MIS 9003 – Prof. Min-Seok Pang

Heather Kennedy

Week 13 Reading Summary (HK)

Kwon, J. & Johnson, M. E. (2014). Proactive versus reactive security investments in the healthcare sector. MIS Quarterly, 38(2), 451-471.

The legislative mandates to disclose security breaches coupled with the detailed data available on security investments makes the healthcare sector a viable industry to consider the impact of proactive versus reactive security investments. Proactive investments are those conducted by the organization prior to an issue or breach. Conversely, reactive investments are those that occur after an incident to respond to said incident. Data from the Healthcare Information Management Systems Society from 2005-2009 was collected to allow for a Cox Proportional Hazard Model to be performed on a sample of 2,386 healthcare organizations. The analysis provided a perspective considering the learning opportunity benefits and the cost effectiveness of healthcare security investments.

Results indicated that proactive security investments are associated with lower security failure rates. This supports the notion that attackers’ abilities and threats evolve at such a rapid pace that it is important to learn from proactive initiatives. Proactive investments are also associated with smaller breaches and lower breach notification costs than reactive investments. This finding is contrary to literature stating that proactive investing results in overinvestment stemming from uncertainty. Results also indicate that security investments have more significant effects on external than internal failures. Regardless of investment type, effects are larger at the state level than the organization level indicating that security investments create positive externalities (i.e., they improve security for all parties involved). Results also indicate that voluntarily made proactive investments are associated with superior performance to those made by external pressure. With external regulatory mandates, the organization might be trying to meet the mandates rather than conducting a threat analysis themselves. Finally, though external regulatory requirements attenuate learning from proactive investments, the requirements are at least not hurtful in failure-induced learning from reactive investments. Effectively, results indicate that CIOs should further emphasize proactive initiatives rather than purely reacting.

Week 12 Reading Summary (HK)

Atasoy, H., Chen, P., & Ganju, K. (2017). The spillover effects of health IT investments on regional healthcare costs. Management Science, forthcoming, 1-20.

Past research efforts have consistently demonstrated the quality benefits associated with the implementation of electronic health records (EHR), but research considering the cost on health care is more scarce and mixed. Atasoy, Chen, and Ganju (2017) shed light onto this research gap by considering the spillover effects of health IT investments on neighbouring healthcare providers’ costs. Moreover, Atasoy et al. (2017) approached this research from a macro-level perspective by considering how one hospital implementing an EHR system impacts the costs for them as well as for  surrounding hospitals. This approach is relevant as healthcare is often a community effort with hospitals sharing patients. Thus, any variable that decreases communication costs between hospitals, such as EHR systems, will lower the financial burden for all parties in the supply chain. In order to verify this proposition, data was collated from a variety of sources including the Healthcare Information Management Systems Society database for the longitudinal period from 1998 to 2012.

Analyses considering said dataset found that though EHR system adoption increases costs at the adopting hospital, it lowers costs at surrounding hospitals. Specifically, the spillover effect is stronger when an increasing number of hospitals in the region are in health information exchange networks and in the same integrated delivery systems since these networks and systems facilitate information exchange. Moreover, for hospitals with regional characteristics that facilitate patient sharing, such as urban vs rural areas, population density, average distance between hospitals, and hospital density, the spillover effect is more pronounced. Finally, the HITECH Act, which increased the adoption and use of EHR systems, catalyzed the spillover effects. Effectively, a macro-level investigation into EHR systems indicates that they can reduce costs for collaborating hospitals.

Week 12 Reading Summary (HK)

Bloom, N., Garicano, L., Sadun, R., & Van Reenen, J. (2014). The distinct effects of information technology and communication technology on firm organization. Management Science, 60(12), 2859-2885.

Information Communication Technologies (ICTs) have radically impacted industries and the roles of various employees. However, this impact has not been uniform across industries, positions, etc. For example, ICTs have rendered Ambassadors mute because technology now makes it relatively easy to be in contact with the actual country leaders regardless of geographic distance. On the other hand, nurses’ responsibilities and capabilities have grown immensely due to ICTs as it allows them to be able to accomplish tasks previously requiring doctors or superiors. Bloom, Caricano, Sadun, and Van Reenen (2014) propose that the differing impact of ICTs could be due to its dual-component nature; effectively, due to differences in information technologies (ITs) and communication technologies (CTs).

