Diffusion of Information Technology Outsourcing: Influence Sources and the Kodak Effect.

Author List: Loh, Lawrence; Venkatraman, N.;
Information Systems Research, 1992, Volume 3, Issue 4, Page 334-358.
The governance of an organizational information technology (IT) infrastructure is steadily shifting away from pure hierarchical and market mechanisms toward hybrid and partnership modes that involve external vendors. In particular, IT outsourcing has recently emerged as a significant administrative innovation in an organization's IT strategy. This paper seeks to explore the sources of influence in the adoption of this innovation. For this purpose, we generated a comprehensive sample of outsourcing contracts in the US using an electronic bibliometric search process. Using diffusion modeling, our empirical analysis shows that the adoption of IT outsourcing is motivated more by internal influence (or imitative behavior) than by external influence amongst the user organizations. Subsequently, we considered the widely-publicized Eastman Kodak's outsourcing decision as a critical event to assess whether this internal influence is more pronounced in the post-Kodak regime than in the pre-Kodak regime. Our results show that internal influence is dominant in the post-Kodak regime but not in the pre-Kodak regime. Implications and directions for future research are discussed.
Keywords: diffusion models;information technology governance;information technology outsourcing;information technology strategy
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#58 0.154 internal external audit auditing results sources closure auditors study control bridging appears integrity manager effectiveness auditor controls facilitating boundaries potential
#116 0.126 research study influence effects literature theoretical use understanding theory using impact behavior insights examine influences mechanisms specifically context perspective findings
#49 0.111 adoption diffusion technology adopters innovation adopt process information potential innovations influence new characteristics early adopting set compatibility time initial current
#47 0.106 outsourcing vendor client sourcing vendors clients relationship firms production mechanisms duration mode outsourced vendor's effort activities in-house managing technology domestic
#292 0.086 information research literature systems framework review paper theoretical based potential future implications practice discussed current concept propositions findings provided extant
#35 0.085 technology organizational information organizations organization new work perspective innovation processes used technological understanding technologies transformation consequences perspectives use administrative economic
#274 0.065 outsourcing transaction cost partnership information economics relationships outsource large-scale contracts specificity perspective decisions long-term develop requirements economic association factors hypotheses