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Exploring the Role of Network Effects in IT Implementation: The Case of Knowledge Management Systems

J. P. Bansler and E. Havn

Reference & Publication Year
Proceedings of the 10th European Conference on Information Systems, Gdansk, June 6-8, 2002

One of the key themes in knowledge management is the role of information
systems designed to facilitate the sharing and reuse of knowledge –
often referred to as knowledge management systems (KMS). However, the
intended users of such systems are often reluctant to use them, and
implementation failures are common. While prior research offers
important insights into the problems and practices of IS implementation
in general, little is known about the special problems involved in
implementing KMS. This study seeks to better understand the process of
KMS implementation and establish a theoretical framework for examining
the underlying dynamics of adoption and use. We suggest that efforts to
implement KMS need to be sensitive to the social interactions and the
collective sensemaking of the intended users if they are to be
successful. In making this argument, we build on recent research within
the field of network economics and highlight the concept of network
effects. Using an exploratory case study as an illustration, we argue
that KMS exhibit strong network effects and that these create positive
feedback loops that complicate the implementation process. Our
conclusion is that the concept of network effects offers an interesting
and useful analytic perspective for understanding the implementation of
KMS in organizations. Implications of using this theoretical lens for
both research and practice are discussed.

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