In this study we extend the resource-based view of the firm to include inter-organizational complementary resources. We use web services as an example of a technology that extends firm resources beyond organizational boundaries. The modular design of web services enables the integration of monolithic applications within and across enterprises, creating the vision of an extended enterprise that is more adaptable and responsive to market changes. As the technology continues to mature, web services will create a dynamic capability that will sustain organizational competitive advantage.