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    Special Section: Information Systems Support for Shared Understanding

    • Content Type Journal Article
    • Pages 107-110
    • DOI 10.2753/MIS0742-1222310105
    • Authors
      • Robert O. Briggs, San Diego State University

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    Shared understanding has been claimed to be crucial for effective collaboration of researchers and practitioners. Heterogeneity in work groups further strengthens the challenge of integrating understanding among diverse group members. Nevertheless, shared understanding and especially its formation are largely unexplored. After conceptualizing shared understanding, we apply collaboration engineering to derive a validated collaboration process module (compound thinkLet "MindMerger") to systematically support heterogeneous work groups in building shared understanding. We conduct a large-scale action research study at a German car manufacturing company. The evaluation indicates that with the use of MindMerger, team learning behaviors occur, and shared understanding of the tasks in complex work processes increases among experienced diverse tool and dye makers. Thus, the validated compound thinkLet MindMerger provides designers of collaborative work practices with a reusable module of activities to solve clarification issues in group work early on. Furthermore, findings from the field study contribute to the conceptualization of the largely unexplored phenomenon of shared understanding and its formation.

    • Content Type Journal Article
    • Pages 111-144
    • DOI 10.2753/MIS0742-1222310106
    • Authors
      • Eva Alice Christiane Bittner, Information Systems Department, Kassel University, Germany, since 2010
      • Jan Marco Leimeister, Institute for Business Informatics (IWI HSG), St. Gallen University

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    This paper examines the effects of social network structures on prediction market accuracy in the presence of insider information through a randomized laboratory experiment. In the experiment, insider information is operationalized as signals on the state of nature with high precision. Motivated by the literature on insider information in the context of financial markets, we test and confirm two characterizations of insider information in the context of prediction markets: abnormal performance and less diffusion. Experimental results suggest that a more balanced social network structure is crucial to the success of prediction markets, whereas network structures akin to star networks are ill suited to prediction markets. As compared with other network structures, insider information has less positive effects on prediction market accuracy in star networks. We also find that the bias of the public information has a larger negative effect on prediction market accuracy in star networks.

    • Content Type Journal Article
    • Pages 145-172
    • DOI 10.2753/MIS0742-1222310107
    • Authors
      • Liangfei Qiu, Warrington College of Business Administration, University of Florida
      • Huaxia Rui, Simon School of Business, University of Rochester
      • Andrew B. Whinston, Center for Research in Electronic Commerce, University of Texas at Austin

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    Credibility assessment is an area in which information systems research can make a major impact. This paper reports on two studies investigating a system solution for automatic, noninvasive detection of rigidity for automated interviewing. Kinesic rigidity has long been a phenomenon of interest in the credibility assessment literature, but until now was infeasible as a veracity indicator in practical use cases. An initial study unexpectedly revealed the occurrence of rigidity in a highly controlled concealed information test setting, prompting the design and implementation of an automated rigidity detection system for interviewing. A unique experimental evaluation supported the system concept. The results of the second study confirmed the kinesic rigidity found in the first, and provided further theoretical insights explaining the rigidity phenomenon. Although additional research is needed, the evidence from this investigation suggests that credibility assessment can benefit from a rigidity detection system.

    • Content Type Journal Article
    • Pages 173-202
    • DOI 10.2753/MIS0742-1222310108
    • Authors
      • Nathan W. Twyman, MIS Department, University of Arizona
      • Aaron C. Elkins, Department of Computing, Imperial College London
      • Judee K. Burgoon, Center for Identification Technology Research, University of Arizona
      • Jay F. Nunamaker, Center for the Management of Information and the National Center for Border Security and Immigration, University of Arizona

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    We conceive of information technology (IT) innovation posture-profile misalignment as a condition that exists when a firm's innovation posture (the extent to which a firm leads with IT innovation) does not match up with its innovation resource profile (the firm's stock of resources conducive to effective innovation). We theorize that firms with a posture-profile misalignment will see diminished returns from IT adoption because they will be less likely to possess (and be less effective at exploiting) crucial innovation resources when they need them most. We demonstrate how misalignment conditions the link between IT innovation adoption and organizational performance using a data set comprising electronic networking technologies in over 25,000 U.S. manufacturing plants. Productivity regression estimations reveal a consistent pattern that the association between IT innovation adoption and productivity is substantially diminished among misaligned firms. These empirical results provide initial confirmation of the theoretical value of innovation posture, innovation resource profile, and innovation posture-profile misalignment. We consider the implications for research on business value and innovation as well as for the practice of management.

