| The confluence of several developments in technology and trends in the business environment has led to the emergence of a new outsourcing model---The Application Service Provider, or "ASP." The growth of the Internet and related technologies, as well as the expansion of networked infrastructure that facilitate the delivery of software over networks is the enabling technologies behind the ASP phenomenon.; The roots of ASP can be traced to three main developments: (1) outsourcing, (2) packaged enterprise applications, and (3) Internet computing. ASP benefits include providing organizations with the ability to access a broader range of applications and achieving on-demand scalability, while keeping implementation short and total cost of ownership low and predictable.; This dissertation research study views the ASP phenomenon both as a method of outsourcing and as an innovation. It tries to answer two general questions: (1) What are the factors that affect ASP adoption? and (2) What factors determine an organization's propensity to adopt the ASP innovation?; Tornatzky and Fleisher's (1990) theoretical framework is adapted as a "starting point" in this study. Specific determinants are then identified and defined, which includes concepts from innovation diffusion and ASP/outsourcing research literature that are generally deemed to influence ASP adoption. Diffusion and infusion are also identified and defined as both necessary and sufficient measures of ASP adoption.; This study employs a Web-based survey method for collecting data from top executives in the ASP user community. It uses a Partial Least Square (PLS) latent variable structural equation modeling (SEM) technique to analyze the data and examine the relationship between exogenous variables and diffusion and infusion.; As exploratory research, this study upholds several widely held beliefs about the diffusion and infusion of ASP innovation, though it rejects some others. The study finds support for significant relationship between four predictors and diffusion and infusion: (1) top management orientation; (2) internal IS expertise; (3) ASP industry characteristics; and (4) competitive pressure and ASP adoption. In addition, the findings show a strong relationship between diffusion and infusion. |
