Measuring the Organizational Information Systems Success in the Malaysian Super Corridor Status Companies

Zakariya Belkhamza
School of Business and Economics Universiti Malaysia Sabah Kota Kinabalu, Malaysia zakariya@ums.edu.my
AbstractThis paper tests and validates a four-stage sociotechnical model on enterprise systems of 229 Malaysian Multimedia Super Corridor status companies. The model, coined as system behavioral success model (SBS) was developed to explain how the behavioral context of an IT organization led by their IT executives would lead to the success of the enterprise system function. This was conducted by exploring the four dimensions: stretch, trust, support and discipline as the shapers of the enterprise climate, and relating them to the success of system performance, information effectiveness and service performance. The results show good support of the model. Except trust, enterprise climate dimensions are proved to be the major factors for the success of the enterprise system of these companies, especially when these companies act ambidextrously within the information systems context. Keyword-Information systems success; enterprise system; system performance; information effectiveness; service performance

Syed Azizi Wafa

School of Business and Economics Universiti Malaysia Sabah Kota Kinabalu, Malaysia sazizi@ums.edu.my their managerial roles and processes. This stage will lead to second stage, where the managerial action produces a climate of behavioral context. Because of the enterprise system context in the organization possesses specific IT capabilities which is manifested from the adaptability and alignment, an organizational change will emerge as illustrated in the third stage. The final stage represents the stage where success of information systems function occurs as a result of this process. The system behavioral success (SBS) model represents how the system, emerged from the managerial action of the IT managers and executives, behaves toward the success of the information systems. In other word, how a behavior lead to a success of technical system amid of complex organizational behavioral structure of change. II. INFORMATION SYSTEMS AND ORGANIZATION

I.

INTRODUCTION

As far as the success of a particular enterprise system is concerned, the system is determined in two parts. The first part is the formal processes, which are assumed to be predeterminable with respect to the decisions about what IT to use. The second part is the informal processes, which consists of the identity of the human beings who use the IT. This later part specifically emphasizes the significance of the human dimension that underpins the appropriate and success use of the enterprise system This paper tests a model that attempts to provide a new insight of looking into the success of the system within the context of the enterprise climate, in which it affects the performance of organization. This model, system behavioral success model (Belkhamza and Syed Azizi, 2011) is a sociotechnical model describes a four stage process of how the behavioral context of an IT organization led by their IT executives would lead to the success of the information systems function. The first stage of this systematical model illustrates the managerial action of IT managers and executives to build a behavioral context in order to fulfill

According to Ghoshal and Bartlett [10], an improved organizational performance depends primarily on the organizational context, where managers are able to build in, and fulfill their managerial roles and processes. However, the broad notion of organization context reflects a combination of the structural context, culture, and climate of a business unit and it considered an objective, higher-level attribute of the unit or organization as a whole [11]. This view manifests in the definition of organizational context by Ghoshal and Bartlett [10], as four behavioral attributes, which are created and reinforced by a variety of actions taken by managers in the organization. These attributes are: stretch, discipline, trust and support. Derived from the SBS model, the conceptualized framework explains how the interaction of these four key dimensions will result in an organizational context conducive to initiative and creativity, collaboration and learning, which lead to an improved enterprise information systems performance. The concept of ambidexterity in the enterprise change and strategic management literature refers broadly to the organizations ability to do two different things at the same time [1]. A more specific definition put forward by Tushman and O'Reilly [19], namely that the ambidextrous organization is one that achieves alignment in its current operations while

also adapting effectively to changing environmental demands. In other words, ambidexterity refers to the configuration of the entire organization vis- - vis its task environment, it is aligned in order to respond efficiently to the demands of its existing customers, but it is also adaptive in order to meet emerging and future demands as they arise or stated slightly differently, ambidexterity is the capacity that allows the organization to balance the conflicting demands for exploitation and exploration. The argument is that the four behavior- framing attributes of discipline, stretch, support, and trust will create the organization context in which an ambidexterity emerges, in order to balance the capacities of the two aspects of alignment and adaptability behaviors [11]. Given this conceptualization of ambidexterity, this study suggests that ambidexterity mediates the relationship between the four attributes of organization context and subsequent enterprise systems success used in the organization. That is, the attributes of enterprise context influence information systems success through the development of ambidexterity. When an organization has not developed the simultaneous capacities for alignment and adaptability, the context characteristics, may or may not influence information systems success. The reason for hypothesizing a mediating effect is that ambidexterity is seen as a meta-capability which is gradually developed over time through the interaction of the various features of an organization context. III. PROPOSED RESEARCH METHODOLOGY

extent, 3= to some extent, 4= to a great extent, 5= to very great extent. A. Data Collection Methods For data collection, web-based survey application called Winsurvey, were used. IT managers, CIOs, executive level IT personnel of the MSC status companies would receive an e-mail containing the invitation letter and the link of the website address where the questionnaire is uploaded. Each link holds the unique ID number of that particular organization to keep track on the respondent. The data then were uploaded to a MySQL database created in the server. This data were retrieved and stored in the local machine as a MySQL database with the software interface. IV. RESULTS AND DISCUSSION

