Effects of Partners' Trust, Coordination, and Commitment
on the Success of e-Commerce Strategic Planning
Liber C.M. Lai, 2George G.G. Lee
Department of Information Management, National Taiwan University of Science and
Technology, Taipei, Taiwan
* Chih-Ming Lai is a doctoral candidate in the Department of
Information Management at National Taiwan University of
Science and Technology (NTUST), Taipei, Taiwan. He
received his M.S. degree from NTUST. His research interests
include issues in business strategic planning and management,
customer relationship management, supply chain management,
knowledge management, and e-business & e-commerce.
Dr. Gwo-Guang Lee is an associate professor in the
Department of Information Management at National Taiwan
University of Science and Technology (NTUST), Taipei,
Taiwan. He received the Ph.D. from the School of Computer
Studies at the University of Leeds, UK, in 1993. Currently, he
also works as a consultant for the Center of Electronic
Commerce at NTUST, as well as large Taiwanese firms. Dr.
Lee has published in the Journal of Information Technology,
Behaviour and Information Technology, Industrial
Management and Data Systems, Management Decision, and
International Journal of Retail & Distribution Management.
His current research interests focus on knowledge
management, IS strategic planning, and e-business.
*Corresponding Author: Chih-Ming Lai, No.27, Alley 2, Lane 142, Sec. 1, Heping
Rd., Ji-an Township, Hualien County 973, Taiwan (R.O.C.)
Tel. no. +886-3-8574856
Local cell-phone no. 0937-978502
Effects of Partners' Trust, Coordination, and
Commitment on the Success of e-Commerce
Liber C.M. Lai
Department of Information Management, National Taiwan University of
Science and Technology, Taipei, Taiwan
George G.G. Lee
Department of Information Management, National Taiwan University of
Science and Technology, Taipei, Taiwan
This study explains how partnership influences the e-Commerce (EC) strategic
planning (SP). Both the strategic planning and information system perspectives are
used to demonstrate that three attributes of partnership: trust, coordination, and
commitment, affect the success of ECSP via a survey of 166 CIOs in Taiwan.
Analytical results demonstrate the relationships among the alignment of ECSP can
improve not only ECSP capabilities, but also the fulfillment of ECSP benefits.
Furthermore, indicating that partner trust indirectly affects the alignment of ECSP via
partner coordination, and indicating that partner trust indirectly affects the fulfillment
of ECSP benefits via partner commitment. From this phenomenon, we can infer that
firms should strive to develop high-quality partnerships when contemplating ECSP.
Keywords: Electronic Commerce, Strategic Planning, Partnership
Partnership was defined as a strategic, purposive, inter-organizational, and
cooperative relationship (Mohr and Spekman, 1994; Ring and Van de Ven, 1994).
Partnerships consist of three attributes: trust, coordination, and commitment (Mohr
and Spekman, 1994). The importance of partnership has been widely discussed in
diverse fields such as marketing (Dwyer et al., 1987; Geyskens et al., 1996; Morgan
and Hunt, 1994), information system (IS) outsourcing (Lee, 2001), IS strategic
planning and management (Mohr and Spekman, 1994; Segars and Grover, 1998), and
inter-organizational relationship (IOR) (Geyskens et al., 1996; Hart and Saunders,
1997; Ring and Van de Ven, 1994). According to the commitment-trust theory of
Morgan and Hunt, trust and commitment have a causal relationship. Partner trust is
considered a cornerstone of partnerships (Lee, 2001; Lusch et al., 2003; Moorman et
al., 1992; Morgan and Hunt, 1994), and is a key determinant of partner commitment
(Morgan and Hunt, 1994; Rodríguez and Wilson, 2002), while partner commitment
which in turn yields benefits (Lee and Lim, 2003; Morgan and Hunt, 1994). Besides,
successful partnerships are marked by coordinated actions directed at mutual
objectives that are consistent across organizations (Narus and Anderson, 1987).
Without high levels of coordination, any planned mutual advantage cannot be
achieved (Mohr and Spekman, 1994). Although partnership is extremely important,
its relation to EC has seldom been discussed together.
EC refers to a business activity involving trading behaviors. However, the
definition of EC is varied, and a clear definition is required to identify the related
influences. This study is based on studies defining EC as front-end business activities,
which require the support of back-end IT infrastructure and IS function. EC describes
the comprehensively cooperative relationships regarding the exchange of products,
services, and information via the information superhighway (such as Internet today)
(Kalakota and Whinston, 1996; Zhu, 2004; Zwass, 1996). Zhu emphasized the firms
need to enhance the integration between front-end EC capability and back-end
information technology (IT) infrastructure in order to reap the benefits of EC
investments. Besides, IS function is as important as IT, because IS can support to and
match for business strategy (Eardley et al., 1997), so we need to systematically
integrate IT and IS for achieving business benefits (Poon and Swatman, 1999). Firms
hope to achieve their strategic benefits from EC, explaining why EC strategic
planning (ECSP) must be made first, because strategic planning provides
indispensable policies (means) to achieve business goals (ends) (Porter, 1980).
Owing to the difficulty of testing a comprehensive model including a number of
constructs, this study adopts both strategic planning and IS perspectives to
demonstrate that partnership attributes (i.e., trust, coordination, and commitment)
influence the ECSP success. Relationships are also found to exist among three
constructs (i.e., ECSP alignment, capability, and strategic benefits) within the domain
of success of ECSP. The research model and hypothesized relationships are tested
using the structural equation modeling approach, supported by LISREL 8.72 software,
and using data gathered from 166 chief information officers (CIOs) in Taiwan who
had adopted EC. Results of this study demonstrate that firms that focus on utilizing
EC under appropriate inter-organizational environments are likely to implement EC
successfully in their organizations and with their cooperative partners.
Although many factors affect ECSP, this issue has seldom been addressed from an
external partner perspective. This logical thinking shapes the conceptual model, which
comprises two domains: one domain is success of ECSP, and the other is partnership.
The first domain, a theoretical framework of the success of ECSP, resembles the
model developed by Venkatraman and Ramanujam (1987). Meanwhile, the second
domain, partnerships are composed of three attributes: trust, coordination, and
commitment (Mohr and Spekman, 1994). If firms can handle environmental
uncertainty by creating inter-organizational links between customers and suppliers,
external partners can provide some suggestions for coping with problems (Choe,
2003). Therefore, partnerships may significantly influence a firm's ECSP (Lee and
Lim, 2003; Raymond, 2001).
2.1. Success of ECSP
This study hypothesizes that ECSP is process-oriented, a new term which is seldom
mentioned previous literature. According to the strategic information system planning
(SISP) definition of Lederer and Sethi (1988), the ECSP definition closely resembles
the SISP definition except for that SISP is a computer-based application and ECSP is
an Internet-based one. Both ECSP and SISP involve analytical strategy planning
based on creative strategy thinking. Consequently, ECSP is defined as identifying a
portfolio of Internet-based IS applications that can not only integrate EC processes
within and beyond an organization, but also help that organization to achieve
strategic benefits. The IS within Internet-based EC that are also inter-organizational
information systems (Gebauer and Shaw, 2002), and thus the IS perspective is used as
a basis for considering ECSP.
