Patterns of information usage in inter-firm processes

Faced with intense competition in the marketplace and aided by advances in information technology, firms are recognizing the importance of inter-firm cooperation and knowledge sharing. Previous research on this topic has implicitly assumed that firms will use the shared information in the same manner and has not examined the distinction between information sharing and information usage in the inter-firm context. We argue that shared information can be used for exploitative or explorative purposes or a combination of both. We draw on boundary management and coordination theory to examine how the digital capability of firms to represent and assess information across organizational boundaries and the allocation of decision rights affect information usage patterns during the course of inter-firm information processing. Our analysis of multiple case studies shows that inter-firm learning requires both effective digital boundary objects and proper decision rights allocation to facilitate its occurrence.