Factors Affecting the Transfer of Inter-Organizational Systems to China: a Case Study of High-Tech Enterprises

Due to the huge market potentiality, profuse production resource such as workforce and land, and low production costs in China, many international high-tech enterprises are moving their production line to China. Accompanying production offshoring is the transfer of Information Technology (IT) to ensure that the production processes remain efficient and effective at home and abroad. Many enterprises however encounter problems in transferring their IT to China, especially when the IT is an inter-organizational system (IOS), which is across organizational boundaries and involves the management of relationships among participants. In order to understand how to successfully transfer IOS to China, we aim to find out key relational factors of IOS performance in China through an observation of a binary relationship built upon an e-procurement system between a Taiwanese PC ODM (Original Design Manufacturer) and its Chinese suppliers. Based on the relational view of the firm, four relational factors are proposed and examined. The results show that IOS specific investments and effective IOS governance most strongly affects the result of IOS transfer to China, whereas complementary resource endowment has least influence.