Organizational knowledge and the Intranet

Decision Support Systems 23 Ž1998. 3–17 Organizational knowledge and the Intranet Judy E. Scott ) Department of Management Science and Information Systems, B6500, Graduate School of Business, The UniÕersity of Texas at Austin, Austin, TX 78712-1175, USA Abstract The Intranet phenomenon has been driven by the push of technology standards and the pull of organizational need to Ž1. communicate across geographic, organizational and functional barriers, and Ž2. collaborate among sites and with suppliers and customers. The objective of this study is to generate a theoretical framework for the interaction between organizational knowledge and the Intranet. The contribution of this paper is 4-fold. First, we generate a theoretical framework using the paradigm model of grounded theory. We show interactions between the Intranet and three organizational knowledge strategies taking into account drivers, the context, and intervening conditions. Second, previous research on organizational knowledge creation theory is incorporated into the framework. Third, the framework forms the basis for future empirical research on the business value of the Intranet. Finally, the study raises implications for IS developers, IS departments, management and researchers. q 1998 Elsevier Science B.V. All rights reserved. Keywords: Organizational knowledge; Intranets; Knowledge management; Knowledge creation; Integration 1. Introduction The Intranet has been hailed as the solution to organizational technology issues as far reaching as faster information systems development, access to legacy system data, integration of incompatible systems w79x, and progress towards the ‘paperless office’. Moreover, Intranets enable work-flow management and project management, and are a platform for process redesign w23,51x. Yet possibly the most far reaching impact of the Intranet is on organizational knowledge. Intranets are providing institutions and organizations with opportunities to create knowledge. A high proportion of the pioneers are high technology com) Tel.: q1-512-471-7858; fax: q1-512-471-0587; e-mail: [email protected] panies making use of intranets for knowledge intensive new product development. Intranets enable community expertise to develop, as engineers brainstorm and give each other feedback in discussion groups, and share product specifications and product test result queries w22,70,95x. The scope of interest in intranets is evidenced by diverse articles and applications in the medical w44x, legal, engineering, training, travel w11x, technical, computer-related and manufacturing industries w22,59x. Although some definitions restrict intranets to internal information on internal webs w23x; accessed exclusively by internal users w79x, in this paper we adopt a broader definition that includes customers and suppliers in the extended enterprise Žalso called an ‘Extranet’ w45x., and industry wide applications w51x. Thus, an intranet is a ‘‘powerful tool for institution-wide communications, collabora- 0167-9236r98r$19.00 q 1998 Elsevier Science B.V. All rights reserved. PII S 0 1 6 7 - 9 2 3 6 Ž 9 8 . 0 0 0 3 2 - 3 4 J.E. Scott r Decision Support Systems 23 (1998) 3–17 tive projects, and the establishment of a sense of community on a manageable scale’’ w59x. Despite the fact that many organizations have adopted the Intranet with great enthusiasm, and there has been an avalanche of web and journalistic articles on the Intranet since the end of 1995, theoretical research has been lacking. Evidence of the business value of the Intranet has been convincing but largely anecdotal w84x. In addition, negative reports have surfaced on hidden costs w33x, performance limitations w29x, and organizational resistance w10,21x. Such issues have been researched with political theories that explain how some constituents gain and others lose when there is organizational change associated with IT implementation w65,76,80x. Organizational learning theories also explain such contradictions by examining what affects the creation, integration and management of knowledge and facilitation of organizational memory w34,35,80,89,92x. For example, the theory of organizational knowledge creation posits that autonomy, intention, redundancy, fluctuation and creative chaos, and requisite variety are conditions that induce the transfer of tacit and explicit knowledge in a spiral from individual to group, to organization levels w71,72,74x. The findings from this analysis of reported implementations of intranets generate a theoretically-based model relating organizational knowledge to the Intranet phenomenon. We extend the inductive concepts w36x by analyzing examples of enabling conditions and organizational knowledge creation modes on intranets, using Nonaka’s w72,74x theory of organizational knowledge creation as a guide. Our contribution is to develop a theoretical understanding of the Intranet phenomenon, with an initial framework to guide further conceptual and empirical research on the impacts and business value of the Intranet, and to present implications for IS developers, IS departments, management and researchers. 2. Methodology We attempt to describe Intranets in terms of the theory of organizational knowledge creation. Qualitative secondary data, in the form of case studies on Intranet implementations are widely available on the Internet, provided by vendors, such as Netscape and Sun, and numerous consultants and academics w10,22,51,70,95x. The articles could be biased but the veracity is likely given the multiple sources and the ease of refutation w93x. The objective of this paper is to use the paradigm model of grounded theory w93x and this secondary data to develop a framework for facilitating organizational knowledge with the Intranet, and for proposing the impacts and business value of the Intranet, to guide further conceptual and empirical research on this topic. The paradigm model is the basic tool for relating concepts in grounded theory w93x. At the heart of the model is a phenomenon, which is explained by causal conditions, context, intervening conditions, actionrinteraction strategies and consequences. Connecting emergent grounded theory with aspects of existing theory and literature enhances the generalizability of the new framework w30,36,76x. In this analysis, we will examine the Intranet phenomenon Žsee Fig. 1., guided by the theory of organizational knowledge creation w72,74x. 3. The paradigm model of the intranet Each component of the paradigm model is analyzed in this section. 