Yae Eun Kim
Week 14_Ramasubbu, Bharadwaj, and Tayi (2015)_Yaeeun Kim
Normally, novelty and flexibility is perceived valuable due to its predicted positive influence on outcome. This article pinpointed the area of software process and reported the drivers, which can increase software process diversity. The software process is varied in plan-based and agile-process approaches at the firm. First, the authors conceptualized the degree of fit (or match) between a projects’ software process diversity and the level of process compliance by conducting focus group meetings and interviews. Next, in the second stage, they tested using empirical data from 410 large commercial software projects of a multinational firm.
The findings suggest that higher level of requirements volatility, design and technological novelty, and customer involvement increase software process diversity within a project. As expected, on the other hand, software process diversity decreased relative to increase in the level of process compliance to the firm’s process standards, enforced on the project. The attributes to increase diversity is reversely correlated with the level of process compliance. Overall, a higher degree of fit between the process diversity and process compliance of a project, which are largely associated with each other, are again correlated with a high level of project performance, based on project productivity and software quality. Boundary effect was found. The results was significant only when there is an increase in organizational process compliance efforts.
For the managerial implication, it is highly recommended to the project designers to suggest an appropriate fit between process diversity and process compliance for improving software project performance. The novel part of this study compared to the previous literature is the authors differentiate the level of process maturity organizations and the conflicting effect of process diversity and compliance efforts. In my opinion, weighing the fit between process diversity and process compliance is highly dependent on the project organizations.
The variety dimension of diversity was measured using the Blau’s index. Process compliance, team size, and team experience were in a reversely related to the effect on process diversity.
Week 12_Miller and Tucker (2009)_Yaeeun Kim
The study tests how privacy protection affects the diffusion of electronic medical records based on the understanding of the network effect. There is empirical study of the role of network externalities in electronic banking adoption by banks. However, this study is the first to address how network effects and technology adoption decisions are affected by privacy protection. According to the conceptual model of hospital EMR adoption, when net gain from electronic records, defined relative to the alternative technology of paper records, is positive, a hospital will adopt EMRs.
As expected, state privacy protection of hospital medical information inhibits EMR adoption or the network effects of EMR, which is defined as positive externalities experienced by individual hospitals who adopt EMRs when other local hospitals have adopted electronic records. The finding shows that without hospital privacy protection, one hospital’s adoption increase the propensity of other hospitals in the local area to adopt by 7%, but with the privacy protection, no network effects are indicated. This study contributes in quantifying how a hospital’s decision to adopt EMRs is affected by whether state privacy protection restricts a hospital’s ability to disclose information.
The authors suggest for the future study to include the overall welfare effects of either EMRs or privacy laws, which is inferred from a trade-off between privacy protection and EMRs. For the further study, it is demanded to investigate the extent to which privacy protection can be optimized to minimize disruption to the diffusion and use of interdependent technology. I also agree that the positive spillovers from increase of security from protecting confidentiality and evaluations toward the effect of strategy toward adopting EMRs would increase the speed of diffusion.
Week11_Tambe and Hitt (2014)_Yaeeun Kim
This study purposed to test the hypothesis that firms benefit from the IT investments of other firms because the flow of specialized technical know-how among organizations facilitates the implementation of new IT innovations. The network provides the basis of the flow of knowledge. As the development of a workforce of engineers with experience redesigning workflow is important for the diffusion of new production methods, IT workers play a similarly important role in spreading the expertise in organizations.
The result suggests that IT labor flows are an important mechanism for the transmission of productivity spillovers related to IT-enabled production methods. In the robust estimates, the elasticity of the pool of external IT investment takes how volume of internal IT investment. This shows that firms located in high density of high-tech companies, where IT investment is likely to be much higher, may receive substantial economic benefit. The benefits are oriented form IT labor flows among firms. The study showed that IT labor flow explains the underlying mechanism, which drives regional IT spillovers.
The findings imply that manager should pay attention to locate their firms in the middle of the IT spill-over. The paper suggests Silicon Valley as an option. The location brings competitive benefits to attract workers. On the other hand, policy makers are suggested to focus on shaping the industry as rigid labor market with high level of labor mobility. The study is however limited in explaining how to develop IT spill-over effect by adopting IT.
Presentation_Yaeeun Kim (with file)
Presentation_Yaeeun Kim
Week 9_Pang, Tafti, and Krishnan (2014)_Yaeeun Kim
The authors examined whether IT improves administrative efficiency in U.S. state governments. This empirical study contributes to the IS literature by expanding the scope of IT value research to the public sector.
