The impact of perceived risk on the capital market’s reaction to outsourcing announcements

Outsourcing is a widely accepted option in strategic management, which, like every business venture, bears opportunities and risks. Supplementing the popular area of research on the merits of outsourcing, this paper examines how stockholders rate corporate sourcing decisions with regard to the risk they associate with this transaction. Using event study methodology and multivariate cross-sectional OLS-regression, we analyze a sample of 182 outsourcing transactions in the global financial services industry between 1998 and 2004 in order to investigate the risk-specific drivers of excess returns to shareholders. The analysis studies the impact of risk-specific independent variables, including transaction size, length, outsourced business functionality, and experience with outsourcing. Our findings indicate that risk-mitigating strategies have significant explanatory power, indicating that the capital market’s reaction to an outsourcing announcement might at least partly be forecast. Results show a positive correlation between market reaction and business process outsourcing by financial services companies. We also find strong evidence indicating that capital markets react positively to relatively large transactions compared to the market capitalization of the outsourcing firm. For service providers our results show that traditional IT-related sourcing projects or the insourcing of administrative processes have a significant positive correlation with market reaction.     

IT outsourcing in insurance services: risk, creative contracting and business advantage

Abstract. Risks in IT outsourcing have received little systematic academic attention, despite growing evidence of wide disappointment and difficulty as well as some successes in outsourcing IT. This paper explores the 1993–98 case history of Polaris, a software intermediary in the European insurance sector. Despite the considerable risks inherent in outsourcing business-critical technology, Polaris was found to be achieving business advantage from such a strategy. This paper details 10 major risk areas in IT outsourcing distilled from previous research. It focuses on the sourcing, contractual and management choices made at Polaris. It assesses, against prior research findings, the degree to which these choices mitigated short- and long-term risk, and whether learning points flow from the analysis for other IT outsourcing arrangements.     

Knowledge-intensive business services in the new mode of knowledge production

The new mode of knowledge production is seen as a distinct form of economic organisation used for exchanging and creating knowledge. The emphasis is laid on the role of business services in innovative networks as carriers of knowledge and intermediates between science (knowledge creator) and their customers (knowledge user). The empirical analysis shows that knowledge-intensive business services are able to make existing knowledge useful for, their customers, improving the customer's performance and productivity and contributing to technological and structural change.This paper is based on a presentation at the International Conference on Science, Technology and Society, 16–22 March 1998, Tokyo.     

Hypermedia Use in Group Work: Changing the Product, Process, and Strategy

Hypermedia structures have beenintegrated with CSCW functionality to develop theDOLPHIN system, an electronic meeting roomenvironment. In this paper, a study is reportedinvestigating how the DOLPHIN environment affectsgroup work. Different aspects of group problem solvingwere examined to understand the effects of workingwith hypermedia: the group's product, cognitivefactors, and the group process. The results showedthat groups can easily work with hypermediastructures, and that these structures influence groupsto produce a different product, to use a differentstrategy, and to use a different collaborative style,namely of dividing up their labor. The experimentalresults are explained in a model which suggests theinvolvement of both procedural and semantic componentsin hypermedia use. We discuss wider implications ofhypermedia for CSCW and group work.     

Information systems management and strategy formulation: the 'stages of growth' model revisited

Abstract. The original 'stages of growth' model, as applied to the field of Information Systems (Gibson & Nolan, 1974), may be viewed as seminal, given the influence it has had on both theory and practice (Nolan, 1984; Sullivan, 1985; Ward, et al., 1990). This is so, despite the model's lack of substantiation based on empirical evidence, the overly simplistic assumptions on which it is based, and the limited focus of the original concept (Benbasat, et al., 1984; King & Kraemer, 1984).
Since its first appearance, the model has been refined following many applications (Nolan, 1979, 1984). In addition, others have developed 'stages of growth' models of their own. For example, Somogyi & Galliers, (1987a, b)provide a model depicting the move from basic data processing systems to strategic information systems, tracing the early days of commercial applications of computing through to the present day (Ward et al. 1990). Earl (1983, 1986, 1988, 1989) proposes a stages-model for information systems planning, as does Bhabuta (1988), while Hirschheim, et al. (1988) have developed a more broadly focused model associated with the development of the information-systems management function.
As a result of a review of the above and of a case study research undertaken in Perth, Western Australia, a revised model was developed, which takes account of current thinking and past experience in the application of the various 'stages of growth' models (Sutherland & Galliers, 1989).
This paper sets out to review some of these models and proceeds to describe the process of developing, testing and applying the revised 'stages of growth' model. The model is more broadly focused than the original concept, incorporating strategic, organizational, human resource and management considerations. As a result, it is argued that this model has greater utility than its predecessors.     

