Coordination and control of retailer-supplier transactions: Factors influencing organizational adoption and use of electronic information networks

This dissertation research investigates the factors influencing organizational adoption and use of electronic information networks. It focuses specifically on retailer-supplier transactions associated with product acquisitions. Derived from transaction cost analysis, several factors antecedent to electronic network adoption and use are proposed; they include uncertainty, asset specificity and complexity of product description. In addition, three social relational predictor variables are tested, namely interpersonal relationships, mutual commitment and trust. One of the dependent variables is an information technology cluster, which measures the adoption of six information technologies that enable electronic exchange of information. The other major criterion variable deals with the perceived importance of electronic network use to supporting transactions associated with product acquisitions.; Empirical observations were obtained from a telephone survey of 143 U.S. grocery retailers. Interviews focused on the way in which product buyers acquired key products from their major suppliers. One main finding is that significant predictors of technological adoption and network use are different. In particular, adoption is more likely when technology is viewed as a functional substitute for two social relational modalities of coordination and control: interpersonal relationships with and trust in the supplier. Trust and the importance of electronic network use also appear to be substitutable in managing transactions that involve routine, straightforward communication of price and order information. Furthermore, in executing these same types of transactions, using an electronic interconnection with a supplier appears to be a tangible indication of mutual commitment between the trading parties. When the transactions involve higher complexity, ambiguity or need for recursive interactions with the supplier (e.g., negotiations, monitoring and problem solving), a different group of factors are found to be correlated with electronic network use. First, electronic network use is perceived as complementary to interpersonal relationships as a coordination and control mechanism. In addition, electronic network use is strongly associated with high levels of complexity of product description: by offering sophisticated capabilities for representing and transmitting information, technologies facilitate the communication of a product's critical features, which are otherwise difficult to describe. All analyses controlled for the impact of organizational size and retailer-supplier integration.; In conclusion, this research shows that social relational factors influence organizational adoption and use of electronic networks in ways that are not explained by transaction cost variables. Future research efforts devoted to the refinement of the conceptualizations and measurement proposed in this study can further test the relative utility of transaction cost and social relational analyses. At a practical level, findings in this research suggest that retailers should not be concerned with technological implementation costs alone. Decisions to adopt and use electronic networks need to factor in the varying complementary and substituting relationships technologies have with the pre-existing social relational conditions characterizing trade with suppliers.