ITs allow employees at lower levels to make impactful decisions, such as the case with nurses, due to the increase in information readily available to them. Effectively, ITs, specifically ERPs for non-product related decisions and CAD/CAM for product decisions, allow lower level employees to gain access to information traditionally only available to high level employees at little to no costs. Furthermore, these technologies widen the manager’s span of control. On the other hand, CTs, such as intranets, lead to more centralization as it is easier to communicate and in theory could render more decisions or more verifications to higher level employees. That being said, results considering CTs are more ambiguous than those for the ITs. Overall, Bloom et al. (2014) were able to draw these conclusions by combining the CEP management and organization survey and the Harte-Hanks ICT panel to create a comprehensive dataset that spanned industries and countries. Overall, these findings help to explain the contradictory impacts of ICTs by highlighting the distinct components of ITs and CTs and their differing impacts.

Week 9 Reading Summary (HK)

Pang, M.-S. (2017). Politics and information technology investments in the U.S. federal government in 2003-2016. Information Systems Research, 28(1), 33-45.

Government information technologies (IT) are often plagued by obsolete legacy systems that are expensive to maintain. These systems are often left in place due to a variety of factors including risk adverse employees, lack of IT commitment/consensus across governing parties, and the sheer volume of difficulties associated with replacing or upgrading IT systems so large in scope that are continually in use. Furthermore, there is a wide variation in IT systems and spending across various agencies and bureaus. To further understanding of factors that influence IT spend, Pang (2017) draws from a range of political science, public administration, and information system literature to develop a theoretical understanding to a previously overlooked phenomenon.

Pang hypothesizes that a federal agency’s capacity-building IT investments are associated with (i) legislative approval for the chief executive, (ii) government dividedness, and (iii) ideological characteristics of the agency. A generalized estimating equation analysis, an approach widely employed for estimating panels with a fractional dependent variable, was conducted on panel dataset of 135 federal agencies and bureaus between 2003 and 2016. Results indicated that the there is a significant, positive relationship between the senate’s confirmation of the chief executive and the agency’s IT investments. Also, there is significant support for the notion that federal agencies are less likely to invest in new IT development under a divided government. Finally, there is significant support for the fact that ideologically moderate federal agencies invest more in development, modernization, and enhancement IT spending. These findings indicate that national politics significantly impact IT investments; investment is dependent on securing compelling policy mandates and political legitimacy from Congress. Therefore, it is proposed that Congress pay more attention to and provide more support for IT investments to ensure the IT infrastructure supports the federal government’s goal to be more agile, flexible, and efficient.

Week 8 Reading Summary (HK)

Saldanha, T. J. V., Mithas, S., & Krishnan, M. S. (2017). Leveraging customer involvement for fueling innovation: The role of relational and analytical information processing capabilities. MIS Quarterly, 41(1), 267-286.

By drawing on three streams of literature, customer involvement, innovation, and IS, Saldanha, Mithas, and Krishnan (2017) were able to respond to calls for insight of how IT enables customer-focused innovation. Previous literature had contradictory findings consider in the impact of customers on the innovation process. On one hand, industry leaders, such as Lego and Sony, and researchers have found that customer involvement in the innovation process can be beneficial. On the other hand, some researchers (e.g., Ittner & Larcker, 1997) have found that it can negatively impact innovation by causing the firm to be reactive instead of proactive. Using a combination of data from several sources including InformationWeek and Compustat, Saldanha et al. (2017) were able to empirically demonstrate that congruent IS can complement the relationship between specific types of customer involvement and innovation.

With respect to customer involvement, the extent to which a firm interacts with customers while developing a product (Carbonell et al., 2009), Saldanha et al. (2017) considered two types: information-intensive (ICI) and product-focused customer involvement (PCI). First, ICI considers the information collected on customers via customer opinion and feedback as well as structure mechanisms such as focus groups. To help manage and analyze such large datasets, Analytical Information Processing Capability (APIC) software such as business analytic technologies can be employed by the organization. Second, PCI captures involvement when the customers are engaged by the firm to actively participate in codeveloping products resulting in customers driving product development or custom configurations of products. CRM software can be employed to help manage relationships with customers as captured under Relational Information Processing Capability (RIPC) software. Effectively, results, including those from the original negative binomial models as well as various robustness checks, indicated that RIPC and AIPC complement the link between PCI and ICI respectively and firm innovation.

Week 7 – Survival Skills

Note: Students in italics, Prof normal

Why do we go to conferences and introduce our research?

