ICT and e-Business Impact in the Retail Industry - empirica

e-Business in the Retail SectorIntra and inter-firm collaborationThere are indications that ICT has a direct impact on process innovation in companies byfacilitating links between different companies (Lee 2000). ICT-enabled interorganisationalsystems integration and collaboration may enhance the innovationcapabilities of companies by providing opportunities for shared learning, transfer oftechnical knowledge and exchange of information.The most obvious benefit of information exchange and integration with the help of ICT isthe optimisation of the value chain. Other, less obvious consequences for firms’innovativeness can be found in tacit and knowledge-based processes. There ICT allowscreating communication infrastructures facilitating production networks of knowledgeworkers or enables business partners to align the incentives of multiple players bycreating joint business units or facilitating the work of teams on the same tasks (McAfee2006).The use of electronic networks may lead to a higher probability of firms collaborating ininnovative activities and it may increase the amount of collaborative relations they have(European Commission 2004). In other words, it can be said that the use of ICTapplications supporting information exchange and inter-firm collaboration constitutesnecessary input for ICT-enabled innovative output, i.e. re-engineered processes, newproducts or distribution channels.The e-Business Survey 2007 included a relevant question about inter-firm collaboration: itregards information sharing about inventory levels with business partners. In 2007,retailers comprising 15% of the sample population (employment weighed) said that theyshare information online about inventory levels with business partners (see Exhibit 3.3-7).Thus, the following hypothesis was formulated to test the assumed importance ofcollaborative applications for innovative output:Hypothesis I.2: Retail firms that use ICT applications to exchange information orcollaborate with business partners are more likely to introduce ICT enabled innovations,compared with their peer-group in the same sector.The hypothesis is tested on the basis of data from the e-Business Survey 2007. Again,the analysis focuses only on ICT-enabled innovations (see questions D2 and D4 inprevious section). Independent variables control for the use of the following: 55Question A7: "Does your company use a Supply Chain Management system?"Question B9: "Does your company share information on inventory levels orproduction plans electronically with business partners?"Question B10: "Does your company use software applications other than e-mail tocollaborate with business partners in the design of new products or services?"Exhibit 4.3-6 reports the results of the regression. An analysis of the results leads to thefollowing conclusions:55One could suspect that this hypothesis is tautological because the independent variables maybe included in the dependent ones. For example, if a company implemented an SCM system inthe past twelve months it would also state that it introduced new ICT-related processes in thepast twelve months. However, the share of such companies is unlikely to be large enough toconsiderably influence significance level, direction and strength of the relationship.102