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A study of Internet service
provider industry stakeholder
collaboration in Australia
An institutional perspective
Karthik Vilapakkam Nagarajan
School of Business, University of Western Sydney, Sydney, Australia
Abstract
Purpose – The purpose of this paper is to examine institutional inuences on the customer service (CS)
and complaints handling (CH) practices of the Australian Internet industry.
Design/methodology/approach – The study adopted a qualitative research methodology using
semi-structured interview as a research method. The study was informed by constructivist/interpretive
research paradigm approaches to knowledge. Eleven senior executives from key Internet industry
stakeholder organizations were interviewed.
Findings – Using the neo-institutional theory lens, this study found that the institutional forces
(regulatory, customer and competition pressures) played a pivotal role in bringing all Internet industry
stakeholders together to address CS/CH shortcomings in the old Telecommunications Consumer Protection
(TCP) Code 2007. This led to signicant changes to the CS/CH practices detailed in the revised TCP Code
2012. The study ndings revealed that frequent and fateful collaborations between central institutional
actors have led to the emergence of organizational elds. The actors identied in the emerging organizational
elds actively inuence the CS/CH practices and the subsequent implementation of the practices in vLISPs.
Research limitations/implications – The study focused on the functional aspects of service
quality (SQ). Technical aspects of SQ is equally important, and future research needs to consider both
aspects of SQ when assessing overall performance of vLISPs.
Practical implications – The study ndings encourage vLISP managers to continue collaboration with
external stakeholders and develop customer-friendly practices that deliver desirable CS/CH outcomes.
Social implications – The study ndings revealed that when all vLISP industry stakeholders
collaborate with each other on a focal issue, there is noticeable progress towards development of CS
practices that will contribute to a better CS experience.
Originality/value – An evidence-based approach was used towards understanding and explaining
how and why institutional actors of technology-based service organizations act together. A signicant
contribution arising from this study is the identication and discussion of emerging organizational
elds comprising the central actors in the Internet industry. These emerging organizational elds have
the potential to develop into mature organizational elds and inform future CS/CH practices and
consumer protection policies in the Australian Internet industry.
Keywords Collaboration, Internet, Customer service management
Paper type Research paper
The author thanks all Internet industry participants for their participation in this study. Special
thanks to anonymous reviewers for their valuable feedback.
The current issue and full text archive of this journal is available at
www.emeraldinsight.com/1477-996X.htm
Internet service
provider industry
stakeholder
collaboration
245
Received 13 February 2014
Revised 3 April 2014
Accepted 8 April 2014
Journal of Information,
Communication and Ethics in Society
Vol. 12 No. 3, 2014
pp. 245-267
© Emerald Group Publishing Limited
1477-996X
DOI 10.1108/JICES-02-2014-0010
1. Introduction
In an era of technological advancement, where Internet customers rely on their Internet
service providers (ISPs) to deliver good quality service solutions, adopting customer
service (CS) practices that meet customer expectations is becoming an absolute
necessity for all ISPs (Kelso, 2008, p. 7.1; Havyatt, 2010,p.1;Alderson, 2011, pp. 7.1-7.6;
Gerrand, 2011, p. 54.1).The proliferation of Internet technologies along with complexity
in products and services is redening the expectations on CS and necessitating
development of appropriate consumer protection policies and regulatory frameworks
that guarantees delivery of services that meet customer expectations. A key challenge
for ISPs is to manage customer expectations and perceptions in relation to CS and
complaints handling (CH) (Sengara et al., 2009,p.5;Wood, 2010,p.10;Havyatt, 2010,
p. 1; Alderson, 2011, pp. 7.1-7.6; ACCAN, 2012;ACMA, 2012;TIO, 2012).
CS is dened as “provision of service to customers before, during and after a purchase”
(ACCAN, 2012), and CH is the manner in which complaints are handled by ISPs. A complaint
is dened as “an expression of dissatisfaction related to an organization’s products, services
or the complaints handling process itself” (ACMA, 2012). Authoritative sources of evidence
from the Australian Government, academic literature and Internet industry reports have
shown that the CS and CH practices of the Australian Internet industry have failed to achieve
desirable outcomes for consumers (Havyatt, 2010,p.1;Wood, 2010,p.10;Alderson, 2011,
pp. 7.1-7.6; Gerrand, 2011, p. 54.1; ACMA RTC Inquiry Report, 2011, pp. 23-41; ACCAN,
2012;ACMA, 2012;TIO, 2012). How to improve the CS and CH practices of the industry has
been widely debated amongst ISPs and external stakeholders of the Internet industry (the
regulator, the industry ombudsman, the consumer association, the industry association and
government authorities).
Technology-based organizations, such as ISPs, strive not only for technical efciency but
also for social legitimacy of their practices (Orlikowski and Barley, 2001, p. 145; Low, 2010,
p. 117). ISPs operate in a complex, interdependent, social, economic and political networks
and are subjected to institutional inuences (Orlikowski and Barley, 2001, p. 145; Low, 2010,
p. 117). While there is in the extant Internet literature, a focus on customer experience,
customer satisfaction and complaints performance data (for example, Sanchez-Franco et al.,
2009, p. 196; Perez and Flannery, 2009, p. 3,334; Havyatt, 2010, p. 1), little exists on the
institutional forces that operate in the industry and their inuence on the CS and CH
practices of Australian ISPs. Several authors emphasize the importance of using an
institutional lens to understand the effectiveness of industry practices and how those
practices are shaped by the institutional forces (DiMaggio and Powell, 1991, pp. 267-292;
Oliver, 1991, p. 145; Gunningham and Rees, 1997, p. 363; Scott, 2001, p. 50). This
understanding is crucial to inform development and revision of industry practices. Further,
it can assist government authorities in the framing and formulation of appropriate consumer
protection policies/frameworks. The main aim of this study is to understand the institutional
inuences on the CS and CH practices of very large Internet service providers (vLISPs) in
Australia. Justication for focus on top four vLISPs is provided in Section 4.
