Competing on price and guarantee compensation: Heeding cloud consumer's quality perception

2023 | Information & Management | Citations: 0

Authors: Chen, Fuzan; Lu, Aijun; Wu, Harris; Li, Minqiang; Feng, Haiyang

Abstract: As frequent service failures raise user concerns, guarantee compensation has bec ... Expand

Abstract: As frequent service failures raise user concerns, guarantee compensation has become a competitive instrument for cloud service providers (CSPs) in addition to price. This study proposes a game-theoretical model where two CSPs compete on both price and compensation. We consider two roles of compensation: (1) remedying user losses and (2) helping users to form quality perception. The results indicate that the higher-quality CSP should always guarantee higher compensation but may not always charge a higher price. We further investigate the signaling policies and find that the lower-quality CSP is more likely to signal a higher-than-actual quality. Collapse

Topics: IS economics consumer surplus service quality cloud computing privacy

Methods: game theoretical model optimization model cross sectional research theory development experiment

Theories: game theory

The Economic Implications of Privacy Dark Patterns (PDPs)

2023 | International Conference on Information Systems | Citations: 0

Authors: Chen, Dawei; Hahn, Jungpil

Abstract: This study investigates the economic implications of privacy dark patterns (PDP ... Expand

Abstract: This study investigates the economic implications of privacy dark patterns (PDPs) through which firms "wisely" play privacy games. It is believed that PDPs advantage firms by deceiving consumers. However, it could also hinder firms' credibility. Thus, we aim to examine whether PDPs always benefit firms and hurt consumers. We also seek to answer whether market forces are sufficient to keep PDPs at relatively low levels. Our results show that PDPs make users weakly worse off and the seller weakly better off. Nevertheless, the seller has incentives to not utilize any PDPs when users' privacy cost is high, and the ratio of privacy concern and search cost is either too high or too low under which market shrinkage effect dominates market division effect. Finally, we show that a welfare maximizing social planner would allow the presence of PDPs when users' privacy cost is sufficiently low. Collapse

Topics: privacy information privacy concern price management data breach IS economics

Methods: cross sectional research game theoretical model literature study

Theories: game theory

Value Destruction in Information Technology Ecosystems: A Mixed-Method Investigation with Interpretive Case Study and Analytical Modeling

2023 | Information Systems Research | Citations: 0

Authors: Sahaym, Arvin; Vithayathil, Joseph; Sarker, Suprateek; Sarker, Saonee; Bjørn-Andersen, Niels

Abstract: Many of today’s software systems are created by leveraging ecosystems consisting ... Expand

Abstract: Many of today’s software systems are created by leveraging ecosystems consisting of heterogeneous “complementors” and “hub” firms. In fact, the reliance on ecosystems is prevalent in the enterprise resource planning (ERP) domain, where larger ERP vendors form collaborative relationships with smaller industry-specific vendors to co-create value for themselves and their customers. However, value creation and destruction processes are often intertwined. A key motivation for this study is to shed light on the behavioral contingencies and underlying mechanisms that might lead to value destruction over time instead of the initially intended value co-creation. Furthermore, although value co-creation in collaborative relationships associated with ecosystems is often highlighted, research has been scarce on offering an in-depth analysis of the challenges in these relationships that can destroy value. This study attempts to address this issue by uncovering the underlying mechanisms that lead a hub firm and its complementors toward value destruction. Our mixed-methods approach involves the use of a combination of interpretive case study and analytical modeling to highlight nuances and develop conceptual propositions about the conditions that can potentially lead to value destruction. Our context is a globally reputed information technology (IT) firm known for providing business solutions (SOFTCo, a pseudonym) and numerous relatively small, less powerful customer-facing service firms (PartnerCos, a pseudonym). Our findings show that opportunism, unjust appropriation of rents, shirking, exploitation of asymmetric power, and undue dependence can initiate a value destruction process. Furthermore, our study revealed an unexpected emergence of a “pack of wolves,” where resentful PartnerCos formed a collective to tackle the opportunistic behaviors of SOFTCo by starting to align with its competitor, further destroying value for SOFTCo’s ecosystem. Overall, this study contributes to the literature on value co-creation/destruction in IT ecosystems. It also offers an illustration of a mixed-methods study where seemingly incommensurable approaches are harnessed to develop a theoretical understanding.History: Ola Henfridsson, Senior Editor; Likoebe Maruping, Associate Editor.Funding: The authors acknowledge the financial support of the 3gERP project at the Copenhagen Business School in Denmark, the Dean’s Summer Research Fund of the McIntire School of Commerce, University of Virginia, and the Huber Dean’s Fellowship of the Carson College of Business, Washington State University.Supplemental Material: The online appendix is available at https://doi.org/10.1287/isre.2022.1119. Collapse