3.1. Phenomenon According to the Scott, Foresman dictionary, a phenomenon is defined as ‘‘an extraordinary or remarkable thing.’’ The term is usually applied to an extreme situation that is growing and spreading quickly, and is surrounded by hype and high expectations. Such is the case with the Intranet, and statistics attest to the Intranet’s phenomenal growth. For example, Intranets, a US$400 million market in 1995 w101x, are predicted to grow to US$1.2 billion by 1997 w88x and US$8 billion by 1998 w14,21,66,105x. Seventy-five percent of Fortune 1000 firms initiated intranet projects in the past year w88x, and other sources conclude that 43% to 90% of surveyed organizations have intranets or plan to have them w51,101x. 3.2. Causal conditions It is not possible to pinpoint a single causal condition for the Intranet phenomenon. Instead, there J.E. Scott r Decision Support Systems 23 (1998) 3–17 5 Fig. 1. A framework for organizational knowledge and the Intranet. has been a complex interaction between technology and management factors. Thus intranets have emerged from both the push of technology and the pull of management needs w104x. On the technology side, standards have laid the foundations for an easy-to-use, cross-platform, open standards environment w8,9x. TCPrIP was introduced in 1983, and the World Wide Web in 1992. Commercial organizations were exposed to the advantages of Internet technology with HTML in 1990, and although practiced by technology leaders such as Digital and Sun among others, there was a three year lag before the media and businesses started becoming interested on a larger scale. Exponential growth began after the introduction of Mosaic, the first browser with a graphical user interface, in 1994 w6x. On the management side, trends such as the quality movement and teamwork have created a need for increased communication and collaboration across functional, geographic and organizational boundaries. These virtual corporations w27,75,78x have highlighted the importance of organizational knowledge management. The Intranet has responded to management’s pent-up demand for organizational knowledge by enabling systems integration, access to information in legacy systems, and easy to use hypertext electronic documents w4x, which provide an alternative to high cost paper-based delivery w91x. 3.3. Context In this section we will examine the context for the Intranet phenomenon, specifically the environmental context, organizational context and IT context. 3.3.1. EnÕironment The current environment is characterized by turbulence and a high rate of technological change. This 6 J.E. Scott r Decision Support Systems 23 (1998) 3–17 environmental fluctuation induces organizational knowledge creation if employees reflect on the chaos, which is then creative rather than destructive w72x. Universal reach in communications both makes globalization possible and enables more effective collaboration. For example, asynchronous communication such as email and the Intranet, with posted electronic documents, electronic discussion groups and transaction systems, are more convenient across different time zones and so more ideal for global communications than synchronous communication by telephone, teleconferencing and videoconferencing. The Web helps to bridge time differences. You can publish something and let someone draw from it after you go home. It’s better than dragging someone out of bed for a conference call, w70x. Potentially, employees on opposite sides of the world could work together as easily as colleagues in adjoining offices w29x. At National Semiconductor, ‘‘the internal Web has connected people from different departments and countries that have never interacted before’’ w70x. 3.3.2. Organizational context The organizational context for knowledge creation has been influenced by management revolutions such as flattening hierarchies, downsizing, and reengineering, all of which have exerted pressure on a smaller remaining group of employees to collaborate, cut costs and increase productivity. Management needs not only to amplify and legitimize informal social interactions w72x and to focus extensively on training w19x, but to hold down training costs and to promote receptivity to tools that are easy-to-use. Moreover, with fewer people and declining costs relative to performance for technology, organizational knowledge is increasingly systems-based w97x. The Intranet addresses Ž1. collaboration with tools such as discussion groups and common repositories of knowledge, Ž2. just-in-time training with posted multimedia documents, and Ž3. ease-of-use with the hypertext feature w4,21,47x. 3.3.3. IT context In the IT context, IS departments are under pressure to reduce costs and speed up services. Cost and time overruns for systems development w56x, incompatible legacy and clientrserver systems, and a diversity of application platforms and operating environments, are common IS woes. Dissatisfaction with IS departmental knowledge has resulted in two trends. The first trend is outsourcing IT w39,63x —a formal provision to build knowledge at the interorganizational level w72x. The second trend is a grassroots revolution or shift by users to gain more control of systems’ implementation and development w51x. With the Intranet, users have welcomed the prospect of solutions to Ž1. speed up systems development, Ž2. integrate systems, and Ž3. access data in legacy systems. 