  • To get feedback
  • To market yourself: your presentation is like a business card, everyone will know you through your research
  • It’s signalling: self-branding (see above point), shows you’re a good presenter (e.g. English-speaking skills), technical skills (e.g., PowerPoint skills)
  • WHEN GIVING A TALK AT CONFERENCE OR ANOTHER SCHOOL, YOU ARE BECOMING A SALESMAN – think about what a good salesman does in his pitch

Gives intro to John Hopkins talk

  • Graph for # of IT outage incidents isn’t the most convincing justification for the study (might want to control for the amount of air travel over those years)

Presentation Tips

  • Don’t start presentation with “$XX-billion-dollar industry” – every industry is big, think of a way to sell a story (use examples that demonstrate the importance of the research)
  • Don’t go directly to the theoretical literature review
  • If you are selling a product (say a laptop), are you going to start with all the details of the product you are going to sell (e.g., screen resolution, battery life, etc.)? No.

In most conferences, you only have 10-20 minutes. The shorter the time, the more difficult it is to give the talk. How are you going to present your research in only 15 minutes?

  • Cut down literature review, but then lit review, methods, results, discussion.

That sounds like a 20-minute talk. In a shorter amount of time focus on ideas, contribution, and motivation. Think about what is the most important aspect of your research (though literature review and methods are important, you don’t have time to introduce these aspects in only 12 minutes)?

  • Don’t waste half of your time on robustness checks – might not be interesting for your audience, probably isn’t the key part of your research
  • For example, 1/3 of the slide deck is on motivation of the research
  • Includes a large number of pictures or graphs
  • No more than three lines of text on a slide – the bigger point here, limit your amount of text. Don’t assume the audience will read the text on the slide
    • Remember that the audience can’t read and listen to you talk at the same time – if there is too much text on the slide, they will read that instead of listening to you
  • Show results with figures and visualization
  • Summary of findings is it

You are becoming a salesperson – focus on the important parts that will convenience your audience you are doing important research

  • This even holds true in 90-minute job talk. Rule of thumb, you would probably only speak for 40 minutes (and 40 slides) which isn’t enough time to talk about your research details

I expected feedback on my research at conference talks, but I haven’t had much luck.

  • I have experienced the same
  • It’s really about introducing / marketing yourself and your research – you speak English well, you are an engaging speaker, etc.
  • The chance of getting good feedback from a conference increases if it has discussants (e.g., WISE)
  • Better to find a few audience members at breaks and ask directly for feedback (e.g., “Thank you for attending my talk. Do you have any feedback or thoughts?”)

Any questions about conferences?

I think it is understandable as faculty to tell stories about research, but PhD students have to demonstrate their skills (e.g. show models to show you have vigorous method skills). My advisor says to focus on the methods and show that I am well trained in those areas

  • Think about having back up slides in your deck that have your full methods, tables, etc. Your presentation is all storytelling, pictures, etc. Then when you are done and taking questions, you can pull up your method slides from the back of your deck
  • Think about it has having Appendix slides – you have all your details and tables in the back of the deck that you can pull up if questions come up about those areas of the research
  • To your advisors point that technical aspect is most important part of the research, that is true to some extent. He is trying to sell you as a rigorous, well-trained person. If that’s the goal, that’s helpful advice.

In my experience, just listing out the robust checks on an Appendix slide is appropriate. Even for method, empirical papers, it can be enough

Different people, even at different conferences, have different tastes.

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.

Week 6 Reading Summary (HK)

Banker, R.D., Hu, N., Pavlou, P.A., & Luftman, J. (2011). CIO Reporting Structure, Strategic Positioning and Firm Performance. MIS Quarterly, 35(2), 487-504.

Since the emergence of the CIO position, academics and practitioners have struggled to identify the ideal CIO reporting structure. Banker, Hu, Pavlou, and Luftman (2011) provide insight by considering the alignment of a firm’s CIO reporting structure and its strategic position. Industry information has shown that the majority of CIOs report to the CEO or CFO and thus Banker et al. (2011) used a dichotomous operationalization of CIO reporting structure. Following Porter’s (1980, 1996) theory, Banker et al. (2011) considered two generic strategies: differentiation and cost leadership. Differentiation is pursued when firms focus on providing products/services that are superior in terms of designs, innovation, development, engineering, customer intimacy, and/or brand image. Conversely, a cost leadership strategy is perused by achieving economies of scale, cost efficiencies, and operational excellence. It is important to note that these generic strategies are not mutually exclusive; firms attempt to effectively balance both while pursing one main strategy. To operationalize, Banker et al. (2011) used an external assessment, specifically profit margin for differentiation and asset turnover for cost leadership, contrary to typical self-assessment methods. Finally, various control variables including IT intensity, IT orientation, industry technology level, industry concentration, and CIO tenure were employed.

