An empirical investigation of the antecedents of telecommunication-based interorganizational systems

Abstract

Interorganizational information systems (IOS) utilising telecommunications technology are commonly used to gain a strategic advantage or to compete with IOS developed by the firm's competitors. The use of telecommunication-based links with customers and suppliers provides such potential benefits as improved internal operations, greater interorganizational efficiency and increased bargaining power. Although this importance of telecommunication links with customers and suppliers is widely recognised, there has been little empirical research on the factors that may affect the use of telecommunication-based IOS. In this paper we investigate the effects of four key factors – environmental uncertainty, product information intensity, value chain information intensity and information system (IS) maturity – on the use of telecommunication links with customers and suppliers, and the impact such links have on organizational performance. Nine hypotheses relating these antecedent variables to the use and impact of interorganizational telecommunication links are proposed. Data were collected through a survey of eighty-four medium-sized companies. In addition, the measures of the impact of telecommunication links on organizational performance and environmental uncertainty were validated using a second respondent and secondary data respectively. Results suggest that environmental uncertainty permits the use of telecommunication links with suppliers. Product information intensity and value chain information intensity were positively associated with the use of telecommunication links with customers and suppliers respectively. IS maturity did not seem to enhance the use of interorganizational telecommunication links, but it did facilitate the impact these links had on organizational performance. Some implications of this study for future research and practice are examined.