Delivering quality customer service has emerged as a strategic imperative, one that is increasingly tied to a firm's information technology resources and capabilities. This paper presents an empirical study that examines the extent to which IT impacts customer service. More specifically, this study investigates the differential effects of various IT resources and capabilities on the performance of the customer service process across firms that compete in the North American life and health insurance industry. The paper builds on (1) information systems work that suggests that the effects of IT are best documented at the level of processes within a firm, (2) information systems work that suggests that the performance effects of IT are likely to be contingent in nature, and (3) developments in the resource-based view, which describes the kinds of IT resources and capabilities that are likely to enable a process in one firm to outperform the same process in competing firms. The findings suggest that tacit, socially complex, firm-specific resources explain variation in process performance across firms and that IT resources and capabilities without these attributes do not. Of particular interest to IS scholars, it is found that shared knowledge between IT and customer service units-an important driver of how IT is implemented and used in the customer service process-is a key IT capability that affects customer service process performance and moderates the impacts of explicit IT resources such as the generic information technologies used in the process and IT spending, which-consistent with resource-based predictions-were not found to be directly and positively associated with relative process performance. The implications of the findings for research and practice are discussed.

Information technology and the performance of the customer service process: a resource-based analysis

Business value of information technology is an enduring research question. The elusive link between IT and financial firm performance calls for further research into intermediate organizational variables through which IT may influence firm performance. This study proposes that knowledge management (KM) is a critical organizational capability through which IT influences firm performance. In the context of multibusiness firms, the study examines how the IT resources of a firm should be organized and managed to enhance the firm's KM capability, and whether and how KM capability influences firm performance. The study develops two hypothesizes: (1) IT relatedness of the firm's business units enhances cross-unit KM capability; (2) KM capability, in turn, leads to superior firm performance. Data from 250 Fortune 1000 firms provide empirical support for these hypotheses. IT relatedness of business units enhances the cross-unit KM capability of the firm. The KM capability creates and exploits cross-unit synergies from the product, customer, and managerial knowledge resources of the firm. These synergies increase the financial performance of the firm. IT relatedness also has significant indirect effects on firm performance through the mediation of KM capability.

Information technology relatedness, knowledge management capability, and performance of multibusiness firms

https://isiarticles.com/bundles/Article/pre/pdf/1138.pdf

The impact of enterprise systems on corporate performance: A study of ERP, SCM, and CRM system implementations

https://cyberleninka.org/article/n/933333.pdf

The role of information technology in the organization: a review, model, and assessment

To date, most research on information technology (IT) outsourcing concludes that firms decide to outsource IT services because they believe that outside vendors possess production cost advantages. Yet it is not clear whether vendors can provide production cost advantages, particularly to large firms who may be able to replicate vendors' production cost advantages in-house. Mixed outsourcing success in the past decade calls for a closer examination of the IT outsourcing vendor's value proposition. While the client's sourcing decisions and the client-vendor relationship have been examined in IT outsourcing literature, the vendor's perspective has hardly been explored. In this paper, we conduct a close examination of vendor strategy and practices in one long-term successful applications management outsourcing engagement. Our analysis indicates that the vendor's efficiency was based on the economic benefits derived from the ability to develop a complementary set of core competencies. This ability, in turn, was based on the centralization of decision rights from a variety and multitude of IT projects controlled by the vendor. The vendor was enticed to share the value with the client through formal and informal relationship management structures. We use the economic concept of complementarity in organizational design, along with prior findings from studies of client-vendor relationships, to explain the IT vendors' value proposition. We further explain how vendors can offer benefits that cannot be readily replicated internally by client firms.

/pdf/from-the-vendor-s-perspective-exploring-the-value-sjtbgjskgz.pdf

From the vendor's perspective: exploring the value proposition in information technology outsourcing

Advances in new Information Technologies IT and changes in the business environment such as globalization and competitive pressure have prompted organizations to embark on reengineering projects involving significant investments in IT and business process redesign. However, the evidence of payoff from such investments can be classified as mixed as best, a problem we partly attribute to the absence of a strong theoretical foundation to assess and analyze reengineering projects. We seek to apply complementarity theory and a business value modeling approach to address some questions involving what, when, and how much to reengineer. Complementarity theory is based on the notion that the value of having more of one factor increases by having more of another complementary factor. Further, related developments in the optimization of “supermodular” functions provide a useful way to maximize net benefits by exploiting complementary relationships between variables of interest. Combining this theory with a multi-level business value model showing relationships between key performance measures and their drivers, we argue that organizational payoff is maximized when several factors relating to IT, decision authority, business processes and incentives are changed in a coordinated manner in the right directions by the right magnitude to move toward an ideal design configuration. Our analysis further shows that when a complementary reengineering variable is left unchanged either due to myopic vision or self-interest, the organization will not be able to obtain the full benefits of reengineering due to smaller optimal changes in the other variables. We also show that by increasing the cost of changing the levels of design variables, unfavorable pre-existing conditions e.g., too much heterogeneity in the computing environment can lead to reengineering changes of smaller magnitude than in a setting with favorable conditions.

https://www.jstor.org/stable/info/23010996

The Calculus of Reengineering

Facing increasingly complex tasks involving coordination, communication and interactions among multiple decision makers, organizations are undergoing a transition, experimenting with new forms such as the team-based structure, and investing heavily in network-based computing to support team activities. We take the position that for the new form to succeed, and for computing investments to pay off, the organizational designer must consider complementarity effects between incentives, IS design, and organizational and task characteristics. Since these factors impact group performance through complex interactions, a change in one factor necessitates changes in others. We develop a stylized, analytical model of group/team interactions involving computing support, and study the impact of various design factors and their interactions on group productivity. Key research issues include the choice of a team/group reward structure, the impact of team composition and computing system features on the overall payoff, incentives for monitoring peers and their effect on group output, the time allocation of group members between peer monitoring and task effort, and the effect of task interdependence on monitoring incentives. The theoretical model provides a set of propositions showing how interactions between the chosen reward system, system design features and organizational factors determine members' behavior e.g., the extent of free riding and shirking and subsequently the organizational payoff. These results provide broad qualitative implications for designing incentive schemes and information systems for appropriating maximum organizational value in team-based environments.

Incentives and Computing Systems for Team-Based Organizations

In this technology-intensive business world, it is important to note that technology does not work alone; it only works when all other supporting elements work in concert. Two ‘things’, or business strategies, are complementary when the marginal contribution of one increases with the value of the other, and vice versa This paper models two business strategies, electronic commerce and mass customization, in a profit maximization model and shows that these two strategies as complementary under certain assumptions. In doing so, this paper sheds light on why many mass customization attempts failed and why electronic commerce does not bring in as high a return as expected. This paper includes three sub-models and shows the optimal price movements under each scenario.

The Complementarity Of Mass Customization And Electronic Commerce

Reengineering has been one of the most popular concepts of this decade. According to a recent Business Week report [l] reengineering is ranked the top priority project of CEOs for both United States and European firms. As companies face increasing pressures from domestic and international competition, reengineering undoubtedly is believed to be the cure for many organizations’ problems. Reengineering promotes a process-oriented redesign of the company, and asserts radical changes for radical improvements. Companies have invested millions of dollars in purchasing new information technology and redesigning their processes in hopes of quantum leap improvements promised by reengineering experts.

C.-H. Sophie Lee

Papers

The Calculus of Reengineering

Incentives and Computing Systems for Team-Based Organizations

The Complementarity Of Mass Customization And Electronic Commerce

CART: a computer aided reengineering tool based on business value complementarity theory