Banker et al. (2011) used 200 firms from 1990-1993, as well as 58 firms from 2006 as a robustness check, to investigate their hypotheses considering the alignment of CIO reporting structure and strategic positioning. Results indicated that strategic positioning influences reporting structure; differentiators favour CIO-CEO, while cost leaders favour CIO-CFO. Alignment of CIO reporting structure and strategic positioning positively affects firm performance (operationalized as abnormal stock returns and future cash flows from operations). Finally, the results highlight the fact that there is not a universal CIO reporting structure, but rather, the ideal structure is dependent on the strategic positioning of the firm.

Week 5 Reading Summary (HK)

Kang, K., Hahn, J., & De, P. (2017). Learning Effects of Domain, Technology, and Customer Knowledge in Information Systems Development: An Empirical Study. Information Systems Research, 28(4), 797-811.

Though there have been a myriad of developments and improvements to programming languages, development methods and tools, and formal training in information systems and technologies, information systems developments (ISDs) are still plagued by performance concerns including failing to adhere to schedules and timetables as well as budgets. Recent research has proposed and explored how capitalizing on learning (or experience) curves could improve ISDs through the theory of transfer of learning. Effectively, ISD projects are difficult due to their disparate tasks, teams, and complexity that vary across projects. To the extent that these projects capitalize on existing knowledge or experience amongst team members, they will be better able to meet performance deadlines and expectations. Using archival data outlining 497 ISD projects that included 2,393 unique employees at a prominent global IT services company from 2005 to 2007, Kang, Hahn, and De (2017) were able to explore how ISD project teams are able to learn and transfer knowledge from prior to new projects and under which conditions learning effects are stronger or weaker.

The theory behind Kang et al.’s (2017) study highlights how employees are able to accrue learning effects through repeated experience of identical elements across tasks (i.e., the environmental perspective). Results indicated that ISD project teams’ experience from prior projects benefits performance (operationalized as development effort and scheduled delay) on subsequent projects when there is an overlap in knowledge or experience. Moreover, ISD project teams can have domain (worked in the domain before), technology (worked with same technology), and customer experience (having dealt with the customers before). These three experience areas are substitutive and become either stronger or weaker depending on the projects’ team and task complexities. For example, the technology experiences a project team may have are less beneficial (i.e., becomes weaker) when the project has high technological complexity.

Week 4 Reading Summary (HK)

Tafti, A., Mithas, S., Krishnan, M. S. (2013). The effect of information technology-enabled flexibility on formation and market value of alliances. Management Science, 59(1), 207-225.

By using a sample of 169 firms that spanned 50 industries, Tafti, Mithas, and Krishnan (2013) were able to investigate the effect of information technology (IT) architecture flexibility on strategic alliance formation and firm value. Three distinct dimensions of IT architecture flexibility, open communication standards, cross-functional transparency, and modularity, were considered. Open communication considers the adoption of an open standard across firms, such as Extensible Markup Language (XML), which allows more connectivity and information transferring between firms. Cross-functional transparency is defined as the skills and abilities that are widely deployable, visible, and accessible across different functions in a firm. Finally, when a firm is modular, it is able to decompose processes into atomic, fine-grained units of functionality which can then be combined easily with other modules to efficiently construct a new process. The study considered the effect of these three dimensions of IT architecture on three types of alliances, arm’s-length, collaborative, and joint-venture alliances respectively. Arm’s-length alliances most closely resemble market transactions and are better suited for the transfer of highly codified explicit knowledge across firm boundaries. Next, collaborative alliances involve the sharing of firm specific or tacit knowledge, a recombination of products/services/processes, or heavy coupling of interoganizational business processes. Finally, joint-ventures create an entirely new business entity through the allocation of partnered resources.

Various Poisson and binomial panel models were run on a dataset that was created by combining various sources including InformationWeek, Compustat, and the Bureau of Economic Analysis. Results found that open communication and modularity are associated with the formation of arm’s-length and joint-venture alliances respectively. Overall, IT architecture flexibility enhances the value of all types of alliances, especially collaborative alliances. Effectively, these results suggest that in collaborative-intensive alliances, reconfiguration of resources and modification of processes can be facilitated by appropriate investments in IT.

Week 3 Reading Summary (HK)

Tambe, P., Hitt, L.M., and Brynjolfsson, E. (2012) “The Extroverted Firm: How External Information Practices Affect Innovation and Productivity,” Management Science (58:5) pp. 843-859.

