Gautam Ray

Information technology and the performance of the customer service process: a resource-based analysis

Delivering quality customer service has emerged as a strategic imperative, one that is increasingly tied to a firms information technology resources and capabilities. This paper presents an empirical study that examines the extent to which IT impacts customer service. More specifically, this study investigates the differential effects of various IT resources and capabilities on the performance of the customer service process across firms that compete in the North American life and health insurance industry. The paper builds on (1) information systems work that suggests that the effects of IT are best documented at the level of processes within a firm, (2) information systems work that suggests that the performance effects of IT are likely to be contingent in nature, and (3) developments in the resource-based view, which describes the kinds of IT resources and capabilities that are likely to enable a process in one firm to outperform the same process in competing firms. The findings suggest that tacit, socially complex, firm-specific resources explain variation in process performance across firms and that IT resources and capabilities without these attributes do not. Of particular interest to IS scholars, it is found that shared knowledge between IT and customer service units-an important driver of how IT is implemented and used in the customer service process-is a key IT capability that affects customer service process performance and moderates the impacts of explicit IT resources such as the generic information technologies used in the process and IT spending, which-consistent with resource-based predictions-were not found to be directly and positively associated with relative process performance. The implications of the findings for research and practice are discussed.

Competing with IT: the role of shared IT-business understanding

Studying why some firms derive more competitive advantage and value than others using IT resources.

Physical product reengineering with embedded information technology

Physical products increasingly incorporate an IT component, requiring manufacturers to adapt their production and support processes.

Manufacturers' Distribution Strategy in the Presence of the Electronic Channel

The Internet provides an additional channel for manufacturers to provide information about and sell their products. The electronic channel has the advantage of reduced search cost and its reach is increasing, but it has limited capability to provide product information. This paper examines how Internet technology affects a monopoly manufacturers distribution problem in an environment where product information is important for consumers to identify their ideal product. The model suggests that a manufacturer uses the electronic channel in addition to the physical channel when the product information is very valuable and product information is largely about digital attributes, or when the product information is not valuable. The model also suggests that when the manufacturer chooses to sell through both channels, there is an increase in price competition between the two channels such that the manufacturer need not sell through the electronic retailer with the highest reach. Also, when a large proportion of consumers have access to both channels, the manufacturer may sell through only one channel. The paper also examines the case where the manufacturer operates in the electronic channel and the case where the retailers are integrated.

Managerial Incentives and IT Strategic Posture

This study examines how managerial incentives may drive firms to adopt a proactive strategic posture to implement more information technology (IT) than competitors. We consider both performance incentives that motivate managers to enhance firm returns and risk incentives that motivate managers to take risks. Our empirical analysis shows that while the proactiveness in IT strategic posture leads to both firm returns and firm risk, risk incentives rather than performance incentives essentially drive the proactiveness in IT strategic posture. These findings highlight the issue of managerial risk aversion and the important role of risk incentives in strategic IT decisions. Our study also shows that in diversified firms, risk incentives have a stronger marginal impact on the proactiveness in IT strategic posture in secondary business areas than in primary business areas. Performance incentives, however, may even generate a negative marginal impact on the proactiveness in IT strategic posture in secondary busin...

Research Note—IT Outsourcing and the Impact of Advisors on Clients and Vendors

There is significant information asymmetry in the information technology (IT) outsourcing market. Clients are uncertain about vendors’ capabilities and vendors are uncertain about clients’ requirements. Prior literature has examined many devices to reduce such information asymmetry, e.g., vendor reputation, client-vendor prior relationship, vendors’ Capability Maturity Model (CMM) rating, vendor location, and technological diversity of the vendor. We examine the impact of (to our knowledge) a hitherto unconsidered device, i.e., the use of an advisor. In the context of global sourcing, third-party advisors, with their accumulated knowledge of client requirements and the vendor landscape, can mitigate the information asymmetry between clients and vendors. However, in an extensive data set of IT outsourcing contracts going back two decades we found use of advisors to be rare (less than 5% of contracts go through an advisor). This motivates us to rigorously analyze their impact on clients and vendors as an open empirical question. Using a data set of 753 large IT outsourcing contracts, and through a series of econometric specifications and robustness tests, we establish that the presence of an advisor is associated with higher revenue for vendors and more positive contract outcomes. This analysis presents what is to our knowledge the first concrete evidence that third-party advisors can mitigate the information asymmetry in the IT outsourcing market and lead to better matching that benefits clients as well as vendors.

