The need for a processual view of inter-organizational systems adoption

In order to sustain competitiveness, companies need to adopt electronic commerce (EC) enabled inter-organizational systems (IOS) to improve the efficiencies of entire supply chains. Adoption of IOS by companies, however, has proved difficult since such systems span organizational boundaries. Understanding IOS adoption is hampered by a lack of theory that can capture the complexity involved in IOS adoption since previous studies mostly employ the factor approach. In this paper, using Efficient Consumer Response as an example of an EC-enabled IOS, we demonstrate that the acknowledgement of the inter-organizational context of these systems naturally introduces the need for the processual approach and different notions of causality. We also show how the factor and the processual approaches to theorizing IOS adoption can be used in a complementary way.     

IOS drivers of manufacturer-supplier flexibility and manufacturer agility

In today’s hypercompetitive environment, it is critical for manufacturing firms to be agile in responding to ephemeral opportunities in the marketplace. This agility often requires the collaboration with supply chain partners. However, how a manufacturing firm collaborates with its suppliers to achieve agility remains an understudied issue. This study holds that manufacturing firms and their suppliers need to develop manufacturer-supplier flexibility accompanied with well-built integrated information systems and associated analytical systems (such as business intelligence) to enable manufacturer agility. To deepen our understanding of the roles of manufacturer-supplier flexibility and IOS technologies in facilitating manufacturer agility, we build and test a model based on the real options theory and bounded rationality. Based on 141 matched-pair samples of Taiwanese manufacturing firms, our findings demonstrate the importance of manufacturer-supplier flexibility in achieving higher manufacturer agility, wherein IOS integration enables better flexibility. We also show IOS-enabled analytical ability can strengthen the effect of such flexibility on manufacturer agility. Implications of the results for practices and academics are provided.     

B2B integration in global supply chains: An identification of technical integration scenarios

The competitiveness of businesses is increasingly dependent on their electronic networks with customers, suppliers, and partners. While the strategic and operational impact of external integration and IOS adoption has been extensively studied, much less attention has been paid to the organizational and technical design of electronic relationships. The objective of our longitudinal research project is the development of a framework for understanding and explaining B2B integration. Drawing on existing literature and empirical cases we present a reference model (a classification scheme for B2B Integration). The reference model comprises technical, organizational, and institutional levels to reflect the multiple facets of B2B integration. In this paper we investigate the current state of electronic collaboration in global supply chains focussing on the technical view. Using an in-depth case analysis we identify five integration scenarios. In the subsequent confirmatory phase of the research we analyse 112 real-world company cases to validate these five integration scenarios. Our research advances and deepens existing studies by developing a B2B reference model, which reflects the current state of practice and is independent of specific implementation technologies. In the next stage of the research the emerging reference model will be extended to create an assessment model for analysing the maturity level of a given company in a specific supply chain.     

Sourcing strategies in supply risk management: An approximate dynamic programming approach

In recent years, supply chains have become increasingly globalized. As a consequence, the world's supply of all types of parts has become more susceptible to disruptions. Some of these disruptions are extreme and may have global implications. Our research is based on the supply risk management problem faced by a manufacturer. We model the problem as a dynamic program, design and implement approximate dynamic programming (ADP) algorithms to solve it, to overcome the well-known curses of dimensionality. Using numerical experiments, we compare the performance of different ADP algorithms. We then design a series of numerical experiments to study the performance of different sourcing strategies (single, dual, multiple, and contingent sourcing) under various settings, and to discover insights for supply risk management practice. The results show that, under a wide variety of settings, the addition of a third or more suppliers brings much less marginal benefits. Thus, managers can limit their options to a backup supplier (contingent sourcing) or an additional regular supplier (dual sourcing). Our results also show that, unless the backup supplier can supply with zero lead time, using dual sourcing appears to be preferable. Lastly, we demonstrate the capability of the proposed method in analyzing more complicated realistic supply chains.     

