TY - JOUR

T1 - Impact of information technology on vendor objectives, capabilities, and competences in contract electronic manufacturing

A1 - Perunovic,Zoran

A1 - Mefford,Robert

A1 - Christoffersen,Mads

AU - Perunovic,Zoran

AU - Mefford,Robert

AU - Christoffersen,Mads

PB - Elsevier BV

PY - 2012

Y1 - 2012

N2 - Many factors influence the success of an outsourcing arrangement but vendor capabilities have been recognized as one of the main contributors. This paper investigates how information technology (IT) utilization contributes to success in outsourcing. We take a vendor's perspective and study how IT impacts vendor capabilities. The research framework integrates four concepts/theories: the resource-based view (RBV), the concept of manufacturing strategy, the concept of business performance, and the concept of IT impact on business performance. Two case companies are studied, one with a high level of IT development and another for which this is not the case. The results show that IT impacts vendor objectives indirectly by impacting competences and capabilities. Two types of impact of IT on competences and capabilities have been identified: IT as a competence enabler and IT as a capability enhancer. The most significant impact takes place when IT enhances a capability so that it becomes a capability important to achieving the objectives of winning, running, and renewing the outsourcing contracts. A method for calculating the impact of IT on capabilities and the impact of IT on operational performance has been proposed. The method gives valuable insights into how IT enables competences, enhances capabilities, and contributes to the fulfillment of vendor objectives. A model of how IT affects a vendor's competitiveness is proposed. In addition, two initiatives for optimizing the utilization of IT are suggested.

AB - Many factors influence the success of an outsourcing arrangement but vendor capabilities have been recognized as one of the main contributors. This paper investigates how information technology (IT) utilization contributes to success in outsourcing. We take a vendor's perspective and study how IT impacts vendor capabilities. The research framework integrates four concepts/theories: the resource-based view (RBV), the concept of manufacturing strategy, the concept of business performance, and the concept of IT impact on business performance. Two case companies are studied, one with a high level of IT development and another for which this is not the case. The results show that IT impacts vendor objectives indirectly by impacting competences and capabilities. Two types of impact of IT on competences and capabilities have been identified: IT as a competence enabler and IT as a capability enhancer. The most significant impact takes place when IT enhances a capability so that it becomes a capability important to achieving the objectives of winning, running, and renewing the outsourcing contracts. A method for calculating the impact of IT on capabilities and the impact of IT on operational performance has been proposed. The method gives valuable insights into how IT enables competences, enhances capabilities, and contributes to the fulfillment of vendor objectives. A model of how IT affects a vendor's competitiveness is proposed. In addition, two initiatives for optimizing the utilization of IT are suggested.

KW - Vendor perspective in outsourcing

KW - Resource-based view

KW - Information technology

KW - Contract electronics manufacturing

U2 - 10.1016/j.ijpe.2012.04.009

DO - 10.1016/j.ijpe.2012.04.009

JO - International Journal of Production Economics

JF - International Journal of Production Economics

SN - 0925-5273

IS - 1

VL - 139

SP - 207

EP - 219

ER -