In Australia, CS and CH practices of ISPs involve adopting and implementing the
terms and conditions stated in a co-regulatory code known as the Telecommunications
Consumer Protection (TCP) Code. This co-regulatory code is developed by the ISP
industry association in consultation with key stakeholders of the Internet industry. von
der Heidt and Charles (2009, p. 5) dene co-regulation as “a system in which some of the
responsibilities for regulatory development, implementation and/or enforcement are
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shared between industry groupings and governments”. A stakeholder is dened as
“persons or groups that have, or claim, ownership, rights, or interests in a corporation
and its activities, past, present, or future” (Clarkson, 1995, p. 96).
The key stakeholders involved in developing the TCP code include the regulator
(Australian Communications and Media Authority – ACMA), the industry ombudsman
(Telecommunications Industry Ombudsman – TIO), the government department for
broadband (Department of Communications), the consumer association (Australian
Communications Consumer Action Network – ACCAN), the ISP industry association
(Communications Alliance – CA) and the top four vLISPs interviewed in this study. In
this paper, old TCP code refers to TCP Code 2007 and revised TCP Code refers to TCP
Code 2012 (Communications Alliance, 2013).
2. Overview of research problem
The ndings from the literature (Havyatt, 2010,p.1;Wood, 2010,p.10;Gerrand, 2011,
p. 363; Alderson, 2011, pp. 7.1-7.6; ACMA RTC Inquiry Report, 2011, pp. 23-41; ACMA,
2012;ACCAN, 2012;TIO, 2012) revealed CS and CH as the top two Internet service
issues for ISPs in Australia. CS and CH have been central issues because of the ongoing
poor CS/CH performance of ISPs (2008-2011) (Havyatt, 2010,p.1;Wood, 2010,p.10;
Gerrand, 2011, p. 363; Alderson, 2011, pp. 7.1-7.6; ACMA RTC Inquiry Report, 2011,
pp. 23-41; ACMA, 2012;ACCAN, 2012;TIO, 2012). The consumer association ACCAN
(2012) states “there’s no other industry that has failed customers so comprehensively
over such a long period of time”. The complaints data published by TIO over the period
2008-2011 reported a number of systemic issues involving CS and CH (TIO, 2012). The
systemic CS issues identied (TIO, 2012) are:
• inability of ISPs to deal with a huge inux of calls;
• incorrect information provided at point of sale;
• excessive waiting time;
• misleading claims;
• lack of follow-up action by providers;
• customer frustration in being shifted to various departments when they seek
assistance; and
• lack of customer understanding of services they have purchased.
The systemic CH issues discussed (TIO, 2012) are:
• failure to recognize a complaint;
• failure to inform customers about alternative dispute resolution avenues, such as
the TIO;
• failure to action undertakings;
• failure to direct customers to the right area of the business to resolve complaints;
and
• failure to resolve complaints in a swift manner.
An inquiry into the ongoing poor CS and CH performance of the Internet industry was
launched by the regulator (ACMA) in 2010 (ACMA RTC Inquiry Report, 2011, pp. 23-41).
247
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This inquiry found that the vLISPs failed to meet customer expectations in relation to CS
and CH. Other ndings were:
• the lack of strong enforcement, monitoring and compliance measures in the old
TCP code leading to ISPs regularly breaching the code and not dealing with
systemic CS and CH issues; and
• lack of penalties in the old TCP code leading to providers not prioritizing CS within
their organization.
As a result, the providers were not motivated to review their CS and CH practices to
improve their CS and CH performance (ACMA RTC Inquiry Report, 2011, pp. 30-41).
Samuel (2009) describes the implication of poor CS/CH performance on Australian
consumers and society at large. He states:
The risk is, if this continues, the industry’s reputation with consumers may be irretrievably
damaged. The provision of Internet services is so important to society and the Australian
economy, consumers should be able to trust their providers, receive high quality CS and be
accurately informed about products and services.
This observation underlines how paramount CS is for the industry and its consumers.