3.4. InterÕening conditions Intervening conditions in this model are both technological and organizational w60x. On the technology side, improvements in bandwidth and tools to address security concerns w32x and maintenance of intranets are needed w15x. In the words of Bowen and Wong w13x, ‘‘technology plays catch up’’, since easy to use maintenance tools are lacking. These tools are being developed at a furious rate, so this problem may be temporary. Intranets are hampered by lack of technical expertise, with knowledgeable webmasters reported to be in short supply w15x. Moreover, as we move from the beginnings when almost anyone could create a web page, to a stage where mission-critical applications run on the Intranet, the tools and applications become more sophisticated, and increased expertise will be in demand. The organizational culture w80x will determine how readily an intranet is accepted. Resistance to change is a classical problem w65x, but is alleviated by the ease-of-use w28x of the Intranet environment. Nevertheless, according to Murphy w69x, ‘‘There is considerable resistance from three factions: wLotusx Notes proponents, legacy dogs too busy to learn new tricks, and three-tier architects’’. These factions have invested time, money, and skills into training and proprietary IT solutions and perceive they have more to lose than other groups. Resistance from technical support w8,9x and administrative groups, based on fears of legal, public relations or capacity management problems, has resulted in instances of reassigned domain names and URLs that bring down J.E. Scott r Decision Support Systems 23 (1998) 3–17 sites and pages w49x. At CAP Gemini there have been problems getting employees to use the Intranet, but an Internet Cafe has had some success w21x. Apparently, resistance is greater in AsiarPacific than in Europe and the US w15x, perhaps because the Web is viewed as an ‘American conspiracy’ w49x. Philosophical opposition is exemplified by mistrust of the openness of the web due to possible embarrassment and the fear of sharing knowledge w20,49x. This fear arises from perceptions of losing a resource, and becoming redundant w49x —similar to resisting ‘giving away’ expertise during expert system development. Enabling conditions for organizational knowledge creation are intention, chaosrfluctuation, autonomy, redundancy and requisite variety w72x. Organizational intention is exemplified by the corporate vision which induces purposeful activity. Moreover, an organization publicizes its intention and vision with a mission statement and organizational standards w74x. Among firms that use the Intranet to communicate their intention are those that post the organizational mission and messages from the CEO and other top management. Sun uses online audio reports from the president and CEO, Scott McNeally, and other top management to communicate its organizational intention on their Intranet w8,9x. Chevron’s Intranet has a message from the president, and Nortel posts reengineering intentions w8,9x. Digital publishes internal standards, such as how to use the company logo and the biweekly Digital Today which is ‘‘ . . . a corporate newsletter and information service made available on the corporate Web to all of Digital’s 61,500 employees, allowing them to be aware of Digital’s position on many issues’’ w16x. Fluctuation and creative chaos also enable organizational knowledge creation w74x. On an Intranet posted information changes frequently, enabled by the ease of making changes with web technology. This contributes to the breakdown of routines which triggers creative chaos and stimulates interaction with a fluctuating environment w74x. A broad variety of information is accessible with web technology, and competitive information is often posted on the Intranet. For example, Allen–Bradley distributes market intelligence w70x; Eli Lilly posts news feeds on their industry w70x; and Sun makes a competitive analysis available to all employees w95x. Seamless 7 integration between the internet and Intranet also introduces fluctuations to the firm. For example, at Nortel, the web is so highly integrated between its internal and external roles, that employees are not even aware that they are outside the firewall, and when employees at Chevron need to tap information sources anywhere in the world, they do so with their Intranet and seamless integration with the internet w8x. Autonomy, another enabling condition for organizational knowledge creating strategies, has been widespread on the Intranet. Web technology use has been a grassroots movement w41,51x and ‘‘a bottom– up effort’’ w16x in most early adopting firms, where anyone could post web pages w79x. According to Carl, ‘‘Right now anybody can have a Web server, wbutx establishing a criteria for having things on the server is a top priority’’ w16x. Thus, as the Intranet becomes institutionalized there is a trend to exert more formalization w16x and management control over the Intranet. For example, at Amoco, conflicting demands associated with intranet growth ‘‘positing user needs against management mandates, are common when representatives of various corporate divisions try to hammer out an intranet strategy that will serve all equally well’’ w41x. Management mandates could threaten autonomy. Organizational knowledge creation depends on preserving individual autonomy, which motivates employees and generates original ideas w74x. However, users’ autonomy threatens management control, and the political and institutional factors which protect the status quo w80x. During creation of standards for presentation and content, which are becoming increasingly adopted to ensure consistency across the institution, conflict between constituencies is likely w41,50x. Autonomy is illustrated on Digital’s intranet, where ‘‘engineers may have made a groupware-like environment for their engineering team without considering what other teams were doing’’ w16x, because: . . . engineering and manufacturing workgroups can develop systems independently using their own departmental servers and LANS. No consultation or even knowledge of one another’s systems is really necessary for these systems to be tied together at 8 J.E. Scott r Decision Support Systems 23 (1998) 3–17 some later date. And no one person or department need really be in charge w24x. The Intranet at Sun provides a balance between autonomy and control, as employees easily create web sites with the provided templates, which ensure consistency and control of standards. Similarly, autonomy was balanced with control when a crossfunctional team from facilities, HR and other divisions at Nortel put together an intranet application to streamline cubicle and office moves w9x. Redundancy offers an overlap in knowledge between different groups that promotes cross-functional collaboration w74x. Wide access to corporate information w74x on an Intranet allows redundancy of knowledge, yet saves on paper, mailing and distribution costs. And even when there is an overlap in knowledge on pages from different departments, there is just one set of data for each department to keep current. Requisite variety, where the firm’s internal diversity matches the complexity of the environment, also enables organizational knowledge creation w74x. Organizational members should know who owns what information, but they should not be overloaded with information w72x. The Intranet addresses both these issues with knowledge repositories, such as ‘Knowledge On Line’ at Booz Allen and Hamilton w46x; and ‘Knowledge Galaxy’ at CAP Gemini w21x. These systems help employees find subject matter experts and prevent overload as they pull rather than push information. 