Clearly, ECSP is a unique realization of SISP. Therefore, numerous SISP theories
can be applied to ECSP. Additionally, strategic planning relies on using a consensus
among domain experts to assess validity, but the suitability of this methodology is
limited. An effective strategic planning must simultaneously provide both internal
consistency and external validity of the planning process (Henderson and Sifonis,
1988). The alignment between IS strategy and business strategy is especially
important for internal consistency. Planners facing environmental uncertainty must
consider both the validity and consistency of the planning process. Therefore, treating
partners as external assessors who can help confirm the validity of the planning
process appears to be an appropriate measure.
Whether to adopt EC is a strategic business decision, and a formal plan is essential
to provide planning direction and focus (Teo and Ranganathan, 2004). The success of
ECSP is adapted from the two-dimensional model of planning system success, where
planning system success is a concept that measured using two constructs:
improvement in system capabilities and extent of fulfillment of key planning
objectives (Venkatraman and Ramanujam, 1987). The two-dimensional model has
been adapted for measuring planning system success in the IS context (Raghunathan
and Raghunathan, 1994). Subsequently, the model was modified again to demonstrate
the pivotal role of improved organizational planning capability in mediating the
influences of organization contexts and planning system dimensions on IS planning
effectiveness (Wang and Tai, 2003).
The above models are modified to fit the EC environment. This proposed that the
domain of success of ECSP involves three measurable constructs: alignment of ECSP,
improvement in ECSP capabilities, and fulfillment of ECSP benefits.
Researchers have hypothesized that a planning system can be visualized as an
administrative system (Venkatraman and Ramanujam, 1987). EC ventures may fail
due to a lack of strategic planning (Kao and Decou, 2003). Therefore, firms that wish
to succeed in system planning must initially conduct appropriate strategic planning
linking IS strategy and business strategy (Gottschalk, 2000; Wetherbe, 1993).
Alignment of ECSP uses the process (or means) perspective (Choe, 2003). An
operable and measurable construct of alignment of ECSP is rational, in contrast with
the conceptual construct of planning systems success.
Other constructs are also modified: improving the ECSP capabilities adopts the
improvement judgment (or process, means) perspective to achieve key ECSP
objectives, and fulfillment of ECSP benefits adopts the goal-centered judgment (or
output, ends) perspective (Venkatraman and Ramanujam, 1987; Wang and Tai, 2003).
The overall framework for the success of ECSP can be considered a process-output
(or means-ends) linkage (Henderson and Sifonis, 1988).
Partnership was defined as a strategic relationship, and has purposive, cooperative,
and inter-organizational properties (Mohr and Spekman, 1994; Ring and Van de Ven,
1994). Partnership describes a relationship involving resource exchange between
partners (Morgan and Hunt, 1994). According to previous studies, partnership is a part
of the environmental context (Raymond, 2001). In a broad sense, the external
environmental context influences the success of ECSP. Consequently, in a narrow
sense, partnership also influences ECSP success. In practice, firms may play multiple
business roles (e.g. buyer and seller). In strategic alliances and marketing, there no
buyers, sellers or customers, but only partners exchanging resources (Morgan and
Hunt, 1994). Therefore, relationships such as buyer-seller, customer-supplier, and
consumer-producer, are all considered as simple partnerships in this study with the
relevant roles being seen as those of partners.
This study examines the influence of partnership based on three partnership
attributes: trust, coordination, and commitment (Mohr and Spekman, 1994).
Commitment-trust theory of Morgan and Hunt (1994) identifies three reasons for why
trust and commitment are key variables. First, both trust and commitment encourage
individuals to actively try to preserve relationship investments by cooperating with
partners. Second, both trust and commitment resist attractive short-term alternatives in
favor of pursuing the expected long-term benefits of staying with existing partners.
Third, both trust and commitment view potentially high-risk actions as prudent due to
their belief that their partners will not act opportunistically. Therefore, a high-quality
partnership must depend on establishing adequate trust and commitment between
partners (Bresnen and Marshall, 2000; Fuller and Vassie, 2002). Besides, Narus and
Anderson (1987) suggest that successful partnerships are also marked by coordinated
actions directed at mutual and consistent objectives across firms. Chatterjee et al.
(2002) consider that the implementation of coordination legitimizes collaboration and
sharing of knowledge and perspectives among executives with marketing, customer,
and technology knowledge.
Furthermore, an effective strategic planning must have external validity (Henderson
and Sifonis, 1988). Partners can be considered as assessors who are located within the
external environment and can facilitate the confirmation of planning process validity
as well as influencing firm's ECSP (Lee and Lim, 2003; Raymond, 2001). Therefore,
the partnership perspective fits the external validity of strategic planning (Henderson
and Sifonis, 1988; Henderson and Venkatraman, 1993; King, 1983).
2.3. Relationship between partnership and success of ECSP
As mentioned earlier, partnership positively influences the success of ECSP (Choe,
2003; Lee and Lim, 2003; Raymond, 2001). Chang et al. (2003) recommended that
firms should carefully assess their customer and competitor base as a part of their
strategic thinking and, thus, derive increased benefits. Clearly, a good partnership
positively increases strategic benefits. Firms develop Internet-enabled initiatives to
strengthen online interactions with customers, disseminate product information,
facilitate transactions, and improve customer service via electronic links with
suppliers that become more critical (Zhu, 2004). Based on the social exchange theory,
the importance of partnership was demonstrated in resource exchange between
partners. Therefore, high-quality partnerships require mutual benefits for partners
(Lee and Lim, 2003).
A successful SISP requires users and line managers to work together with the IS
function, which may not only generate relevant application ideas, but also tends to
create ownership of both processes and outcomes (Earl, 1993). Based on the supply
chain management (SCM) literature, strategic alignment requires not only an internal
business-technology alignment (internal consistency) but also a buyer-supplier
relationship alignment (external validity) (Handfield et al., 2000), because
misalignment of buyer-supplier strategies results in extremely wasteful supply chains
and generates considerable dissatisfaction among customers (Fisher, 1997). Therefore,
it is plausible that improved supplier performance will not be realized or sustained
unless buyers recognize procurement and SCM as sources of competitive advantage
and align SCM strategy with overall business strategy (Handfield et al., 2000).
Besides, a significant finding of this study is that suppliers derive considerable
strategic benefits when customers initiate a system and the supplier enhances the
capabilities of that system (Mukhopadhyay and Kekre, 2002). Consequently, the
participation of external partners strongly influences firm strategic alignment and
outcomes. This view is corresponds to an empirical study on a web shopping mall in
which customer relations are demonstrated to positively influence both alignment and
competitive advantage (Lederer et al., 2001).
3. Research model and hypotheses
The previous section discussed the conceptual model of the two domains and their
relationship. This section subdivides the two domains into six constructs, and thus
forms a complete research model and hypotheses, and illustrated in Figure 1.
H6 Partner Partner H9
Success of ECSP
H3 ECSP benefits
Improvement in H2
Figure 1. Research model and hypotheses
3.1. Fulfillment of ECSP benefits
For providing useful guidance regarding improved planning management, a direct
measuring and benefit-based approach is utilized in this study (King, 1983). Three
classes of benefits were identified: informational, transactional and strategic. Strategic
benefits comprise three parts: competitive advantage, customer relations, and
alignment (Lederer et al., 2001; Mirani and Lederer, 1998). This study focuses
strategic benefits on measuring four key factors which are recognized to achieve
ECSP benefits. The first factor, namely strengthening competitiveness, is emphasized
as the most important strategic benefit (Lederer et al., 1997). Meanwhile, the second
factor, i.e., improving customer relations (Lederer et al., 2001; Mirani and Lederer,
1998; Teo and Ranganathan, 2004), is shown to positively influence both competitive
advantage and alignment (Lederer et al., 2001).
