Information Technology

29 Results


Learning Curve: Making the Most of Outsourcing

Companies that view outsourcing as an easy way to offload commodity work are missing powerful improvements to be gained by working closely with service providers, says Professor Robert S. Huckman. Open for comment; 5 Comments posted.

Monitoring and the Portability of Soft Information

This study examines the "portability" of soft information within a decentralized financial institution. Using a unique dataset on loans from a large credit union and employees' notes summarizing their interactions with borrowers, the authors provide new insights on the portability of soft information within organizations, focusing in particular on an internal monitoring system used at this field site which, in effect, acts as a central repository of soft information gathered in the course of interactions between employees and customers. Contrary to the prevailing view that soft information lacks portability, results provide evidence that the "stock" of soft information accumulated in this system has persistent effects on the lending decisions of employees. Overall, findings indicate that the centralization of soft information acquired in past borrower-employee interactions can enable organizations to separate this informational asset from individual employees to facilitate future loan decisions. These results suggest that centralized information technology can alleviate the well-documented barriers of transmitting soft information consistent with economic theories on the role of centralization of information as a complement to decentralized decision-making. Read More

10 Reasons Customers Might Resist Windows 8

Has Microsoft become too innovative? Professor Rosabeth Moss Kanter, a leader in the field of change management, discusses reasons that people might not rush to embrace Windows 8. Closed for comment; 27 Comments posted.

Information Technology and Boundary of the Firm: Evidence from Plant-Level Data

It has long been believed that information technology (IT) has the potential to shift the boundaries surrounding where production takes place. Specifically, networked IT investments are supposed to reduce costs of monitoring behavior of internal and external partners, thereby improving incentives and reducing the risk of opportunistic behavior. Networked IT can also reduce costs of coordinating economic activity within and between firms. This study, by Chris Forman and Kristina McElheran, explores how IT investments influence vertical integration in supply chain relationships. Read More

Signaling to Partially Informed Investors in the Newsvendor Model

Why might firms make operational decisions that purposefully do not maximize expected profits? This model looks at the question by developing scenarios using the example of inventory management in the face of an external investor. The research was conducted by Vishal Gaur of Cornell University, Richard Lai of the University of Pennsylvania, and Ananth Raman and William Schmidt of Harvard Business School. Read More

How IT Shapes Top-Down and Bottom-Up Decision Making

What determines whether decisions happen on the bottom, middle, or top rung of the corporate ladder? New research from professor Raffaella Sadun finds that the answer often lies in the technology that a company deploys. Open for comment; 15 Comments posted.

The Determinants of Individual Performance and Collective Value in Private-Collective Software Innovation

Why do people expend personal time and effort toward creating a public good? Over the past decade, collaborative, community-based approaches to developing knowledge-intensive products like encyclopediae, music, and software have gained prominence in both practice and scholarly analysis. "Open source software development," for example, is distinguished by self-selection of distributed participants into tasks, free revealing of knowledge, collective creation of shared software artifacts, and participants' ability to generate new innovations by reinterpreting and repurposing knowledge and artifacts created by others. The MathWorks' Ned Gulley and HBS professor Karim R. Lakhani study the determinants of individual performance and collective value in software innovation by analyzing 11 programming competitions that mimic the working of the open source software community. Read More

The Architecture of Complex Systems: Do Core-periphery Structures Dominate?

All complex systems can be divided into a nested hierarchy of subsystems. However, not all these subsystems are of equal importance: Some subsystems are core to system performance, whereas others are only peripheral. In this study, HBS professor Carliss Y. Baldwin and coauthors developed methods to detect the core components in a complex software system, establish whether these systems possess a core-periphery structure, and measure important elements of these structures. The general patterns highlight the difficulties a system architect faces in designing and managing such systems. Results represent a first step in establishing stylized facts about the structure of real-world systems. Read More

