Title
Social Networks and Contract Enforcement in IT Outsourcing.
Abstract
Most prior research on Information Technology Outsourcing has characterized the dominant governance modes as either 'Formal' or 'Relational,' which rely on stringent assumptions of perfect foresight or about the extent to which one party can punish unilateral deviations by the other. We propose a third alternative in addition to dyadic measures of inter-firm reputation. The reputation of an actor can be associated with how the firm is positioned in a network, which in turn influences how information about a particular actor flows within the network. Such aspects of structural embeddedness suggest a role in predicting not only characteristics of inter-firm exchange, but also for the continuation and expansion of the relationship. The social network capital offers a measure to mitigate the uncertainty associated with both the nature of service outsourced as well as the uncertainty pertaining to the nature of the service provider. The network of trading partners enables a community enforcement of contracting terms by providing safeguards that may not be offered by traditional measures of formal or relational governance. Based on a large dataset of publically announced IT Outsourcing arrangement, we examine the role that structural embeddedness can play in predicting contract duration and the likelihood of contract renewal. Our preliminary results are very encouraging. We find evidence suggesting that network position does matter in predicting contract structure over and above the traditional economic variables.
Year
Venue
Keywords
2009
AMCIS
it outsourcing,reputation,service provider,information technology,social network,social networks
DocType
Citations 
PageRank 
Conference
2
0.36
References 
Authors
13
3
Name
Order
Citations
PageRank
Kiron Ravindran182.17
Anjana Susarla245532.29
Vijay Gurbaxani32847240.32