To be specific, U.S. state governments spent approximately 5% of the tax revenues in IT in 2004. On the other hand, for-profit firms used 3.6% of the sale revenue on IT in 2004. This fact enhances the necessity for policy makers to keep their eyes on the IT spending in public organizations. Two important factors motivated the authors to study: 1) the public sector is different from the private business context, and 2) the approach to measure the value effect of IT investments in the private sector may not be appropriate in the government context. In particular, for-profit context uses production function framework, but the public sector context is more suitable to use cost function.
For the analysis, the authors estimated the impact of IT investments on administrative efficiency with a two-stage estimation approach based on a multi-product translog cost function. In the first stage, they estimated cost inefficiency with a stochastic frontier model, and in the second stage, the estimated cost inefficiency was regressed on IT intensity and other exogenous factors by reflecting on the fact that the government outputs are exogenously given. As government agencies are expected to deliver necessary public service within a budget collected from tax, efficiency benefits of IT is more applicable in the public sector context than adopting the effect of IT on costs of goods sold. The applicable area of cost efficiency is not limited to human resources but opens to services, which is affected by automating organizational process by focusing on the automate and informate roles of IT.
Week8_Forman and Zeebroeck (2012)_Yaeeun Kim
The authors examined the basic Internet adoption for reducing the coordination costs of geographically dispersed firm teams. They hypothesized that adoption of basic Internet will be associated with an increase in the likelihood of collaboration for multi-inventor, geographically dispersed teams (hypothesis 1); Adoption of basic Internet will be associated with a smaller increase in the likelihood of collaboration for single-location multi-inventor teams than for geographically dispersed teams (hypothesis 2); and Adoption of basic Internet will be associated with a smaller increase in the likelihood of collaboration for single inventors than for geographically dispersed teams (hypothesis 3).
For analysis, they used fixed effects panel data model. Their findings suggest that there is no evidence of a link between Internet adoption and within-location collaborative patents. There is no evidence of a relationship between basic Internet and single-inventor patents. These evidences show that basic Internet adoption lowered the coordination costs of geographically dispersed research teams. This does not have to be interpreted as easier access to electronic knowledge systems or shared resources rendered an increase in research output of those who adopted basic Internet. .
The result suggests that IT can be used to integrate geographically dispersed operations, either obtained through acquisition or deliberately dispersed. The limitation of the study oriented from the sample data is one sample size and one period of time within U.S. When they design their international R&D organization, firms mostly regard the following options: a centralized organization that provides higher control and decentralized structure that enables local knowledge resources but increasing coordination cost. However, the study result supports that IT investments may substantially alter the trade-off and decentralized model more attractive, which encourages a more distant R&D activities within firms.
Week7_ Gopal (2012)_Yaeeun Kim
In the vendor-client relationship, how to govern the relation is important, however, the effect depends on the hazard. The study mentions two gaps. First gap is the moderating effect of risk exposure on the benefit of relational governance. According to the prior studies, in the presence of formal contracting, relational governance has a significant impact on the outcomes of economic activities. On the other hand, relational governance provides symmetric benefits to all parties. In a way of understanding the contradicting findings, this study focused on the positive effect of relation on mitigating risk. This suggests that the parties who take larger risks might be more beneficial as a result. Second, the effect of relational governance on enhancing values differed by the dimensions of outsourcing (e.g. quality and profitability). However, it is important to understand that when there is not equivalently expected hazard size, why would the other party would accept the relational governance if the party is not be a beneficent as the other party. Relational governance highlights flexibility in the environment of projects, resulting in more beneficial to immediate project rather than long-run project.
To test hypotheses, 105 projects was collected from a software service frim. The relational governance is inherently required for this area since software service firms outsource, and the relationship between the vendor and developer is important. From the findings, the study shows that relational flexibility positively affects profitability in only fixed price contracts, where the vendor faces greater risk, while positively affecting quality only in time and materials contracts, where the client is at greater risk. Service quality was measured by question items.
Overall, relational governance (relational flexibility) is beneficial for profitability depends on the type of contract. As expected, the effect of relational flexibility on profitability is moderated by FP contracts. However, the effect of T&M contracts was insignificant on the effect of relational flexibility on project profit.
Week6_Li et al. (2012)_Yaeeun Kim
The greatest implication of this paper is oriented from testing the link between system quality and information quality, via actual decision making outcomes. They assess the forecast accuracy when IT material weaknesses are present. In short, firms with IT material weakness are associated with less accurate management forecasts. Improvements in IT control quality are associated with decrease in forecast error. Among the types of IT control problems, systems with IT control problems related to data processing issues are associated with low quality of decision outcome.
