Week 7 Reading Summary (HK)

Angst, C.M., Wowak, K.D., Handley, S.M., and Kelley, K. (2017). Antecedents of Information Systems Outsourcing Strategies in U.S. Hospitals: A Longitudinal Study. MIS Quarterly, 41(4), 1129-1152.

Angst, Wowask, Handley, and Kelly (2017) explored information systems sourcing strategies in hospitals to develop an understanding of preferences between single-sourcing and multi-sourcing strategies and their antecedents. Organizations can employ single-sourcing strategies, where all information systems are provided by one supplier, or multi-sourcing strategies, which involve an integration of information systems from a variety of suppliers. Both sourcing strategies come with advantages and disadvantages; for example, single-sourcing allows for a more cohesive system, but one supplier may not be able to provide a sufficient product in all required areas, while multi-sourcing allows for superior products for each domain, but might result in additional IT costs or inter-system communication issues. That being said, results considering nearly all U.S. hospitals over a nine-year period from 2005 to 2013 using sequence analysis across the five IS modules indicated that hospitals were transition to single-sourcing strategies. This finding is counter to larger firm trends favouring multi-source systems. However, the rate at which the hospitals are transitioning to a single-source system depends on various institutional factors.

Leveraging institutional theory, Angst et al. (2017) proposed that organizational antecedents such as strategic orientation (for-profit versus non-profit and teaching versus non-teaching), formal structure (size as the log of the number of hospital beds and membership of larger health systems), and internal dynamics (patient case complexity) will impact hospitals’ rates of transition. Results indicated that there was no significant difference in transition speed between for-profit and non-profit hospitals, teaching hospitals moved towards single-source more quickly than non-teaching, larger hospitals moved towards single-source more quickly than smaller hospitals (which were employing single-source earlier on), hospitals in smaller health systems moved towards single-source more quickly than those in larger health systems, and hospitals with less complex cases move towards single-source more quickly than those with more complex cases in later years.