Abstract
While there is much discussion around how Software as Service (SaaS) enterprise applications can contribute to firm performance, we know very little about how two different types of these applications – i.e., vertical and horizontal – might dissimilarly contribute to firm performance. Drawing upon arguments flowing from the dynamic capabilities literature in IS research, we study the differential impacts of vertical and horizontal SaaS applications on firm performance. In particular, we hypothesize that vertical SaaS enterprise applications have a stronger impact on firm performance than horizontal ones. Our empirical analysis using a sample of 45,522 firm observations from 2011 to 2019 supports the hypothesis. We discuss the implications that our findings have for research and practice.