The determinants of long‐term relationship on inter‐organizational systems performance

Abstract

PurposeThis study aims to explore the relations among inter‐organizational, organizational, technical factors, inter‐organizational systems (IOS) use, IOS performance and long‐term relationship.Design/methodology/approachTo test the research hypotheses, this study primarily used LISREL 8.52 to do the SEM in order to ensure the relation across various dimensions. After SEM, path analysis is applied to test each of the hypotheses.FindingsThe findings of this study show that organizations exerting more power on suppliers are more likely to be aggressive in expanding the extent of IOS use. Organizations with strong executive support for IOS are more likely to be aggressive in expanding the extent of IOS use, and the extent of IOS use has significant and positive moderating effects on long‐term relationships and IOS performance.Research limitations/implicationsFuture studies may focus on competition pressure and IS compatibility. It may increase the number of samples, while including small companies for the study, in order to achieve generality.Practical implicationsThis study found that IOS will not only improve a company's productivity, product quality and costs, but also strengthen the long‐term relationship with their partner. Both buyers and suppliers can pay attention about how to improve and expand the extent of IOS use by three major factors: inter‐organizational, organizational, and technological perspectives.Originality/valueThis study is the first to examine three dimensions of factors (inter‐organizational, organizational, and technical factors) and their interaction with the use of IOS. This study is also the first to simultaneously discuss the relationships among IOS usage, IOS performance and long‐term relationships.