Interorganizational dependence,information transparency in interorganizational information systems,and supply chain performance

To explain the large disparity between the potential and practice of interorganizational information systems (IOSs), this study investigates asymmetric information transparency in an IOS from a dyadic perspective. When there is asymmetric dependency in a dyad, an IOS may not completely eliminate asymmetric information transparency between supply chain (SC) partners but may change the nature of information asymmetry. Consistent with resource dependence theory, this study includes joint dependence and dependence asymmetry as antecedents of information transparency in an IOS. The data used in this study were collected from 111 matched pairs of intermediate component manufacturers and their immediate suppliers in heavy manufacturing industries. The results show that asymmetric information transparency in an IOS is prevalent in SC relationships. Regarding the antecedents of information transparency in an IOS, both joint dependence and each partner’s dependence advantage are significant. Furthermore, information transparency in an IOS positively influences SC performance measured by SC relationship quality and relationship-specific performance, whereas asymmetric information transparency negatively influences joint profit performance.     

An empirical investigation of the antecedents of telecommunication-based interorganizational systems

Interorganizational information systems (IOS) utilising telecommunications technology are commonly used to gain a strategic advantage or to compete with IOS developed by the firm's competitors. The use of telecommunication-based links with customers and suppliers provides such potential benefits as improved internal operations, greater interorganizational efficiency and increased bargaining power. Although this importance of telecommunication links with customers and suppliers is widely recognised, there has been little empirical research on the factors that may affect the use of telecommunication-based IOS. In this paper we investigate the effects of four key factors – environmental uncertainty, product information intensity, value chain information intensity and information system (IS) maturity – on the use of telecommunication links with customers and suppliers, and the impact such links have on organizational performance. Nine hypotheses relating these antecedent variables to the use and impact of interorganizational telecommunication links are proposed. Data were collected through a survey of eighty-four medium-sized companies. In addition, the measures of the impact of telecommunication links on organizational performance and environmental uncertainty were validated using a second respondent and secondary data respectively. Results suggest that environmental uncertainty permits the use of telecommunication links with suppliers. Product information intensity and value chain information intensity were positively associated with the use of telecommunication links with customers and suppliers respectively. IS maturity did not seem to enhance the use of interorganizational telecommunication links, but it did facilitate the impact these links had on organizational performance. Some implications of this study for future research and practice are examined.     

SOA adoption in business networks: do service-oriented architectures really advance inter-organizational integration?

The emergence of the Internet as a global communication infrastructure has dramatically reduced interaction costs within and across organizations, with significant impact on inter-organizational relationships, vertical industry structures, and markets. More recently, service-oriented architectures (SOA) and Web services have introduced the next paradigm shift and foster the idea of dynamic business networks with quick connect and disconnect relationships. However, little research has systematically analyzed how companies leverage SOA to improve their inter-organizational relationships and reshape their business networks. In addition, the mature research stream on inter-organizational information systems (IOS) has not yet sufficiently considered SOA. In order to close this gap, our research seeks to improve the fundamental understanding of how SOA is applied in business networks and how it differs from prior forms of IOS. Using an exploratory research approach, we investigate 33 SOA cases to identify focus areas and patterns of SOA adoption in business networks. Our case analysis builds on a multi-dimensional classification scheme which we derived from prior literature. While our empirical findings do not confirm all promising propositions related to SOA, they underline the specific contribution of SOA compared to prior forms of IOS. We conclude by suggesting five clusters of SOA adoption in the inter-organizational domain, each of those introducing new aspects in the coordination of distributed business networks.     

A multi-agent based system for e-procurement exception management

E-procurement has become an important function of enterprise information systems. The process of e-procurement includes the automatic definition of product requirements, search and selection for suppliers, negotiation and contracting with suppliers. However, the adoption of e-procurement encounters various uncertainties from internal and external environments, such as inventory failure, sharp increased demand, and delivery delay. In this paper, we propose a novel agent-based architecture for an e-procurement system in which agent technology is applied to deal with the internal and external uncertainties. Through the collaboration and interaction between different agents, the architecture that we propose can enhance the flexibility to handle unexpected exceptions, thus leading to agile procurement management. To valid the feasibility of our approach, a case study has been conducted to investigate how our agents collaborate to manage the inventory failure exception which occurs in restaurant e-procurement.     