3. Literature review
A number of authors have studied the importance of delivering consistent CS
performance for the business survival of ISPs (van der Wal, Pampallis and Bond, 2002,
p. 323; Maxham and Netemeyer, 2002,p.57;Chiou, 2003, pp. 685-690; Kim et al., 2007,
p. 822; Spiller et al., 2007, p. 513; Perez and Flannery, 2009, p. 3,334; Sanchez-Franco et al.,
2009, p. 196; Havyatt, 2010,p.1;Wood, 2010,p.10;Alderson, 2011, pp. 7.1-7.6; Gerrand,
2011, p. 54.1). These studies found that CS performance of ISPs was central to retaining
existing customers, increasing positive word-of-mouth effects and acquiring new
customers. Previous research has found that an institutional perspective can provide a
valuable theoretical framework within which to evaluate the effectiveness of industry
practices (DiMaggio and Powell, 1983, pp. 149-150; Oliver, 1991, p. 145; Suchman, 1995,
p. 577; Gunningham and Rees, 1997, p. 363; Scott, 2001,p.59;Orlikowski and Barley,
2001, p. 145; Hoffman, 2001, p. 133). The top four vLISPs interact with external
stakeholders and collaborate with them on developing/reviewing/revising CS and CH
practices. They are subject to external stakeholder pressures within their institutional
environment. Institutional environment relates to systems of formal laws, regulation
and informal conventions, such as norms that mould organizational behaviour (Scott,
2001, pp. 44-50). Hence, institutional perspectives become relevant in examining
practices of technology based service organizations.
Several authors have applied institutional perspective in IT (Information
Technology) and telecommunications studies. For example, King et al. (1994, p. 139)
studied the role of institutional interventions in accelerating IT innovation in IT
companies. The study revealed that government regulations had signicant inuence
on the organizational behaviour. Avgerou (2000, p. 234) used the institutional theory to
understand the relationship between information systems development and
organizational transformation using a case study of the Mexican oil company Pemex.
Within this study context, the normative pressures inuenced IT innovation
development and implementation. Ang and Cummings (1997, p. 235), Tan and Fichman
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(2002) studied IT adoption in various organizations. The studies revealed the
legitimation strategies (e.g. acquiescence through compliance) used by organizations
when they come under pressure from external constituents. In particular, the
compliance with stakeholder expectations on IT innovation increased when there were
strong coercive pressures from the state.
Silva and Backhouse (2003, p. 294) studied the role of power in the institutionalization
of information systems through a longitudinal in-depth case study. The study found
that once technology is institutionalized within an organization, it is seen as legitimate
by both the people within the organization and those outside. Swanson and Ramiller
(2004, p. 553) studied innovative behaviour in IT organizations (US context). The study
found that coercive, mimetic and normative pressures led to mindless innovation with
IT (instead of exploring new IT innovation, the organization joined the bandwagon of
prior adopters and adopted because others were doing it). This occurred to acquire
legitimacy among the external constituents. Gopal et al. (2005, p. 679) studied the impact
of institutional forces on the software metrics program in the USA. They studied the
inuence of both external and internal institutional forces on the assimilation of
software metrics programs in software organizations. Hu and Huang (2006, p. 225) used
the institutional theory to study the rise and fall of competitive local exchange carriers
in the USA. The institutional forces led to companies adopting similar business models
promoted by their institutional environment resulting in destructive competition. Low
(2010, p. 117) studied institutional isomorphism in Chinese telecommunications market.
In a case study of Nokia China it was found that incremental conformity to regulatory
processes, institutional norms and cognitive meanings within the environment were
important characteristics in studying institutional isomorphism. Such studies conrm
that the neo-institutional theory can offer a valuable framework for analyzing
organizational responses to external stakeholder demands and the legitimation
strategies they use to achieve organizational legitimacy. Hirst (2010) studied
intra-organizational processes of institutionalization involving knowledge management
practices in Australia. The study developed a framework to understand how practices
emerge and become entrenched within an organization.
Lawrence et al. (2002, p. 281) studied the institutional effects of inter-organizational
collaboration and the emergence of proto-institutions and their new practices, rules and
technologies that transcend a particular collaborative relationship. It was a four-year
study conducted in a small non-governmental organization in Palestine. They used
qualitative multi-case, comparative research design. Participants were from different
organizational units in the same organization. The unit of analysis was collaboration
rather than the organization. Hu et al. (2006) studied the role of external inuences on
organizational information security (ISec) practices in the USA. The study focused on
how institutional forces shaped and motivated managers and employees at different
levels and in different ways. Qualitative research using case study was used.
Participants were senior executives of the ISec industry in the USA. Truscott (2007,
p. 2854) used a neo-institutional approach to explore the corporate social responsibility
(CSR) industries, current state of institutionalization through investigation of CSR
practices, products and services, sources of institutional pressures and the strategic
responses to these pressures. Qualitative research using case studies was used.
Participants were key actors from the CSR industry in Australia. Williams et al. (2009,
p. 595) used the neo-institutional theory approach to exploring the drivers of supply
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Internet service
provider industry
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collaboration
chain security practices in the USA. A qualitative research using in-depth interviews
with the supply chain management professionals was conducted. Nurdin et al. (2012,
p. 13) studied the inuence of external institutional pressures and local e-government
adoption and implementation within an Indonesian local e-government context. They
used an interpretive case study approach to understand the external pressures.
Participants were management and technical employees from an Indonesian local
government organization.
Previous studies on organizational practices in IT, information systems,
telecommunications, services industry (Bjorck, 2004,p.4;Hu et al., 2006,2007, p. 153; Hu and
Huang, 2006, p. 225; Lee et al., 2009, p. 397; Krell et al., 2009, pp. 1-5; Major and Hopper, 1954,
p. 205) and other industries (Martin and Sayrak, 2003,p.37;Delmas and Toffel, 2004, p. 209;
Lewis et al., 2013;Okhmatovskiy and David, 2012, p. 155) have shown that:
• organizational practices are inuenced by both institutional and organizational
factors; and
• external stakeholders have a role to play in inuencing co-regulatory industry
practices.