3.5. Actionr interaction strategies The actionrinteraction strategies that firms can adopt to gain advantages from the Intranet focus on knowledge. For example, National Semiconductor has developed an internal communications network based on the World Wide Web hoping ‘‘to make it easier to connect our employees to knowledge’’ w70x. Organizational knowledge creation, integration and management strategies leverage organizational intelligence w43x. Moreover, organizational knowledge creation requires interaction and conversion of tacit and explicit knowledge between individuals and groups in the organization w74x. 3.5.1. Organizational knowledge creation Organizational Knowledge Creation has four modes—socialization, internalization, externalization and combination w74x. Socialization refers to the transfer of individual tacit knowledge to organizational tacit knowledge. Tacit knowledge is difficult to articulate but need not be verbal w72x and is transferred by team interaction, and sharing of mental models, technical skills, experiences and perspectives. Although face-to-face communication is ideal, virtual teams use visual cues from observation and rich media such as animation, graphics, audio, videoconferencing, the chat feature of the Internet, and virtual reality to facilitate socialization. For example, Mitre’s ‘Collaborative Virtual Workspace’ is a multimedia groupware environment, that uses the Internet’s Network News Transfer Protocol ŽNNTP. for discussion groups and Multi-User domain ŽMUD. for chat environments w46x. Multimedia capabilities of the Intranet, such as video clips, demonstrate organizational procedures that are difficult to explain verbally w18x. Rich media also helps tacit knowledge transfer across different languages, cultures and time zones. Nevertheless, socialization skills for effective global virtual collaboration need to be developed to build trust and compensate for the lack of face-to-face interaction w57x. Internalization is a mode exemplified by an iterative process of trial and error and experimentation with explicit knowledge, resulting in organizational learning and tacit knowledge creation w74x. For example, simulations and spreadsheet-like ‘what if’ scenarios are possible on an Intranet with Java applets incorporated into Intranet decision support applications. At Sun the Supply Planning group developed a site with supporting assumptions and definitions for iterative plans using trial and error for enhanced data analysis and decision making w95x. At National Semiconductor, ‘‘ . . . people are experimenting and not taking things for granted. The organization can adopt change more readily and not get stuck, rather than leaving business processes the same way they’ve always been. This means we can create new products faster and be more proactive about giving customers what they want’’ w70x. Externalization is the conversion of subjective tacit knowledge based on experience to objective explicit knowledge w72,74x. It is challenging because J.E. Scott r Decision Support Systems 23 (1998) 3–17 tacit knowledge is difficult to articulate, communicate, formalize and encode w72,74,99,102x. Tacit knowledge is ‘sticky’ because the rules of expertise are unknown w99x, and to progress through to higher knowledge stages requires an increase in understanding of causal influences w12x. Nonaka w72x proposes repeated, time-consuming dialogue, sharing one’s original experience and a metaphor–analogy-model sequence for effective externalization. Metaphor, experiencing one thing in terms of another, is an intuitive cognitive process to relate concepts, which are then resolved through analogy to things that are already understood, and finally made explicit through prototypes w72x. Iterative prototyping has been used successfully to externalize ‘sticky’ user requirements w99x, and is one of the recommendations for applying the stages of the technological knowledge framework w12x. Prototypes and models are explicit representations of new products. Potentially, three-dimensional graphics, animation, video clips, virtual reality and other technologies enhance presentation of prototypes on the Intranet. Moreover, Intranet-based prototypes for enterprise decision support have been developed w3x. On the Intranet, discussion lists can facilitate dialogue and interaction; graphics can enhance the use of metaphors, analogies and prototypes to clarify what was originally fuzzy and obscure. Hyperlinks relate concepts and organize knowledge repositories for better access with drill down to ease cognitive overload. For example, in product development, dialogue includes ideas exchanged in discussion threads that focus on specific expertise, forums for brainstorming new ideas and critiquing proposed approaches; and discussion on customer feedback on new products from sales, marketing, and customer service. This dialogue increases understanding of customer requirements and technical capabilities. At National Semiconductor, Electronic Arts and Olivetti, virtual workgroups quickly assemble to access information, teams debate topics, discuss projects and project results, and share knowledge and experiences; engineers troubleshoot technical problems, and share tools, design methodologies, successes, mistakes and ideas w21,70x. Ford’s intranet, linking design centers in Asia, Europe and the US, facilitated development of the 1996 Taurus w21x. Virtual new product development 9 teams use worldwide talent, videoconferencing and simulations to share designs, and to build and test prototypes of a global car w61,78x. The