Predicting open IOS adoption in SMEs: An integrated SEM-neural network approach

This research examines the predictors of open interorganizational systems (IOS) adoption by using RosettaNet as a case study. The model used in this research derived its theoretical supports from literature related to interorganizational relationships and knowledge management studies. A sequential, multi-method approach integrating both structural equation modeling (SEM) and neural network analysis was employed in this research. Data was collected from 136 small and medium sized enterprises (SME). Our result showed that interorganizational relationships such as communication, collaboration and information sharing play an important role in SMEs’ RosettaNet adoption decisions. Knowledge management practices such as knowledge application, knowledge acquisition and knowledge dissemination also influenced SMEs’ decision to adopt RosettaNet. The findings are useful for decision makers to understand how they can improve the adoption of RosettaNet in their organizations. Unlike previous studies, this research provided additional insights into what influence the adoption of RosettaNet by examining variables beyond the traditional technological attributes which have been studied quite extensively. By integrating SEM with artificial intelligence techniques such as neural network, this study also examined the non-linear and non-compensatory relationships involved in the adoption of RosettaNet.     

The linkage between IOS use and competitive action: a competitive dynamics perspective

The use of interorganizational systems (IOS) for competitive advantage has been the topic of much writing and research. As a successful example, American Airlines’ aggressive use of its computer-based reservation system, SABRE, has often been cited for improving operational efficiency, increasing organizational flexibility, and altering interorganizational relationships. Yet, little attention has been given to a series of competitive actions that were generated through the use of SABRE along this system’s evolutionary trajectory. These competitive actions enabled American to disrupt competitive forces and remain as a market leader in the airline industry for decades. Stimulated by American’s case and today’s widespread use of IOS, this study asks two interesting questions: “Is there a systematic link between IOS use and competitive action?” “If so, how do they relate to each other?” In addressing these questions, we adopt research from the field of competitive dynamics to examine roles of IOS in influencing firm behavior and resultant firm performance. Competitive dynamics research has shown robust relationships between measures of competitive action and firm competitiveness, but technological antecedents of competitive action have been little studied. Collecting and analyzing 12 months of data for the year 2003 from multiple secondary data sources, this study empirically investigates links between IOS uses and competitive actions for nine major sports car makers. Our findings suggest a strong link between IOS uses and competitive actions. Also, there are larger implications for information technology (IT) researchers. The novel adoption of competitive dynamics suggests the development of a new kind of IT value measure, going beyond limitations of traditional measures by recognizing competitive actions as specific moves that are first observed after undertaking initiatives aimed at enhancing competitiveness. Additional implications for IT research, methodology, and practice are discussed.     

How Corporations E-Source: From Business Technology Projects to Value Networks

A 78 organization study in USA, Europe and Australasia throughout 1999–2001 finds a variety of practices in sourcing the development and running of technology and e-businesses in value networks. The paper points to trade-offs in e-sourcing decisions, not least between speed to the net, cost, and organizational learning. Leading and lagging practices are identified and the evolutionary paths organizations take are described and assessed. Outsourcing emerges as highly useful for specific purposes, but other ways of using the external market for e-business development can be more suitable for certain identifable activities. The paper further discusses how external sourcing and partnering practices are increasingly being extended into the customer resource life-cycle, into supply chains and throughout value networks. Case examples are discussed and the strengths and weaknesses of their practices identified. The need to clarify core capabilities is demonstrated, and two matrices that facilitate effective e-sourcing decisions are developed to summarize the findings from the research.     