Competing Ad Auctions

Joining ad platforms can attract substantial regulatory attention: In November 2008, the Department of Justice planned to file antitrust charges to stop the proposed Google-Yahoo transaction. More recently, in September 2009, the Department of Justice sought additional information from Microsoft and Yahoo about their proposed partnership. At first glance it might seem paradoxical to claim that the Google-Yahoo transaction is undesirable, for advertisers and for the economy as a whole, while the Microsoft-Yahoo transaction offers net benefits. But that conclusion is entirely possible. HBS professor Benjamin G. Edelman and doctoral candidates Itai Ashlagi and Hoan Soo Lee explore competition among ad platforms that offer search engine advertising services. In addition, the authors evaluate possible transactions among ad platforms—building tools to predict which transactions improve welfare and which impede it. Read More

Optimal Auction Design and Equilibrium Selection in Sponsored Search Auctions

Reserve prices may have an important impact on search advertising marketplaces. But the effect of reserve prices can be opaque, particularly because it is not always straightforward to compare "before" and "after" conditions. HBS professor Benjamin G. Edelman and Yahoo's Michael Schwarz use a pair of mathematical models to predict responses to reserve prices and understand which advertisers end up paying more. Read More

The IT Leader’s Hero Quest

Think you could be CIO? Jim Barton is a savvy manager but an IT newbie when he's promoted into the hot seat as chief information officer in The Adventures of an IT Leader, a novel by HBS professors Robert D. Austin and Richard L. Nolan and coauthor Shannon O'Donnell. Can Barton navigate his strange new world quickly enough? Q&A with the authors, and book excerpt. Read More

Gray Markets and Multinational Transfer Pricing

Gray market goods are brand-name products that are initially sold into a designated market but then resold through unofficial channels into a different market. Gray markets can arise when transaction and search costs are low enough to allow products to "leak" from one market segment back into another. Examples of industries with active gray markets include pharmaceuticals, automobiles, and electronics. Understandably, reactions to gray market encroachment are mixed. On the one hand, consumer advocates and governments have applauded the increasing role that gray markets have played in improving competition for domestic goods. On the other hand, multinationals have decried the increasing role of gray markets in the economy, with an estimated $40 billion in cannibalized sales resulting from gray markets in the information technology sector alone. This study investigates the optimal price of a multinational's internal transfers and the consequences of regulations mandating arm's-length transfer pricing. Read More

How Much Obsolescence Can Business and Society Absorb?

This month's question brought out both the poets and the engineers among respondents. The rapid pace of new technology adoption within organizations implies change for management and society, says HBS professor Jim Heskett. How does change affect the open sharing of information? (Forum now closed; next forum begins May 1.) Closed for comment; 41 Comments posted.

Optimal Deterrence when Judgment-Proof Agents Are Paid In Arrears—With an Application to Online Advertising Fraud

It is commonplace for large entities (both advertisers and ad networks) to enter into relationships with numerous small agents such as Web sites, blogs, search syndicators, and other marketing partners. For example, one well-known affiliate network boasts more than a million affiliates promoting offers from the network's hundreds of merchants, and Google contracts with numerous independent Web sites to show Google's "AdSense" ads. Although these advertising agents are often small, they can take advantage of technology to claim payments they have not earned. In practice, the legal system cannot offer meaningful redress to an aggrieved advertiser or ad network. This paper argues that delayed payment offers a more expedient alternative—a sensible stopgap strategy for use when primary enforcement systems prove inadequate. Read More

The Business of Free Software: Enterprise Incentives, Investment, and Motivation in the Open Source Community

IBM has contributed more than $1 billion to the development and promotion of the Linux operating system, and other vendors such as Sun are ramping up open source software efforts and investment. Why do information technology vendors that have traditionally sold proprietary software invest millions of dollars in OSS? Where have they chosen to invest, and what are the characteristics of the OSS projects to which they contribute? This study grouped OSS projects into clusters and identified IT vendors' motives in each cluster. Read More