Covariance-based SEM technique called Partial Least Squares (PLS) were used in this study because it is primarily intended for causal-predictive analysis in which the explored problems are complex and theoretical knowledge is scarce, and useful in a theory development situation [21], [5]. Following the PLS technique, the test of the model includes two stages: the measurement model, where the psychometric properties of the measures are evaluated in terms of reliability and validity. The second stage is the structural model, which involves the assessment of the path analysis of the theorized model. Three tests were computed to assess the reliability, Cronbach alpha, composite reliability coefficient and average variance extracted (AVE). Hair et al. [13] suggests that both Cronabch alpha and composite coefficient should be equal of greater than 0.70 to represent good reliability, whereby in exploratory studies, a value of .60 may also be accepted [13]. As for AVE, a level greater than .50 is considered acceptable [5], [4]. Results revealed that all item loadings between an indicator and its posited underlying construct factor were greater than 0.7. Composite reliability of constructs all exceeded criterion of 0.7, while the average variances extracted were above the recommended threshold of 0.5, adequately demonstrating convergent validity. Partial Least Square PLS Structural Model was used to estimate the structural paths and to test the hypotheses. WarpPLS 1.0 [15] was used for the analysis. A bootstrapping technique was used to generate 500 subsample. One of the advantages of this WarpPLS software compared with other PLS based SEM softwares is that it provides the P value, which is more meaningful than T values for hypothesis testing purposes. This is due to the fact that P values reflect not only the strength of the relationship, which is already provided by the path coefficient itself, but also the power of the test, which increases with sample size [15]. The other

To test the hypothesized model, MSC status companies were selected for this purpose. This is because these companies are developed specifically to explore the frontiers of information and multimedia technologies, revealing their full potential through the creation and implementation of cyber laws, cutting-edge technologies and excellent infrastructure. According to MDC (2008), there are over 2173 approved MSC-status companies. Following the stratified proportion technique, the final sample drawn is 618 organizations. To measure organizational context constructs, namely stretch, discipline, trust and support, 61 items were used. These items were previously validated (Belkhamza, 2011) before their inclusion in the model. The items to measure the ambidexterity constructs, namely alignment and adaptability, were adapted from Gibson and Birkinshaw [11]. Finally, six items were used to measures system performance were adapted from chang and King [4], seven items measuring information effectiveness were adapted from DeLone and McLean [6], and 4 items measuring service performance were adapted from Chang and King [4]. These three constructs form the information system success constructs. All items of information systems success constructs were measured using the scale: 1= to no extent, 2= to a little

advantage is the existence of some formative constructs in the model, which is supported by PLS techniques [5]. Table I illustrates the results.
TABLE I. PSYCHOMETRIC PROPERTIES AND DESCRIPTIVE STATISTICS OF THE MEASURMENET MODEL

Constructs

Item Loading

Discipline DSPLN1 DSPLN2 DSPLN3 DSPLN4 Support SPORT2 SPORT3 SPORT4 SPORT5 Trust TRUST2 TRUST3 TRUST4 TRUST5 Stretch STRTCH2 STRTCH3 STRTCH4 STRTCH5 Ambidexterity AMBAL1 AMBAL2 AMBAD1 AMBAD2 AMBAD3 System Performance SYSPR1 SYSPR2 SYSPR3 Information Effectiveness INFOE1 INFOE2 INFOE3 INFOE4 Service performance SERVP1 SERVP2 SERVP3 SERVP4

.73 .77 .82 .72 .70 .84 .73 .77 .70 .80 .56 .86 .73 .78 .68 .74 .70 .62 .68 .75 .67

Reliability (Cronbach ) .85 (.81)

AVE

Mean

S.D

.58

2.47

.76

.84 (.75)

.56

3.10

.73

.82 (.75)

