Many dramatic and potentially powerful uses of information technology involveinterorganizational systems (IOS). These systems, defined as distributed computing systems thatsupport shared processes between firms, have become fundamental to business operations,spanning multiple activities in value/supply chains. They have opened avenues to unprecedentedcollaborative linkages between firms. As IOS-mediated relational networks are rapidly evolving,roles of IOS have progressively changed beyond those of efficiency and power functions.To fully appreciate modern roles of IOS in e-business, this dissertation addresses two keyresearch questions: (1) How do firms achieve competitiveness through IOS? (2) How do IOSinfluence competitive behaviors of the competing firms in intertwined electronic networks? Itdoes so by integrating three research streams – social network analysis, interorganizationalsystems, and competitive dynamics – into a model of competitive dynamics in electronicnetworks. This study focuses on the paired relationships between the three constructs of networkstructure, IOS use, and competitive action, and empirically investigates nine general hypotheses.Data collection focuses on second-hand data in the automotive industry. A total of 805collaborative relationships, 106 IOS technologies and applications, and 305 competitive actionsinvolving nine major automakers are collected. Data sources include databases, major tradepublications, Web sites, and industry indices. Data analysis includes network analysis, ANOVAtest, and correlation.Empirical results support the general contention that network structure and IOS use coevolveand influence competitive action. Building on these results, a framework characterizingIOS's roles in achieving firm competitiveness is concluded and advanced. This dissertation broadens our view of IOS's roles in e-business. It contributes to IS/IOS theory, methodology, and practice. First, this study examines IOS-mediated networks inmultiple levels, including firm-level, pair-level, and network-level. It provides new theoreticalconceptualizations of IOS's roles. Second, this study advances a new IT value measureaddressing limitations of the traditional measures. Third, it introduces a novel, usefulmethodology for data collection. Fourth, results from this study can guide a firm's e-businessinitiatives for using IOS as powerful tools for achieving firm competitiveness.