A study of the institutional forces influencing the adoption intention of RFID by suppliers

We extended the application of Roger's model for evaluating the institutional forces influencing the adoption intention of RFID by retailer's suppliers. Drawing on institutional theory, we examined how different institutional forces experienced by retailer's suppliers were related to their relational investment on inter-organizational information sharing. Data collected from 130 major Taiwanese suppliers was used in our empirical analyses. We found that relational investment was the most critical adoption factor, which also indirectly enhanced organizational readiness for technological adoption intention. From a Taiwanese perspective, our findings should be helpful in understanding what factors significantly impact the adoption of RFID technology.     

A multiple-vendor single-buyer integrated inventory model with a variable number of vendors

Supply chain management is concerned with the coordination of material and information flows in multi-stage production systems. A closer look at the literature reveals that previous research on the coordination of multi-stage production systems has predominantly focused on the sales side of the supply chain, whereas problems that arise on the supply side have often been neglected. This article closes this gap by studying the coordination of a supplier network in an integrated inventory model. Specifically, we consider a buyer sourcing a product from heterogeneous suppliers and tackle both the supplier selection and lot size decision with the objective to minimise total system costs. First, we provide mathematical formulations for the problem under study, and then suggest a two-stage solution procedure to derive a solution. Numerical studies indicate that our solution procedure reduces the total number of supplier combinations that have to be tested for optimality, and that it may support initiatives which aim on increasing the efficiency of the supply chain as a heuristic planning tool.     

To outsource IT or not?: recent research on economics and evaluation practice

The paper reports findings from 26 longitudinal case studies of information technology (IT) outsourcing researched in the 1993–95 period. The primary focus is on evaluation practices in the lead up to making IT sourcing decisions. The pre-existing IT evaluation system was found to be a help or a major hindrance as a basis from which to assess outsourcing vendor bids. Difficulties experienced in evaluating in-house performance are highlighted. Issues include evaluating total IT contribution, identifying full costs, benchmarking and external comparisons, the role of charging systems, and the adoption of service level agreements by the in-house operation. Organizational experiences on assessing vendor bids against in-house options are then detailed. These are presented in distilled form as ‘a rich picture’ representative case study, together with additional lessons derived from the research. Finally we highlight the emerging evaluation approach shared by organizations that made effective sourcing decisions.     

Supply chain modeling in uncertain environment with bi-objective approach

Supply chain is viewed as a large-scale system that consists of production and inventory units, organized in a serial structure. Uncertainty is the main attribute in managing the supply chains. Managing a supply chain (SC) is very difficult, since various sources of uncertainty and complex interrelationships among various entities exist in the SC. Uncertainty may result from customer’s demand variability or unreliability in external suppliers. In this paper we develop an inventory model for an assembly supply chain network (each unit has at most one immediate successor, but any number of immediate predecessors) which fuzzy demand for single product in one hand and fuzzy reliability of external suppliers in other hand affect on determination of inventory policy in SCM. External supplier’s reliability has determined using a fuzzy expert system. Also the performance of supply chain is assessed by two criteria including total cost and fill rate. To solve this bi-criteria model, hybridization of multi-objective particle swarm optimization and simulation optimization is considered. Results indicate the efficiency of proposed approach in performance measurement.     

Design and development of agent-based procurement system to enhance business intelligence

The purpose of this research is to propose a procurement system across other disciplines and retrieved information with relevant parties so as to have a better co-ordination between supply and demand sides. This paper demonstrates how to analyze the data with an agent-based procurement system (APS) to re-engineer and improve the existing procurement process. The intelligence agents take the responsibility of searching the potential suppliers, negotiation with the short-listed suppliers and evaluating the performance of suppliers based on the selection criteria with mathematical model. Manufacturing firms and trading companies spend more than half of their sales dollar in the purchase of raw material and components. Efficient data collection with high accuracy is one of the key success factors to generate quality procurement which is to purchasing right material at right quality from right suppliers. In general, the enterprises spend a significant amount of resources on data collection and storage, but too little on facilitating data analysis and sharing. To validate the feasibility of the approach, a case study on a manufacturing small and medium-sized enterprise (SME) has been conducted. APS supports the data and information analyzing technique to facilitate the decision making such that the agent can enhance the negotiation and suppler evaluation efficiency by saving time and cost.     