.55

2.40

.70

To statistically investigate the mediating effect, the two stage analysis mentioned above involves the three steps necessary for the mediation function [2], [11]. The first step is to establish that the independent variables (discipline, support, trust and stretch) significantly influence the mediator (ambidexterity). The second step is to demonstrate that the independent variables (discipline, support, trust and stretch) influence the dependent variables (system performance, information effectiveness and service performance). The last step is to demonstrate that the mediator (ambidexterity) influences the dependent variable. If, in this final step, the effect of organizational context constructs (discipline, support, trust and stretch) on information systems success constructs is no longer significant when the mediator is introduced to the model, full mediation is indicated. On the other hand, partial mediation is indicated if there is a substantial decrease for the contribution of the independent variable when the mediator is introduced. For full mediation the contribution has to decrease to a not significant level. Discipline has direct effect on system performance, information effectiveness and service performance, which means that discipline in the MSC status companies is positively related to the system performance and its effectiveness, as well as services of the enterprise systems function. This finding is consistent with recent research in the occupational commitment for IT professionals [12]. Support was also found to have a direct effect on system performance, information effectiveness and service performance. The finding of this study confirms the findings of previous studies emphasizing the importance of support as a behavioral capability for IT personnel, which leads to an efficient performance of the enterprise systems [7]. The findings of this paper suggest the importance of trust in success of the enterprise systems in the MSC status companies. Some researchers examining the DeLone and McLean success model have also noted the importance of trust in the enterprise system success. Jia et al. [14] even used trust as a scale to measure in the service quality construct. When trust exists, the users are prepared to make efforts to ensure that output of the system and its service are interpreted appropriately [9], [8]. Regarding stretch, it was found that when it exists within enterprise systems users in the MSC status companies, the information systems will more likely be effective in terms of performance, and effectiveness. This is consistent with the findings of Watts and Henderson [20], that the motivation to achieve and strive toward a common organizational goal will enhance the IT innovation in the organization and translate the mutual vision into a technology vision and positively affect the system performance.

.82 (.76)

.54

2.62

.71

.81 (.71)

.48

2.54

.86

.90 (.86) .93 .94 .96 .83 (.73) .74 .76 .73 .74 .87 (.75) .93 .94 .75 .70

.71

1.39

.48

.56

2.81

.71

.67

1.48

.40

Two-stage analysis was conducted to analyze the mediation. In the first stage, a fully mediated model (i.e., no direct paths from discipline, support, trust and stretch to system performance, information effectiveness and service performance) was evaluated. This analysis was also used to test the relationship between organizational dimensions and enterprise systems constructs. In the second stage, direct paths from the four constructs, discipline, support trust and stretch, were introduced to examine the direct and mediated effects.

Ambidexterity in this study was also found to consistent with previous studies that confirm the importance of ambidexterity to the success of the enterprise systems projects [16]. Not only that ambidexterity in the MSC status companies had shown to be associated with higher levels of information systems organizational performance [17], but also successful CIOS and IT managers tend to employ ambidextrous coping strategies to improve the adverse effects enterprise systems effectiveness. Looking at the elements of the ambidexterity, alignment activities tends to improve the system function in the short term, whereas adaptability activities tends to improve the systems function in the long term. B. Managerial Implications For a better performance of the systems functions and a successful systems project of the Malaysian MSC status companies, IT managers and IT executives should offer two main things in their companies: firstly, a purposeful action to harness the behavioral collective context in the IT business units. Secondly, they should facilitate an IT capabilities and infrastructure in which it provides the organization a capacity of change, which is a key factor of a successful enterprise system projects. By providing these two things, IT executives and CIOs are likely to solve the explanation of why some enterprise systems in their companies encounter unexplained failure and never met expectation and subsequently, a poor organizational performance. V. CONCLUSION

effectiveness were adapted from DeLone and McLean [6], and four items measuring service performance were adapted from Chang and King [4]. The results show good support for the three constructs of the study, The Multimedia Super Corridor status companies show a well maturity in terms of system performance, information effectiveness and service performance which could create a model to be generalized in other IT-related companies. ACKNOWLEDGMENT The authors would like to thank Professor Ned Kock Nick of Texas A&M International University for providing WarpPLS software which was used in this research. REFERENCES
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This paper tests and validates a four-stage socio-technical model on enterprise systems of 229 Malaysian Multimedia Super Corridor status companies. The model, coined as system behavioral success model (SBS) was developed to explain how the behavioral context of an IT organization led by their IT executives would lead to the success of the enterprise system function. This study implemented a new approach which is based on the IT managers perception, as a user of the performance for all of the aspects of the information function experienced within the organization [4], as the notion of information systems function includes all information systems groups and departments within organization. The enterprise systems functions use resources to produce systems performance, which in turn influences business process effectiveness and organizational performance. The operationalization of information systems success is based on three dimensions of information systems put forward by Chang and King [4] which are systems performance, information effectiveness, and service performance. To measure the information systems success constructs, six items were used to measures system performance were adapted from Chang and King [4], seven items measuring information

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