This empirical study, which used SOX 404 control reports, contributes to explaining the implications of IT controls on information quality issues for system users and decision makers. Just as manufacturing process focuses on managing the quality of input for enhancing the outcome, information systems focus on managing high quality of information for a better decision making.
The authors also examined the impact of the different dimensions of IT material weaknesses. From the findings, the authors showed that firms with IT material weakness have significantly larger management forecast errors, and the errors are larger than those of firms with non-IT material weaknesses, as problems in information systems could directly impact the FRS output data that management uses to form their forecasts.
Although IT controls are often correlated with the extent of overall control weakness, this study try to answer the remaining unclear points that which type of material weakness yields a greater impact on the quality of information produced by an information system. The control weakness is solely based on the firm’s SOX 404 reports. There are some limitations of this paper: Can the types of control weakness all be answered within this archival report? Also, it is hard to say that the severity of weakness is controlled across the firms.
Week5_Grewal et al.(2006)_Yaeeun Kim
This article examined the effects of network embeddedness on the success of open source projects. The authors assume heterogeneity and investigated how these structure differ across project and managers. They showed that there is significant effect of network embeddedness on technical and commercial success. By using latent class regression analysis, they showed that different aspects of network embeddedness have powerful but subtle effects on project success. In this case, the valence of word-of-mouth (WOM) decides the success (the number of page view or downloads).
According to the social contagion, positive WOM within the network of users would result in more users visiting the project websites (externality), and leads to commercial success. However, they assume that negative WOM would make a decrease in outcome (or the number of downloads).
The result shows that project network embeddedness positively influences project technical success, while the effect of project manager network embeddedness is more complex and different for older projects when compared with younger project. They used centrality for method: degree centrality is the number of projects in which the manager participates (structural embeddedness), betweenness centrality is the number of paths between other nodes on which the manager lies (junctional embeddedness), and eigenvector centrality is the manager participates in important projects (positional embeddedness).
In summary, the article shows that the effect of project network embeddedness positively influenced project technical success. However, the effect of project manager network embeddedness varies in the year of project. As a result, the network embeddedness was more influential to technical success, which were attractive to developers visually, but the influence was less powerful in commercial success, which were less visible to users.
Week4_How to work with your advisor?
Discussion topic: How to work with your advisor?
Pang: There are two important principles:
- Your advisor is not your boss.
- Your advisor is not doing your research for you.
Let’s talk about what the first principle means. How is an advisor different from a boss?
Student1: A boss and an advisor are different in that an advisor gives guideline for what you are doing, while a boss gives you what you should undertake and follow.
Pang: Right. In your research, you are the boss, not your advisor is. You don’t need to do everything that your advisor tells you to do. If you only follow your advisor’s instructions, you are no more than his/her research assistant. You should be the boss for your own project, dissertation, or job market paper.
I understand that to Asians, what a teacher says is always God-given truth. You must change such a mentality. Sometimes, you have to have a courage to disagree with your advisor and should be able to convince him/her why your way is better. If you can’t convince your advisor, how would you convince your editor or reviewers?
Pang: What do you think with the second principle? – Your adviser is not going to do research for you.
Student2: You should be an independent researcher.
Student3: From my own experience, I had to recheck and have a second look at a paper before submitting it, because I am responsible for it.
Student4: We should be the one who pushes your project forward.
Pang: Yes, you should be the one who manages your research. The bottom line is, your advisor is not going to solve your problems. His/her role is helping you do quality research and complete it, not offering solutions to you every time you hit a wall. “My advisor does not let me graduate..” does not really make sense from this perspective.
Student5: I think the relationship between a student and an advisor varies in disciplines.
Pang: True, but in a business school, as we’ve been discussing, you are expected to become an independent researcher. Remember this – Don’t blame your advisor when your research goes south. Your advisor is not the person who solves every problem of yours. It is your job.
You are the one who knows the most about your project. An advisor often does not know everything about your work. At a conference presentation, I’ve seen a professor talking to the audience that “I don’t know why my student chose this method..” He may not be supposed to say it, but he was likely telling the truth. Since you’re the boss in your research, you make the decisions, and therefore, you’re responsible for it.
Pang: I also want to talk a little about who should be your advisor. It might be a good idea to have two advisors – a senior professor and a junior/assistant professor. There is a study in a science discipline that the most cited papers are ones with a three co-author combination – a doctoral student (first), a junior faculty (second), and a senior professor (third). The doctoral student is the one who came with up the idea, did the bulk of the analyses, and wrote most of the paper. What are the roles of the other two co-authors, then?
Student1: The senior advisor provides a big picture, and the junior advisor provides detailed skills.
