Jan Damsgaard and Kalle Lyytinen
Electronic Data Interchange (EDI) provides means for interorganizational communication, creates network externalities, requires an advanced IT infrastructure, and relies on standards. In the diffusion of such innovations institutional involvement is imperative. Such institutions contain governmental agencies, national and global standardization organizations, local government, and non-profit private organizations like industry associations. The last type of organizations we call intermediating institutions. They intermediate or coordinate (“inscribe”) the activities of a group of would-be adopters. Unfortunately, little is known how these organizations shape the EDI diffusion trajectory. In this paper we examine one specific type of intermediating organizations - industry associations – and how they advanced the EDI diffusion process in the grocery sectors of Hong Kong, Denmark and Finland. We identify six institutional measures — placed into a matrix formed by the mode of involvement (influence vs regulation) and the type of diffusion force (supply-push vs demand-pull) — that can be mobilized to further the EDI diffusion. Industry associations were found to be active users of all these measures to varying degrees. Their role was critical especially in knowledge building, knowledge deployment and standard setting. Furthermore institutional involvement varied due to policy and cultural contingencies and power dependencies.