The adoption and diffusion of interorganizational system standards and process innovations

Abstract

Interorganizational system standards have reached a new era in industry. An era that has largely been overlooked in research but is on the verge of immense widespread diffusion. The notion of an interorganizational system (IOS) has nearly been lost. Virtually eclipsed by the attention towards e-commerce, B2B, P2P and many others. When asked about interorganizational systems, invariably most think of electronic data interchange (EDI). Albeit EDI still remains the preeminent type of interorganizational system, IOS solutions have been overhauled since the mid-1990s. IOS solutions are now collaboratively developed, structured around discretely defined cross-company business process standards and able to be distributed via the web. Compared with EDI technology from the past, the notions of open standards code, modularity, scalability, and interorganizational business process reengineering are embedded in modern-day IOS development. Fundamentally, this work bridges the research gap between prior studies in IOS diffusion (based predominantly on EDI) versus modern-day IOS solutions. Pragmatically, this work examines assimilation levels of interorganizational system standards and process innovations (IOS SPI) among members of an industrial group where a standards development organization (SDO) exists. The innovations under study include a group of related technologies (XML, SOAP, WSDL and other API's) that are essential in modern-day IOS solutions. A conceptual multi-stage IOS SPI adoption and diffusion model is defined, hypotheses proposed and empirically tested based on firm-level cross-sectional surveys of 102 firms from 10 industrial groups encompassing 16 SDOs. Using the technological-organizational-environmental framework (with the addition of the SDO construct), the significant determinants of IOS SPI adoption and deployment are identified. A rich discussion is provided regarding findings in the areas of industrial coordination of IOS standards, consequences of IOS standards diffusion, and SDO measures of success (including governance, management practices and architecture). The paper includes numerous research implications and provides practitioner recommendations in this critically important and emerging frontier.

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