The third factor, increasing market share, such as increasing the sale volume in
business-to-business (B2B) study (Mukhopadhyay and Kekre, 2002) and as increasing
market expansion in business-to-customer (B2C) study (Zhuang and Lederer, 2003),
is recognized as capable of achieving strategic benefits. The final factor, i.e.,
improving customer service quality (Earl, 1993), such as improving customer service
in B2B study (Teo and Ranganathan, 2004) and as increasing customer service benefit
in B2C study (Zhuang and Lederer, 2003), is also recognized as capable of achieving
strategic benefits. Consequently, success in ECSP must involve the fulfillment of the
above four strategic benefits.
3.2. Alignment of ECSP
Firms hope to succeed in ECSP must first align their IS strategy and business
strategy, this argument is consistent with the internal consistency of strategic planning
(Henderson and Sifonis, 1988). Alignment is clearly important in Wetherbe's four-
stage planning model (1993). During the first stage, namely strategic planning, the
alignment between IS/IT plan and the overall organization objectives must be
addressed (Bowman, et al., 1983; Reich and Benbasat, 1996). Although identifying
the strategies to which the ECSP should be aligned is extremely difficult, without such
alignment, the ECSP will not obtain long-term organizational support (Bowman, et
al., 1983), and a firm's economic performance will falter as well (Henderson and
The importance of alignment can be demonstrated based on the ranking of IS
management issues. Major IS management issues can be divided into four groups:
business relationship, technology infrastructure, internal effectiveness, and technology
application (Niederman et al., 1991). The first one of these groups, i.e., business
relationship, focuses on managing the relationship between IS and the business.
Effective planning requires appropriate IS organization alignment, and inappropriate
alignment can seriously interfere with effective IS strategic planning (Niederman et
al., 1991). Furthermore, SISP focuses mainly on alignment of IS with business needs
(Earl, 1993). Therefore, Gottschalk (2000) predicts that an important IS management
issue within business relationships in the 21st century is to improve the links between
IS strategy and business strategy. Alignment thus is a critical starting point for overall
Accordingly, the alignment must be clarified. Alignment is not an event but rather
is a process of continuous adaptation and change (Henderson and Venkatraman,
1993), and it is generally accepted key factor for successful IS/IT planning (Segars
and Grover, 1998). Alignment involves a close link between IS/IT strategy and
business strategy (Bergeron et al., 2004; Chan et al., 1997; Choe, 2003; Earl, 1993;
Segars and Grover, 1998). However, alignment is also explained as a link between IS/
IT plan and business plan (Henderson et al., 1987; Reich and Benbasat, 1996; Teo and
Ang, 1999; Teo and King, 1996). Regarding the direction of our study, we argue that
alignment is a planning process based on a close link between IS strategy and
business strategy; consequently, the alignment is referred to as "strategic alignment"
rather than "structural alignment" (Hirschheim and Sabherwal, 2001).
Item measures for alignment of ECSP were primarily adapted from those developed
by Segars and Grover (1998), and retained four in eight items. The discarded reasons
were as follows: one item referred to the emerging technologies issue, and three items
referred to top management issues. Four items were retained and had demonstrated
validity by empirical studies (cf. Kunnathur and Shi, 2001; Lee and Pai, 2003).
Numerous empirical studies have demonstrated that increased alignment leads to
increased IS contributions to business benefits (cf. Bergeron et al., 2004; Chan et al.,
1997; Choe, 2003; Sabherwal and Chan, 2001; Teo and King, 1996). Therefore,
alignment could be considered a critical starting point for the success of ECSP and the
following hypothesis is proposed:
H1: Alignment of ECSP positively impacts fulfillment of ECSP benefits.
3.3. Improvement in ECSP capabilities
The construct of ECSP capabilities derives from the concept of strategic planning
systems capability (Ramanujam et al., 1986). Planning system capability is
conceptualized in terms of system ability to foster control and creativity
(Raghunathan and Raghunathan, 1994; Ramanujam et al., 1986; Wang and Tai, 2003).
Additionally, objectives associated with improved capabilities provide a potentially
important perspective for assessing the adaptability of the planning system to fit
planning needs (Segars and Grover, 1998). Differentiated capabilities can be created
via alliances and partnerships, and dot-com operations are for assembling
complementary strategic capabilities through relationships (Venkatraman, 2000).
Therefore, EC planning should have sufficient inbuilt flexibility to enable the
adaptation of EC processes to foster new opportunities, thus fostering creativity.
Furthermore, planners should attempt to balance creativity with adequate control
mechanisms, thus preventing frequent adaptations on the grounds of creativity from
leading to loss of control (Raghunathan and Raghunathan, 1994). Certainly, a
planning system with greater capability to anticipate environmental change and
maintain management control should provide the organization with a better chance of
achieving its planning objectives (Wang and Tai, 2003).
Items measured to assess the improvement in ECSP capabilities were also primarily
adapted from those developed by Segars and Grover (1998). This study discarded two
items, one of which referred to the alignment issue, while the other referred to the
cooperation issue. Five items were retained, and their validity had to be demonstrated
through empirical studies (cf. Kunnathur and Shi, 2001; Raghunathan and
Raghunathan, 1994; Venkatraman and Ramanujam, 1987; Wang and Tai, 2003).
The relationship between "improvement in ECSP capabilities" and "fulfillment of
ECSP benefits" has been demonstrated in numerous studies (Kunnathur and Shi,
2001; Segars and Grover, 1998). Further, their positive relationship has been also
demonstrated by empirical studies (cf. Raghunathan and Raghunathan, 1994;
Venkatraman and Ramanujam, 1987; Wang and Tai, 2003). Consequently, for
consistency with previous studies, the following hypothesis is proposed:
H2: Improvement in ECSP capabilities positively impacts fulfillment of ECSP
On the other hand, while focusing on the fulfillment of ECSP benefits to provide a
useful focal point for assessing strategic planning outcomes, but the ability of the
planning process to adapt to a changing business environment remains unclear.
Restated, equally important is to assess how the planning process has adapted to better
determine planning system effectiveness (Segars and Grover, 1998). This effective
planning system criterion has been formally defined and operationalized as an
improvement in system capabilities (Segars and Grover, 1998; Venkatraman and
However, an effective planning system should continuously improve in terms of its
basic capabilities to support the organization (Venkatraman and Ramanujam, 1987).
Segars and Grover (1998) observed that the organizational learning that accompanies
planning experience should improved capabilities to achieve alignment between IS
strategy and business strategy, analyzing and understanding a business and associated
technologies, fostering cooperation and partnership among functional managers and
user groups, anticipating relevant events and issues within the competitive
environment, and adapting to unexpected organizational and environmental changes.
Many studies have demonstrated the relationship between "alignment of ECSP"
and "improvement in ECSP capabilities" (Kunnathur and Shi, 2001; Segars and
Grover, 1998). Furthermore, their positive relationship has also been demonstrated by
empirical researches (cf. Lee and Pai, 2003; Wang and Tai, 2003). Therefore, for
consistency with previous studies, this study presents the following hypothesis:
- 10 –
H3: Alignment of ECSP positively impacts improvement in ECSP capabilities.
