Abstract
Building on Resource Based View (RBV), we investigate the complementary effect between ERP and e-business technologies, and the impact of such effect on firm performance. Different from previous studies that assume ERP and e-business technologies have direct effects on firm performance, this study argues that it is the complementarily use of the two IT resources to build system and business integration capabilities that is more likely to create business value. We use a sample of 150 U.S. manufacturing firms and two different approaches — product term approach and direct measure approach — to measure the complimentary effect. We present new empirical evidence that the complementary effect between ERP and e-business technologies in creating business value is stronger than the main effects of ERP or e-business technologies alone. Accordingly, firms should utilize and deploy ERP and e-business technologies in a mutually reinforcing manner to extract the most complementarity value from ITs.