    • Content Type Journal Article
    • Pages 203-240
    • DOI 10.2753/MIS0742-1222310109
    • Authors
      • Robert G. Fichman, Carroll School of Management, Boston College
      • Nigel P. Melville, Stephen M. Ross School of Business, University of Michigan

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    It is widely acknowledged that information technology (IT) and business resources need to be well aligned to achieve organizational goals. Yet, year after year, chief information officers still name business-IT alignment a key challenge for IT executives. While alignment research has matured, we still lack a sound theoretical foundation for alignment. Transcending the predominantly strategic executive-level focus, we develop a model of "operational alignment" and IT business value that combines a social perspective of IT and business linkage with a view of interaction between business and IT at nonstrategic levels, such as in daily business operations involving regular staff. Drawing on social capital theory to explain how alignment affects organizational performance, we examine why common suggestions such as "communicate more" are insufficient to strengthen alignment and disclose how social capital between IT and business units drives alignment and ultimately IT business value. Empirical data from 136 firms confirms the profound impact of operational business-IT alignment, composed of social capital and business understanding of IT, on IT flexibility, IT utilization, and organizational performance. The results show that social capital theory is a useful theoretical foundation for understanding how business IT alignment works. The findings suggest that operational alignment is at least as important as strategic alignment for IT service quality; that managers need to focus on operational aspects of alignment beyond communication by fostering knowledge, trust, and respect; and that IT utilization and flexibility are appropriate intermediate goals for business-IT alignment governance.

    • Content Type Journal Article
    • Pages 241-272
    • DOI 10.2753/MIS0742-1222310110
    • Authors
      • Heinz-Theo Wagner, German Graduate School of Management and Law (GGS), Heilbronn
      • Daniel Beimborn, Frankfurt School of Finance and Management, Germany
      • Tim Weitzel, University of Bamberg, Germany

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    Organizations increasingly initiate Internet-based innovation-contest communities through which individuals can interact and contribute to the innovation process. To successfully manage these communities, organizations need to understand what roles members assume, how they communicate and vary in their contribution behavior. In this exploratory study, we investigate the heterogeneous roles of contest participants based on an international innovation-contest community. We identify six user types associated with various behavioral contribution patterns by using cluster and social network analysis. The six user types further differ in their communicative content and contribution quality. Our paper contributes to a better theoretical understanding of distinctive user types in innovation-contest communities, their role in the community, and their contribution to the success of innovation contests in the era of social software. From a managerial perspective, the study provides guidance for contest platform design and appropriate reward structures.

    • Content Type Journal Article
    • Pages 273-308
    • DOI 10.2753/MIS0742-1222310111
    • Authors
      • Johann Füller, Innsbruck University School of Management, Austria
      • Katja Hutter, Harvard-NASA Tournament Lab, Institute for Quantitative Social Science
      • Julia Hautz, Department of Strategic Management, Marketing, and Tourism, Innsbruck University School of Management
      • Kurt Matzler, Innsbruck University School of Management