4. Limitations of the current literature
Havyatt (2010, p. 5) describes the nature of the discourse in relation to Internet industry’s
poor reputation for CS as lacking in deep analysis. In the literature there is limited
evidence of institutional perceptions in relation to the CS and CH practices of vLISPs in
Australia. That is, little is known about the perceptions and attitudes of central actors in
external agencies and the top four vLISPs towards CS and CH practices and the key
agencies that inuence those practices. Previous studies have largely neglected the
personal viewpoints of vLISP industry stakeholders in understanding how and why
vLISPs respond to external stakeholder pressures and how pressures drive actors’
actions and confer meaning on such actions. Such perspectives are essential to:
• enrich and supplement knowledge about the role of external stakeholder pressures
in inuencing the CS and CH practices of the vLISP industry;
• identify central actors who inuence the CS and CH practices of the top four
vLISPs;
• understand how and why they respond to external stakeholder pressures; and
• understand the vLISP industry’s responses to competing pressures for
technology, efciency and legitimacy (DiMaggio and Powell, 1983, p. 148, 1991,
p. 5; Hoffman, 1999, p. 351, 2001, p. 133).
Studying the institutional effects is fundamental to informing future CS policy
formulation and developing customer-oriented CS practices that will deliver desired CS
outcomes (Horsley and Gerrand, 2011, p. 15.1). CS will play an important role in future
Internet services, such as National Broadband Network (NBN) (NBN, 2013) which is
currently being rolled out by the Australian Government) (LNP, 2014). A future NBN
environment introduces several CS challenges for the providers because of a mix of
technologies (wireless, copper and bre) that will be used to deliver NBN services and
because of the convergence in and multitude of services provided over the NBN platform
for a variety of industries, such as health, education and retail. Understanding these
emerging challenges for CS and overcoming them has implications for both the CS
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reputation of the industry and the business survival of vLISPs (ACCAN, 2012;NBN,
2013). For detailed information on NBN please refer to NBN (2013).
The main research question investigated in this study is: How do Institutional forces
inuence the CS and CH practices of vLISPs in Australia?
To answer the main research question it was essential to examine inter-organizational
collaboration between stakeholders of the vLISP industry. This led to two research
sub-questions: What led to the collaboration between the institutional actors of the vLISP
industry on CS/CH practices? What do the collaborative efforts of institutional actors of the
vLISP industry tell us about their role in inuencing the CS/CH practices of the industry?
This study focused on the top four vLISPs in Australia providing Internet services to
residential customers. There are reasons for this focus. First, the four vLISPs have high
visibility in the market place (collectively they have 80 per cent of the residential Internet
subscriber base). Second, they collaborate with external stakeholders on the Internet
consumer protection policy formulation. Third, these four vLISPs are subjected to
increased scrutiny in both public and the political sphere when they fail to deliver on
their service promises. Finally, they are board members of external stakeholder
organizations and members of the ISP industry association (Communications Alliance,
2013). Table I provides prole of participants.
5. Theoretical framework: neo-institutional theory
This research is informed by the neo-institutional theory (Meyer and Rowan, 1977,
p. 340; DiMaggio and Powell, 1983, p. 148, 1991, p. 267). The theory posits that
organizations not only strive for technical efciency but also for social legitimacy of
their practices (DiMaggio and Powell, 1983, p. 148). Oliver (1997, p. 699) states that:
[…] unlike economic and strategic frameworks, which examine the extent to which rm
behaviour is rational and economically justied, institutional theorists emphasize the extent to
which rm behaviour is compliant, habitual, unreective and socially dened.
Organizations and the individuals who populate them are suspended in a web of values,
norms, rules, beliefs and taken-for-granted assumptions which specify the forms and
procedures an organization of a particular type should adopt if it is to be seen as a
legitimate organization and as a member in good standing of its class (Meyer and
Rowan, 1977, p. 340; DiMaggio and Powell, 1983, p. 148, 1991, p. 267; Oliver, 1991, p. 145;
Barley and Tolbert, 1997, pp. 93-97; Scott, 2001,p.5;Hoffman, 2001, p. 133). The actors,
whether individual or collective, are rmly embedded in institutional environments. In
such environments, institutionalized rules are based on society’s cultural foundations
and determine the relation between actors and their actions (DiMaggio and Powell, 1983,
p. 148; Tolbert and Zucker, 1983,p.22;Hwang and Colyvas, 2011, p. 62). Further, actors
in an organization can be constrained by institutional arrangements and salient
stakeholder pressures that impact on their choices and constrain their possible courses
of action (DiMaggio and Powell, 1983, p. 148; Scott, 2001, p. 23). The neo-institutional
theory provides a coherent framework for studying institutional inuences on vLISP
industry practices.
The vLISP organizations constantly aim to maintain and increase their legitimacy
among their external stakeholders by responding to pressures that arise from their
institutional environment (DiMaggio and Powell, 1983, p. 148). The three main types of
pressures vLISP organizations are exposed to include the:
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(1) regulatory pressure (enforcement actions by regulator);
(2) mimetic pressure (pressures from competitors excelling in CS); and
(3) normative pressure (pressures that stems from professionalization).
