Thomas L. Huber

A Process Model of Complementarity and Substitution of Contractual and Relational Governance in IS Outsourcing

This paper develops a process model of how and why complementarity and substitution form over time between contractual and relational governance in the context of information systems outsourcing. Our analysis identifies four distinct process patterns that explain this formation as the outcome of interaction processes between key elements of both contractual and relational governance. These patterns unveil the dynamic nature of complementarity and substitution. In particular, we show that the relationship between contractual and relational governance oscillates between complementarity and substitution. Those oscillations are triggered mainly by three types of contextual events (goal fuzziness, goal conflict, and goal misalignment). Surprisingly, substitution of informal control did not occur as an immediate reaction to external events but emerged as a consequence of preceding complementarity. Thus, our study challenges the prevailing view of an either/or dichotomy of complementarity and substitution by showing that they are causally connected over time.

Contractual and Relational Governance as Substitutes and Complements – Explaining the Development of Different Relationships

For a long time research on the management of IS outsourcing projects viewed relational and contractual governance as substitutes. However, subsequent studies provided empirical evidence for the complementary view. Recently, some authors supported the notion that relational and contractual governance mechanisms can simultaneously be complements and substitutes. Given these inconsistencies the question arises how contractual and relational governance become substitutes or complements. We investigate whether the relationship between governance mechanisms is the outcome of distinctprocesses of interaction between contractual and relational governance. For that purpose, we conduct an exploratory multiple-case study of five IS outsourcing projects at a leading global bank. We identify three archetypical processes illustrating how the interaction between relational and contractual governance can result in a complementary relationship. In addition, we discover one process explaining their substitution. The results of our study propose a shift in perspective. While former studies focused on explaining whether contractual and relational governance are complements or substitutes, we answer the question how and why they become complements and substitutes. Based on our findings, we give implications for further research.

Governance Practices in Platform Ecosystems: Navigating Tensions Between Cocreated Value and Governance Costs

Based on an exploratory multiple-case study in two platform ecosystems, we develop a process theory that explains how and why different ways of practicing ecosystem-wide governance are more or less successful in navigating the tension between cocreated value and governance costs. Our process theory shows that how ecosystem-wide rules and values are practiced considerably varies and changes over time. Initially, governance practices follow ecosystem-wide rules; if and how practices shift toward going beyond the rules hinges on specific necessary conditions. Irrespective of which governance route is taken, the tension between cocreated value and governance costs is more successfully addressed if practices are sensitive to ecosystem-wide values. The online appendix is available at https://doi.org/10.1287/isre.2017.0701.

Explaining Emergence and Consequences of Specific Formal Controls in IS Outsourcing -- A Process-View

IS outsourcing projects often fail to achieve project goals. To inhibit this failure, managers need to design formal controls that are tailored to the specific contextual demands. However, the dynamic and uncertain nature of IS outsourcing projects makes the design of such specific formal controls at the outset of a project challenging. Hence, the process of translating high-level project goals into specific formal controls becomes crucial for success or failure of IS outsourcing projects. Based on a comparative case study of four IS outsourcing projects, our study enhances current understanding of such translation processes and their consequences by developing a process model that explains the success or failure to achieve high-level project goals as an outcome of two unique translation patterns. This novel process-based explanation for how and why IS outsourcing projects succeed or fail has important implications for control theory and IS project escalation literature.

Governance Mechanisms as Substitutes and Complements – A Dynamic Perspective on the Interplay between Contractual and Relational Governance

In recent years scholars have discussed the relationship between contractual and relational governance in information systems (IS) outsourcing. Findings regarding this relationship are still mixed. Some hint at a substitutional relationship, others at a complementary relationship. Moreover novel investigations favor another argument: relational and contractual governance mechanisms can simultaneously be complements and substitutes.