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    Attention for the division of work between computers and humans is growing due to ever-increasing computer capabilities. Over the past decades, creativity support systems (CSSs) have gained ground as a means to enhance individual, group, and organizational creativity. Whereas prior research has focused primarily on the main effects of CSSs, we explore the interaction effects with the creative ability of the individual. In this paper, we investigate the use of the case-based reasoning (CBR) technology, which is based on the principle of analogical reasoning, to aid individuals in solving business problems creatively. The expectations as to why the CBR technology should enhance individual creativity, and under what conditions (i.e., the type and number of cases that are made available), are derived from creative cognition theory, and are tested empirically. In a series of studies, a CBR system loaded with a diverse set of cases was found to enhance the performance of individuals with lower creative ability, but it did not help the most creative individuals. Although the literature suggests that cases from remote problem domains should lead to more novel solutions, loading the CBR system only with cases closely related to the problem domain proved more effective than remote cases only. Finally, loading the CBR system with a larger set of diverse cases was found to positively influence the creativity of the solutions. These findings have the following implications for CSSs and creative cognition theory: (1) when considering the effectiveness of CSSs it is important to take into account the creative ability of the individual (i.e., "one size does not fit all"), (2) making a sufficiently large and diverse set of cases available is better for stimulating creativity, and (3) providing cases that are too remote may be counterproductive. On a practical note, organizations seeking to redesign their division of labor between individuals and machines can easily follow the CBR approach presented here using their own set of cases.

    • Content Type Journal Article
    • Pages 309-340
    • DOI 10.2753/MIS0742-1222310112
    • Authors
      • Niek Althuizen, Department of Marketing, ESSEC Business School, Paris
      • Berend Wierenga, Rotterdam School of Management (RSM), Erasmus University

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  • 11/10/14--09:33: Editorial Introduction
  • Editorial Introduction

    • Content Type Journal Article
    • Pages 5-6
    • DOI 10.2753/MIS0742-1222310200
    • Authors
      • Vladimir Zwass

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    Special Issue: Economics of Electronic Commerce

    • Content Type Journal Article
    • Pages 7-10
    • DOI 10.2753/MIS0742-1222310201
    • Authors
      • Ravi Bapna, Carlson School of Management, University of Minnesota
      • Anitesh Barua, Department of Information, Risk and Operations Management at the McCombs School of Business, University of Texas at Austin
      • Andrew B. Whinston, Center for Research in Electronic Commerce, University of Texas at Austin

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    Markets can yield significant economic benefits by improving transaction efficiency, but effective design is necessary to achieve these benefits. We compare a physical market to a discrete electronic market in the wholesale used vehicle industry to evaluate how their different designs work for different types of transactions. We find that buyers and sellers balance adverse selection costs and other transaction costs when using the two markets, with the physical market serving as the general exchange and the electronic market serving as a spot market for vehicles with low adverse selection risk. These findings increase our understanding of how sellers and buyers distribute supply and demand between physical and electronic markets in industries in which they coexist. They also increase our understanding of how information technology can improve market function in wholesale environments.

    • Content Type Journal Article
    • Pages 11-46
    • DOI 10.2753/MIS0742-1222310202
    • Authors
      • Eric Overby, Scheller College of Business, Georgia Institute of Technology
      • Sabyasachi Mitra, Scheller College of Business, Georgia Institute of Technology

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    New e-markets try in a number of ways to attract a critical mass of participation and usage. Two innovative, all-electronic options exchanges, the International Securities Exchange (ISE) and the Boston Options Exchange (BOX), opened for trading in 2000 and 2004. In contrast to rival floor markets, they offer immediate order execution, direct user access, and reduced costs. As a result, ISE and BOX grew trading volumes and won market share from four incumbent exchanges in the United States. We observe significant differences between broker order-routing practices across ISE and BOX, leading to the markets' different growth patterns. We develop and test hypotheses about new market growth using a panel of six years of quarterly disclosures from 24 major brokerage firms. We find that membership affiliations are the dominant force in predicting brokers' order-routing patterns. In contrast to prior research, network externalities, as measured by an exchange's previous quarter market share, are not significant predictors after controlling for temporal heterogeneity. From our results, executives of new electronic exchanges should concentrate on developing broker exchange affiliation and incentive schemes in order to achieve sustainable order levels. Furthermore, keeping a keen eye on the competitive landscape and reacting to changes in current and prospective competitors' affiliation structures may prove the most beneficial way to ensure continued success. Top management must identify the relative advantages of new entrants' affiliation structures and respond accordingly. A new entrant that provides incentives through a novel affiliation structure can be routed significant orders if the incumbent exchange does not react swiftly and effectively. The results are not limited to analyzing electronic exchanges but, we expect, to many situations where competing information technology platforms also benefit from user affiliation and network effects.