Scale without Mass: Business Process Replication and Industry Dynamics

Over the past ten years there's been a clear link between IT investment and productivity growth in the U.S. economy. But what impact has IT had on competition? This paper identifies several recent changes in the competitive dynamics of U.S. industries and shows that they are associated with IT intensity; the more IT and industry has, the greater the changes. Using case studies, previous research, and a simple model, the authors offer a theory that explains these patterns in the data. They argue that IT allows the rapid spread of business process innovations, which in turn leads to more turbulent and concentrated industries. Read More

Online Match-Making with Virtual Dates

Users of online dating sites often struggle to find love because the sites themselves make it more difficult than it needs to be. To the rescue: Virtual Dates, an online ice-breaker from Jeana Frost of Boston University, Michael Norton of HBS, and Dan Ariely of MIT. Read More

Information Technology Ecosystem Health and Performance

An IT ecosystem is "the network of organizations that drives the creation and delivery of information technology products and services." To understand the health and well being of the IT industry in the context of an ecosystem, the authors looked at three crucial IT ecosystem metrics: productivity, robustness, and innovation. Read More

Building an IT Governance Committee

Boards need to take more accountability for IT, argue professors Richard Nolan and Warren McFarlan. In this excerpt from their recent Harvard Business Review article, the authors detail what an IT governance committee should look like. Read More

Why IT Matters in Midsized Firms

What does IT actually contribute to a business? Is IT a commodity like electricity or is it a crucial element of competitive advantage? In a study of over 600 medium-sized global firms to analyze the business benefits that IT can enable, the authors found that IT capability was key to profitable business growth. This was true in both the U.S. product and services sectors as well as in Germany and Brazil. Read More

Why IT Does Matter

HBS professors F. Warren McFarlan and Richard L. Nolan respond to the much-discussed assertion by Nicholas Carr that company investments in IT are less and less likely to produce competitive advantage. Read More

Don’t Get Buried in Customer Data—Use It

Don't blame your CRM technology. Be smarter about collecting and using your data, says Jean Ayers in this article from Harvard Management Update. Read More

Computer Security is For Managers, Too

Computer security isn’t just an IT headache, say HBS professor Robert D. Austin and co-author Christopher A.R. Darby. Here are eight to-do items for managers to protect their digital assets. Read More

Wrapping Your Alliances In a World Wide Web

HBS professor Andrew McAfee researches how the Internet affects manufacturing and productivity and how business can team up to get the most out of technology. Read More

Tech Investment the Wise Way

Can elephants dance? Large companies are perceived to be less inclined to invest in new technologies than start-ups. But HBS professor Henry Chesbrough and Professor Emeritus Richard S. Rosenbloom say look to your business model—not the technology itself—to judge investment decisions. Read More

Whence IT Value?

Spending on information technology on the part of U.S. manufacturers is finally starting to pay off in increased productivity. Why now? Have IT investments, growing steadily since the 1970s, suddenly crossed a magic threshhold? HBS Professor Andrew McAfee believes the answer lies neither in magic nor in the growing power of computers themselves. Productivity gains, he writes in this article from the online journal Exec, may have more to do with the evolution of computing from PC "islands" to integrated networks that bridge distances and bring people together. Read More

Delivering Information Services: A 30-Year Perspective

When the HBS Executive Education course Delivering Information Services (DIS) began nearly three decades ago, the focus was on the management of mainframe computers. HBS Professor Richard L. Nolan discusses how the program and the way it's taught have kept pace with change in the Internet Age. Read More

Rapid Response: Inside the Retailing Revolution

A simple bar code scan at your local department store today launches a whirlwind of action: data is transmitted about the color, the size, and the style of the item to forecasters and production planners; distributors and suppliers are informed of the demand and the possible need to restock. All in the blink of an electronic eye. It wasn’t always this way, though. HBS Professor Janice Hammond has focused her recent research on the transformation of the apparel and textile industries from the classic, limited model to the new lean inventories and flexible manufacturing capabilities. Read More