Jeffrey L. Sampler

Information specificity and environmental scanning: an economic perspective

This paper addresses two questions. First, how does an organization allocate its environmental scanning resources among all the potential sources of information in the environment? Second, how does an organization allocate responsibility for acquiring environmental information? Specifically, when does an organization choose to monitor an environmental source within its hierarchy, and when does it outsource the task? In the former case, when does the responsibility for acquiring information rest with the ultimate user, and when is it delegated, either to a subordinate or to a central environmental scanning unit?The paper proposes a set of economic arguments to answer these questions. Borrowing from transaction cost theory, the paper develops the concept of information specificity to parallel the idea of asset specificity. Information specificity has two dimensions -- knowledge specificity and time specificity. The paper uses transaction cost theory and agency theory to propose that the information acquisition choices made by managers and organizations are based on the specificity of the desired information. In making its arguments, the paper introduces the notion of cognitive transaction and agency costs to complement the behavioral costs that are the focus of traditional transaction cost and agency theory logic.

Redefining industry structure for the information age

We are entering a new competitive age in which the basis of competition is being fundamentally altered through the introduction of advanced information technologies and public communication infrastructures, such as the Internet. In these environments, the nature and locus of competition will radically alter, as information becomes an increasingly important resource. This paper develops ideas around the strategic characteristics of information—information separability and information specificity. Moreover, it attempts to redefine the nature of industry structure in such a competitive environment by examining what constitutes the real boundaries of competition, industry concentration, related diversification, and innovation for firms competing in the Information Age.

Transformation of the IT function at British Petroleum

In 1989, the IT function of the exploration and production division of British Petroleum Company set out to transform itself in response to a severe economic environment and poor internal perceptions of IT performance. This case study traces and analyzes the changes made over six years. The authors derive a model of the transformed IT organization comprising seven components that they suggest can guide IT departments in general as they seek to reform themselves in the late 1990s.This model is seen to fit well with recent thinking on general management in that the seven components of change can be reclassified into the Bartlett and Ghoshal (1994) framework of purpose, process and people. Some suggestions are made on how to apply the model in other organizations.