How Do IT Service Vendors Build Organizational Resilience in Response to Major Exogenous Shocks?

Abstract

Organizational resilience is crucial for information technology (IT) service vendors, as they are highly vulnerable to major exogenous shocks. Extant resilience studies in the information systems (IS) field focus on the resilience of IS or the resilience of organizations that utilize IS. However, neither perspective adequately addresses how IT service vendors build organizational resilience in response to exogenous shocks. Using the feedback loop, this study investigates how IT service vendors interact with their environment to build resilience. Through an in-depth case study of two Chinese IT offshoring vendors, we found that IT service vendors can build organizational resilience through outside-in and inside-out processes to form a new stable state after experiencing major exogenous shocks: (1) In the outside-in process, vendors absorb external resources to build new capabilities. The combination of developing resilient IT portfolios with the collective interpretation of business domains facilitates the process. (2) In the inside-out process, vendors establish and improve client relationships by demonstrating their solutions and experiences. Our findings unpack the resilience development process, enrich the understanding of resilience in IS research, and extend the literature on IT service vendors’ risk management and organizational resilience.