the extent to which IT impacts customer service. More specifically, this study investigates the differential effects of various IT resources and capabilities on the performance of the customer service process across firms that compete in the North American life and health insurance industry. The paper builds on (1) information systems work that suggests that the effects of IT are best documented at the level of processes within a firm, (2) information systems work that suggests that the performance effects of IT are likely to be contingent in nature, and (3) developments in the resource-based view, which describes the kinds of IT resources and capabilities that are likely to enable a process in one firm to outperform the same process in competing firms. The findings suggest that tacit, socially complex, firm-specific resources explain variation in process performance across firms and that IT resources and capabilities without these attributes do not. Of particular interest to IS scholars, it is found that shared knowledge between IT and customer service units—an important driver of how IT is implemented and used in the customer service process—is a key IT capability that affects customer service process performance and moderates the impacts of explicit IT resources such as the generic information technologies used in the process and IT spending, which—consistent with resource-based predictions—were not found to be directly and positively associated with relative process performance. The implications of the findings for research and practice are discussed.