Pang: That’s right. The junior advisor can provide hands-on and detailed skills and tacit/intimate knowledge on how to make a progress in research, how to get it done. The senior professor, on the other hand, can provide a big picture: What is interesting to reviewers, what is not, how to frame/sell the paper, and what contribution the paper makes, and etc. This is a complementary role between the senior and the junior faculty members.
Week4_Tanriverdi & Uysal (2011)_Yaeeun Kim
This paper considered the cross-business information technology integration (CBITI) capability of an acquirer as a potential value-creation mechanism in M&A. This study contributes to the M&A streams within the finance and strategy literature by explaining how and why the CIBTI capability of an acquirer following an acquisition.
In examining the short-run abnormal stock returns, capital markets are indifferent to whether the value will be created out of potential synergies in similar resources of related targets or complementary resources of unrelated targets, but it showed significant result when CBITI capabilities. Event study method was used to measure forward-looking expectations of the capital markets about the value-creation or destruction effects of CBITI in a new M&A. This method assumes that capital markets are efficient (efficient market hypothesis), incorporating into the stock price of the acquirer all relevant information about the acquirer. By setting an event day as 0, the event window is set as five-day [-2, 2], and examining the difference of actual returns and expected returns that when M&A was not announced.
In examining long-run abnormal operating performance (AOP), industry relatedness of a target was significant in moderation effect. Interestingly, the complexity of structure does not deter for superior CBITI capabilities integrate the complementary resources of unrelated targets acquired from different industries. To compute the long-run AOP of an acquirer after a new acquisition, an event study method was used again. This method is designed to capture changes in accounting-based measures of a firm’s operating performance relative to a benchmark, such as M&A. Industry benchmark minimizes problems such as differences in the prevent characteristics of firms leading to operating performance differences before the impact of the M&A event under consideration.
Week3_Dewan and Ren (2011)_Yaeeun Kim
IT investment as a return or risk. How does a firm increase return and decrease risk by using boundary strategies: vertical integration and diversification.
From the findings, this paper suggests that suitable boundary strategies can moderate the impact of information technology (IT) on firm performance, increasing return and decreasing risk. This tendency is apparent especially when the firm is categorized as service industry, with high levels of IT investment intensity, and in more recent time periods.
Diversification refers to the extent to which the firm chooses to operate in multiple lines of business or product markets, whereas vertical integration is the extent to which value chain activities are conducted inside the firm as opposed to contractually with business partners.
Vertical integration (VIit) is measured with two ways: The first measure is the ratio of value added to sales (Adelman, 1955). Second, an alternate measure was used for robustness, which is less sensitive to industry differences (Fan and Lang, 2000; Ray et al., 2006).
Key dependent variables are firm return and firm risk, and the set of predictor variables includes IT capital, degrees of diversification and vertical integration, along with other firm and industry control variables.
Among key independent variables, a level of diversification (DIVit) was analyzed with the entropy measure (Palepu, 1985).
From the analysis, diversification is negatively associated with both returns and risk at 1% significance level, and vertical integration is positively associated with return but negatively associated with risk model. For the individual interaction term of IT with diversification or IT with vertical integration is positive in return model and negative in risk model, confirming the significant moderating impact of firm boundaries on firm risk-return performance.
Week2 Summary_Tambe et al. (2012)_ Yaeeun Kim
This paper is meaningful to add the third value, external focus, based on the prior work. This 3-way model explains the productivity of the firm at the best. External focus is a set of practices that firms use to detect changes in their external operating environment.
Findings suggest that firms can more successfully leverage IT investments if they effectively capture external information through networks of customers, suppliers, partners, and new employees.
This paper contributes to a literature on IT value, supporting the argument that organizational complements lead to higher IT returns.
They also build upon prior work that addresses complementarities between IT and internal practices such as decentralized decision making but add the external orientation dimension which has been shown to be important in technology-intensive firms.
The survey questions was conducted by telephone and includes a new set of measurements, which include external and internal information practices, human capital mix such as occupational and educational distributions.
For its econometric method, organizational inhibitors were used as instrumental variables because they reflect the cost faced by firms in adopting new organizational practices.
In their correlation tests, external focus measure is correlated with IT measure and decentralization measure. The correlation between workplace organization and external focus suggests that the decentralization leads external information practices (although the correlation does not explain the causality, it can be interpreted as above when we bring our common knowledge).
By adding individual inhibitors of organizational transformation and location variables as instruments, decentralization was more associated with effective management of the product line. This finding suggests that capturing external information is important, but at the same time, governing internal information processing boosts product leadership by managing products in a timely manner.