When success turns into failure: a package-driven business process re-engineering project in the financial services industry

This article discusses a Business Process Re-engineering project that involved the implementation of an enterprise resource planning software package. Although the project was deemed to be a success when the system was first delivered, this initial success soon turned to failure. While the short-term financial results were spectacular, the long-term implications of the changes were more worrying. This paper raises many questions about the meaning of “success.” In particular, it shows how a “successful implementation” can, within a relatively short space of time, turn into failure.     

The complexities of electronic services implementation and institutionalisation in the public sector

Electronic service implementation (ESI) in the public sector attempts to improve efficiency, effectiveness, and transparency of governmental departments. Despite having provided the necessary infrastructure and investment, many governments have struggled to realise such aims due to the various forces that challenge implementation and institutionalisation. Using institutional theory as a lens, we explored the forces influencing the implementation and institutionalisation of ESI in the public sector. While our results reinforced previous research in IT implementation and organisational transformation, they showed that the dynamic nature of technology poses unanticipated pressures, and that these can impede the implementation and institutionalisation process.     

Information systems strategizing,organizational sub-communities,and the emergence of a sustainability strategy

The realized strategy contents of information systems (IS) strategizing are a result of both deliberate and emergent patterns of action. In this paper, we focus on emergent patterns of action by studying the formation of strategies that build on local technology-mediated practices. This is done through case study research of the emergence of a sustainability strategy at a European automaker. Studying the practices of four organizational sub-communities, we develop a process perspective of sub-communities’ activity-based production of strategy contents. The process model explains the contextual conditions that make sub-communities initiate SI strategy contents production, the activity-based process of strategy contents production, and the IS strategy outcome. The process model, which draws on Jarzabkowski’s strategy-as-practice lens and Mintzberg’s strategy typology, contributes to the growing IS strategizing literature that examines local practices in IS efforts of strategic importance.     

ERP and SCM systems integration: The case of a valve manufacturer in China

Many modern organizations integrate enterprise resource planning (ERP) and supply chain management (SCM) systems, as they work in a complementary fashion. This often results in technical and organizational challenges. Neway, a Chinese organization, recently went through this complex process. This required efficient procurement and management of hardware, software, and human resources for successful completion. The integrated system was found to improve operations, foster a paperless environment, and provide efficient inventory tracking and picking. It also had several tangible benefits, including reduced lead time and improved inventory accuracy. ERP and SCM systems integration is still a novel concept for a Chinese manufacturing organization. Our case study details the organization's experience, identifies challenges that were faced, and describes solutions adopted to overcome them.     

ERP systems adoption: An exploratory study of the organizational factors and impacts of ERP success

We examined the relationships between the success of ERP system adoption, extent of business process improvement (BPI), and organizational performance and investigated the associations between the outcomes of these initiatives and such organizational factors as strategic intent, senior management support, and the status of the IT function within a company. A correlation analysis of 96 firms was made to test our hypothesis that the strategic intent to use ERP was closely related to the success of BPI, ERP, and organizational performance. The results also demonstrated that CEO-IT distance may have little direct bearing on the outcomes of ERP and BPI initiatives. A closer CEO-IT reporting relationship, however, was found to be associated with higher levels of senior management support for both types of enterprise projects. This empirical evidence reinforced the long-held assumption that organization-level benefits, BPI, and ERP success were closely related; and that these relationships were subject to the influence of the organizational variables.     

