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NEBIC: A Dynamic Capabilities Theory for Assessing Net-Enablement

Kelley School of Business, Indiana University, 1309 East 10th Street, Bloomington, Indiana 47405
bwheeler{at}indiana.edu

We propose the Net-Enabled Business Innovation Cycle (NEBIC) as an applied dynamic capabilities theory for measuring, predicting, and understanding a firm's ability to create customer value through the business use of digital networks. The theory incorporates both a variance and process view of net-enabled business innovation. It identifies four sequenced constructs: Choosing new IT, Matching Economic Opportunities with technology, Executing Business Innovation for Growth, and Assessing Customer Value, along with the processes and events that interrelate them as a cycle. The sequence of these theorized relationships for net-enablement (NE)¹ asserts that choosing IT precedes rather than aligns with corporate strategy. The theory offers a logically consistent and falsifiable basis for grounding research programs on metrics of net-enabled business innovation.

Key Words: Theory Building; IS Research Frameworks; Net-Enabled Organizations (NEOs); Innovation; Digital Business; e-Commerce; e-Business
History: This paper was received on December 10, 2002.

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