3.4. Partner trust
Partner trust refers to the reliance (or confidence) between partners. Although the
definition of partner trust is problematic, owing to the wide variety of approaches to
the concept, this study defines partner trust using two approaches: cooperative
behavior and belief (Moorman et al., 1992).
Two different conceptualizations of trust exist in social reality: viewing trust as a
cooperative behavior, and viewing trust as a psychological construct (Lewis and
Weigert, 1985). Partner trust has been defined as "the reliance by one person, group,
or firm upon a voluntarily accepted duty on the part of another person, group, or firm
to recognize and protect the rights and interests of all others engaged in a joint
endeavor or economic exchange", where this reliance must be designed to improve
cooperation and achieve benefits (Hosmer, 1995). Meanwhile, partner trust has also
been defined as one party having confidence in the reliability and integrity of an
exchange partner (Morgan and Hunt, 1994), or in the goodwill of such a partner
(Moorman et al., 1992; Ring and Van de Ven, 1994). More explicitly, partner trust can
be defined as a belief that partners will act to achieve positive outcomes as well as not
unexpectedly taking actions that result in negative outcomes (Anderson and Narus,
1990). Trust enables parties in a relationship to develop confidence that can yield
long-term benefits (Anderson and Weitz, 1989).
Based on the literature by Butler and Cantrell (1984), partner trust includes four
measured key factors: openness, honesty, competence and benevolence (Butler and
Cantrell, 1984; Ganesan, 1994; Geyskens et al., 1996; Hart and Saunders, 1997;
Larzelere and Huston, 1980; Morgan and Hunt, 1994; Rempel et al., 1985; Walter,
2003). Openness indicates mental willingness to share ideas and information freely
with partners. Moreover, honesty indicates the reputation for integrity of the partners
who stand by their word and fulfill promised role obligations. Furthermore,
competence indicates that partners have the required expertise, such as technical
knowledge and interpersonal skills, for performing their jobs, and moreover handle
situations consistently. Finally, benevolence indicates that partners are interested in
firm welfare, will not opportunistically pursue their own gain, are loyal and also are
willing to protect, support, and encourage their partners.
3.5 Partner coordination
Coordination is a process of arranging activities (Quinn and Dutton, 2005) and
reflects the set of tasks each party expects the other to perform (Mohr and Spekman,
1994). Therefore, coordination is established in the partner's believe between each
other, and such definition of coordination is about the expectation of coordination
rather than the realization of coordination (Quinn and Dutton, 2005). Cooren (2000)
asserts that coordination is a process of using speech acts to impose narrative
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structures onto situations in order to make sense of those situations, this view had
revealed the individual ability of coordinator can affect the coordinated result. In sum,
actual coordinated jobs must depend on two differ coordinated offers: one is to own
the coordinated ability and the other is having willingness for the partners to work
together (Gerwin, 2004). Narus and Anderson (1987) suggest that successful working
partnerships are marked by coordinated actions directed at mutual objectives that are
consistent across organizations. Pfeffer and Salancik (1978) assert without high levels
of coordination, any planned mutual advantage cannot be achieved.
Chatterjee et al. (2002) suggest that managerial judgments and actions across the
enterprise can be linked through the use of a variety of coordination mechanisms,
such as standard operating procedures (SOP), liaison roles, and task forces. Therefore,
the executed degree of above three mechanisms can be estimated the level of partner
3.6. Partner commitment
Partner commitment refers to an exchange partner believing that a valued
relationship with another is considered sufficiently important to warrant making a
maximum effort at maintaining it; that is, the committed party believes the
relationship is worth maintaining to ensure it endures indefinitely (Moorman et al.,
1992; Morgan and Hunt, 1994).
Commitment has been classified into various types. Affective commitment and
calculative commitment appear most frequently, and also appear to be the most
relevant for IOR (Geyskens et al., 1996). Affectively committed channel members
wish to maintain relationships because they like the partner and enjoy the partnership,
while calculative commitment indicates the extent to which channel members
perceive the need to maintain a relationship given the significant termination or
switching costs associated with leaving. Simultaneously, the conceptualized affective
commitment and calculative commitment have been identified as mutual
independence (Geyskens et al., 1996). Savant contended that two consequences of
affective commitment surpass calculative commitment (Kumar et al., 1994). First,
affectively committed partners invest more in the relationship than calculative
commitment parties. Second, affectively committed partners are more resistant to
opportunistic behavior. These two consequences are consistent with Morgan and
Hunt. Consequently, this study adopts "affective commitment" as a generic term for
Theory was primarily adopted by Walter (2003), and item development was
primarily adapted by Lusch et al. (2003), Morgan and Hunt (1994). Partner
commitment incorporates three key measured factors: continuing investment, short-
term sacrifice and long-term benefit orientation. Continuing investment represents
partner willingness to strive to maintain the partnership; these commitment inputs
include idiosyncratic and dedicated investments (Dwyer et al., 1987; Gundlach et al.,
1995; Hart and Saunders, 1997; Lee and Lim, 2003; Lusch et al., 2003; Morgan and
Hunt, 1994; Walter, 2003). Because commitment potentially entails vulnerability,
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partners will make an effort and balance short-term sacrifice against long-term goal
achievement. Obviously, partner commitment is also a long-term benefit (Anderson
and Weitz, 1992; Gundlach et al., 1995; Lusch et al., 2003; Mohr and Spekman, 1994;
Morgan and Hunt, 1994; Walter, 2003).
3.7. Relationships among partner trust, partner coordination, partner commitment,
alignment of ECSP, improvement in ECSP capabilities, and fulfillment of ECSP
Anderson and Narus (1986) deemed that trust as a party's expectation that another
party desires coordination, will fulfill obligations and will pull its weight in the
relationship. Trust has been suggested as the relationship mechanism that facilitates
cooperation and coordination (Rodríguez and Wilson, 2002). Once trust is established,
firms learn that coordinated efforts will lead to outcomes that exceed what the firm
would achieve if it acted solely in its own best interests (Anderson and Narus, 1990).
Pruitt (1981) believes trust and a desire to coordinate with another party are closely
related, and an empirical research of Jap (1999) has demonstrated the positive
relationship between trust and coordination. Therefore, based on the above, we
H4: Partner trust positively impacts partner coordination.
If one partner conforms to expectations, then the other partner will be encouraged
to maintain the partnership. Thus, a reciprocal relationship exists between continuity
and trust, with trust reinforcing the prospect of continuity in a relationship
representing a commitment to maintain an IOR in the future (Hart and Saunders,
1997). Since commitment entails vulnerability, only trustworthy partners are sought
after (Geyskens et al., 1996; Morgan and Hunt, 1994; Rodríguez and Wilson, 2002).
The process framework of cooperative IOR comprises a repetitive and cyclic
sequence of negotiation, commitment, and execution. In the commitment stage,
during which the parties identify trustworthy partners, the mechanism for governing
the cooperative relationship is established, and the commitments among the parties
are either codified in a formal legal contract or an informally psychological contract
(Ring and Van de Ven, 1994). This process clearly reveals the relation between trust
and commitment; that is, it uses trustworthiness as a basis for codifying commitment
to partners to keep their promises and complete deals.
Thus the link between trust and commitment is important because commitment is
essential for successful long-term relationships (Gundlach et al., 1995). Partners can
demonstrate their trustworthiness by committing themselves to the exchange
relationship, therefore, trust building can be considered a business investment made to
strengthen a mutual relationship (Hallén et al, 1991). Finally, partners with long-term
relationships can achieve competitive advantage (Ganesan, 1994). Additionally, trust
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is conceived as a determinant of relationship quality (Moorman et al., 1992). Because
trust is so highly valued, parties are strongly motivated to maintain such relationships.
