Three Essays in Information Systems

This dissertation tackles three problems in information systems: In the first essay we investigate the value of a local showroom to online competition. An increasing number of online retailers are grappling with whether to expand their operations to offline local showrooms. In this study, we quantify the value of showrooms by investigating how the presence and absence of local showrooms may impact customers’ searching and purchasing behaviors with online competitors. By using an exogenous event of a large retailer’s offline market exit and a unique data set capturing customers’ online browsing and purchasing activities before and after the event, we empirically examine the changes in online search and sales made by customers who lived within neighborhoods where showrooms closed. We question the adequacy of conventional sales-based measures and devise several search-based measures in order to better quantify the value of a showroom from the perspective of customer experience online. Using a difference-in-difference approach, we find mixed results in terms of online competitors’ sales when a neighboring showroom closes. More importantly, we observe an increase in customers’ online search intensity in the absence of local showrooms. We discuss a wide range of implications both for online and offline retailers based on our results.

The second problem we analyze is the effect of worker collaboration on productivity and costs to a company. Although collaboration in the workplace is promoted as a silver bullet for increasing productivity and decreasing costs, there is little empirical evidence to show the effects of collaboration. Using a unique dataset and a field experiment we develop a framework to measure the effects of collaboration in a service delivery industry. Our results show that when collaboration is forced on employees, although productivity increases, costs also increase. Based on our conclusions we recommend management to allow employees to choose when to collaborate and when not to. On further analysis of the implementation of our recommendations, we find that productivity levels increase along with reduction in costs if employees are allowed to choose when to collaborate on tasks.

Finally, we investigate how to tackle the patching schedule of custom built enterprise systems. Keeping software systems safe from hackers is one of the most important goals for system operations managers. A system that has outstanding security patches is inherently risky and managers incur costs to keep the security of such systems at an acceptable level. Alternatively, they can choose to expend resources to apply outstanding patches and increase the security state of the system and thereby reducing the costs to maintain the system. In this research we study a motivating example from the Information and Communications Technology (ICT) industry and apply a control theoretic model to solve for optimal patching periods. The optimal patching policy is shown to have a bang-bang solution which explains common approaches practiced in the industry. The results in this research are valuable to operations and maintenance managers who strive to keep enterprise software systems safe while minimizing cost.