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Network relations and boundary spanning: understanding the evolution of e-ordering in the Chinese drug distribution industry

Journal of Information Technology

Abstract

The application of e-ordering systems has brought significant changes to the drug distribution industry in China, but the effects of these changes have remained unclear. Adopting a practice perspective and based on longitudinal data collection using multiple methods, we reveal that the Chinese drug distribution practice has passed through the following three stages: the stage before e-ordering, the transitional stage in which the government attempted to impose a centralised platform, and the current fragmented systems stage. We draw upon the theoretical foundations of the network relations model and the boundary spanning theory developed by Schultze and Orlikowski and Levina and Vaast, respectively, to formulate a taxonomic framework for understanding inter-firm network practices. Applying the framework to explain long-term changes in drug distribution in China, we discover that the practice in the field has evolved from traditional, socially embedded relations to information systems-based, socially embedded relations, while the centralised platform deployed by the government was unable to establish a practice with arm’s length relations. Our theoretical work contributes an integrated framework for studying inter-firm practices that explicitly incorporates the presence of inter-organisational information systems. Our empirical findings offer helpful practical insights for facilitating collective efforts toward the innovative use of novel IT in the drug distribution industry in China and in other contexts that are similar.

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Acknowledgements

This research has been supported by the National Natural Science Foundation of China (grant numbers 70972029, 71110107027, 71273151, 70831003), the German National Science Foundation (DFG, grant number 1328/2–2), the MOE Project of Key Research Institute of Humanities and Social Sciences at Universities of China (grant number 12JJD630001), and the Beijing Municipal Science and Technology Commission (grant number Z07020600290793). The authors thank the four anonymous reviewers, for their constructive suggestions through the developmental review process, and Dr. Lihui Lin from Tsinghua University, for her valuable comments on an early version of this paper.

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Correspondence to Xunhua Guo.

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Guo, X., Reimers, K., Xie, B. et al. Network relations and boundary spanning: understanding the evolution of e-ordering in the Chinese drug distribution industry. J Inf Technol 29, 223–236 (2014). https://doi.org/10.1057/jit.2013.27

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