In sum, partner trust is considered a cornerstone of partnership (Lee, 2001; Lusch
et al., 2003; Moorman et al., 1992; Morgan and Hunt, 1994), and is a key determinant
of partner commitment (Geyskens et al., 1996; Morgan and Hunt, 1994; Rodríguez
and Wilson, 2002). Numerous empirical researches have demonstrated the existence
of these positive trust-commitment relationships (cf. Geyskens et al., 1996; Larzelere,
R. E., Huston, 1980; Lusch et al., 2003; MacDonald amd Smith, 2004; McDonald,
1981; Moorman et al., 1992; Morgan and Hunt, 1994; Rodríguez and Wilson, 2002;
Walter, 2003). Therefore, based on the above, we hypothesize:
H5: Partner trust positively impacts partner commitment.
A theoretical study has described the development of trust between firms as a
function of maintaining the relationship, and the trust mechanisms lying behind
alignment (Bresnen and Marshall, 2000). And, alignment of IS strategy with business
strategy gained through coordination between the business and IS planning functions
and activities (Teo and King, 1996). Besides, according to three empirical studies
demonstrating how the partnership and the alignment of ECSP are related from the
perspectives of external environment (Choe, 2003), customer relations (Lederer et al.,
2001), and partnership (Earl, 1993). Partnership is a part of the environmental context
(Raymond, 2001), and customer relations are viewed as a type of partnership.
Consequently, three relationships can be inferred, namely that partner trust,
coordination, and commitment can impact alignment of ECSP. Therefore, based on
the above, we hypothesize the following:
H6: Partner trust positively impacts alignment of ECSP.
H7: Partner coordination positively impacts alignment of ECSP.
H8: Partner commitment positively impacts alignment of ECSP.
Some investigations have demonstrated that partner trust lead to benefits (Anderson
and Weitz, 1989; Anderson and Narus, 1990; Fuller and Vassie, 2002; Hosmer, 1995),
while other studies have shown that partner coordination lead to benefits (Anderson
and Narus, 1990; Fisher, 1997). Yet other researches have demonstrated that partner
commitment achieves benefits (Kumar et al., 1994; Mathieu and Zajac, 1990).
Besides, some studies have demonstrated that partnership lead to benefits (Chang et
al., 2003; Lederer et al., 2001). Numerous empirical researches have demonstrated the
positive relationships between partner trust and fulfillment of ECSP benefits (cf. Lee
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and Lim, 2003), partner coordination and fulfillment of ECSP benefits (cf. Jap, 1999),
partner commitment and fulfillment of ECSP benefits (cf. Kumar et al., 1994; Lee and
Lim, 2003; Mathieu and Zajac, 1990). Therefore, based on the above, we hypothesize
H9: Partner trust positively impacts fulfillment of ECSP benefits.
H10: Partner coordination positively impacts fulfillment of ECSP benefits.
H11: Partner commitment positively impacts fulfillment of ECSP benefits.
4.1. Survey procedures
Data were collected via a postal survey. A draft questionnaire was pilot tested by
three MIS professors to ensure the content validity and no problems in wording. Five
CIOs were administered the revised questionnaire and asked to examine it for
meaningfulness, relevance, and clarity, which resulted in some minor modification of
the wordings of certain survey items. The final instrument was mailed to the CIOs of
784 firms randomly selected from the directories of the 2003 Common Wealth 1000
largest firms in Taiwan. Although the use of a single informant may result in method
variances and informant biases, the CIO is sufficiently qualified to answer questions
about ECSP (Huber and Power, 1985; Van der Heijden, 2001).
4.2. Measure procedures
A direct measurement and benefits based approach is used to improve planning
management (King, 1983). Meanwhile, a multi-item approach is used to measure the
research variables, together with a five-point Likert-type scale. All the scale items
please see Appendix.
The research models were analyzed using SEM, supported by LISREL 8.72.
Because the statistics technique of SEM allow a researcher can compare the
explanatory power of a model to that of competing models by using adequacy indices.
And the researcher can reduce uncertainty about a plausible model by testing a priori
competing models, comparing their meaningfulness to account for the data.
Eliminating competing rivals strengthens support for a model (Aquino et al., 1997).
The measure procedures consist of three stages.
The first stage, we use confirmatory factor analysis (CFA) to identify whether items
are appropriate. Therefore, we test the questionnaire's validity and reliability, factor
loading, and overall fit of the model with six constructs. Seven approved indices are
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used, such as chi-square test (χ2), χ2/df, root mean square error of approximation
(RMSEA), normed fit index (NFI), non-normed fit index (NNFI), comparative fit
index (CFI), goodness-of-fit index (GFI), and adjusted goodness-of-fit index (AGFI)
(Aquino et al., 1997; Bentler, 1990; Bentler and Bonett, 1980; Carmines and McIver,
1981; Etezadi-Amoli and Farhoomand, 1996; Hair et al., 1998; Rigdon, 1996).
The second stage, the research model and hypothesized relationships are tested
using the SEM approach, and seven approved indices are also used to test the overall
fit of research model. However, owing to partner coordination positions between the
partner trust and the alignment of ECSP, partner commitment positions between the
partner trust and the fulfillment of ECSP benefits. The mediation may be existence, so
we need to test thus mediation further.
The third stage, we delete some path parameters of the research model to form new
nested models, namely model-a and model-b, in order to compare the parameters
change among different competing models (Marsh, 1994). According to the
suggestion of Baron and Kenny (1986), the test processes of mediation are two steps.
If we want to prove variable M is mediator between variable X and Y. The first step
must prove X to Y, as well as X to M is influential. The second step when M is added
between X and Y, the influence of M to Y is significant and the influence of X to M is
still significant but the influence of X to Y becomes un-significant. Because the
existence of M makes the influence of X to Y to be not significant anymore, therefore
M can be proved that is a really complete mediator between X and Y.
5. Data Analysis
A total of 166 completed usable questionnaires were returned, for an effective
response rate of 21.17%. The sample size of 166 was adequate for model testing,
since the ratio of sample size (166) to the observed indicators (23) was 7.2 exceeding
the recommended ratio of 5.0 (Bentler and Chou, 1987).
5.1. Sample characteristics
The demographic characteristics of the sample and reveals some interesting
phenomenon. First, the respondents come from diverse industries, including:
electronics industry 24.7%, financial/insurance 22.3%, manufacturing 19.3%,
traditional industry 10.2%, in addition to various other industries such as building,
transportation, retailing and so on. Second, most IS departments are not large, 33.1%
of the responding firms had fewer than ten IS employees, 31.9% had between 11 and
50, 10.2% had between 51 and 100, and 24.8% had over 100. Finally, EC remains in
its infancy, 22.3% of respondent firms had been carrying out EC for less than 1 year,
56.6% between 1 and 3 years, 14.5% between 3 and 5 years, and only 6.6% for over 5
- 16 –
5.2. Measure validity and reliability (CFA)
All constructs were measured with multiple indicators. Respondents gave the extent
of their agreement or disagreement with each statement concerning the constructs.
CFA was performed to examine the validity and reliability of the questionnaire. Table
1 lists the CFA results.