Regulatory pressures is dened as:
[…] pressures exerted on organizations by other organizations on which they are dependent
and by cultural expectations in the society within which organizations function, such
pressures may be felt as force, as persuasion or as invitations to join in collusion (DiMaggio
and Powell, 1983, p. 148).
Mimetic pressure is dened as “when goals are ambiguous (or) when the environment
creates symbolic uncertainty, organizations may model themselves on other
organizations” (DiMaggio and Powell, 1983, p. 149). Normative pressures urges
organizations to conform to societal norms, values and stems primarily through
professionalization (collective struggle of members of a profession to dene the
Table I.
Prole of participants
Topic Description
Prole (P)-Participant
(O)-Organization
Consumer Association (O1): Senior executive of consumer association
representing telecommunication consumers in Australia. Has decades
of experience in CS area (P1)
ISP Industry Consultant (O2): A telecommunications veteran with ⬎
30 years’ experience in working for major telecommunication
companies in the past. Currently provides advice on regulatory
compliance to various ISPs and is involved in industry association
activities (P2)
ISP Industry Association (O3): Senior executive of the industry
association that is responsible for developing the TCP code. Has
decades of experience in the industry and heavily involved in
industry related activities (P3)
Telecommunications Regulator (O4): Regulatory executive involved
in TCP code development and enforcement (P4)
Telecommunications Industry Ombudsman (O5): Ombudsman
executive with extensive experience in handling CS and CH issues.
Manages four functional teams (P5)
vLISP 1 (O6): Regulatory manager of a national ISP based in
Melbourne. Has decades of experience on regulatory affairs. Another
executive assists him in regulatory compliance (P6- Two
participants)
vLISP 2 (O7): Regulatory manager of a national ISP based in
Melbourne. Has ⬎30 years’ experience in regulatory affairs area (P7)
vLISP 3 (O8): Regulatory manager of a national ISP based in Western
Australia. Has ⬎40 years’ experience in the Internet industry (P8)
vLISP 4 (O9): Customer knowledge manager of a national ISP based
in Melbourne. Has several years of experience in dealing with
customer service issues (P9)
Australian Government Department for Broadband (O10): Senior
executive managing the consumer engagement division with
extensive consumer affairs experience (P10)
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conditions and the way work should be organized) (Scott, 2001,p.14;Zhao, 2011,
pp. 23-32). Customer pressure is dened as “force, persuasions or invitations that is
applied both implicitly and explicitly by Customers to which rms must respond”
(Williams et al., 2009, p. 597).
Previous studies (Bjorck, 2004,p.1;Major and Hopper, 2005, pp. 205-210; Gopal
et al., 2005, p. 679; Hu and Huang, 2006, p. 225; Lee et al., 2009, p. 397) in IT, service
management, information systems adoption and telecommunications revealed that
organizations avoid negative sanctions and increased scrutiny by external
stakeholders by responding to pressures and complying with external stakeholder
demands.
For example, Bjorck (2004, p. 1) investigated why the formal security structures and
the actual security behaviour differed on information security (ISec) practices. His work
shed light on why many organizations create and maintain formal security policies
without implementing them fully. It also revealed that the organizations had ISec policy
documents because the institutional forces they were exposed to leading to
organizations developing policy documents that conform to “the prevailing ideas of
what information security policy should ideally entail” (Bjorck, 2004, p. 1). A study by
Major and Hopper (2005, pp. 205-210) of Portuguese telecommunication rm (Marconi)
found that the institutional pressures played a signicant role in the profound changes
that occurred in the company’s accounting system. Several constituents pressured the
company to adopt a prescribed management accounting system. They include the
regulator, European Union (EU), its parent company and the industry consultancies.
The regulatory pressures pressed the EU telecommunications operators to adopt similar
management accounting practices. Major and Hopper concluded that such an adoption
occurred to allow the company “Marconi” to gain social legitimacy for the way its
interconnection prices were calculated. Major and Hopper’s study highlights that the
factors that motivate the telecommunication companies to change their practices are not
purely driven by the efciency demands and that institutional pressure inuenced
changes to the practices. For example, the changes to Marconi’s accounting practices
through the adoption of management accounting system popularized by its main
constituents prevented the business from having its conduct questioned by the
regulator. This is indicative of the organizational response to pressures from external
constituents.
Another central concept related to institutional theory is the organizational elds
Scott (2001, p. 5) denes organizational elds as “a collection of varying types of
organizations, their suppliers, customers, and regulators that are formed around a
common issue”. The eld acts as a common channel for dialogue and discussion on the
focal issue and brings various eld constituents with disparate purposes together. The
organizational eld is formed by organizations intensively involved in the debate on
the focal issue and are concerned with the production and reproduction of specic set of
practices related to the focal issue. These practices then become a part of the
institutional arrangement and the institutional actors who share the same
organizational eld adopt similar practices. In the vLISP industry, this refers to
stakeholders who are involved in the CS/CH debate and contribute to development,
adoption and implementation of CS/CH practices.
Past studies have highlighted the role of collaboration in the development of
organizational elds (DiMaggio and Powell, 1991,p.14;Gray, 1985, p. 911; 1989,p.
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34; Wooten and Hoffman, 2008, p. 130; Lawrence et al., 2002, p. 281). Collaboration is
dened as “a co-operative relationship among organizations that relies on neither
market nor hierarchical mechanisms of control” (Phillips et al., 2000, p. 23).
