TY - JOUR
T1 - The use of impression management strategies to manage stock market reactions to IT failures
AU - Triche, Jason
AU - Walden, Eric
N1 - Publisher Copyright:
© 2018 by the Association for Information Systems.
PY - 2018/5
Y1 - 2018/5
N2 - In this work we show how organizational impression management strategies can influence stock market reactions to information technology (IT) failures. We combine the resource-based view of the firm with organizational impression management strategies to analyze what strategies work with different types and causes of IT failures. We perform an event study on a sample of 214 IT failures over eight years and find that a firm’s choice of organizational impression management strategy has a significant effect on a firm’s market value. On average, over $212 million in market value can be saved with the correct impression management strategy. For implementation failures, we find that assertive strategies are better than defensive strategies. Conversely, we find that for operational failures, defensive strategies are superior. Furthermore, we examine failures caused by human error and discuss the impacts. This research provides new theoretical insights to the resource-based view of the firm.
AB - In this work we show how organizational impression management strategies can influence stock market reactions to information technology (IT) failures. We combine the resource-based view of the firm with organizational impression management strategies to analyze what strategies work with different types and causes of IT failures. We perform an event study on a sample of 214 IT failures over eight years and find that a firm’s choice of organizational impression management strategy has a significant effect on a firm’s market value. On average, over $212 million in market value can be saved with the correct impression management strategy. For implementation failures, we find that assertive strategies are better than defensive strategies. Conversely, we find that for operational failures, defensive strategies are superior. Furthermore, we examine failures caused by human error and discuss the impacts. This research provides new theoretical insights to the resource-based view of the firm.
KW - Event study
KW - Information technology failure
KW - Organizational impression management
KW - Resource-based view of the firm
UR - http://www.scopus.com/inward/record.url?scp=85047154936&partnerID=8YFLogxK
U2 - 10.17705/1jais.00494
DO - 10.17705/1jais.00494
M3 - Article
AN - SCOPUS:85047154936
SN - 1558-3457
VL - 19
SP - 333
EP - 357
JO - Journal of the Association for Information Systems
JF - Journal of the Association for Information Systems
IS - 4
ER -