    • Content Type Journal Article
    • Pages 47-76
    • DOI 10.2753/MIS0742-1222310203
    • Authors
      • Chris Parker, Supply Chain and Information Systems Department at the Smeal College of Business, The Pennsylvania State University
      • Bruce W. Weber, Lerner College of Business and Economics, University of Delaware

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    Pay-per-bid auctions require all bidders to pay for every bid. However, paying bidding fees without receiving the auction item in return often causes high dissatisfaction among losers, resulting in heated discussions and high churn rates. To reduce these negative reactions, pay-per-bid auctioneers created the Buy-Now feature, which allows losers to put all or part of the bidding fees that they paid during an auction toward buying the auction item. Using unique data, including individual customer bidding histories and cost data from more than 6,800 pay-per-bid auctions, we find that, overall, the Buy-Now feature leads to more aggressive bidding behavior, attracts more bidders, increases loyalty, and results in a higher profit per auction. However, for voucher auctions that represent common value auctions, the Buy-Now feature causes a decrease in the number of bidders and the profit per auction, although we find an increase in the average number of bids per bidder. We also show theoretically that a bidder can pursue a risk-free bidding strategy. However, we find empirically that bidders rarely use this strategy.

    • Content Type Journal Article
    • Pages 77-104
    • DOI 10.2753/MIS0742-1222310204
    • Authors
      • Jochen Reiner, Faculty of Business and Economics, Goethe University Frankfurt, Germany
      • Martin Natter, Hans-Strothoff Chair of Retailing, Goethe University Frankfurt
      • Bernd Skiera, Faculty of Business and Economics, Goethe University Frankfurt

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    Customized bundling retail strategies have become increasingly popular online. In customized bundling, consumers decide the bundle's components, and the effects of this change on consumption variety have important implications for information goods retailers. Although reduction in transaction and search costs increases supply-side product variety, customized bundling can introduce new types of friction in the consumption process. We show that customization of information good bundles reduces consumption variety through two effects: design cost effects and compromise effects. We present the results of three behavioral experiments and an empirical study using sales data from a national music retailer. This study contributes to the theoretical understanding of the effects of customized bundling on search costs and demand-side dynamics. The results provide insights for information goods retailers on the effects of design and search costs on consumer purchasing behavior. Implications for the design of retail platforms for customizable information goods are discussed.

    • Content Type Journal Article
    • Pages 105-132
    • DOI 10.2753/MIS0742-1222310205
    • Authors
      • Jesse C. Bockstedt, Eller College of Management, University of Arizona
      • Kim Huat Goh, Division of IT and Operations Management at the Nanyang Business School, Nanyang Technological University

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    Mobile applications markets with app stores have introduced a new approach to define and sell software applications with access to a large body of heterogeneous consumer population. This research examines key seller- and app-level characteristics that impact success in an app store market. We tracked individual apps and their presence in the top-grossing 300 chart in Apple's App Store and examined how factors at different levels affect the apps' survival in the top 300 chart. We used a generalized hierarchical modeling approach to measure sales performance, and confirmed the results with the use of a hazard model and a count regression model. We find that broadening app offerings across multiple categories is a key determinant that contributes to a higher probability of survival in the top charts. App-level attributes such as free app offers, high initial ranks, investment in less-popular (less-competitive) categories, continuous quality updates, and high-volume and high-user review scores have positive effects on apps' sustainability. In general, each diversification decision across a category results in an approximately 15 percent increase in the presence of an app in the top charts. Survival rates for free apps are up to two times more than that for paid apps. Quality (feature) updates to apps can contribute up to a threefold improvement in survival rate as well. A key implication of the results of this study is that sellers must utilize the natural segmentation in consumer tastes offered by the different categories to improve sales performance.