Topics: participatory design enterprise resource planning digital ecosystem value creation pseudonymity

Methods: design methodology case study mathematical model qualitative interview mixed method

Theories: game theory prisoner's dilemma organizational behavior theory

Introduction to the Minitrack on Digital Transformations of Business Operations

2023 | HICSS | Citations: 0

Authors: Zhang, Jie; Jiang, Yabing; Seidmann, Abraham

Abstract: ... Expand

Abstract: Collapse

Topics: cryptocurrency crowdsourcing social media mobile business customer service

Methods: game theoretical model natural experiment regression discontinuity design computational algorithm

Theories: game theory

Information Asymmetry in Business-to-Business Negotiations: A Game Theoretical Approach to Support Purchasing Decisions with Suppliers

2022 | Group Decision and Negotiation | Citations: 0

Authors: Bodendorf, Frank; Hollweck, Barbara; Franke, Jörg

Abstract: The digital transformation confronts purchasing and supply management (PSM) with ... Expand

Abstract: The digital transformation confronts purchasing and supply management (PSM) with numerous new challenges, such as digital procurement objects and the information asymmetry between buyers and suppliers. Existing approaches contributing to PSM research (e. g., the selection of suppliers or the calculation of equilibrium prices) have in common that information regarding suppliers (e. g., production costs) must be well-known. However, this information is rarely accessible to purchasers due to the existing information asymmetry. This problem is addressed by a game-theoretical model based on a Stackelberg game to assist PSM in dealing with the information advantage of software suppliers. The applicability in practice is evaluated by a real-world case study from the automotive industry. The results show that the presented model can support decision-making in purchasing by a qualitative analysis of profit scenarios for different negotiation strategies. The model contributes to dismantling the information asymmetry and provides a basis for determining negotiation prices, also for digital procurement objects. This research motivates both supply and purchase managers to jointly optimize their product costs and thus increase their competitiveness on the market. Collapse

Topics: digital good IT investment procurement management usability supply chain management

Methods: game theoretical model case study simulation

Theories: lemon market theory game theory

A Real Case Application of Game Theoretical Concepts in a Complex Decision-Making Process: Case Study ERTMS

2022 | Group Decision and Negotiation | Citations: 0

Authors: Bekius, Femke; Meijer, Sebastiaan; Thomassen, Hugo

Abstract: Engineering systems are complex, amongst others due to the interdependencies bet ... Expand

Abstract: Engineering systems are complex, amongst others due to the interdependencies between actor and technical aspects. This complexity has consequences for the way of designing such systems and, in particular, for the decision-making process. Recognizing the impossibility of having an optimal system design in such complex systems, this article explores how a game theoretical characterization of a decision-making process assists in the organization and design of the process itself. In contrast to a game theoretical analysis, which results in optimal outcomes, the characterization is fed back to the designers of the decision-making process during the course of the process. The study analyses how the game concept characterization was used, i.e., which strategies were defined during the game theory interventions, and what the consequences of these strategies were for the design of the decision-making process. The design of a new safety system ERTMS for the Dutch railway sector is the context in which the study was performed. The contribution is a successful approach to complex decision-making in multi-actor systems by identification of multiple game concepts over time, with periodic feedback into the designing system, and not the actual decision-making itself. In short, it supported adapting to an actor focus on the process, it affected the role and responsibilities of the program management, it contributed to (de)coupling of issues, and it influenced the capability of creating awareness amongst actors of the urgency of the decision window. The paper ends with reflections on the experience of intervening in a decision-making process with game theoretical concepts. Collapse

Topics: decision making decision support systems design business process management

Methods: qualitative interview action research game theoretical model case study theory development

Theories: game theory lemon market theory general systems theory

How Online Reviews Interact with a Firm's Free Version Strategy

2022 | Information & Management | Citations: 0

Authors: Cao, Huanhuan; Jiang, Jinhu; Geng, Xianjun

Abstract: This study developed a game-theory model to explore interactions between online ... Expand

