An Exploratory Analysis of the Relationship Between Organizational and Institutional Factors Shaping the Assimilation of Vertical Standards

Abstract

Vertical standards describe products and services, define data formats and structures, and formalize and encode business processes for specific industries. Vertical standards enable end-to-end computing, provide greater visibility of the organization's supply chain, and enable transactional efficiencies by automating routine tasks, reducing errors, and formally defining all parameters used to describe a product, service, or transaction. Research on standards diffusion has explored either firm-level and institutional variables, without integration of the two areas. This study develops scales for 11 constructs based on concepts culled from diffusion of innovations theory, organizational learning theories of technology adoption, institutional theory and network effects theory. The scales are validated with data collected from the membership of OASIS, a leading international standards-developing organization for electronic commerce technologies. Using data cluster analysis, relationship patterns between the 11 constructs are investigated. Results show that low fit between vertical standards and existing organizational business processes and data formats, low levels of anticipated benefits, and inadequate momentum with critical business partners contribute to slower vertical standards assimilation. However, organizational involvement with influential standards-development organizations, and the right set of technologies, skills, and structures to readily benefit from vertical standards spur their assimilation.