Supply Chain Opportunism, Relative Dependency and the IOS Adoption

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Supply Chain Opportunism, Relative Dependency and
the IOS Adoption

• Kelvin (XT) Liu
• University of South Carolina

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Motivation

• Money left on the Table
• IOS improves supply chain profit
• Cash and Konsynski, 1985 Clemons and Row, 1992
  Mukhopadhyay and Kekre, 2002
• Not all trading partners seem willing to adopt
• Clemons and Row, 1993 Iacovou, Benbasat and
  Dexter, 1995 Wathne and Heide, 2000
• Why?

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Motivation

• IOS adoption literature
• Interorganizational factors
• Dependence, power, trust and external pressure
  etc
• Chwelos, Benbasat and Dexter, 2001 Hart and
  Saunders, 1997 Iacovou et al., 1995 Teo et al.,
  2003
• Opportunism
• Wathne and Heide, 2000

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Motivation

• Relative dependence and IOS adoption
• Dependence creates potential power
• Pfeffer and Salancik, 1978 Thompson, 1967
• Will higher dependence lead to IOS adoption?
• Theoretically, Yes Hart and Saunders, 1997 Hart
  and Saunders, 1998 Iacovou et al., 1995
• Chwelos et al., 2001 Hart and Saunders, 1998

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Conceptual Model
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Opportunism Deter IOS Adoption Link 1

• Ex post Opportunism
• Initiator (buyer) expropriate all the IOS benefit
• Ex post opportunism deter ex ante invt
• Bakos and Brynjolfsson, 1993 Clemons and Row,
  1993 Williamson, 1989.

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Opportunism Deter IOS Adoption Link 1

• H1 A buyers ex post opportunism in dividing the
  economic surplus from IOS adoption is negatively
  related to its suppliers likelihood of adopting
  the IOS.

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Relative Dependence and Opportunism Link 2

• Dependence creates potential power
• Resource dependence theory
• Pfeffer and Salancik, 1978 Thompson, 1967

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Relative Dependence and Opportunism Link 2

• Relative dependence affect opportunism

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Relative Dependence and Opportunism Link 2

• H2 The dependence of a buyer on its supplier is
  negatively related to its ex post opportunistic
  behaviors in allocating the IOS benefits. The
  buyers opportunism levels for the four types of
  dyads are is in the following order
• Buyer power gt Independence gt Interdependence gt
  Supplier Power

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Relative Dependence and IOS adoption

• H3 Greater dependence of a supplier on its buyer
  is negatively related to the likelihood of its
  adoption of IOS.

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Dependency and Performance

• H4 A dyad with symmetric dependency can realize
  greater IOS-enabled benefits than a dyad with
  asymmetrical dependency structure.