Benefits of electronic markets that are realized by individual participants increase the more organizations join the system. This property, known as network externalities, can significantly affect the dynamics of the introduction and adoption of electronic market technologies like XML/EDI.
2. The benefits realized by individual participants in an electronic market increase as more organizations join the system.
This property, known in economics as network externalities (Katz and Shapiro, 1985), can affect the dynamics of the introduction and adoption of electronic market systems, e.g., by favoring the first intermediary introducing such a system.
Katz, M. L. and Shapiro, C. "Network Externalities, Competition and Compatibility." American Economic Review, (75) Spring 1985, pp. 70-83.
When it comes to deciding about an IT project, the costs can be defined and controlled quite easily. But the benefits are usually only covered be a few statements full of hope about the effect on large labor costs, and deal with intangible expectations which cannot easily be defined (Strassmann 1985: 81). [This section will give an insight into traditional methods of evaluating IT investments.]
The demand for increased productivity, and the desire to improve responsiveness to customer needs are the driving forces behind Information Systems integration.
When it comes to making decisions about information technology, I will always consider the competitive market price to be the final arbiter. [...]
The demand for increased productivity, the need to restore falling profits, and the desire to improve responsiveness to customer needs arc the driving forces behind office automation.
Technical matters, consuming the most time, deal with relatively tangible purchases, with costs that can be defined and controlled. Benefits, covered by a few general statements full of hope about the effects on large labor costs, deal with intangible expectations which cannot easily be defined.
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