Value Creation and Value Claiming in Make-Or-Buy Decisions

Transaction value analysis (TVA) integrates the concepts of resourceheterogeneity and transaction cost economics into a single framework,which emphasizes both value creation and value claiming in firms'vertical integration decisions. Using a TVA perspective, we develophypotheses to explain the firm's intent to outsource applicationservices. A sample of 178 firms in the publishing and printingindustry in The Netherlands is used to test the hypotheses. This paperfinds that firms take both value-creation and value-claimingmotivations into consideration, with value creation having on averagea dominating impact, thus substantiating the TVA framework. However,we also find that if the risks of opportunism in outsourcingcontracting are high, value creation becomes the less important factorin make-or-buy decisions. Furthermore, the paper shows that the needfor flexibility is a major driver of governance choice forvalue-creation as well as for value-claiming motivations. Implicationsand future research directions are discussed.information technology;interorganizational strategy;make-or-buy decisions;outsourcing relationships;transaction value analysis

A Managerial Perspective on the Logic of Increasing Returns

The focus of this study is on the challenges faced by managers in effectively dealing with the new management logic of increasing returns as the information and knowledge intensity of their transformation processes rises. Dealing with these challenges is especially relevant for companies currently making the transition from capital and physical labor intensive transformation processes (old economy) to information and knowledge intensive transformation processes (new economy). For these companies, this study provides a definition of increasing returns, explains the sources of increasing returns and develops tools for monitoring the realization of increasing returns. These tools are applied at the Randstad Group, a leading temporary employment agency based in the Netherlands, currently making the transition from the old to the new economy. The study concludes with a discussion of the management implications of the new logic of increasing returns and suggestions for further research.management;economics;interaction effects;increasing returns;network effects

The Effects of Self-Reinforcing Mechanisms on Firm Performance

This study empirically investigates the influence of the market-bound (i.e., interaction and network effects) on the firm-bound (i.e., scale and learning effects) self-reinforcing mechanisms, and their combined effect on product and organizational performance. The findings from a sample of 257 manufacturing firms reveal that interaction effects have a positive effect on network effects. Network effects have a positive impact on the potential for firms to realize scale and learning effects, which in turn, is positively related to their actual realization of these effects. The actual realization of scale and learning effects has a positive effect on product performance, which in turn positively influences organizational performance. These effects are robust across industries and provide ample opportunities for future research.management;economics;increasing returns;self-reinforcing mechanisms

Value Creation and Value Claiming in Make-Or-Buy Decisions

Transaction value analysis (TVA) integrates the concepts of resource heterogeneity and transaction cost economics into a single framework, which emphasizes both value creation and value claiming in firms' vertical integration decisions. Using a TVA perspective, we develop hypotheses to explain the firm's intent to outsource application services. A sample of 178 firms in the publishing and printing industry in The Netherlands is used to test the hypotheses. This paper finds that firms take both value-creation and value-claiming motivations into consideration, with value creation having on average a dominating impact, thus substantiating the TVA framework. However, we also find that if the risks of opportunism in outsourcing contracting are high, value creation becomes the less important factor in make-or-buy decisions. Furthermore, the paper shows that the need for flexibility is a major driver of governance choice for value-creation as well as for value-claiming motivations. Implications and future research directions are discussed

The Effects of Self-Reinforcing Mechanisms on Firm Performance

This study empirically investigates the influence of the market-bound (i.e., interaction and network effects) on the firm-bound (i.e., scale and learning effects) self-r

A Managerial Perspective on the Logic of Increasing Returns

The focus of this study is on the challenges faced by managers in effectively dealing with the new management logic of increasing returns as the information and knowledge intensi

How to Determine the Increasing Returns Sensitivity of Your Industry?

Increasing returns means that self-reinforcing mechanisms are at work within firms and markets. These mechanisms come in four forms: scale effects, learning effects, network effects and social interaction effects. Some industries are more sensitive to increasing returns than others. It is important that managers are able to assess the increasing returns sensitivity of their industry. Therefore we have developed an analytical tool that allows managers to assess their industry’s sensitivity to increasing returns. Four case studies are used to illustrate this typology. The analytic tool shows that an industry has high increasing returns sensitivity if a combination of the following situations exists: 1) high fixed costs and low, or even zero, variable costs, indicating a high sensitivity to scale effects, 2) a high level of complexity of the business process and/or the products, indicating a high sensitivity to learning effects, 3) low product utility and high network utility, indicating a high sensitivity to network effects and finally, 4) a high degree of social involvement by customers and potential customers, indicating a high sensitivity to social interaction effects

Phase Evolution and Li Diffusion in LATP Solid-State Electrolyte Synthesized via a Direct Heat-Cycling Method

Herein, the direct synthesis of phase-pure lithium aluminum titanium phosphate (Li_{1.3}Al_{0.3}Ti_{1.7}(PO_{4})_{3}, LATP) solid-electrolyte powder in 220 min and relatively low temperatures (850 °C) is achieved via a new (cyclic) fast heat treatment (c-FHT) route. The complex structural evolution highlights rate-limited lithium incorporation of intermediate metal phosphates formed prior to the final phase-pure LATP. The prepared LATP product powder displays similar bulk (2 × 10^{−10} cm^{2} s^{−1}) and local (3 × 10^{−10} cm^{2} s^{−1}) values for lithium diffusion coefficients (D_{Li}) characterized by electrochemical impedance spectroscopy and muon spin relaxation (μSR), respectively. The similarity between both D_{Li} values suggests excellent retention of inter- and intraparticle lithium diffusion, which is attributed to the absence of deleterious surface impurities such as AlPO4. A low-energy barrier (E_{a} = 73 meV) of lithium diffusion is also estimated from the μSR data

An on-line post-column detection system for the detection of reactive-oxygen-species-producing compounds and antioxidants in mixtures

Reactive oxygen species (ROS) can damage proteins, cause lipid peroxidation, and react with DNA, ultimately resulting in harmful effects. Antioxidants constitute one of the defense systems used to neutralize pro-oxidants. Since pro-oxidants and antioxidants are found ubiquitously in nature, pro-and antioxidant effects of individual compounds and of mixtures receive much attention in scientific research. A major bottleneck in these studies, however, is the identification of the individual pro-oxidants and antioxidants in mixtures. Here, we describe the development and validation of an on-line post-column biochemical detection system for ROS-producing compounds and antioxidants in mixtures. Inclusion of cytochrome P450s and cytochrome P450 reductase also permitted the screening of compounds that need bioactivation to exert their ROS-producing properties. This pro-oxidant and antioxidant detection system was integrated on-line with gradient HPLC. The resulting high-resolution screening technology was able to separate mixtures of ROS-producing compounds and antioxidants, allowing each species to be characterized rapidly and sensitively