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Although networks are traditional (but until recently neglected) forms of organizing commercial activities, they have become more prominent throughout the 1990s (e.g., Little, 2001). Even though various strategic drivers of network formation can be identified, the development of information and communication technologies (ICT) and of innovative forms of information flows across companies’ boundaries (Konsynski, 1993) has significantly contributed to the fast and vast proliferation of networks. Inter-organizational information systems (IOISs) have been developed in various industries like airlines, automotive, banking, health care, etc. Global, standardized communication infrastructures have lowered the cost and facilitated new forms of cross-company collaboration (Bender, 2002). The diffusion of the World Wide Web has led to the emergence of numerous network business models (e.g., Franke, 2002; H cki & Lighton, 2001), in which companies quickly try to exploit windows of technologically facilitated, commercial opportunities. IOISs aim to reorganize the interfirm value creation by supporting or replacing processes and by enabling new value creation structures and new flexible arrangements such as virtual organization networks.
Technological and organizational developments have become increasingly inter- twined. Organizational changes call for new ICTs that give birth to a range of new IOISs, while these IOISs enable new organizational forms at the same time.
Acceptance and adoption are frequently far below the sponsors’ expectations, and, even if they have been launched successfully, their stabilization in a dynamic business environment is quite challenging. Most critical issues and challenges that are well known from the IS field also apply- often in an exacerbated mannerto IOISs. Thus, in order to understand fully the impact of IOISs and to address the resulting management challenges, we looked at the nature of network management in general and network information management (NIM) in particular.
The notion of strategic alignment (Henderson & Venkatraman, 1993) highlights the need to coordinate along two dimensions: first between IT and the business sphere and second between strategic and operational issues. Applied to IOISs, strategic alignment addresses the issue of coordination between NIM and network management in general and between IOISs and the underlying network structures and processes. Our findings show that the managerial challenges of establishing and running IOISs successfully extend beyond NIM. The IOIS is seen as embedded in an interfirm network and facilitating interfirm processes, in particular, inter-organizational collaboration and coordination, which will eventually determine the outcome of the network. The underlying assumption is that systematic network (information) management practices are needed in order to facilitate the overall outcome and performance of the network. In order to address these challenges, such as the IOIS-enabled transformation of business processes or the stabilization of IOISs through the development of social capital and trust, NIM will be embedded into a network management model. Network management in a broad sense comprehends information management issues. However, it addresses, in particular, the network business and organizational environment within which the IOIS is functioning, it specifies support needs, and provides an institutional support structure for the IOIS.
Ouchi (1980) suggested that cooperation between operational units implies that a certain level of interdependence exists between these units. Extending this concept across organizational boundaries, we suggest that collaboration of firms in new organizational forms reshapes traditional managerial practices and creates new requirements for coordination, collaboration, and joint action. IOISs are essentially precarious systems: they have to accommodate the interests of various independent actors, they are difficult to design, and they have to adhere to existing standards or establish standards (or conventions) themselves.
The next section will present a brief taxonomy and three cases that illustrate the linkage between IOISs and inter-organizational networks. The third section will expand the notion of NIM, which will then be embedded in the broader notion of network management in the following section.
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