Byounggu Choi

Effects of initial and ongoing trust in IT outsourcing: A bilateral perspective

Much has been written about the need for trust in outsourcing relationships, but the literature has produced only a few theoretical models that explain the process that helps it evolve. We proposed a theoretical model by distinguishing ongoing beliefs, such as ongoing trust and distrust, from initial perceptions, such as initial trust and distrust, in the context of IT outsourcing, and then explored empirically how these interacted with one another the knowledge sharing experience between the participants, thus leading to a successful experience from both the outsourcer and the service provider. The model and its hypotheses were tested using two-stage survey data collected from IT outsourcing projects. Our results showed that the ongoing trust and distrust between the receiver and provider were crucial in attaining benefits and that the outcome was also affected by the perceptions of the participants at the initial stage of the outsourcing process. We also found that knowledge-sharing experience between the parties moderated the impact of initial trust or distrust on the ongoing trust or distrust in different ways: the change in the service providers initial perceptions were apparently more visible and positive than those of the service receivers, although both initial perceptions tended to be cognitively consistent. These results helped us understand how trust evolves over time in an outsourcing relationship, and enabled us to explore the different viewpoints of the service provider and receiver.

Assessing the impact of knowledge management strategies announcements on the market value of firms

Although there is much literature on the relationship between KM strategies and organizational performance, the benefit of KM strategies is not well understood. We addressed this issue by exploring how KM strategies influence a firms market value using event study methodology. We evaluated the cumulative abnormal returns for KM strategies announced by U. S. firms from 1998 to 2003. Our findings supported the hypothesis that firms announcements about their KM strategies provoked positive reactions in the market. More specifically, strategies that focus on either (i) knowledge reusability through IT or (ii) knowledge sharing through informal discussions among employees contributed to higher performance than strategies that emphasized both. This outcome empirically supported our argument that the emphasis on either tacit or explicit knowledge results in a better market value of the firm. Furthermore, the markets reaction to the announcement is dependent on the firms industry classification. The findings of this study offer insights that may help managers maximize the market impact of their KM strategies.

Categorizing commercial products for customer oriented online retailing

Online retailing can offer several benefits. In order to realize these benefits, a commercial web site needs to ameliorate its deficiencies due to the absence of actual physical products. Although the use and popularity of the Internet continues to increase, it is still unclear how online retailers can establish effective online retailing strategies to capitalize on their benefits. For this clarification, this paper proposes a framework to categorize products according to consumers involvement and information quality fitness. Involvement refers to the degree of psychological identification or emotional ties consumers have with a particular product. Information quality fitness refers to the extent to which a product can fit with shoppers requirements for online information. Thirty-six commercial products are empirically tested. It is found that products can be grouped into four categories such as complex, intelligent, light, and simple. This categorization can help understand product characteristics when they are sold via the Internet. Our finding implies that online retailers need to formulate their retailing strategies in view of these product categories.

Alignment Between Service Innovation Strategy and Business Strategy and Its Effect on Firm Performance: An Empirical Investigation

A well-planned service innovation strategy is recognized as a prerequisite for successful service innovation in organizations. However, prior studies on service innovation strategies struggle to provide guidance on successful service innovation, because they do not consider the alignment between service innovation strategy and business strategy. Furthermore, they did not consider conditions, such as industries, that affect the alignments to improve firm performance. By using empirical data collected from 175 service firms in Korea, this study aims to investigate the effect of alignments between service innovation strategy (i.e., service creation-focused [SCFS], service delivery-focused [SDFS], and customer interaction-focused [CIFS] strategies) and business strategy (i.e., cost leadership [CLS], innovative differentiation [IDS], and focus [FS] strategies) on firm performance, which is assessed using both nonfinancial and financial measures. We then examine how the effect of alignments differs depending on industry types (i.e., scale intensive [SCIS], technology-based knowledge intensive [TKIS], and professional-based knowledge intensive service industries [PKIS]). Empirical evidence indicates that three alignment patterns (i.e., SCFS-IDS pattern, SDFS-CLS pattern, and CIFS-FS pattern) have synergistic effects on firm performance. Results also confirm that the effects of the alignments on firm performance differ according to the types of industry. The SCFS-IDS alignment performs well in the TKIS group, the SDFS-CLS alignment in the SCIS group, and the CIFS-FS alignment in the PKIS group. The implications for practice highlight the idea that successful service innovation requires judicious alignment between service innovation strategy and business strategy with the consideration of industries.