电力体制改革背景下电网企业参与竞争性业务的适应性策略及业务模式

2015年启动的新一轮电力体制改革明确提出了“以配售电市场放开”为主要内容的改革路径,同时强调了市场公平竞争。随着电力体制改革的推进,电网企业所面临的内外部环境也发生了较大变化,其如何合理合规、有效高效地参与电力市场竞争性业务值得关注。本文梳理和总结了我国配售电市场改革进展;根据对配电和售电市场发展情况,针对现阶段电网企业如何依托自身优势参与竞争性业务,提出了适应性策略;为适应未来市场发展需要,从短期发展和长期发展两个维度提出了电网企业在增强电力用户粘性的增值业务及保障措施。     

Using a case study to test the role of three key social enablers in ERP implementation

The literature indicates that three key social enablers—strong and committed leadership, open and honest communication, and a balanced and empowered implementation team are necessary conditions/precursors for successful enterprise resource planning (ERP) implementation. In a longitudinal positivist case study, we find that, while all three enablers may contribute to ERP implementation success, only strong and committed leadership can be empirically established as a necessary condition. This presents a challenge to future ERP researchers for resolving apparent contradictions between the existing literature and the results of our analysis. One possible direction for future research would be to undertake an interpretive re-examination of the rationalisitic assumptions that underlie much of the existing literature on ERP systems implementation.     

Challenges and opportunities in collaborative business process management: Overview of recent advances and introduction to the special issue

Modern business process management expands to cover the partner organisations’ business processes across organisational boundaries, and thereby supports organisations to coordinate the flow of information among organisations and link their business processes. With collaborative business processes, organisations can create dynamic and flexible collaborations to synergically adapt to the changing conditions, and stay competitive in the global market. Due to its significant potential and value, collaborative business processes are now turning to be an important issue of contemporary business process management, and attracts lots of attention and efforts from both academic and industry sides. In this paper, we review the development of B2B collaboration and collaborative business processes, provide an overview of related issues in managing collaborative business processes, and discuss some emerging technologies and their relationships to collaborative business processes. Finally, we introduce the papers that are published in this special issue.

Risks and benefits of business process outsourcing: A study of transaction services in the German banking industry

We developed a model of the adoption of business process outsourcing (BPO) based on risk–benefit analysis. The model was tested in the German banking industry in four areas of transaction processing. Our results showed that, in general, perceived BPO benefits have a substantially stronger impact on intention to increase the level of BPO than perceived risks. However, the experience that banks have with the BPO process, [whether already decided on BPO (Pro), still in the pre-decision phase (Neutral), or opted against BPO (Contra)], moderated the impact of factors affecting the perceived risks and benefits of BPO. Banks that opted for BPO were mostly driven by a desire to focus on their core business while considering financial risks. Banks in the neutral position had the most balanced view of risks and benefits, mainly financial and performance ones, and also focusing on the core business and increased business process performance. Those banks that decided against BPO mostly focused on benefits while the perceived risks were mostly formed by strategic and performance risks rather than financial ones. The results point out the path dependencies of the BPO decision.     

Capturing Global Youth: Mobile Gaming in the U.S., Spain,and the Czech Republic

We adapt the technology acceptance model (TAM) to examine the factors influencing mobile gaming adoption among “global youth.” Our model replaces usefulness with convenience, incorporating visual appeal and escapism as antecedents of fun, and perceived novelty and economic value as antecedents of convenience. Questionnaire surveys were conducted in the U.S., Spain, and the Czech Republic, producing 432 usable responses. In the structural model assessment with the pooled sample, convenience exercises greater effects on attitude toward mobile games than fun, suggesting that the most important driver is probably the capability of being used flexibly at any time and in any place, rather than mere enjoyment. Tests of latent means suggest that most dimensions are perceived more strongly in the Czech Republic.     

