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AbstractWe define social innovation as strategic decision making to improve social conditions and facilitate social changes in a desirable direction by dealing with crucial issues and solving fundamental societal problems. This paper proposes a framework that enables the decision maker to implement social innovation effectively. The framework consists of three influential theories or ways of thinking, that is, design thinking, systems thinking, and learning organization. This paper shows how these three approaches can be integrated to tackle a critical social problem and develop a sustainable solution. We present a case study on an actual social issue to demonstrate its practical application.

We examine how the government and the market affect firm's pollution abatement efforts, i.e. firm's efforts to reduce its pollution emission. The way for the government to control firm's pollution is to impose penalty, whereas the consumers (the market) make their purchasing decision by taking into account the pollution, i.e. the demand is affected by the stock of pollution. In effect, we consider two forces, government penalty and consumer's sensitivity to pollution, as primary factors to control firm's pollution and analyze their interaction in relation to the firm's pollution reduction efforts. The analysis suggests as follows. The government penalty and the consumer's awareness are substitutes either (1) when the market size is relatively large or (2) when the market is relatively small, but the government penalty is relatively heavy. On the contrary, the two factors are complements when the market size is relatively small and the government penalty is relatively light. We discuss managerial and economic implications of the analysis results.

It is important for an IT service company (IS company) to fully take into account the differences in customer satisfaction across different customer groups. In this article, we consider three layers of customers in the client company. There are project directors who interface with and accept the final product (i.e. IT system) from the IS company, users who actually use the IT system for their daily operations, and finally operators who do maintenance works for the IT system. We propose that each customer group (i.e. project director, user, or operator) evaluates the IT systems success with a different set of criteria. Transaction relationship and partnership turn out to be important determinants for the project directors: task‐related and IS‐related output performances seem to be less influential. The reverse conclusion can be made for users and operators. One additional insight is that IS company's efforts to understand its customer's tasks and share risks with the customer company might have unexpected effects. Although the project directors seem to like such close involvement, it can be detrimental to the users' satisfaction with the IS outsourcing projects.

As an exploratory study, our research aims to investigate what factors would influence choices of foreign market entry mode by system integration (SI) companies. There are two distinct points. First, we specifically focus on a service industry, i.e., SI (System Integration) industry, which has unique features compared with other industries, yet not been studied extensively. Second, we indirectly examine whether forces influencing firms in an advancing country like Korea are different from those in more advanced countries: in this paper we investigate the Korean cases only, since most of the previous studies viewed this issue from the perspective of advanced countries.

AbstractWe explore the economic and environmental impacts of market structures (competition or integration at vertical and horizontal levels). We consider a bilateral duopoly consisting of two manufacturers and two retailers in which each manufacturer offers a wholesale price contract to the respective retailer. The manufacturers decide on wholesale prices and abatement efforts concerning pollution emissions related to manufacturing processes, whereas the retailers compete in quantities in the consumer market. To understand the comprehensive effects of market structures on economic competitiveness and environmental sustainability, we examine a measure of eco‐friendly social welfare, which is the ratio of social welfare and environmental pollution. Interestingly, we find that the market structures that have been believed to be more efficient are less efficient from a broader perspective: (1) double marginalization can generate higher eco‐friendly social welfare, and (2) horizontal competition between firms can result in lower eco‐friendly social welfare. Although vertical integration and horizontal competition yield greater social welfare by facilitating more production activities, these market structures often fail to induce sufficient abatement efforts to balance the polluting effect of the large volume, resulting in more significant environmental degradation. We also show that, despite the pollution‐curbing effect, higher emission penalties can result in less eco‐friendly social welfare. They can even curtail the abatement efforts of firms under particular circumstances. When products become more substitutable, the eco‐friendly social welfare can decrease depending upon the market structure.