Table 1. The results of measurement model CFA
Latent construct Indicator Factor Standard t-value Composite
loading error reliability
Partner trust 0.87
TR1 0.47 0.04 10.64***
TR2 0.52 0.04 12.77***
TR3 0.52 0.04 13.05***
TR4 0.57 0.05 11.48***
Partner coordination 0.84
CR1 0.46 0.05 10.13***
CR2 0.55 0.04 12.67***
CR3 0.59 0.05 12.32***
Partner commitment 0.86
CO1 0.48 0.04 13.02***
CO2 0.45 0.04 12.64***
CO3 0.44 0.04 11.61***
Alignment of ECSP 0.92
AL1 0.61 0.05 12.76***
AL2 0.65 0.05 13.70***
AL3 0.70 0.05 14.00***
AL4 0.60 0.04 13.49***
Improvement in ECSP capabilities 0.93
CA1 0.52 0.04 12.84***
CA2 0.60 0.04 13.56***
CA3 0.58 0.04 13.31***
CA4 0.61 0.04 14.75***
CA5 0.59 0.04 13.66***
Fulfillment of ECSP benefits 0.87
BE1 0.57 0.04 12.67***
BE2 0.59 0.05 12.43***
BE3 0.52 0.05 9.81***
BE4 0.57 0.04 13.16***
***p<0.001 (|t-value| >3.08), **p<0.01 (|t-value| >2.575), *p<0.05 (|t-value| >1.96)
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The validity of the questionnaire can be defined as the degree to which an indicator
or set of indicators correctly represents the study concept (Hair et al., 1998). This
study focuses on three forms of validity: content, convergent and discriminate
Content validity was established by adopting constructs that have been used in
former empirical studies, and through conducting a pilot test on experts in related
fields (Lee and Lim, 2003). This questionnaire has content validity because all the
indicators were determined through a review of other similar studies and a pilot test
was conducted on three MIS professors and five CIOs.
Convergent validity tests were conducted to determine whether all the indicators
measuring a construct clustered together and clearly formed a single construct (Lee
and Lim, 2003). Table 1 shows that each indicator had a higher load on associated
construct than any other construct. Most of indicators' factor loading fitted the
threshold value between 0.5 and 0.95. Even though a few indicators' factor loading are
smaller than 0.5, but their standard error are extremely small (Bagozzi and Yi, 1988)
and all t-values were statistically significant (Bagozzi et al., 1991), so indicating that
the indicators were one dimensional. Consequently, this questionnaire has good
Discriminate validity indicates the degree to which a conceptual and theoretical
differences between constructs, and is indicated by a low correlative coefficient
between measured variables (Lee and Lim, 2003). Table 2 reveals the occurrence of
discriminate validity, in which the correlative coefficient of any pair construct is
below 0.9 (Hair et al., 1998).
Table 2. Correlations between constructs
Construct (1) (2) (3) (4) (5) (6)
(1) Partner trust 1.000
(2) Partner coordination 0.575*** 1.000
(3) Partner commitment 0.666*** 0.482*** 1.000
(4) Alignment of ECSP 0.552*** 0.575*** 0.444*** 1.000
(5) Improvement in ECSP 0.498*** 0.487*** 0.431*** 0.677*** 1.000
(6) Fulfillment of ECSP 0.548*** 0.443*** 0.512*** 0.646*** 0.685*** 1.000
***p<0.001 (|t-value| >3.08), **p<0.01 (|t-value| >2.575), *p<0.05 (|t-value| >1.96)
Reliability can be defined as the extent to which an indicator or set of indicators is
consistent with what the researcher intends to measure (Hair et al., 1998). Reliability
assessment was performed using composite reliability, which indicates the degree of
internal consistency. In Table 1, all constructs indicated adequate reliability when the
- 18 –
composite reliability exceeded the threshold value of 0.7 for confirmatory research
(Hair et al., 1998). This demonstrates that the questionnaire has good reliability.
Consequently, this study concluded that all the indicators used had acceptable
validity and reliability. Table 3 shows that the following measured indices were used
to assess the overall fit of the measurement model. The goodness of fit indices was:
χ2/df=1.239, RMSEA=0.039, NFI=0.97, NNFI=0.99, CFI=0.99, GFI=0.88,
AGFI=0.84. Overall, the CFA results demonstrated that this questionnaire was
appropriate for testing the hypothesized model.
Table 3. Fit statistics and recommended values for measurement model
Fit statistics Threshold Reference Measurement
chi-square/degree of <3 Carmines and McIver, 1981 266.42/215
freedom (χ2/ df) =1.239
root mean square error of < 0.08 Hair et al., 1998 0.039
normed fit index > 0.90 Hair et al., 1998 0.97
non-normed fit index > 0.90 Hair et al., 1998 0.99
comparative fit index > 0.90 Bentler and Bonett, 1980 0.99
goodness-of-fit index > 0.80 Etezadi-Amoli and Farhoomand, 1996 0.88
adjusted goodness-of-fit > 0.80 Etezadi-Amoli and Farhoomand, 1996 0.84
***p<0.001 (|t-value| >3.08), **p<0.01 (|t-value| >2.575), *p<0.05 (|t-value| >1.96)
5.3. Analysis of structural model and hypothesis testing
Figure 2 illustrates the structural model with parameters requiring estimation. Table
4 shows the structural model with related fit statistics and estimated parameters. The
global fit statistics indicate adequate fit (χ2/df=1.548, RMSEA=0.058, NFI=0.96,
NNFI=0.98, CFI=0.98, GFI=0.85, AGFI=0.81). Since the proposed model is
meaningless if the correlations among the alignments of ECSP, improvement in ECSP
capabilities, and fulfillment of ECSP benefits are not significant, therefore the
relationships within the constructs of success of ECSP are examined before
partnership. Consistent with H1, the alignment of ECSP significantly and positively
influences the fulfillment of ECSP benefits (β53=0.30, p<0.01). Furthermore, the
improvement in ECSP capabilities also positively and markedly influences the
fulfillment of ECSP benefits (β54=0.44, p<0.001), and thus H2 is supported.
Additionally, the alignment of ECSP markedly and positively influences the
improvement in ECSP capabilities (β43=0.64, p<0.001), and thus H3 is supported.
- 19 –
Since H1, H2 and H3 are statistically significant. Each hypothesis is tested to
identify the constructs that are important for ECSP success. Moreover, regarding the
hypothesis of partner trust is considered a cornerstone of partnership, partner trust is
considerably related to partner coordination (γ11=0.32, p<0.001), thus H4 is
supported; partner trust is also considerably related to partner commitment (γ21=0.38,
p<0.001), thus H5 is supported too.
Regarding the hypotheses relating to partnership and alignment of ECSP, partner
trust is not significantly as well as partner commitment related to the alignment of
ECSP (γ31=0.16, p>0.05; β32=0.07, p>0.05), but partner coordination is significantly
related to the alignment of ECSP (β31=0.58, p<0.001). Therefore, H7 is supported but
H6 and H8 are not.