According to Phillips et al. (2000, p. 23), inter-organizational collaboration involves
“sets of negotiations that are demanded by the lack of predened institutional roles
that accompany market- and authority- based relationships”. Phillips et al. (2000,p.
23) argue that collaboration “facilitates the emergence of inter-organizational
networks, structures of domination and the production and reproduction of
institutional rules and resources, all of which lead to the structuration of
institutional elds”. The participants need to be convinced to act even though there
is no formal authority demanding their cooperation.
Previous studies (Oliver and Montgomery, 2008, p. 1147; Anand and Watson, 2004,
pp. 59-64; Garud, 2008, p. 1061; Lampel and Meyer, 2008, p. 1,025; Hardy and Maguire,
2010, p. 1,365) on emergence of organizational elds identied events that triggered
processes that drive the organizational eld evolution. These events are called as eld
conguring events (FCEs). FCEs are “temporary social organizations such as
tradeshows, professional gatherings, technology contests, and business ceremonies that
encapsulate and shape the development of professions, technologies, markets and
industries” (Lampel and Meyer, 2008, p. 1,025). For example, FCEs, such as industry
forums, working groups/committees, provide unique social space for institutional actors
from diverse organizations to:
• assemble and explore central issues;
• build collective understanding of problem;
• mobilise collection action on problems; and
• work collaboratively towards establishing an organizational eld (Meyer et al.,
2005, p. 456).
The FCEs in the vLISP industry were:
• TCP code review steering committee meetings;
• TCP code review working committee meetings;
• consumer association annual conferences 2009-2011;
• industry ombudsman board meetings;
• industry ombudsman campaigns;
• regulator customer inquiry;
• regulator consumer consultative forums; and
• ISP industry association board meetings.
Neo-institutional theory provides a solid platform to:
• identify central institutional actors who inuence the CS/CH practices of vLISPs;
• understand the role of regulatory, customer and competitive pressures in
inuencing CS/CH practices of industry;
• understand how and why vLISPs respond to pressures, given that they thrive for
legal legitimacy through regulatory compliance;
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• identify and validate any signs of emerging organizational elds based on
frequent and fateful interactions of institutional actors during 2010/11 to
collaborate on CS/CH issues of the Internet industry; and
• study how such emerging organizational elds can transform into mature
organizational elds and inform future CS practices (DiMaggio and Powell, 1983,
p. 148; Hoffman, 1999, p. 351).
Such perspectives cannot be gained using other theories, such as the legitimacy theory,
the rational actor theory, the network theory and the stakeholder theory.
6. Research methodology, data collection and data analysis
A qualitative research methodology using the semi-structured interview method was
used in this study. The quantitative approaches are not suitable for this research
because:
• this research does not wish to measure variables using scales or rating;
• statistical signicance and variance are irrelevant for answering the research
question(s) under study;
• probing of participant responses (not supported by quantitative approach) is
critical to generating rich description and understanding of the problem area; and
• quantifying relationship between variables or studying or measuring
developmental changes is not the intention of this study.
Semi-structured interviews provide several opportunities for both the interviewer and
the interviewee to have detailed discussions on the research topic. It allows the
interviewer to probe if the interviewee provides only a brief response to the questions.
This will assist in obtaining further explanation and clarication of interviewees’
responses thereby adding signicance and depth to the data obtained (Warren, 2002;
Rapley, 2004,p.15;Rubin and Rubin, 2005). Semi-structured interviews are appropriate
for collection of information such as participant’s attitudes, perceptions and reections
on their experiences (Boyd, 2001;Groenewald, 2003;Creswell, 2007;Flick, 2008). It
provides interviewees with an opportunity to think aloud about the matters that they
may not have previously thought about or considered (Hermanns, 2004, p. 209).
Semi-structured interviews are a favoured method of data collection in qualitative
research (Marton and Booth, 1997). Overall, the exibility offered by semi-structured
interview as a data collection method enables collection of a rich and detailed set of data
(Robson, 1993). In relation to the development of the interview questions, Patton (2002)
states:
[…] your interview questions should be judged not by whether they can be logically derived
from your research question, but by whether they provide the data that will contribute to
answering these questions.
This highlights the need for researchers, as best as they can, to anticipate how the
interview questions will work in practice (Berg, 1998). When interview questions were
developed I ensured that they were related to the research topic of interest in a broad
sense and open-ended (so other questions can emerge based on the interviewee’s
responses). The questions were ne-tuned depending on the stakeholder being
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interviewed. I collected the data as a sole researcher using semi-structured interviews. A
convenient location, date and time for the interview were scheduled in consultation with
the participant. The interview duration varied between 50 and 80 minutes.
Approval from the university human research ethics committee for interviews was
obtained. From 10 key stakeholder agencies,11 senior executives were interviewed
between November 2011 and November 2012. Purposive sampling was used in this
study. Participants were selected based on the information available through ISP
websites, ISP industry association website and government agencies. Participants had
experience ranging from 7 to 40 years in dealing with CS issues, regulatory affairs and
were the point of contact between their organization and external stakeholders.
