Interorganizational Cooperation: The Role of Information Technology in Empirical Comparison of US and Japanese Supplier Relations

This paper investigates the comparative role of several factors, including information technology (IT), predicting the level of cooperation between two independent organizations. Drawing upon multiple theoretical perspectives we develop five hypotheses about the impact on interorganizational cooperation of three sets of factors: (1) the characteristics of the environment within which the relationship operates, (2) the characteristics of the relationship itself, and (3) the characteristics of how IT is used within the relationship. Each of these conceptual constructs is operationalized and measured within the specific context of buyersupplier relationships in the automobile industry. The hypotheses are tested across two national settings (i.e., the US and japan) using multiple regression analyzes conducted on a data set of 447 distinct relationships. The results indicate that the use of IT and the characteristics of the environment do not play the same role in explaining interorganizational cooperation in the two country settings, while in both countries the characteristics of the relationship significantly contribute to change in R2. Interorganizational Cooperation: the Role of Information Technology An Empirical Comparison of US and Japanese Supplier Relations Introduction In recent years, many large firms have been undergoing profound transformations, streamlining their operations, typically moving away from vertical integration toward more external contracting of key activities. They are also transforming the nature of the relationships with their external business partners (Powell 1987, Jarillo 1988, Thorelli 1986). In particular, many manufacturers are changing their relationships with component suppliers away from traditional arm's length relations driven by a competitive logic toward new arrangements based on a cooperative logic. These take the form of complex cooperative relationships, also described as "value-adding partnerships" (Johnston and Lawrence 1988), or "alliances" (Heide and John 1990, Anderson and Narus 1990). While there are several factors that explain this trend toward more cooperative relationships, we are in this paper concerned with the phenomenon of interorganizational cooperation that explicitly leverages IT capabilities -that has been variously described as: 'inter-organizational systems' (Barrett and Konsynski 1982, Cash and Konsynski 1985), 'information partnerships' (Konsynski and MacFarlan 1990) and 'electronic integration' (Venkatraman and Kambil, 1991) within a broader continuum of electronic markets and electronic hierarchies (Malone, Yates and Benjamin 1987). In this paper, we propose to examine some of the factors that may influence the level of cooperation between two firms, with a particular interest in the comparative role of information technology. Specifically, 1