AN EMPIRICAL INVESTIGATION INTO INTERORGANIZATIONAL SYSTEMS INTEGRATION, AND ORGANIZATION PERFORMANCE IN THE GROUP INSURANCE INDUSTRY

Abstract

Interorganizational Systems (10s) are increasingly used to support exchange of business documents in many industries. Though clear improvements in organization performance are forthcoming in many cases, the research evidence is based largely on anecdotes and suggests that performance improvements may not be uniformly attained across organizations. Though integration of IOS with internal systems is recommended, the affects afforded through integration remain largely unexplored. This research study formulates a theoretical model of the complex interplay of relationships among IOS Usage, Systems Integration and Organization Performance, and tests the model's validity using a dataset of 48 organizations in the Group Insurance industry. The mode1 recognizes two conceptually distinct ways in which IOS may be used more intensively, includes two notions of systems integration which are argued to differentially affect the organization performance advantages, and uses a multidimensional organization performance construct to more adequately reflect the diversity of anticipated organization performance impacts presumed to extend from IOS use. The results are mixed in terms of direct organization performance impacts, and suggest that both notions of integration play a key role in facilitating attainment of the organization performance advantages.