teams avoid redundant efforts by using globally coordinated engineering-release databases, common CAD tools, common global specifications for manufacturing, and a common repository of national environmental and safety laws w50,78,86x. Designers transmit three-dimensional images of prototypes over the intranet for computer-animated examination by executives in Europe and the US. If they give the go-ahead, the designs are translated into numeric data, which are input into an automated rendering of a clay model w96x. Combination is the organizational knowledge creation mode whereby individual explicit knowledge is converted to group and organizational explicit knowledge w74x. This mode is facilitated by categorization and traditional information processing w73x. Although transaction processing with web technology is not yet as common as electronic documents and discussion lists, leading edge companies like Sun are automating processes on the Intranet. We will discuss web-based transaction systems further in the section of the framework on consequences. In addition to organizational knowledge creation, two important Intranet strategies are organizational knowledge integration and organizational knowledge management. 3.5.2. Organizational knowledge integration Organizational knowledge integration is made possible by the cross-platform open-standards capabilities of the Intranet w1x, which allows data access from multiple sources, including legacy databases, presented on one interface w54x. Furthermore, the Intranet is proposed as a potential alternative to integrated enterprise systems such as SAP Rr3 w21,54x. Technology in the form of knowledge bases, data dictionaries, and online databases, along with people reengineering processes, facilitate integration of systems, knowledge, and data w7,37,58x. Standards are important for integration, specifically for data definitions and formats, and interoperable network protocols w58,64,81,82x. A Fortune magazine article explains that on an intranet: You don’t have to abandon or struggle to integrate existing legacy databases or different platforms where 10 J.E. Scott r Decision Support Systems 23 (1998) 3–17 your information resides. There’s no need to retrofit. It gives companies the flexibility to do what they need to do internally, and it’s a lot easier to implement than some of the more complex proprietary systems w23x. For example, at AT & T, a web system integrates disparate billing systems, w70x; at John Deere, a cross-functional parts database is used by purchasing for quotes, by the shop floor to find out how a part is put together and by engineering ‘‘to automatically develop bills of materials for their designs’’ w70x; and at Sun Microsystems, ‘Asset Managers Workbench’ is a Web-based reporting tool that allows instant queries and standard reports from Oracle Financials —a process that used to take several days w95x. Web queries to mainframes at Sandia Labs, Federal Express Žto track packages., the US Postal Service Žto search for zip codes., and to corporate databases at Allen–Bradley, Silicon Graphics, HBO, Tyson Foods and Dreamworks fetch information more quickly and at less cost than traditional systems. Web based forms are also front ends to ordering systems at AT & T for office supplies, and at Allen–Bradley for help desk support. 3.5.3. Organizational knowledge management Organizational knowledge management uses repositories and improved access w26x to make critical knowledge available wherever and whenever it is needed. . . . Intranets also help companies get maximum efficiency from various experts and departments, no matter where they work or where they are located. So Web technology offers the kind of application that really fits well with the current trends in business—more coordination, more collaboration, more virtual offices w23x. Collaboration in virtual teams is made possible by such technology developments as groupware and other forms of group support systems w76,85x. The intranet has generated a great deal of interest as a cheaper and less complex alternative to groupware, such as Lotus Notes w21,38,40,52,66,77,83,87, 98,103x. For example, Olivetti uses a ‘ virtual laboratory’ to link their main sites and labs worldwide. The goal is to use the Intranet for knowledge management— ‘‘so researchers access the largest possible amount of current information, both inside and outside the Olivetti Group, recognizing that in an R & D environment, the free exchange of ideas and information is a powerful catalyst for innovation’’ w70x. Conversion of paper-based delivery systems to electronic Intranet documents generates substantial cost savings w95x as processes are reengineered and electronic documents enhance organizational memory w53,91x with a knowledge repository of technical information w17,18,22,31,48,55,90,92,100 x. For example, at Booz Allen and Hamilton, ‘Knowledge On Line’ ŽKOL. has email that is sent to discussion conferences tightly integrated to a ‘knowledge repository’ w46x; and at CAP Gemini, ‘Knowledge Galaxy’ is a giant repository of technical information that helps the consulting firm respond more quickly to customers w21x. At Olivetti, ‘‘ . . . if a problem has already been solved by one employee, we can find out about it immediately and avoid duplicating efforts. Before the Web, there was no central repository of information, so researchers often spent time looking for information that was already available in-house’’ w70x. In a manufacturing context, the Web could provide ‘cyber-instructions’ w22x or a repository of technical data, ‘‘including voice clips, video clips, model data, drawing data, even part programs for rapid prototyping . . . all could be exchanged via the Internet during the supplier selection process, and later during product development’’ w24x. 3.6. Consequences We analyze the organizational consequences of these knowledge-oriented strategies for exploiting the Intranet with an IT business value approach. Studies of IT business value typically report organizational improvements in efficiency or effectiveness w5x. Cost reduction has been documented on the basis of the ‘paperless office’ and a shorter systems development cycle. Increased efficiency generates tangible benefits such as cost reduction and faster processes, while increased effectiveness produces intangible benefits such as enhanced communication and collaboration. More recently, a process-oriented view J.E. Scott r Decision Support Systems 23 (1998) 3–17 offers three dimensions of IT business value w68x, encapsulating the nine suggested categories of IT impacts of business process innovation w25x. Applying the three dimensions of IT business value—automational effects, informational effects and transformation effects—to Intranets is revealing. 