Improvement in β54
Figure 2. Structural equation model
Table 4. Parameter estimates, and fit statistics for structural models
Parameter (Path) Original research Research Research
Estimate t-value Estimate t-value Estimate t-value
γ11 (Trust → Coord) 0.32 *** 7.38 0.33 *** 7.59 0.32 *** 7.38
γ21 (Trust → Comit) 0.38 *** 9.59 0.38 *** 9.55 0.39 *** 9.77
γ31 (Trust → Align) 0.16 1.57 0.40 *** 4.47 0.15 1.46
γ51 (Trust → Benef) 0.05 0.68 0.05 0.59 0.18 *** 3.30
- 20 –
β31 (Coord → Align) 0.58 *** 3.83 Deletion 0.58 *** 3.85
β32 (Comit → Align) 0.07 0.42 -0.01 -0.04 0.08 0.50
β43 (Align → Capab) 0.64 *** 9.23 0.64 *** 9.23 0.64 *** 9.22
β51 (Coord → Benef) -0.14 -1.14 -0.13 -1.06 -0.16 -1.29
β52 (Comit → Benef) 0.29 * 2.20 0.30 * 2.22 Deletion
β53 (Align → Benef) 0.30 ** 2.76 0.28 ** 2.67 0.29 ** 2.66
β54 (Capab → Benef) 0.44 *** 4.27 0.45 *** 4.28 0.46 *** 4.30
χ2/df [<3] 340.66/220= 1.548 362.27/221= 1.639 346.01/221= 1.566
RMSEA [<0.08] 0.058 0.062 0.059
NFI [>0.9] 0.96 0.96 0.96
NNFI [>0.9] 0.98 0.98 0.98
CFI [>0.9] 0.98 0.98 0.98
GFI [>0.8] 0.85 0.84 0.85
AGFI [>0.8] 0.81 0.80 0.81
***p<0.001 (|t-value| >3.08), **p<0.01 (|t-value| >2.575), *p<0.05 (|t-value| >1.96)
Trust: Partner trust; Coord: Partner coordination; Comit: Partner commitment; Align: Alignment of
ECSP; Capab: Improvement in ECSP capabilities; Benef: Fulfillment of ECSP benefits
Finally, regarding the hypotheses relating to partnership and fulfillment of ECSP
benefits, partner trust is not significantly as well as partner coordination related to the
fulfillment of ECSP benefits (γ51=0.05, p>0.05; β51=-0.14, p>0.05); but partner
commitment is significantly related to the fulfillment of ECSP benefits (β52=0.29,
p<0.05). Therefore, H11 is supported but H9 and H10 are not.
5.4. Mediation testing
Research model-a and model-b are nested models of original research model, thus
three model have adequate fit statistics (cf. Table 4). Although H6 is not supported in
original model, but H6 is supported in model-a. Using a test processes of mediation
(Baron and Kenny, 1986), when parameter β31 is not existence in model-a, γ11 and
γ31 are significant (γ11=0.33, p<0.001; γ31=0.40, p<0.001). When parameter β31 is
existence in original model, γ31 becomes un-significant (γ31=0.16, p>0.05). Because
the existence of β31 makes γ31 to be not significant, therefore partner coordination
can be proved that is a really complete mediator between partner trust and alignment
Using same test processes of mediation, when parameter β52 is not existence in
model-b, γ21 and γ51 are significant (γ21=0.39, p<0.001; γ51=0.18, p<0.001). When
parameter β52 is existence in original model, γ51 becomes un-significant (γ51=0.05,
p>0.05). Because the existence of β52 makes γ51 to be not significant, therefore
partner commitment can be proved that is a really complete mediator between partner
trust and fulfillment of ECSP strategy.
- 21 –
The first five hypotheses are directive inferences based on the results of numerous
empirical studies. Thus H1, H2, H3, H4, and H5 are all expected to be supported. H1
successfully demonstrated that if a firm wishes to fulfill ECSP benefits, they must first
align IS strategy and business strategy. Meanwhile, H2 successfully demonstrated that
a firm that is capable of enhancing strategic planning capability will have a higher
likelihood of achieving ECSP benefits. Good alignment of ECSP improves ECSP
capabilities, as demonstrated by H3. Finally, H4 demonstrates that partner trust
positively influences partner coordination; H5 demonstrates that partner trust
positively influences partner commitment.
These hypotheses H6, H7, and H8 are probing into the relations between the
partnership and the alignment of ECSP. H6 is not supported, although the result of
data analysis demonstrates the partner coordination is complete mediator between
partner trust and ECSP alignment, namely that partner trust can indirectly affect the
alignment of ECSP via partner coordination. H7 successfully demonstrated that a
good partner coordination can positively impacts the alignment of a firm's EC
strategic planning. H8 is not supported; a reasonable inference is that partner
commitment is benefit orientation (Morgan and Hunt, 1994). Former studies consider
the partner attributes are the independent variables when discussed the influences of
partnerships to other constructs; few studies consider the relations among partner
attributes. Consequently, when we discuss the influences of partnerships to ECSP
alignment; particularly partner trust, coordination, and commitment have certain
antecedent-subsequent relations. Therefore, non-benefit oriented partner trust and
coordination can affect the ECSP alignment, but benefit-oriented partner commitment
can not affect the alignment of ECSP.
Besides, hypotheses H9, H10, and H11 are probing into the relations between the
partnership and the fulfillment of ECSP benefits. H9 is not supported, although the
mediation testing demonstrates the partner commitment is complete mediator between
the partner trust and the fulfillment of ECSP benefits, namely that partner trust can
indirectly affect the fulfillment of ECSP benefits via partner commitment. H11
successfully demonstrated that the partner commitment can positively impacts a firm
to achieve their ECSP benefits. In the process of literatures study, we find most
literatures discussed the relationship between fulfillment of ECSP benefits with
partner trust only (Anderson and Weitz, 1989), or with partner coordination only
(Anderson and Narus, 1990), or with partner commitment only (Kumar et al., 1994).
However, few studies have simultaneously discussed the fulfillment of ECSP benefits
together with partner trust-coordination and trust-commitment relationship. H10 is not
supported, a possible reason is that partner commitment is more benefit-oriented than
partner coordination; partner coordination is more like a process of focusing on
arrangement of inter-organizational activities (Quinn and Dutton, 2005).
- 22 –
Although the extent to which the high-quality partnerships influence firm policy
and contribute to ECSP success has been extensively studied, these two issues have
seldom been simultaneously addressed in empirical research. This study not only
offers implications for practitioners and researchers, but also identifies limitations of
the methods used here, which are presented in the next paragraph. Two conclusions
are listed below.
Conclusions regarding the success of ECSP:
1. Alignment of ECSP is a critical starting point for the success of ECSP. Good
alignment of ECSP influences not only the improvement in ECSP capabilities,
but also the fulfillment of ECSP benefits.
2. Improvement in ECSP capabilities influences the fulfillment of ECSP benefits.
Conclusions regarding the influence of partnership to ECSP success:
1. Partner trust owns important influence in partnership. The relations among
three partnership attributes (i.e., trust, coordination, and commitment) are not
only simple correlation but also antecedent-consequence relationships. Partner
trust is a critical cornerstone of partner coordination and commitment.
2. Based on EC environment, it necessary to handle partner trust, coordination,
and commitment simultaneously from the partnership perspective. Thus,
partner coordination is an important mediator between partner trust and
alignment of ECSP. If firms wish to achieve the alignment between IS strategy
and business strategy, they must to win partner trust first, and then do the
coordinated jobs well. Besides, partner commitment is an important mediator
between partner trust and fulfillment of ECSP benefits. If firms wish to achieve
strategic benefits, they must base on partner trust first, and then must strive to
achieve partner commitment.
3. It is necessary to separate the partnership from the environmental context when
discussing questions related to environmental issues.
