Strategic Payoff from EDI as a Function of EDI Embeddedness.

Author List: Chatfield, Akemi Takeoka; Yetton, Philip;

Journal of Management Information Systems, 2000, Volume 16, Issue 4, Page 195-224.

A key issue facing information technology (IT) researchers and practitioners has been the difficulty in realizing strategic payoff from IT investment. This study, drawn on sociological theories of embeddedness, addresses this key issue, with particular attention to the perspective of EDI network initiator. Cross-case analysis is conducted comparing three initiators of sophisticated EDI networks, who realized different levels of strategic payoffs. Results reveal that the achievement of strategic payoffs is a function of EDI embeddedness, which is defined as how central or peripheral a specific EDI network is to managing interfirm interdependence. In a model of EDI initiator strategic payoff, the authors argue that EDI embeddedness, which is influenced by existing interfirm relationship, moderates the impact of adopter EDI use on initiator strategic payoff derived from the EDI investment. Specifically, while high embeddedness motivates adopter strategic use, low embeddedness deters such use. The model is validated against three reported cases in the literature.

Keywords: Electronic Data Interchange; Embeddedness; Interfirm cooperation; Interfirm Interdependence; IT Investment; Strategic Payoff; Time-Based Competition

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List of Topics

#101	0.241	edi electronic data interchange b2b exchange exchanges interorganizational partners adoption transaction trading supplier factors business suppliers impact network commerce efficiency
#25	0.199	relationships relationship relational information interfirm level exchange relations perspective model paper interpersonal expertise theory study effects literature role social identify
#165	0.114	uncertainty contingency integration environmental theory data fit key using model flexibility perspective environment perspectives high conditions processing examine issue uncertain
#246	0.111	strategic benefits economic benefit potential systems technology long-term applications competitive company suggest additional companies industry operating costs difficult substantial total
#271	0.107	technology investments investment information firm firms profitability value performance impact data higher evidence diversification industry payoff return findings decisions greater
#122	0.073	attention utilization existing codification model received does limitations theories receiving literature paying causes additional building examine examination focusing technological initial