Determinants of Knowledge Management Assimilation: An Empirical Investigation

Knowledge management (KM) and its effective assimilation as an interrelated innovation are critical to the success of contemporary organizations, and have recently attracted increasing interest. The sources of influence on successful KM assimilation were explored via a study of Korean firms. A synthesis of previous studies that had utilized various theories to investigate KM variables yields six critical factors (i.e., knowledge worker, technical knowledge infrastructure, external knowledge linkage, knowledge strategy, internal knowledge climate, and knowledge management process), which facilitate KM assimilation. We then evaluated the effects of these critical factors on the level of KM assimilation, using responses from 187 Korean organizations that had already implemented enterprise-wide KM systems. Our findings show that four of the six variables were significantly related to KM assimilation. Interestingly, the KM process was found to be the most critical factor in the proliferation of KM activities across an organization, and knowledge strategy and external knowledge linkage were identified as insignificant ones for KM assimilation. The findings of this paper are expected not only to serve as early groundwork for researchers hoping to understand KM and its effective assimilation in organizations, but also to provide practitioners with guidelines as to how they can enhance their KM assimilation level, thus improving their organizational performance.

Augmenting productivity analysis with data mining: An application on IT business value

In this paper we use a large firm-level dataset to extend previous studies by augmenting the endogenous growth accounting framework with a data mining technique to analyze the complex relationships between the use of IT and organizational practices. There is emerging evidence of recent emphasis on organizational factors and a greater shift towards IT complementarities in which value addition is linked to combining complementary organizational practices with IT investments. Our findings indicate that the set of interrelated organizational practices that complement positively to IT use is different from the set of practices hindering IT use. The presence of clustering among organizational practices clearly implies that some combinations of practices make it difficult to precisely empirical examine. We have found that our technique was able to show some organizational factors may have different pathways to affect organizational performance and such organizational practices have often been overlooked but can play a weak yet non-trivial role in production and organizational processes.

Deriving web usage strategies for online sales: A decision framework and empirical exploration

The primary objective of this paper is to explore possible web usage strategies for online direct sales. For this purpose, this paper proposes a framework that can help managers to utilize their web site as a sales channel. This framework is, based on two factors: (i) channel conflict and (ii) web appropriateness. Sixty-three Korean firms across 13 industries are selected as the sample base for an empirical investigation. Our analysis results suggest four web usage strategies. The channel relationship enhancement strategy attempts to strengthen relationships with existing off-line sales channels. The emphasis of the customer relationship enhancement strategy is on the organization-to-customer relationship via the web. Collaborative transformation focuses on the use of a web-based sales channel via collaboration with existing channel partners. Quick transformation results in an aggressive and quick transformation into an online channel. Our findings are more likely to help managers to formulate web usage strategies that can lead to competitive advantages.

Open and closed knowledge sourcing: Their effect on innovation performance in small and medium enterprises

Many studies have investigated the relationship between the adoption of open innovation and performance in large firms. However, limited research is available with regard to the use of open innovation in small and medium enterprises (SMEs). SMEs are important because of their contribution to innovation in almost all economies. The purpose of this paper is to extend the current literature by focusing on SMEs. Using complementarity and knowledge-based theories, this study develops three hypotheses to identify the effect of knowledge sourcing approaches for innovation on SMEs’ innovation performance.,Surveys collected from 196 SMEs in Korea were analyzed using the supermodularity function to test the hypotheses.,Results indicate that an external knowledge-oriented approach has no significant effect, whereas an internal knowledge-oriented (i.e. closed) approach has a positive effect on innovation performance. Interestingly, this study found that open innovation has a negative effect on SMEs’ innovation performance (i.e. both internal knowledge-oriented and external knowledge-oriented approaches have a substitutive relationship).,This study sheds new light on open innovation and knowledge management research by identifying the relationship between knowledge sourcing approaches for innovation, and innovation performance in SMEs. Practical implications highlight that open innovation could impede SMEs’ innovation performance.