E-Lance Enabled Network Exchanges within Supply Chains: The Influence of Network Governance and Social Control Mechanisms on Network Success

E-Lance Enabled Network Exchanges within Supply Chains: The Influence of Network Governance and Social Control Mechanisms on Network Success

Robert E. Hooker (Department of Marketing, University of South Florida, Tampa, FL, USA), Carmen C. Lewis (Sorrell College of Business, Troy University, Troy, AL, USA), Molly M. Wasko (Department of Management, Information Systems and Quantitative Methods, University of Alabama at Birmingham, Birmingham, AL, USA), James L. Worrell (Department of Accounting and Finance, University of Alabama at Birmingham, Birmingham, AL, USA) and Tom Yoon (Management Information Systems Department, Western Connecticut State University, Danbury, CT, USA)
DOI: 10.4018/IJISSCM.2016040101
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E-business based e-lance networks can impact the coordination and completion of work within organizations and improve efficiencies in global supply chains. This may be particularly true for organizations mitigating sudden demand spikes, or lacking internal expertise and bandwidth. However, little is known about what governance and social control mechanisms impact network success. Utilizing data from 14,644 projects, this research tests a theory of network governance specific to this new emerging e-lance economy by integrating transaction cost economics with the concepts of social controls. For transaction costs, findings indicate that higher average project values lead to more projects and more money being exchanged, but more bids leads to less monetary exchange. For social controls, restricting access by sealing bids and not disclosing budget amounts leads to less bidding, but not disclosing budgets is associated with more projects being posted. The authors further find that the best predictor of e-lance success across all measures is the number of projects posted in the prior time period.
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Governance between supply chain partners is improved through proper coordination, communication, and integration, which is further enhanced through the flow of information (Fawcett, Ogden, Magnan, and Cooper, 2006; Lambert and Cooper, 2010; Thun, 2010). The role of information and communication technology (ICT) in facilitating supply chain and logistics integration and performance through coordination and communication has been heralded for some time (Gustin, Stank, and Daugherty, 1994; Gustin, Daugherty, and Stank, 1995; Paulraj and Chen, 2007; Rasheed and Rasheed, 2015). ICT have proven to be a key driver of successful supply management, as the sharing of information across the supply chain helps to reduce the bullwhip effect, allowing for greater efficiency and responsiveness (Cachon and Fisher, 2000; Bowersox, Closs, and Drayer, 2005; Sanders, 2005; Devaraj, Krajewski, and Wei, 2007; Lee, Padmanbhan, and Whang, 1997).

However, ICT continues to evolve and, as a result, alter the way supply management is conducted. The falling costs of communication predicted during the “dawn of the e-lance economy”, which made it possible for globally dispersed networks of organizations and individuals to change the way they organize themselves to accomplish complex tasks (Malone and Laubacher, 1998), have grown considerably over the past few years. E-lance networks operate as a form of e-business that provides the ability to connect buyers and suppliers, particularly in temporary or ad hoc portions of a supply chain, and are deemed as being a critical component for streamlining supply chain networks (Malone and Laubacher, 1998). According to a 2013 Accenture report, upwards of $300 billion is being spent on projects conducted with such contingency labor, with nearly one third of the projects being manufacturing oriented (Faust 2013). Just as e-business has changed traditional purchasing from an e-commerce standpoint, e-lance may have a similar ability to transform how work is purchased and fulfilled across buyers and suppliers in global supply chains. Similarly, we posit that the characteristics surrounding the procurement and fulfillment of supply chain related services through e-lance mechanisms are more unique than procuring such services through other e-procurement or conventional means. Recent reviews of the purchasing and supply management (P/SM) literature reveal that e-business is largely under-researched. In particular, e-sourcing solutions, such as those provided by e-lancing, are highlighted as a relevant trend in e-business needing further exploration (Schneider & Wallenburg, 2013).

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