Research Interests: information technology and business strategy, information technology and financial markets, making the decision to invest in strategic information technology ventures, managing the risk of strategic information technology implementations, risk-reward tradeoffs in outsourcing and off-shoring, strategic implications of electronic commerce for channel power and profitability
Dr. Eric K. Clemons is Professor of Operations, Information and Decisions at The Wharton School of the University of Pennsylvania. A pioneer in the systematic study of the transformational impacts of information on the strategy and practice of business, his research and teaching interests include strategic uses of information systems, information economics, and the changes enabled by information technology.
Eric K. Clemons and Rick Spitler (Working), The Road Map for eCommerce: Mastering the Territory, Setting Your Strategy.
Eric K. Clemons and Elizabeth T. Gray, jr (Working), Vendor Relationship Management: The Role of Shared History and the Value of Return on Trust.
Abstract: Information technology outsourcing has become too important to ignore, or to delegate. The twin goals remain unchanged — (1) creating and retaining economic value over time while (2) controlling exposure and strategic risks — but the scale of both the upside gain and downside risk have become enormous. Fortunately, as we shall show in this article, setting strategy for outsourcing is principally a leadership issue, not a technical issue, and thus now falls squarely within executives’ expertise and experience. Managing sourcing is principally about setting a strategy, based on economic objectives, communicating those objectives within and between firms, and managing psychology and expectations when the high economic stakes cause communications to break down. Successfully managing expectations and maintaining effective communications leads to trust, which, we have seen, produces great and measurable economic benefits in strategic sourcing relationships.
Eric K. Clemons and M. C. Row (Working), Alternative futures for Electronic Customer Interaction: Market Structures and Competitive Strategies.
Eric K. Clemons (Working), Victory: Information Endowment, Hyper-Differentiation, And Non-Information Goods.
Eric K. Clemons and S. P. Reddi (Working), An Analysis of the Impact of Information Technology on the Organization of Economic Activity.
Noi Sian Koh, Hu Nan, Eric K. Clemons (Forthcoming), Do Online Reviews Reflect a Product’s True Perceived Quality—An Investigation of Online Movie Reviews Across Cultures, ECommerce Research and Applications.
Eric K. Clemons and Paul F. Nunes (Under Review), Carrying Your Long Tail: Delighting Your Consumers and Managing Your Operations.
Abstract: The growing ability to sell a wider range of goods, in smaller quantities, while still making a profit, is now widely called a long tail strategy. Profiting from greater product diversity represents a real change in optimal business strategy, which is based on real changes in customer behavior. Many firms want to develop long tail strategies, avoiding competition in mass market fat spots, and harvesting the superior margins available through selling in market sweet spots. Sweet spot offerings resonate with customers, allowing customers to find what they truly want and to avoid compromises; consequently, customers pay more while remaining happier with their purchases, and firms earn more and are more profitable. Evidence from earlier recessions suggests that in an era of excess capacity and pressures on consumers to find the best possible prices, competing through resonance offerings may represent an important source of protected profits. And yet, carrying a long tail and selling into sweet spots requires new skills, both for locating targets of opportunities and for controlling costs.
Eric K. Clemons and Nehal Madhani (Forthcoming), Regulation of Digital Businesses with Natural Monopolies or Third Party Payment Business Models: Antitrust Lessons from the Analysis of Google, Journal of Management Information Systems.
Abstract: In a wide range of industries alternative electronic distribution channels may permit customers to deal directly with manufacturers and primary service providers, effectively disintermediating wholesalers, retailers, and agencies. In some cases manufacturers or primary service deliverers will be able to implement strategies to interact with and sell directly to their customers, while in other industries existing intermediaries will be able to withstand attempts to bypass them. Two illustrative industries — consumer packaged goods and air travel — are compared. Simulation models are used to examine alternative strategies for channel participants in both industries. Simulation, particularly the philosophy of Industrial Dynamics, is employed in order to observe the dynamic behavior of complex systems, where the strategies of consumers, producers, and intermediaries interact in complex and non-linear ways. The critical aspects of the system, including consumer preferences and brand strength, channel power and channel conflict, and the role of customers’ speed of adoption, are borrowed from the marketing literature. We conclude that consumer packaged goods manufacturers will for a variety of reasons continue to find it difficult to disintermediate major retailers; in contrast, airlines have found that the power structure of their industry supports either disintermediation of agencies or dramatic reduction in commissions paid to them. Strategic responses for the weaker channel participants in both industries are explored. While we focus here on exemplars where the end-consumer of the good or service is an individual, this does not mean that the analysis applies solely to business-to-consumer channels. Indeed, the most attractive customers sought by airlines were corporate travelers, and the attempted disintermediation of retailers and of wholesalers of industrial components can be addressed with the same simulation models.