Developing a Financial Statement-Based Effectiveness Measure of Interorganizational Systems' Contribution

Measuring the contribution of interorganizational systems (IOS) is challenging, and mainly based on subjective surveys. The purpose of this study is to objectively examine the effectiveness of IOS, through data from corporate financial statements. We developed a novel performance measure: an effectiveness ratio that reflects changes in average inventory level in comparison with change in annual sales. This measure reflects a certain aspect of improvement in supply chain management achieved by the evident developments of IOS, while considering external events that affected the companies. Two samples of American and Israeli companies were used for developing and empirically examining the suggested effectiveness ratio over 20 years (1993-2012). The results show considerable improvement as measured by the average effectiveness ratio of randomly selected American international companies in the cosmetics and toiletry products sector. However, the Israeli sample of food suppliers and importers, showed average marginal improvement, and major variance among the companies.     

Inter-organizational Emergency Medical Services: Case Study of Rural Wireless Deployment and Management

Over the last two decades, use of mobile communications for emergency services (e.g. 911) has grown exponentially. This rise of mobile networks has increased reliance on new private and public partnerships to deliver these time critical services. Drawing upon complex systems theory and Inter-organizational Systems (IOS) dynamics, a framework is developed for investigating technology, organizational and policy dimensions of Emergency Medical Services (EMS). The case study for this investigation is rural Minnesota, where a series of semi-structured interviews were conducted and supplemented by analysis of candidate EMS system evaluations. The twofold objectives of the study were to explore the nature of inter-organizational dynamics in this setting and to set forth an architecture for measuring and enhancing performance. Key technology concerns included gaps in wireless coverage, complex system upgrades, and lagging integration of wireless communications into existing infrastructures. These issues were intertwined with organizational aspects, such as the challenges in developing coordinated relationships among agencies and between the public and private sectors. Several policy levers were also influential, such as federal standards that had been set forth for E-911 location information and funding initiatives in the transportation area. The final section draws upon these findings to suggest an EMS architecture that portrays the entire system as well as critical IOS linkages. While IOS has traditionally examined supply chains, these findings are aimed to contribute to understanding more complex, dynamic and heterogeneous socio-technical processes. The paper concludes with a discussion of management and research implications.     

A new order splitting model with stochastic lead times for deterioration items

In unreliable supply environments, the strategy of pooling lead time risks by splitting replenishment orders among multiple suppliers simultaneously is an attractive sourcing policy that has captured the attention of academic researchers and corporate managers alike. While various assumptions are considered in the models developed, researchers tend to overlook an important inventory category in order splitting models: deteriorating items. In this paper, we study an order splitting policy for a retailer that sells a deteriorating product. The inventory system is modelled as a continuous review system (s, Q) under stochastic lead time. Demand rate per unit time is assumed to be constant over an infinite planning horizon and shortages are backordered completely. We develop two inventory models. In the first model, it is assumed that all the requirements are supplied by only one source, whereas in the second, two suppliers are available. We use sensitivity analysis to determine the situations in which each sourcing policy is the most economic. We then study a real case from the European pharmaceutical industry to demonstrate the applicability and effectiveness of the proposed models. Finally, more promising directions are suggested for future research.     

Impacts of internal and interorganizational information systems on the outsourcing of manufacturing

Drawing on transaction cost economics, this paper looks at the relationship of IT use to the outsourcing of manufacturing using survey data from US manufacturers. We find that greater use of interorganizational systems (IOS) is associated with greater outsourcing, but we do not find any main effects between internal IT and outsourcing. A negative interaction effect is found between measures of internal IT and IOS, suggesting that the two may be substitutes rather than complements. This distinction between internal IT and IOS, and the relationship of the two, offers scholars a more nuanced understanding of the nature and impacts of IT. It provides managers insight into how different types of IT can support different sourcing options.