Leveraging open-standard interorganizational information systems for process adaptability and alignment

Abstract

Purpose The purpose of this paper is to understand the value creation mechanisms of open-standard inter-organizational information system (OSIOS), which is a key technology to achieve Industry 4.0. Specifically, this study investigates how the internal assimilation and external diffusion of OSIOS help manufactures facilitate process adaptability and alignment in supply chain network. Design/methodology/approach A survey instrument was designed and administrated to collect data for this research. Using three-stage least squares estimation, the authors empirically tested a number of hypothesized relationships based on a sample of 308 manufacturing firms in China. Findings The results of the study show that OSIOS can perform as value creation mechanisms to enable process adaptability and alignment. In addition, the impact of OSIOS internal assimilation is inversely U-shaped where the positive effect on process adaptability will become negative after an extremum point is reached. Originality/value This study contributes to the existing literature by providing insights on how OSIOS can improve supply chain integration and thus promote the achievement of industry 4.0. By revealing a U-shaped relationship between OSIOS assimilation and process adaptability, this study fills previous research gap by advancing the understanding on the value creation mechanisms of information systems deployment.

External diffusion of B2B e-procurement and firm financial performance: role of information transparency and supply chain coordination

“…Also, external diffusion of e-procurement, an IOS, will help the firm to exploit the network effect (Pu et al , 2019; Sodero et al , 2013) with higher information availability and processing. This will help the buyer's firm in enhancing supplier base and thereby in reducing the procurement cost through competitive buying.…”

“…Internal diffusion or assimilation means the degree or extent to which the e-procurement is deployed for key internal activities of an organization related to the supply chain. Whereas, external diffusion is defined as the degree or extent to which the e-procurement system is deployed for integrating the supply chain partners for performing the transactions with them (Ranganathan et al , 2004; Pu et al , 2019; Lin and Lin, 2008).…”

“…(Ranganathan et al , 2004; Brandon-Jones, 2017; Alvarez-Rodríguez et al , 2014). Prior studies on IT diffusion in e-business and electronic SCM (e-SCM) have differentiated the diffusion of IT in internal assimilation and external diffusion (Pu et al , 2019; Wu and Chang, 2012; Huo, 2012; Lin and Lin, 2008).…”

“…Zhang et al (2011) pointed out that the impact of information and communication technology (ICT) on supply chain performance is to be viewed separately for internal and external activities for consistent results. Pu et al (2019) advocated the use of open-standard IOS for process adaptability and alignment. They concluded that by enabling process adaptability, external diffusion of IOS helps in integrating the inter-firm supply chain activities through process alignment.…”

“…This reflects the practitioner's requirement of an inter-organization system having the capability for easy integration within their organization and with suppliers for ensuring supplier onboarding on the system. External diffusion of an e-procurement system, an IOS in the upstream of the supply chain, having easy integration capabilities will help the organization in aligning its process with suppliers and therefore improving supply chain integration (Pu et al , 2019). Integrated e-procurement system with maximum suppliers onboard will ensure efficient and effective supplier information management.…”