The data analysis stage involved coding of all interview data collected during the
study (manual coding). Coding occurred concurrently, as the data were being collected
from different stakeholders. Coding involves deriving and developing concepts from
data (Corbin and Strauss, 2008). A concept represents groups or classes of objects,
events and actions that share some major common properties (Silverman, 2006;Corbin
and Strauss, 2008). Categories are group of concepts identied from data pertaining to
the same phenomena (Strauss and Corbin, 1998). Several tasks were undertaken during
each coding phase and iteration using qualitative data analysis techniques and
guidelines described by Strauss and Corbin (1998).
First, the interviews were transcribed and phrases of interview data were grouped as
data chunks. At the rst level of coding, these data chunks were assigned a code. The
process was repeated for all the interview data and interviews. Then, a list was compiled
including all the codes and the chunked data to obtain an overall consolidation of the
codes. This led to sub categories. The tasks that were undertaken during this stage
include naming, labelling, concept coding and description of the different dimensions
and properties of each coded sub category. At the second level of coding, the links
between the categories and the relationship between similar categories were analysed.
Detailed notes/memos were written to determine if they belonged together under a
higher level category, referred to as minor category in this study. At the third level of
coding, further analysis of the minor categories that emerged during the second level of
coding and their relationship to each other resulted in re-grouping of minor categories
under a higher level category label, referred to as major category in this study.
Microsoft’s Excel software program and Microsoft Word’s notes tool were used for
recording, analysing and studying major, minor and sub-categories and themes. In this
research, a major category comprises one or more minor categories. A minor category is
comprises one or more sub categories. Drawing from my understanding of the
relationship amongst categories and sub-categories broad themes emerged under which
the major categories could be grouped (please see Figure 1). A theme is dened as an idea
or a common meaning that runs through an identied chunk of data. Six key themes
emerged during this process.
7. Major research ndings
Theme 1: perceptions and attitudes of key institutional actors in external agencies
towards the CS/CH practices and the external stakeholder pressures that inuenced
those practices
All external stakeholders interviewed in this study identied CS and CH as the top two
Internet service issues. The key CS/CH issues that the industry stakeholders raised
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revolved around issues, such as contactability, receiving incorrect and inaccurate
information about products and services, failure by providers to follow up on
complaints, failure to action undertakings, failure to resolve complaints in a swift
manner and increased focus on improving the internal CH mechanisms rather than
avoiding the complaints in the rst place. The poor CS/CH performance was attributed
to several reasons. They are:
• inability of the old TCP code in dealing with emerging consumer issues;
• complexity of products and services;
• rapid increase on rates of services growth;
• lack of strong enforcement and monitoring in the old TCP code;
• vLISP increased focus on technical aspects of services as opposed to CS and CH;
• customer inability to understand new technologies and how best to utilize them;
• lack of commitment of senior management in vLISPs to prioritize CS;
Data Grouping
Interviews
transcribed
Phrases are grouped
as ‘chunks’
Coding Stage 1
Thematic analysis
begins
Interview data
assigned labels using
codes against data
chunks
Process repeated for
all the interviews
Result: Compilation
of sub categories
Coding Stage 2
Grouping of chunked data
using principles of
thematic analysis
Studied the links between
the sub categories
Grouped the sub categories
to create minor categories
Grouping of sub categories
using detailed notes written
to provide justifying such a
grouping
Result: Compilation of
minor categories
Coding Stage 3
Analysed minor categories for
relationships with each other
resulted in regrouped categories
that could be classified under
higher level Major category
Result: Compilation of Major
categories
Emergence of Themes
Studied the Major categories and
their relationship with each other
Identified broad Themes which
will fits the associated Major,
Minor and sub categories
Thematic analysis ends
Result: Compilation of Themes
Source: Strauss and Corbin (1998)
Figure 1.
Coding process used for
data analysis in this study
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collaboration
• failure of vLISPs to engage in activities that broaden understanding of consumer
affairs; and
• failure to focus on avoiding complaints rather than dealing with them.
The CS/CH practices of the vLISPs are developed through the collaborative efforts of
central actors in the consumer association, the regulator, the industry ombudsman, the
government department for broadband, the ISP industry association and the four
vLISPs. The increased regulatory activities, real threat of tighter regulation and
continuous exposure to regulatory pressures combined with customer and competitive
pressures in the recent past (2010/11) led to vLISPs paying more attention to the external
stakeholder CS/CH concerns and acceding to their demands in addressing shortcomings
in the old TCP code. The collective pressures exerted by the external stakeholders led to
increased collaboration and engagement between the vLISPs and external stakeholders.
This led to signicant changes in the revised TCP code with a clear focus on achieving
desirable CS/CH outcomes for consumers.
Theme 2: perceptions and attitudes of regulatory managers of vLISP organizations
towards CS/CH practices and the institutional pressures that inuenced those practices
The study identied ve key factors that inuence the adoption and implementation of
CS/CH practices in vLISPs. They are:
(1) TCP Code (ability of code to deal with emerging or new consumer issues);
(2) penalties and enforcement mechanism in the code (regulatory compliance with
the code);
(3) competition politics (providers excelling in CS pressuring other providers to
improve their CS/CH performance);
(4) complexity of products and services (vLISPs’ ability to deal with CS issues while
selling new products and services has implications on their CS/CH performance
because of complaints that arise); and
(5) organization culture and attitude towards CS/CH practices (vLISP senior
management attitude towards prioritizing CS is based on whether they view
investment in CS as a prot factor as opposed to a cost factor).