7.1. Implications for practitioners
This study has five main implications for practitioners initiating or currently
- 23 –
First, the alignment of ECSP has been shown to be a critical starting point for ECSP
success. Managers should carefully consider the alignment between IS strategy and
business strategy when considering how to improve ECSP capabilities and fulfill
Second, improvement in ECSP capabilities has been shown to affect the fulfillment
of ECSP benefits. Managers need numerous relevant planning skills to smoothly
involve the EC environment when facing the rapidly changing world. Managers must
improve ECSP capabilities in identifying key problem areas and new business
opportunities, anticipating crises, understanding businesses and their information
needs, and flexibly adapting to unanticipated change. Mass creativity applications and
adequate control mechanisms provide a better opportunity for firms to achieve
Third, partner trust can be considered an important external factor which influences
firm policy and helps to align IS strategy and business strategy. Managers must learn
how to take partner advice to appropriately modify firm policy; restated, for the
purpose of max mutual benefits among partners that firm needs to learn how to
modify their strategy to gain the partner trust.
Fourth, partner coordination has been demonstrated to be an important mediator
between partner trust and alignment of ECSP. If firms wish to do the strategic
planning well, they must win partner trust first, and then strive to coordinated jobs.
When the trust-coordination relationship is established, firms have good external
cooperated partner who can give suggestions to fit the firms' ECSP alignment.
Fifth, partner commitment has been demonstrated to be an important mediator
between partner trust and fulfillment of ECSP benefits. Thus, if firms wish to achieve
strategic benefits, they must first win partner trust via cooperative behavior and belief,
and then gain partner commitment. When the trust-commitment relationship is
established, the commitments are codified either in a formal legal contract or in an
informal psychological contract among the partners. Consequently, it may be possible
to fulfill the ECSP benefits.
7.2. Implications for researchers
This study demonstrates the need to separate the partnership from the
environmental context when discussing certain questions related to environmental
issues. The environmental context can be divided into two parts, environmental
uncertainty and partnership. Partnership should be considered an independent
construct which can be distinguished from other environmental constructs. A situation
in which partnership is neglected or mixed together with other environmental
constructs when discussing the environmental context regarding firm influence can
affect the inference of study results. Two related examples can be found in the study
of Choe (2003) and Raymond (2001).
Choe (2003) noted the clear environmental uncertainty, which indicated an external
- 24 –
environment but not internal environment (e.g. organizational development goal,
technological ability). Choe indicated that external environments factors include
environmental dynamism, heterogeneity, hostility, competition and external needs, but
not include partnership. This limits our understanding of the environmental context.
Although Raymond (2001) indicated the environmental context included both
environmental uncertainty and partner influence, his study also found that
environmental context did not significantly influence the strategic benefit. However,
Raymond does not analyze the relationship of strategic benefit with environmental
uncertainty and partnership, but mixes environmental uncertainty with partnership to
create one construct, namely environmental context. This study only tests the
relationship between partnership and strategic benefit, and successfully demonstrates
the relationship between them. Consequently, it is important to distinguish between
environmental uncertainty and partnership, thus avoiding criterion pollution.
This study has three main limitations. First, in the SCM a firm may simultaneously
fulfill the upstream, middle, and downstream roles. Questionnaire responses may have
differed according to the type of role fulfilled. Second, this study used a single
respondent per firm because this helped obtain a good response rate. Chief executive
officers (CEO) are generally used as subjects for completing questionnaires in
management studies, and CEO can be an appropriate respondent who has adequate
management knowledge. However, this study selected CIO as the respondent, because
the CIO is more likely to possess know-how regarding the research variables,
particularly the measurement of ECSP success. Asking a different management level
representative to fill in the questionnaire probably influenced the results. Third, the
sample population came from large enterprises in Taiwan and 78.9% of sampled firms
had conducted EC for less than three years. The conclusions thus may differ from
those in other countries that have performed EC for a long time, and have limited
generalizability for small-sized and medium-sized enterprises.
7.4. Future research directions
Although the surveys of Ng et al. (1998), Poon and Swatman (1999) clearly
indicated that EC remains in its infancy in the late 20th century, EC is still highly
promising on marketing. The survey of Ng et al. selected 300 firms from those listed
in the Yahoo! Directory for detailed study. However, only 15.3% of these firms were
engaged in on-line transactions. Additionally, the number of secure transaction sites
remains low. This may well create a barrier to visitors considering buying products or
services via the Internet. Most firms look to the Internet as a potential marketing tool.
According the survey of Ng et al., despite the problem of security, the opinions of the
respondents suggest that businesses will continue to adopt the Internet to enlarge their
markets. Restated, a situation in which partner trust can be won would achieve long-
term benefits and potential business opportunities.
- 25 –
So far, this study has only discussed two vertices issues, strategic planning as a
starting point and strategic benefits as an end point, and the relationship between
them. A complete ECSP process also includes other three parts (i.e., organizational
information requirements analysis, resource allocation, and project planning)
(Wetherbe, 1993), which have not been discussed. Enormous potential exists for
future research discussing the other three processes in terms of their strategic benefits.
Numerous studies have indicated that alliance and partner (or partners and
customers) differ from each other. However, this study considers them to be similar.
When a firm has multiple roles in the SCM, the relationship of that firm with its
cooperator makes it difficult to identify which is an alliance, or which is a partnership,
or a simple provider-customer. Nevertheless, if the use of dichotomy is practicable for
separating purely on a buyer versus seller basis, the effects of partner relationship on
ECSP could be more significant.
- 26 –
Appendix. Questionnaire items
A.1. Partner trust
TR1: The EC partners have willingness to share ideas and information with us.
TR2: The EC partners are integrity and stick to their obligations in dealing with us.
TR3: The EC partners are competence who has technical knowledge and interpersonal
skill to perform the jobs, and good consistency in handling situations.
TR4: The EC partners are concerned about our welfare and have willingness to
protect, support, and encourage us.
A.2. Partner coordination
CR1: Participators (i.e., planners and EC partners) have good standard operating
procedures to be follow in the EC coordinated process.
CR2: Participators play well the liaison roles in the EC coordinated process.
CR3: In the EC coordinated process, participators solve the problem via task forces.
A.3. Partner commitment
CO1: Our relationship to EC partners deserves my firm's maximum effort to maintain.
CO2: Our relationship to EC partners is something my firm is very committed to even
though short-term sacrifice happened.
CO3: Our relationship to EC partners is something my firm intends to support
indefinitely base on long-term benefits.
A.4. Alignment of ECSP
AL1: Aligning EC strategies with the strategic planning of the organization.
AL2: Adapting the objectives of EC to changing objectives of the organization.
AL3: Identifying EC-related opportunities to support the strategic direction of the
AL4: Adapting EC to strategic change.
A.5. Improvement in ECSP capabilities
CA1: Capabilities of ECSP in identifying key problem areas was improved.
CA2: Capabilities of ECSP in identifying new business opportunities was improved.
CA3: Capabilities of ECSP in anticipating surprises and crises was improved.
CA4: Capabilities of ECSP in understanding the business and its information needs
CA5: Flexibility to adapt to unanticipated changes was improved.
A.6. Fulfillment of ECSP benefits
BE1: Fulfillment of ECSP can increase competitiveness.
BE2: Fulfillment of ECSP can improve customer relations.
BE3: Fulfillment of ECSP can increase market share.
BE4: Fulfillment of ECSP can improve customer service quality or increase customer
- 27 –
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