3.6.1. Automational effects First, automational effects from Intranets have not been reported widely yet. An exception is Sun Microsystems, which has automated check processing ŽCheckMate., expense reporting ŽSunTea., and processing employee raises ŽSaltool.. Checkmate saves more than US$100 K per year, and transaction costs fell from US$35 to US$2 per check issued. SunTea saves US$2.5 million a year and the time to process went from 5 days to 2 days. Saltool returned its development cost of US$300 K in the first three months of use w95x. The Intranet is creating a revolution in systems application development w29,79x. Development is faster because browser capabilities reduce interface coding from a traditional 80% of the application to about 40% w29x. Faster development translates into increased productivity, and lower development and maintenance costs. For example, at National Semiconductor: New applications can be rolled out very quickly. ‘‘Development time is extremely rapid. Because we can develop applications so fast, we can modify applications or try new applications very quickly,’’ he says. ‘‘And the costs associated with deploying and using the Web are lower compared to what we were doing before.’’ On the other hand, although browser capabilities are improving at a frantic pace, they limit the features in current web applications, disappointing some users w29x. Additional front-end web interfaces to applications across platforms are in place at Allen–Bradley, John Deere, Sandia Labs, Silicon Graphics, Genentech, HBO w70x, and Tyson Foods w77x. 3.6.2. Informational effects Second, informational effects encompass informational, tracking, analytical and intellectual opportunities w25,68x. Web pages of regulations, standard operating procedures, and employee benefits provide examples of informational effects. Information 11 abounds on the typical Intranet, as organizations post electronic versions of paper documents. Although we can dispute the term ‘paperless office’ in the absolute sense, there is no doubt that reducing paper in the office has tremendous advantages, not the least of which is cost reduction. Substituting electronic documents for paper-based systems provides superior search and retrieval, and increased ease of maintaining current information. There is no confusion as to the correct version when electronic documents are kept up-to-date in a central location. Furthermore electronic documents are not limited to text, and there is no printing cycle. Electronic publications offer timely content, and immediate event coverage at lower cost w95x. For example, Sun shifted the publication of its quarterly employee magazine, Illuminations, to the Web in April 1995. Now they can report up to the previous day’s events while eliminating about two-thirds of the production and distribution costs by ‘‘jettisoning pre-press, printing, postage and mailing-list maintenance’’ w95x. Sun saves an estimated US$25 million a year on documentation distribution, that includes literature fulfillment, manuals, catalogs, price books, white papers, newsletters and magazines w95x. However, some cultures, such as US West, resist giving up the print media. If both print and electronic media are used, cost savings are sacrificed w10x. Tracking and monitoring project status and scheduling w21,70x are widely used applications on the Intranet. At Olivetti, project leaders now instantly have administrative data such as expenses, man-hours spent, and the status of procurement requests. ‘‘These services help us cut down on project management overhead and let project leaders focus more on technical problems than on administrative issues,’’ w70x. Customer service and support groups monitor status reports on problems, while sales and marketing groups check order status w70x. Federal Express has a successful web package tracking system, which saves US$2 million and gives customers better access than the information system it replaces w21,94x. Analytical systems on the Intranet, for decision support, are being developed with Java and other web languages, using ‘on the fly’ spreadsheets with ‘what if’ capabilities, or group support features w29x. Software agents also hold promise for decision sup- 12 J.E. Scott r Decision Support Systems 23 (1998) 3–17 port w42x. An Intranet of the future could use agent technologies to facilitate integrated decisions in real time supply chain management w42x. Enterprise modeling systems and client–broker–server decision support systems are being researched w2,3x. Intellectual opportunities are exemplified by systems on the Intranet that promote and capture organizational knowledge. For example, community expertise is generated with brainstorming, feedback, information exchange on experiences—what has succeeded or failed—and discussion on accounts and issues surrounding winning deals against a competitor w70x. The Intranet enables this with discussion groups, electronic posting of organizational documents, bulletin boards to target areas of expertise, multimedia groupware environments, and Multi-User domain ŽMUD. for chat environments. For example, Ž1. the ‘Community of Practice’ at National Semiconductor is a forum for engineers to share knowledge, tools, design methodologies, successes, mistakes and ideas; National Semiconductor developed an intranet largely to help its customers get their products to market faster. Tim Stuart, information services consultant for National Semiconductor, says, ‘‘When we develop a new product, we go through cycles of learning. The faster you can get a product out and look at it, the better you can make the next generation of product. If you can learn faster, you can end up ahead of the competition.’’ Ž2. At Electronic Arts, virtual workgroups assemble quickly to collaborate and use newsgroups to discuss projects, access information, and come up to speed quickly by reviewing the history of discussions; Ž3. at Mobil, employees collaborate and share knowledge on research; Ž4. Sandia Labs use ‘knowledge preservation’ w101x, to enhance scientific collaboration and allow employees to find experts; Ž5. at Silicon Graphics, their Intranet ties together more than 100 offices around the world so field teams share expertise globally; during new product development they use real-time information retrieval of schedules, roles, changes, test results, benchmarks, bugs, lists of work in progress, and have a sales guide for product launch; Ž6. at Genentech, bulletin boards target areas of expertise; Ž7. Mitre’s ‘Collaborative Virtual Workspace’ is a multimedia groupware environment, that uses Internet’s Network News Transfer Protocol ŽNNTP. for discussion groups and Multi-User domain ŽMUD. for chat environments; Ž8. ‘Knowledge On Line’ ŽKOL. at Booz Allen and Hamilton has 3000 users in 30 offices worldwide able to send email to discussion conferences tightly integrated to a ‘knowledge repository’; Ž9. at Lockheed Missiles and Space, engineers around the country collaborate in real time with ‘Multimedia Engineering Collaboration Environment’ ŽMECE.; and Ž10. CAP Gemini’s ‘Knowledge Galaxy’ is a giant repository of technical information that helps the consulting firm respond more quickly to customers, prepare sales bids faster, and cut down the project time. The repository is a virtual storehouse for software objects that can be reused, and has a database of current projects with links to employees working on them w21,46,70,94x. 3.6.3. Transformation effects Third, transformation effects offer new products and services, effectiveness rather than efficiency and encompass sequential, geographical, disintermediating and integrative opportunities w25,68x. These opportunities are realized by removing barriers. On the Intranet, sequential barriers are removed by the concurrent possibilities of web groupware w29x. Geographical barriers are removed by the technology’s global reach. For example, 3M’s Global Economic Overview disseminates corporate economists’ quarterly reports to employees anywhere in the world, instantly and securely w70x; Silicon Graphics sends video and audio feeds on the Net to more than 7200 employees at 100 offices around the world w21,70x; Eli Lilly will link 16,000 workers—almost two-thirds of its worldwide staff—in 2 dozen countries, by the end of 1996 and since each market has unique requirements, it will post regulatory information from different countries on the web w21x; Douglas Aircraft has a system to distribute aircraft service bulletins to customers around the world w70x; Federal Express will link 30,000 office employees around the world to share information formerly on hard copy reports w21,94x; and Booz Allen and Hamilton has 3000 users in 30 offices worldwide w46x. National Semiconductor uses an Intranet to share information among globally distributed manufacturing sites and finds communicating graphically helps with differences in languages, cultures and time zones. J.E. Scott r Decision Support Systems 23 (1998) 3–17 If we can give people a new way to communicate and make that communication richer, then we can make better products faster and more efficiently w70x. Disintermediating barriers are removed by the ease of coordinating needs and services—often with self-service w95x; For example, the Intranet enables efficient software distribution, and ‘‘ . . . it has dramatically lowered the transaction and delivery costs of software and dataware’’; With the application on the server, you can disregard the different operating system platforms and the logistics of upgrading to the latest version of client software. Similarly, with Web-supported drag-n-drop engineering, hundreds of thousands of intelligent, editable objects that contain properties and manufacturing information, could be available on the Web for purchase and rapid downloading. Without doubt, this approach will significantly change the way most part engineering is performed, and create a revolutionary impact on the CADrCAM, CAE industry as a whole w24x. Integrative barriers are removed by the ease with which the Intranet uses standards and open systems to cross platforms. Information stored on the corporate mainframe was previously not easily accessible. However, better access to corporate information translates into increased productivity, and dynamic electronic web documents w79x streamline organizational processes w67,91x, when organizations capture this information. For example, procurement of Olivetti products for internal use is more efficient because employees can now access the entire product catalog and information for ordering on the Web w70x. Another integrative role for the Intranet is as a front-end to business applications. Electronic Arts has plans to integrate the web with their back-end Oracle applications w70x. 4. Discussion We increase our understanding of the Intranet phenomenon by coding case studies with the paradigm model w93x. Furthermore, we incorporate existing theories and literature on organizational knowledge to enhance the generalizability of the new framework w30,36,76x. An analysis of the causal conditions and context furthers our understanding of 13 the reason for the Intranet phenomenon. An examination of the intervening conditions, actionrreaction strategies and consequences of the Intranet phenomenon provides alternatives for management action. For example, reaching a goal of intellectual capital improvement with knowledge strategies is helped by promoting the enabling conditions—autonomy, intention, redundancy, fluctuation and creative chaos, requisite variety—from the theory of organizational knowledge creation. Organizational knowledge emerges as an important concept for the Intranet. Existing theories on organizational learning, w48,62x and organizational knowledge creation w72x support the anecdotal evidence of successful Intranet applications. Whereas traditional sequential text-based IT supports explicit knowledge transfer, the multimedia, hypertext capabilities of the Intranet also facilitate tacit knowledge transfer and externalization of tacit knowledge to explicit knowledge. Furthermore, unlike traditional IS, the Intranet is characterized by autonomy, redundancy, creative chaos and variety. 