A novel, rule-based technical pattern identification mechanism: Identifying and evaluating saucers and resistant levels in the US stock market

This paper has two main purposes. The first one is the development of a rigorous rule-based mechanism for identifying the rounding bottoms (also known as saucers) pattern and resistant levels. The design of this model is based solely on principles of technical analysis, and thus making it a proper system for evaluating the efficacy of the aforementioned technical trading patterns. The second aim of this paper is measuring the predictive power of buy-signals generated by these technical patterns. Empirical results obtained from seven US tech stocks indicate that simple resistant levels outperform saucers patterns. Furthermore, positive statistical significant excess returns are being generated only in first sub-periods of examination. These returns decline or even vanish as the experiment proceeds to recent years. Our findings are aligned with the results reported by various former studies. The proposed identification mechanism can be used as a component of an expert system to assist academic community in evaluating trading strategies where technical patterns are embedded.     

GoBIS: An integrated framework to analyse the goal and business process perspectives in information systems

ContextOrganisational reengineering, continuous process improvement, alignment among complementary analysis perspectives, and information traceability are some current motivations to promote investment and scientific effort for integrating goal and business process perspectives. Providing support to integrate information systems analysis becomes a challenge in this complex setting.ObjectiveThe GoBIS framework integrates two goal and business process modelling approaches: i^⁎ (a goal-oriented modelling method) and Communication Analysis (a communication-oriented business process modelling method).MethodIn this paper, we describe the methodological integration of both methods with the aim of fulfilling several criteria: i) to rely on appropriate theories; ii) to provide abstract and concrete syntaxes; iii) to provide scenarios of application; iv) to develop tool support; v) to provide demonstrable benefits to potential adopters.ResultsWe provide guidelines for using the two modelling methods in a top-down analysis scenario. The guidelines are validated by means of a comparative experiment and a focus-group session with students.ConclusionsFrom a practitioner viewpoint (modeller and/or analyst), the guidelines facilitate the traceability between goal and business process models, the experimental results highlight the benefits of GoBIS in performance and usability perceptions, and demonstrate an improvement on the completeness of the latter having an impact on efficiency. From a researcher perspective, the validation has produced useful feedback for future research.     

State estimation for fuzzy cellular neural networks with time delay in the leakage term, discrete and unbounded distributed delays

This paper deals with the problem of state estimation for fuzzy cellular neural networks (FCNNs) with time delay in the leakage term, discrete and unbounded distributed delays. In this paper, leakage delay in the leakage term is used to unstable the neuron states. It is challenging to develop a delay dependent condition to estimate the unstable neuron states through available output measurements such that the error-state system is globally asymptotically stable. By constructing the Lyapunov-Krasovskii functional which contains a triple-integral term, an improved delay-dependent stability criterion is derived in terms of linear matrix inequalities (LMIs). However, by using the free-weighting matrices method, a simple and efficient criterion is derived in terms of LMIs for estimation. The restriction such as the time-varying delay which was required to be differentiable or even its time-derivative which was assumed to be smaller than one, are removed. Instead, the time-varying delay is only assumed to be bounded. Finally, numerical examples and its simulations are given to demonstrate the effectiveness of the derived results.     

Modeling and analysis of the effects of QoS and reliability on pricing, profitability, and risk management in multiperiod grid-computing networks

In this paper we develop a network equilibrium model for optimal pricing and resource allocation in Computational Grid Network. We consider a general network economy model with Grid Resource Providers, Grid Resource Brokers and Grid Users. The proposed framework allows for the modeling and theoretical analysis of Computational Grid Markets that considers a non-cooperative behavior of decision-makers in the same tier of the grid computing network (such as, for example, Grid Resource Providers) as well as cooperative behavior between tiers (between Resource Providers and Grid Brokers). We introduce risk management into the decision making process by analyzing the decision-marker's reliability and quality of service (QoS) requirement. We analyze resource allocation patterns as well as equilibrium price based on demand, supply, and cost structure of the grid computing market network. We specifically answer the following questions with several numerical examples: How do system reliability levels affect the QoS levels of the service providers and brokers under competition? How do system reliability levels affect the profits of resource providers and brokers in a competitive market? How do system reliability levels influence the pricing of the services in a competitive environment? How do users' service request types, QoS requirements, and timing concerns affect users' behaviors, costs and risks in equilibrium? How does the market mechanism allocate resources to satisfy the demands of users? We find that for users who request same services certain timing flexibility can not only reduce the costs but also lower the risks. The results indicated that the value of QoS can be efficiently priced based on the heterogeneous service demands.