    • Content Type Journal Article
    • Pages 133-170
    • DOI 10.2753/MIS0742-1222310206
    • Authors
      • Gunwoong Lee, W.P. Carey School of Business, Arizona State University
      • T. S. Raghu, W.P. Carey School of Business, Arizona State University

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    While profitable business models elude many virtual worlds, sales of virtual products are a potentially lucrative source of revenue. One new addition to this strategy is virtual gifting, whereby users purchase virtual products to give to other users. The monetary value of such virtual good transactions is economically significant but no prior study has examined this phenomenon in a strictly virtual context. We apply theory from the economics literature to examine gifting behavior in a virtual world in which users' social status is reflected in observable social connections (friendships) and interactions (personal messages). We find strong evidence that gifting is associated with future enhancements of the gift giver's social status, consistent with a social status-seeking motivation, thus confirming a theorized behavior that is difficult to study in the real world. Our study has implications for system proprietors and managers because we show that gift giving increases system use continuance. We identify various antecedents of gift giving, which may assist a manager in identifying users who are most inclined to give gifts and enable the manager to signal the social exchange benefits to users as a way of improving their social connections.

    • Content Type Journal Article
    • Pages 171-210
    • DOI 10.2753/MIS0742-1222310207
    • Authors
      • Sigi Goode, College of Business and Economics, Australian National University (ANU)
      • Greg Shailer, Research School of Accounting and Business Information Systems, Australian National University (ANU)
      • Mark Wilson, Research School of Accounting and Business Information Systems, Australian National University
      • Jaroslaw Jankowski, Information Systems Engineering group in the Computer Science Faculty of West Pomeranian, University of Technology, Poland

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    The objective of our paper is to determine the effect of piracy advice from various sources on the behavior of the music consumer. Specifically, does it matter if the source of advice has a stake in the outcome of the piracy decision? Does it matter if the source of advice has a social tie with the advisee? Accordingly, we conduct a laboratory experiment using teenagers and their parents as subjects, increasing the realism of the context by sampling potential pirates and their parents. Treatments represent various sources of piracy advice (e.g., the teen's parent, a record label, or an external regulator). Subjects make decisions playing our new experimental game—The Piracy Game—extended from the volunteer's dilemma literature. Interestingly, subjects respond negatively to advice from record labels over time, purchasing fewer songs as compared to other sources such as the subject's parent. The existence of a social tie between the adviser and the subject assists in mitigating piracy, especially when a parent is facing potential penalties due to his or her child's behavior. An external regulator, having no social tie or stake in the decision, provides the least credible source of advice, leading to the greatest amount of piracy. Our analyses not only provide managerial insights but also develop theoretical understanding of the role of social ties in the context of advice.

    • Content Type Journal Article
    • Pages 211-244
    • DOI 10.2753/MIS0742-1222310208
    • Authors
      • Matthew J. Hashim, Eller College of Management, University of Arizona
      • Karthik N. Kannan, Krannert School of Management, Purdue University
      • Sandra Maximiano, Krannert School of Management, Purdue University
      • Jackie Rees Ulmer, Krannert School of Management, Purdue University