Abstract: This study developed a game-theory model to explore interactions between online reviews and free version strategies. Results show that a firm could have four strategies as a strategic tool to respond best to availability of online reviews depending on the relative strength of network effect, cannibalization effect, and dispersed effect. Moreover, when offering a free version is the best strategy both with and without online reviews, online reviews and the free version strategy could still be both complementary and substitutive. This result provides possible theoretical explanations for mixed empirical conclusions regarding whether online reviews complement or substitute free version strategies. Collapse

Topics: online review network effect mobile application market digital distribution price management

Methods: optimization model computational algorithm theoretical contribution game theoretical model

Theories: game theory

Analyzing e-government design science artifacts: A systematic literature review

2022 | International Journal of Information Management | Citations: 0

Authors: Carter, Lemuria; Yoon, Victoria; Liu, Dapeng

Abstract: Design science as a research paradigm is gaining popularity in the information s ... Expand

Abstract: Design science as a research paradigm is gaining popularity in the information systems (IS) discipline. E-gov­ ernment research explores IS artifacts designed to improve the quality and efficiency of public administration and service. This paper utilizes the E-government Design Research Model (EgovDR Model) to review e-gov­ ernment designs. Through a comprehensive literature review, this paper identifies prototypical e-government tasks for design science implementation and the corresponding solutions. We demonstrate whether and how the development and evolution of e-government designs continue to gain relevance in design science research. Additionally, this paper identifies and analyzes the theories employed in the literature to illustrate how the EgovDR Model has facilitated e-government designs in increasing rigor over time. Our findings indicate the majority of the workpractice tasks in existing e-government designs are decision-support tasks. Collapse

Topics: government system criminality decision support system social identity knowledge representation

Methods: design science literature study design artifact literature sample synthesis

Theories: information theory activity theory social disorganization theory portfolio theory structuration theory

Intellectual Diversity in IS Research: Discipline-Based Conceptualization and an Illustration from Information Systems Research

2022 | Information Systems Research | Citations: 0

Authors: Tarafdar, Monideepa; Shan, Guohou; Bennett Thatcher, Jason; Gupta, Alok

Abstract: This paper advances the understanding of the information systems (IS) discipline ... Expand

Abstract: This paper advances the understanding of the information systems (IS) discipline by developing a multidimensional conceptualization of the discipline’s intellectual diversity. It also provides an empirical analysis of the intellectual diversity exhibited by the full set of articles published in Information Systems Research (ISR) over the last 10 years. We categorize IS intellectual diversity into four intellectual dimensions of IS research—namely, domain-topic, level of phenomenon, type of contribution, and method—and highlight differences along these dimensions. We develop a framework for evaluating the ebb and flow of the topics, methods, and contributions of IS scholarship over time. Regarding ISR specifically, our study offers a glimpse of the IS intellectual diversity found in the research topics, methods, and contributions of papers published during 2012–2021. Our analysis shows a preponderance of econometric and modeling studies. It also shows that there is a substantial variety of topics, research questions, and methods. Based on these conceptual and empirical insights, we identify implications for intellectual diversity and inclusion in the broader IS discipline. History: Paul Pavlou served as Senior Editor of this paper. Collapse

Topics: IS discipline electronic commerce online community IS sourcing organizational value

Methods: econometric modeling mixed method theoretical contribution experiment literature sample

Theories: game theory

What Forms the Trajectory of Social Reforms? The Roles of Decision Rules and Communication under Epistemic Uncertainty

2022 | Group Decision and Negotiation | Citations: 0

Authors: Tsubota, Taiga; Horita, Masahide

Abstract: This paper presents a theoretical model that explains how decision rules and com ... Expand

Abstract: This paper presents a theoretical model that explains how decision rules and communication jointly affect collective outcomes in a small community under epistemic uncertainty. To see the likelihood of social reform and the probability of sensible decision-making under uncertainty, we compare two types of decision rules: unanimity rule and majority rule with veto. Also, we analyze the role of communication among voters before the voting occurs. We show that there exist equilibria and that once each player’s preference is determined, the equilibrium behavior is specified. In addition, we use simulation methods to examine how the precision of group decision and the voters’ welfare vary. Collapse

Topics: economic surplus IS economics decision making

Methods: simulation Monte Carlo simulation game theoretical model theory development