Advances in information and communication technologies and their sophisticated integration into business processes have made ICT – enabled innovation a significant driver of competitive advantage in most firms. At Schneider National, IT prowess has given the firm a marketplace edge; it is the largest truckload carrier in the United States. In the words of Steve Matheys, Executive Vice President of Sales and Marketing, “Do I think IT has contributed to our growth and to our position in the marketplace? Absolutely. ” At Transavia Airlines, an Amsterdam-based carrier, “It (internet) is the only way to do business with us,” says Rob Slagboom, the Chief Information Officer (CIO) of the company. “It’s how we deal with suppliers, employees, customers. The Web is the business. It’s a new era for us. An old but very creative company declared that it was now a dot.com company.”
There are several other examples of how ICTs are transforming the competitive models across a wide-range of industries. In our research, we have argued that ICT’s should be viewed as digital options because they are the platform for a firm’s wealth of innovation and growth opportunities. ICT’s play four different roles in enabling business innovation: automation, empowerment, control, transformation (See Figure 1). However, success will materialize only when the executives of a firm possess the entrepreneurial orientation toward leveraging the strategic ICT opportunities and the foresight to invest in the appropriate information technologies and services.More importantly, it is clear that the role of the CIO is undergoing significant transformation towards that of a business leader (See Figure 1).

A decade ago, the primary responsibility of CIOs was to reign in the costs of IT and ensure timely and economic delivery of IT services and applications. However, the role of the CIO is undergoing significant transformation. The demand for innovative use of IT in digitising products and services, pioneering new business models, and strengthening customer and supplier relationships is escalating. Business expectations about IT as an innovation catalyst, productivity enabler, and as a tool for enterprise-wide coordination and control are driving greater attention toward leveraging IT as a strategic differentiator. As Transavia’s Slagboom confirms, “A couple of years ago, ICT was managed purely on cost. We are now being positioned as a business enabler. Actually, in our thinking we go beyond being a business enabler. IT is a business transformer.” Similarly, Hideo Ito, Chairman and CEO of Toshiba America, Inc. explains, “For a long time, Toshiba didn’t think of IT strategy when it thought of business strategy. IT was always just information processing, something done in a back room. Today, IT strategy should be part of the business strategy, a major element of strategy and planning.”
At the same time, pressures for cost-efficient provisioning of IT services, management of outsourcing and vendor relationships, and the establishment of a reliable and global IT infrastructure are equally prominent. With the proliferation of IT products and services, growing sophistication of IT vendor’s services capabilities and heightened concerns about information integrity and security, the effective management of IT services is equally critical.