5. Conclusion The contribution of this paper is along four dimensions. First, using the paradigm model of grounded theory w93x we show interactions between the Intranet and organizational knowledge strategies taking into account drivers, the context, and intervening conditions. Second, previous research on organizational knowledge creation theory reinforces the paradigm model of the Intranet, and is incorporated into our framework. Specifically, intervening conditions for organizational knowledge strategies include Nonaka’s enabling conditions for organizational knowledge creation. Third, the framework forms the basis for future conceptual and empirical research on the business value of the Intranet. Finally, there are many implications of this study. The economic implications suggest lower transaction costs w24x. For example, Sun decreased the transaction costs of check processing from US$35 to US$2 with their Intranet application called CheckMate. Furthermore, the study raises implications for IS developers, IS departments, management and researchers. 14 J.E. Scott r Decision Support Systems 23 (1998) 3–17 5.1. Implications for IS deÕelopers The web has generated a revolution in systems development w29,79x. Browser capabilities and new web languages such as Java reduce interface coding resulting in faster and cheaper development and lower maintenance costs w29x. However, because of a perceived threat that traditional programming skills will become obsolete, there is some resistance from ‘‘legacy dogs . . . too busy to learn new tricks’’ w69x. Many IS developers need reskilling, training, motivation and the time to gain web systems development skills. The cross-platform integration capabilities of web technology has reduced the need to write software interfaces and recode systems for different platforms. ‘‘CADrCAM, CAE vendors, standards organizations, specialty suppliers and individual manufacturers are sizing up strategies for incorporating wWeb technologyx into their overall programs, processes and product lines’’ w24x. Some strategies are: including Internet viewers, interoperability with Web technology, creating systems with Web technology, or making sure ‘‘their value added wisx readily distinguished from what can be put together with standard Internet browsers and viewers’’ w24x. 5.2. Implications for IS departments Traditionally, IS departments produced and delivered voluminous paper-based reports to user departments. With Web technology, documents on the server can be Ž1. outputs produced from a user query in a decision support system or Ž2. formatted reports produced by management or transaction processing systems. Thus, IS departments that adopt this environment will not ‘push’ information to users, but instead make the information available for users to ‘pull’ when they require it w79x. Training is essential to keep IS department skills aligned to current needs. Although users of intranets get a friendly point and click interface, IS personnel need to learn new technical skills and cope with maintenance problems. They need to manage Ž1. the volume of information and huge numbers of disorganized electronic documents posted in many organizations w15x, Ž2. decaying links, Ž3. obsolete information and Ž4. information redundancy. Despite more distributed systems development, enabled by independent development capabilities of web technology, IS departments need to provide expertise Ž1. to take advantage of advanced features such as interactive forms and scripts that can be integrated with corporate clientrserver databases, Ž2. to manage information flow and coordination, and Ž3. to speed intranet construction and channel its development in directions most beneficial to a corporation with ‘‘guidelines based on a clear vision and philosophy of a company’s intranet goals, objectives, architecture, and how it fits, overlaps and augments existing corporate systems including EDMrPDM, MRP, SAP and others’’ w24x. There are signs that IT acceptance of centralized administration and distribution of systems is growing. 5.3. Implications for management By examining the technical and organizational intervening conditions in the model, we discover how management could make a difference in facilitating organizational knowledge creation with the Intranet. First, management can allocate resources to purchase or develop tools for control and maintenance of the Intranet. Second, management can obtain and retain technical expertise by hiring, training and reskilling personnel. Third, management can nurture an organizational culture that explores and adopts new technologies, minimizing resistance to change with incentives and reward systems. Fourth, management can encourage socialization skills for effective global virtual collaboration. Fifth, management can show its support for using web technology for systems development. Finally, management can enable organizational knowledge creation on the Intranet by promoting autonomy, intention, redundancy, fluctuation and creative chaos, and requisite variety. 5.4. Implications for researchers The framework developed in this study shows the most promising areas in which to focus empirical and further conceptual research efforts. Although the causal conditions and context help to explain the Intranet phenomenon, these aspects are largely out of management’s control. In contrast, intervening conditions and actionrinteraction strategies are a fertile J.E. Scott r Decision Support Systems 23 (1998) 3–17 area for further research that is relevant to management. Impacts are highly probable and prescriptive studies could benefit management practice with conceptual material to guide the development of decision support systems. References w19x w20x w21x w22x w1x APC Staff, Groupware, intranets and the power of sharing, Australian Personal Computer, Groupware Feature, May Ž1996.. http:rrwww.com.aurapcr9605rinprintrfeatint.html. w2x S. Ba, R. Kalakota, A.B. 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She received her MBA and PhD from the University of California, Irvine. Her research interests include the impact of information technology on organizational learning and knowledge management, and the implementation of enterprise and interorganizational information technology.