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http://hdl.handle.net/10397/93359
Title: | Optimal distribution strategy for enterprise software : retail, SaaS, or dual channel? | Authors: | Li, S Cheng, HK Jin, Y |
Issue Date: | Nov-2018 | Source: | Production and operations management, Nov. 2018, v. 27, no. 11, p. 1928-1939 | Abstract: | While the optimal distribution channel strategy of physical goods has been extensively studied, there is a lack of research for that of enterprise software as a digital good. This research analyzes the optimal distribution strategy of enterprise software by taking into account the distinct features of enterprise software for both the short-run problem, in which the software quality is fixed, and the long-run problem, in which the software quality becomes part of the strategic decisions. Our results indicate that in the presence of high unfit cost relative to the customization cost, the dual channel strategy exists and generates the highest profit for the firm and the highest social welfare. When the unfit cost is low relative to the customization cost, the SaaS channel strategy becomes the best strategy for both the firm in terms of profitability and society in terms of social welfare. This key finding is robust in that it holds for both the short-run problem and the long-run problem. | Keywords: | Customization cost Enterprise software SaaS Software distribution channel Software quality Unfit cost |
Publisher: | Wiley-Blackwell | Journal: | Production and operations management | ISSN: | 1059-1478 | EISSN: | 1937-5956 | DOI: | 10.1111/poms.12909 | Rights: | ©2018 Production and Operations Management Society This is the peer reviewed version of the following article: Li, S., Cheng, H. K., & Jin, Y. (2018). Optimal distribution strategy for Enterprise software: Retail, SaaS, or dual channel?. Production and Operations Management, 27(11), 1928-1939, which has been published in final form at https://doi.org/10.1111/poms.12909. This article may be used for non-commercial purposes in accordance with Wiley Terms and Conditions for Use of Self-Archived Versions. This article may not be enhanced, enriched or otherwise transformed into a derivative work, without express permission from Wiley or by statutory rights under applicable legislation. Copyright notices must not be removed, obscured or modified. The article must be linked to Wiley’s version of record on Wiley Online Library and any embedding, framing or otherwise making available the article or pages thereof by third parties from platforms, services and websites other than Wiley Online Library must be prohibited. |
Appears in Collections: | Journal/Magazine Article |
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Jin_Optimal_Distribution_Strategy.pdf | Pre-Published version | 1.13 MB | Adobe PDF | View/Open |
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