Eric K. Clemons (Forthcoming), The Power of Patterns and Pattern Recognition When Developing Information-Based Strategy, Journal of Management Information Systems.
The Senior Capstone Project is required for all BAS degree students, in lieu of the senior design course. The Capstone Project provides an opportunity for the student to apply the theoretical ideas and tools learned from other courses. The project is usually applied, rather than theoretical, exercise, and should focus on a real world problem related to the career goals of the student. The one-semester project may be completed in either the fall or sprong term of the senior year, and must be done under the supervision of a sponsoring faculty member. To register for this course, the student must submit a detailed proposal, signed by the supervising professor, and the student's faculty advisor, to the Office of Academic Programs two weeks prior to the start of the term.
OIDD201 introduces students to two critically important and tightly linked concepts. The first is online business model innovation, including key opportunities to exploit information-based strategies in businesses as diverse as Capital One and Uber (newly vulnerable markets) and Amazon and Airbnb (online channel conflict). The second is computer-based simulation modeling to assess the viability of an online innovation, the strategies for its launch, and its economic value.
This course provides a broad-based introduction to the management of information technology focusing on three interrelated themes: technology, organization, and strategy. The goal of this course is to equip students with the knowledge and tools to utilize information systems to pursue a firm's strategic and organizational goals. The course has no prerequisites other than a general interest in the applications of information technology.
This course number is currently used for several course types including independent studies, experimental courses and Management & Technology Freshman Seminar. Instructor permission required to enroll in any independent study. Wharton Undergraduate students must also receive approval from the Undergraduate Division to register for independent studies. Section 002 is the Management and Technology Freshman Seminar; instruction permission is not required for this section and is only open to M&T students. For Fall 2020, Section 004 is a new course titled AI, Business, and Society. The course provides a overview of AI and its role in business transformation. The purpose of this course is to improve understanding of AI, discuss the many ways in which AI is being used in the industry, and provide a strategic framework for how to bring AI to the center of digital transformation efforts. In terms of AI overview, we will go over a brief technical overview for students who are not actively immersed in AI (topic covered include Big Data, data warehousing, data-mining, different forms of machine learning, etc). In terms of business applications, we will consider applications of AI in media, Finance, retail, and other industries. Finally, we will consider how AI can be used as a source of competitive advantage. We will conclude with a discussion of ethical challenges and a governance framework for AI. No prior technical background is assumed but some interest in (and exposure to) technology is helpful. Every effort is made to build most of the lectures from the basics.
This course is devoted to the study of the strategic use of information and the related role of information technology, and designed for students who want to manage and compete in technology-intensive businesses. The topics of the course vary year to year, but generally include current issues in selling digital products, intermediation and disintermediation, competing in online markets, emerging technologies, managing artificial intelligence and data science for business, and technology project management. Heavy emphasis is placed on utilizing information economics to analyze businesses in information-intensive industries. Technology skills are not required, although a background in information technology management, strategic management or managerial economics is helpful. The course is designed to complement OIDD 210, OIDD 215, OIDD 245, and OIDD 255X.
Information technology has transformed many industries, including media, financial services, and retailing, among others. These technologies have changed not only how we produce services (e.g., outsourcing and offshoring, and their newest extension, cloud computing) but what services we offer (virtual experiences, online advertising, long tail products and services, and social networking). The purpose of this course is to improve understanding of how information technologies enable transformation of business models within existing organizations as well as the development of completely new business models and new organizational forms. The course will serve as an introductory course on information technologies and will serve as a foundation on which students can explore more advanced technology concepts.
In this opinion piece, Wharton’s Eric K. Clemons, a professor of operations, information and decisions, focuses on how academic institutions will need to adapt to the pandemic.Knowledge @ Wharton - 2020/06/22