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    Sharing of truthful information involving business intelligence between supply chain partners is a challenge on account of the asymmetric nature of the information, where one party possesses information such as market intelligence that is neither available in the public domain nor verifiable through third parties. While busesinss-to-business (B2B) technology solutions, such as CPFR (collaborative planning, forecasting, and replenishment), facilitate the sharing of historical information (e.g., transaction records), business intelligence (e.g., potential customer demand) is considered private. Central to CPFR is collaborative demand forecasting (CDF) that allows supply chain partners to share private demand information and incorporate the jointly derived demand forecast into production planning and product replenishment decisions. Implementing CDF, however, is a challenge because of the high costs of the laborious collaboration effort (e.g., to resolve forecast differences). Hence, companies are unable to realize the benefits of CDF and, in turn, the full potential of CPFR. Typically, the issues of information truthfulness and collaboration cost are addressed through an exception management mechanism that defines a range of forecast updates within which collaboration is automated without any human intervention in B2B trading partners. In this paper, we develop incentive-based contracts that explicitly consider the truth-telling behavior and exception resolution in decisions related to the threshold values of demand information. Our first contribution to B2B information management is in establishing the strategic value of exception management and resolution mechanisms in B2B relationships, leading to truthful revelation of demand information. Our second contribution is in developing exception-based incentive contracts, especially in light of the advances in today's business practices and technology, to address issues associated with unobservable and asymmetric demand information. Specifically, we propose a resolution contract to coordinate the supply chain that directly incorporates both exceptions and resolution in an incentive mechanism. We show that these alternative contracts are all viable solutions in assuring truthful exchange of demand information but excel individually in specific situations and, thus, provide practitioners with alternative demand collaboration tools when price negotiation is not an option.

    • Content Type Journal Article
    • Pages 245-284
    • DOI 10.2753/MIS0742-1222310209
    • Authors
      • Yan Dong, Darla Moore School of Business, University of South Carolina
      • Xiaowen Huang, Miami University Distinguished Scholar at the Richard T. Farmer School of Business, Miami University
      • Kingshuk K. Sinha, Corporate Responsibility at the Carlson School of Management, University of Minnesota
      • Kefeng Xu, College of Business, University of Texas at San Antonio

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    We use coping theory to explore an underlying relationship between employee stress caused by burdensome, complex, and ambiguous information security requirements (termed "security-related stress" or SRS) and deliberate information security policy (ISP) violations. Results from a survey of 539 employee users suggest that SRS engenders an emotion-focused coping response in the form of moral disengagement from ISP violations, which in turn increases one's susceptibility to this behavior. Our multidimensional view of SRS—comprised of security-related overload, complexity, and uncertainty—offers a new perspective on the workplace environment factors that foster noncompliant user behavior and inspire cognitive rationalizations of such behavior. The study extends technostress research to the information systems security domain and provides a theoretical framework for the influence of SRS on user behavior. For practitioners, the results highlight the incidence of SRS in organizations and suggest potential mechanisms to counter the stressful effects of information security requirements.

    • Content Type Journal Article
    • Pages 285-318
    • DOI 10.2753/MIS0742-1222310210
    • Authors
      • John D'Arcy, University of Delaware
      • Tejaswini Herath, Brock University
      • Mindy K. Shoss, Saint Louis University

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    More companies have realized that information technology (IT) outsourcing, once viewed as a cost reduction tool, could facilitate and even enable the transformation of their core business processes. The benefits from a potential outsourcing relationship expansion have strategic implications for relational incentive provision. Modeling "information poaching" in IT outsourcing as an incentive problem with contractibility constraints, our analysis shows that this problem could be mitigated in a repeated game where the outsourcing client and the service provider agree on a relational contract. When the two partners share the belief that they can potentially benefit from a future relationship expansion, they are more likely to behave cooperatively during the early stages of their relationship. However, when they disagree about the likelihood of the future relationship expansion, they will have different preferences on a set of otherwise equivalent relational bonus contracts. Specifically, they will adopt a relational contract with large but infrequent bonuses when the client is more optimistic than the service provider about the potential of their relationship. Because these results hold even when the sourcing partners' beliefs are very close to each other, our analysis sheds fresh light on the issue of equilibrium selection in relational contract theory. In the context of IT outsourcing, the results of this study suggest that, because salient forms of relational bonuses are often not adopted, relational incentive provision is likely more pervasive than what we can observe.

    • Content Type Journal Article
    • Pages 319-350
    • DOI 10.2753/MIS0742-1222310211
    • Authors
      • Xiaotong Li, University of Alabama in Huntsville