Strategic dependence on the IT resource and outsourcing: A test of the strategic control model

Detmar Straub (), Peter Weill () and Kathy S. Schwaig ()
Additional contact information
Detmar Straub: Georgia State University
Peter Weill: MIT
Kathy S. Schwaig: Kennesaw State University

Information Systems Frontiers, 2008, vol. 10, issue 2, No 6, 195-210

Abstract: Abstract Using resource dependency theory (RDT), this research analyzes how organizations control their information technology resources to improve organizational performance. According to RDT, organizations must manage their dependency on external organizations and limit external dependencies when resources are considered critical. The current study proposes and tests a portion of a Strategic Control Model positing that managers seek to control important, strategic resources in order to create value for the firm and to avoid dependency on external entities. Utilizing a research design that captured extensive quantitative data on the control of IT functions and services, the research team gathered 5 years of data on 54 business units (BUs) in 27 global companies located in seven countries. Study examined the linkages of these 54 BUs to firm performance. Locating the Extent of Control within the firm in cases where the firm depends on IT as a strategic resource proves to be a good explanation for effective decisions leading to higher performance. Viewing IT as a strategic resource alone does not lead to positive business unit outcomes, but the moderating influence of Extent of Control is found to establish the complex statistical relationship with business unit performance. For these reasons, it is critical that a theoretically grounded firm-wide process for decisions on locating IT control is in place to capture business value.

Keywords: Resource dependency theory; IT outsourcing decisions; Strategic information systems; Strategic IT resources; Core competency; IT outsourcing; IT performance; Firm performance; Extent of control (search for similar items in EconPapers)
Date: 2008
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://link.springer.com/10.1007/s10796-008-9064-9 Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:infosf:v:10:y:2008:i:2:d:10.1007_s10796-008-9064-9

Ordering information: This journal article can be ordered from
http://www.springer.com/journal/10796

DOI: 10.1007/s10796-008-9064-9

Access Statistics for this article

Information Systems Frontiers is currently edited by Ram Ramesh and Raghav Rao

More articles in Information Systems Frontiers from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().