The Emergence of Formal Control Specificity in Information Systems Outsourcing: A Process-View

Information systems (IS) outsourcing projects often fail to achieve initial goals. To avoid project failure, managers need to design formal controls that meet the specific contextual demands of the project. However, the dynamic and uncertain nature of IS outsourcing projects makes it difficult to design such specific formal controls at the outset of a project. It is hence crucial to translate high-level project goals into specific formal controls during the course of a project. This study seeks to understand the underlying patterns of such translation processes. Based on a comparative case study of four outsourced software development projects, we inductively develop a process model that consists of three unique patterns. The process model shows that the performance implications of emergent controls with higher specificity depend on differences in the translation process. Specific formal controls have positive implications for goal achievement if only the stakeholder context is adapted, while they are negative for goal achievement if in the translation process tasks are unintendedly adapted. In the latter case projects incrementally drift away from their initial direction. Our findings help to better understand control dynamics in IS outsourcing projects. We contribute to a process theoretic understanding of IS outsourcing governance and we derive implications for control theory and the IS project escalation literature.

The Evolution of Contractual and Relational Governance in IS Outsourcing

This paper explores how and why contractual and relational governance evolve over time in information systems (IS) outsourcing projects. Governance is broken down into its foundation and action dimension resulting in four governance parameters: trust /norms and informal control representing relational governance; contract and formal control reflecting contractual governance. Drawing on the lenses of punctuated equilibrium and biological interaction, we examine both incremental and disruptive change along our four governance parameters. The findings from four longitudinal IS outsourcing projects suggest that incremental changes are driven by interactions between governance parameters. We found three basic patterns of interaction between governance parameters (mutualism, commensalism, competition) that explain incremental changes. In contrast, disruptive governance changes during revolutions are driven by stark contextual changes. However, interactions during equilibriums may lead to self-perpetuating dynamics that may detract governance from basic outsourcing objectives. Revolutions may break these self-perpetuating dynamics and redirect governance to basic objectives.

A Framework for Routing in Large Ad-Hoc Networks with Irregular Topologies

In this paper, we consider routing in large wireless multihop networks with possibly irregular topologies. Existing position-based routing protocols have deficiencies in such scenarios as they always forward packets directly towards the destination. Greedy routing frequently fails and costly recovery mechanisms have to be applied. We propose the Ants-based Mobile Routing Architecture (AMRA) for optimized routing, which combines position-based routing, topology abstraction, and swarm intelligence. AMRA routes packets along paths with high connectivity and short delays by memorizing past traffic and by using ant-like packets to discover shorter paths. The geographic topology abstraction allows AMRA to cope with high mobility and large networks. Simulative evaluation indicate that compared to other position-based routing AMRA finds significantly shorter paths with only marginal overhead protocols.

Supporting Joint Idea Generation with Software Prototypes in Offshore-Outsourced Software Development Projects

Joint idea generation is vital in software development projects requiring team members with different knowledge specializations to exchange and integrate multiple perspectives into ideas to improve the software product. While joint idea generation is generally difficult to achieve, it is even more challenging in offshore-outsourced settings. Our goal was to understand the process of how software prototypes can support joint idea generation over the life of a 16 month offshore-outsourced software development project. Based on an in-depth, ethnographic case study, we reveal three joint idea generation modes building on and stimulating each other: from diverging, to exploring and advancing. These joint idea generation modes were closely interwoven with the software prototype. We find that as the software prototype evolved, new possibilities for engaging in various joint idea generation modes emerged. Our research has important implications for literature and practice.

Recurrent Knowledge Boundaries in Outsourced Software Projects: A Longitudinal Study

Knowledge boundaries can constrain cross-border collaboration. Based on a qualitative case study of a distributed team, we examine which semantic knowledge boundaries recur and why they recur over the life of an agile, outsourced software project. Based on our analysis of observational data, collaboration tool data and interviews, we first identify the similar recurrent boundaries and categorize them under three domains for this type of software application: Assembling, Designing, and Intended user interaction. We then examine three practices utilizing software prototypes that team members used to bridge them. First, we find that similar semantic knowledge boundaries related to all three of the domains recur over the 10-month life of the project. Second, we find that team members repeatedly enact the same practices to bridge similar knowledge boundaries over the life of the project. Our data also suggest that team members in outsourced agile software development projects will likely use practices to transcend, rather than traverse, knowledge boundaries. Based on these emergent findings, we develop three propositions for future testing. Our study therefore contributes to the growing research streams on knowledge boundaries in IS outsourcing and the usage of prototypes in agile software development.