Guest editorial for the special section on Technology acceptance, usage, and competitive advantage

A central question in the strategic management literature is one of how organizations achieve and maintain sustainable competitive advantage. While scholars in this area have explored this issue from many different perspectives, our understanding of the relationship between technology acceptance, usage, and competitive advantage is still incomplete. The papers in this special section (some of which were originally presented in a session on this topic in INFORMS 2008) focus on this issue. They present studies situated in an international context, underscoring the importance of technology to competitive advantage across different national contexts. They examine a rich array of technologies or technological infrastructures that have a bearing on the success of individuals and organizations, pointing to the complex relationship between technology and business outcomes. We present a brief summary of the papers below. The study “From IT deployment capabilities to competitive advantage: An exploratory study in China” by Jun Tian, Kanliang Wang, Yan Chen, and Bjorn Johansson uses a survey of Chinese firms to examine how organizations can deploy acquired information technologies to support and shape business strategies and value chain activities. The paper identifies three building blocks of IT deployment, namely strategic IT flexibility, business—IT partnership, and business—IT alignment, and empirically examines how these three constructs directly or indirectly influence competitive advantage. The study “ICT infrastructure for innovation” by Bendik Bygstad builds on a case study of the Norwegian company, Norwegian Corp., to examine how the concept of an enterprise service bus, applied at different levels, can provide insights into the innovation process both within and across different business units of an organization. The study illustrates how technologies can influence the development of organizational structures. The study “Knowledge management technology for organized crime assessment” by Petter Gottschalk presents a knowledge management technology stage model. This study examines how police organizations use information and communication technologies in intelligence and investigative work, and highlights the challenges these organizations face in applying and using new technologies to improve their functioning. The study “Successful and unsuccessful multicommunication episodes: Engaging in dialogue or juggling messages?” by JeanineW. Turner and N. L. Reinsch uses a critical incident technique to explore multicommunicating by individuals. Turner and Reinsch define multicommunicating as the act of engaging in more than one conversation at a time, and find that some technology pairings appear more conducive to multicommunicating than others. The respondents in their study provide a number of reasons why some episodes of multicommunicating are successful while others are not. D. Rau (*) :W. Zheng Northern Illinois University, DeKalb, IL, USA e-mail: drau@niu.edu

Why Do Firms Outsource: A Tool for Contextual Ambidexterity

Why do firms outsource information technology (it)? The literature is divided on whether it outsourcing is a cost-reduction strategy or a growth strategy. We argue that organizations can do both, i.e., they can make choices between exploitative and explorative aspects of it outsourcing, depending on the firm’s objective, i.e., to increase revenues and/or decrease costs. Our empirical findings show that it outsourcing has a positive direct effect on revenues and no impact on costs. We also find that the firms with low internal innovation capability use it outsourcing as a substitute for internal research and development (R&D) expenditure to increase revenues while firms with high internal R&D capability use it outsourcing as a complement for internal R&D expenditure to decrease costs. Moreover, in case of less concentrated i.e., more competitive industries firms tend to outsource more in order to increase revenues, while in highly concentrated i.e., less competitive industries firms tend to outsource in order to reduce cost. We reconcile our findings which are partially consistent with disparate perspectives from the literature, using the contextual ambidexterity framework. Our findings suggest that contextual ambidexterity also occurs at organizational level and is embedded in organizational level contexts. We provide important implications for is scholars working on it outsourcing and practitioners from outsourcing firms as well as it vendors.