Tambe, Hitt, and Brynjolfsson (2012) combined various data sources including survey-based measures and COMPUSTAT information to identify and demonstrate the value of organizations embracing external focuses. An external focus is the ability of a firm to identify and respond to changes in the external operating environment. Extreme examples of firms successfully embracing external focuses are internet based companies, such as Google and Amazon, who record users’ keystrokes and analyze these data to optimize their products, processes, and marketing strategies. Using survey based measures, Tambe et al. (2012) first identified the correlation between external focus and IT investment and organizational decentralization. Next, the authors found that these three practices are all associated with improved production innovation capabilities. Finally, a three-way complementarities model indicated that the combination of the three practices of external focus, IT investment, and organizational decentralization are associated with significantly higher productivity.

Prior to Tambe et al.’s efforts (2012) research had demonstrated the value of organizational decentralization on IT investments. Tambe et al. (2012) confirmed this finding and highlighted that IT has the strongest impact on productivity in firms assuming that they are embracing the appropriate organizational structure. Furthermore, the authors added to past research findings by introducing the third factor of external focus into the IT productivity framework. Results indicated that product development was one of the principle mechanisms through which external focus impacts productivity. Overall, the key managerial implication of Tambe et al.’s findings is that firms with an external focus are more productive and reap disproportionate benefits from advances in IT and workplace organization. It is worth noting that to derive the maximum amount of benefits from complements organizations must embrace them all. Thus, firms with decentralized structures should look to embrace a more external focus to fully realize the returns of their IT investments.

Week 2 Reading Summary (HK)

Ray, G., Wu, D., & Konana, P. (2009). Competitive environment and the relationship between IT and vertical integration. Information Systems Research20(4), 585-603.

Information technology (IT) can reduce coordination costs for companies, both internally and externally, minimizing barriers preventing the use of markets. Based on this premise, it is proposed that increasing the use of IT will in turn decrease the employment of vertical integration (VI). Past research has found that less vertically integrated firms have a higher need for external coordination and thus a higher demand for IT capital (Dewan et al., 1998; Hitt, 1999). Despite this premise and its empirical support, the average level of VI has increased over the past 25 years. This prompted Ray, Wu, and Konana (2009) to examine firms included in InformationWeek 500 from 1995 to 1997 using COMPUSTAT data to better understand this incongruence. Ray et al. (2009) considered demand uncertainty and industry concentration as boundary conditions which impact VI and IT spend. Demand uncertainty captures the degree of unpredictability in consumers’ tastes and preferences as well as in production and service technologies. Industry concentration is high when a leader or leaders control an industry with high barriers to entry; diluted industries are those with many small firms.

Results found that when demand uncertainty is high or industry concentration is low, results were consistent with past literature; IT is associated with a decrease in VI. In these conditions, an increase in the level of VI is associated with an increase in product and coordination costs and thus, less VI is ideal. On the other hand, when demand uncertainty is low or industries are highly concentrated, IT is associated with an increase in VI; this is contrary to past literature. In these environments, VI is associated with a decrease in production and coordination costs and thus, is ideal. Effectively, these findings indicate that the industry environment impacts the value of VI and IT.

Week 1 Reading Summary (HK)

Anderson, M.C., Banker, R.D., and Ravindran, S. (2006) “Value Implications of Investments in Information Technology,” Management Science (52:9) pp. 1359-1376.

Anderson, Banker, and Ravindran (2006) capitalized on the unique Y2K bug situation to further the debate on the value of IT. Skeptics of IT spending argue that companies overspend on IT (Carr, 2004) based on the false belief that IT can provide a sustainable competitive advantage. Proponents of this belief feel that companies should wait to allow others to absorb the cost of IT and simply mimic successful implementations. On the contrary, IT supporters argue that IT creates value by connecting consumers and suppliers in a value driven way. This debate has been ongoing due to the difficulties that arise when attempting to empirically address IT performance and value; past research has relied on survey information (Bharadwaj et al., 1999; Brynjolfsson et al., 2002) or public announcements (Dos Santos et al., 1993; Im et al., 2001; Chatterjee et al., 2001). However, Anderson et al. (2006) capitalized on the U.S. SEC’s mandate to disclose Y2K preparations in order to gain unique insight into this ongoing debate.

Following a market valuation framework similar to Lev and Sougiannis’ (1996), Anderson et al. (2006) employed empirical models which related the combination of firms’ current book values and earnings, along with other value-relevant variables, to firms’ market values (i.e. prevailing stock prices). Though some critics proposed that organizations were overzealous with their IT spending in light of Y2K (Kong and Seipel, 2000), Anderson et al. (2006) found companies who spent more in the Y2K period experienced the benefits of improved earnings performance and increased value. These benefits were further realized in transformational industries, or those where IT has the potential to alter traditional business processes and relationships. Effectively, companies that embraced IT upgrades in response to the Y2K bug positioned themselves so that they could realize the benefits of emerging e-business applications.