Information technology sourcing alliance efficacy: A multi-method comparison of initial value distributions among alliance participants

Leveraging IT knowledge assets is key to competitive distinctiveness. Because firms sometimes lack the needed IT knowledge stocks, IT sourcing alliances are ubiquitous. IT vendors possess specialized knowledge stocks that help to position firms competitively in the new economy.; Although IT alliances are common, some recent alliances are fundamentally different from those in the past. Clients are creating IT alliances to not only source standard IT assets but to also acquire critical capabilities or jointly create value. Moreover, bilateral alliances are not the only alliance form observed. Multilateral alliances, rare a few years ago, are increasingly in their frequency.; This dissertation thus examine three questions germane to the bifurcation of IT sourcing alliances. First, do IT alliances generate value? Second, how is the value distributed among its participants? Finally, how does the value created and appropriated by an alliance participant vary across different alliance types?; This dissertation examine these questions using two methods. A cooperative game theory model models the cooperation and competition dialectic present in IT alliances and its impact on the value extracted from them. An event study model then tests, extends, and generates additional insights. These two models, which leverage the conceptual, analytic, and empirical research from resource based theories of the firm, innovation theory, institutional economics, and game theory, triangulate key results.; Results suggest that firms receive positive rents from IT sourcing alliances but that the value accrues disproportionately to those vendors that possess scarce and valuable IT knowledge stocks. Results also suggest the conditions under which IT alliances are stable, alliance participants have the potential to earn rents, and vendors will be assured of abnormal rents.; Most notably, results suggest that the value extracted from alliances can differ significantly across types of alliances. Firms received normal rents from some alliances while they received abnormal rents from others due to the bifurcation of IT sourcing alliances into various configurations. Moreover, clients compensated vendors that cooperated more than vendors that did not cooperate thereby suggesting an abnormal valuation for cooperation.; The dissertation concludes by highlighting its contribution to theory and practice, and directions for future work.