Decision execution mechanisms of IT governance: The CRM case

Employing the literature on IT governance and the structuration theory of technology assimilation, this research develops a conceptual model to examine decision execution mechanisms of IT governance in post-adoption stages of CRM diffusion, i.e. CRM use, impacts on business processes, and impacts on firm performance. While the literature mainly addresses the forms and contingencies of IT governance structures for decision making, we focus on IT governance mechanisms for decision execution, that is, the role of top management, business managers and IT managers in post-adoption stages of technology diffusion and how these groups are held accountable for their role. We conceptualize decision execution mechanisms of IT governance as including two dimensions: vertical advocacy from top management and horizontal coordination between business and IT managers. Decision execution mechanisms are assumed to facilitate CRM use and value creation. We analyze a dataset of 82 Chinese firms to examine the model and associated hypotheses. Our results show that: (1) decision execution mechanisms, including both vertical advocacy and horizontal coordination, significantly contribute to the three stages of CRM diffusion; (2) vertical advocacy has a notably greater effect on CRM use and firm performance gains than horizontal coordination, which has a greater effect on process gains. (3) CRM use creates operational and strategic benefits in customer-oriented business processes, which further improves firm performance. These findings have important implications for understanding how IT governance shapes the diffusion of CRM technology.