The perceptions and attitude of the regulatory managers of vLISPs in adopting and
implementing the CS/CH practices is inuenced by their formal and informal
interactions with the institutional stakeholders of the vLISP industry, institutional
pressures (regulatory, mimetic and customer) they are exposed to, their perception of
pressures and their organizational culture and attitude towards CS/CH practices. The
response to the pressures depended on who exerted the pressure and under what
circumstances those pressures were exerted.
Theme 3: level of interaction of individual stakeholders with one another in relation to
CS/CH practices and the role such interactions played in inuencing the CS/CH
practices of the vLISP industry
The central actors from various stakeholder agencies met frequently and fatefully and
collaborated during various eld-conguring events (FCEs) to develop revised CS/CH
practices. The engagement between various stakeholders occurred using both formal
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(example, face-to-face) and informal communication channels (e.g. email, telephone). These
FCEs brought actors together to build collective understanding and mobilize collective
action on CS/CH issues. They acted as key venues for collaboration between actors and laid
the foundation for organizational eld emergence. The FCEs provided institutional actors
with opportunities to get involved in dening the CS/CH practices and setting standards in
relation to the CS/CH performance. The deep interactions, information ow and embedded
collaborations between the institutional actors of the vLISP industry on CS/CH practices
resulted in signicant revision to the CS/CH practices in the revised TCP code. The
signicant changes include the establishment of independent compliance committee to
oversee code compliance activities, mandatory compliance attestations for large players
certied by an external assessor, tighter timeframes for complaint acknowledgement and
resolution, obligations to advise customers of complaint outcomes and the provision of
clearer information about products and services at the point of sale. For additional
information, please refer to Communications Alliance (2013).
Theme 4: institutional pressures and their inuence the CS/CH practices of the top
four vLISPs
The institutional pressures that inuenced the CS/CH practices of the vLISPs are regulatory,
customer, mimetic (competitive) and normative pressures. The CS/CH practices of the vLISP
industry are institutionally derived practices developed through the collaborative efforts of
the central actors interviewed in this study. The increased collaboration, co-operation,
dialogue and discussion on addressing CS/CH concerns in the old TCP code (TCP code 2007)
occurred as a direct result of the regulatory pressures combined with customer and
competitive pressures. Regulatory pressure was the dominant pressure in inuencing the
attitude of the vLISPs towards CS/CH practice improvements.
Theme 5: collaboration between the institutional actors of the vLISP industry on CS/
CH practices
What led to the collaboration between the institutional actors of the vLISP industry on
CS/CH practices? The four vLISPs came together to address the CS/CH concerns of
external stakeholders due to increased regulatory activities, collective pressure from
multiple constituents and fear of tighter regulation. Collective rationality among these
vLISPs occurred to deal with the CS/CH issues and demonstrate their genuine
commitment to improve the CS reputation of the industry. The central actors from
various stakeholder agencies met frequently and fatefully and collaborated during
various FCEs to come up with the revised CS/CH practices. The frequent interactions,
embedded collaboration and information exchange between the institutional actors of
the vLISP industry have led to emergence of organizational elds. The emerging
organizational elds comprises key actors from various stakeholder agencies who
inuence the CS/CH practices of vLISPs.
What do the collaborative efforts of institutional actors of the vLISP industry tell us
about their role in inuencing the CS/CH practices of the industry?
The criteria for organizational eld emergence derived from the institutional theory
of organizational eld development literature (DiMaggio and Powell, 1983, p. 148;
Lawrence et al., 2002, p. 281; Maguire et al., 2004, p. 657) are: indication of increased level
of collaboration on a focal issue, increased density of inter-organizational contacts and
increased ow of information amongst central actors. Analysis of study data and
259
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collaboration
ndings demonstrate that these organizational eld emergence criteria were met
(Vilapakkam Nagarajan, 2013, p. 15). Two emerging organizational elds (one focused
on CS/CH practices formulation and denition and other on CS/CH adoption and
implementation) were identied in this research. Emerging organizational eld 1
comprises all external stakeholders and four vLISPs. Emerging organizational eld 2
comprises the industry association actor and regulatory managers in four vLISPs
(please see Figure 2). The actors of the emerging organizational eld 1 and 2 are actively
involved in determining CS/CH practices, its implementation, monitoring/enforcement,
reporting and as a result agreeing to acceptable levels of CS/CH performance.
Given that the vLISPs are exposed to continuous exogenous shocks due to regulatory
developments and technological growth (NBN, 2013), there is an ongoing commitment by
regulatory managers of four vLISPs to express their collective interests on regulatory
arrangements, maintain good relationship with external stakeholders and seek their active
support to inuence CS/CH practices of the vLISP industry. The intensication of
collaboration amongst the actors to handle CS/CH challenges both now and in the future will
fuel further eld development (DiMaggio and Powell, 1983, p. 148; Lawrence et al., 2002,p.
281). Such eld development will inform future CS/CH and consumer protection policy
arrangements for the vLISP industry. Hence, there is a need to study the organizational eld
development over a long -term from its “emerging” to “mature” state to understand the
institutional work central actors engage in and structuration of the organizational eld. The
signicance of a long-term study of these emerging organizational elds and their
development contributes to both the understanding of the structuration of organizational
elds in the Australian Internet industry as well as assessment of the implications such
emerging and mature organizational elds bring to Australian Government consumer
protection policy formulations and future directions for the Internet services in Australia.
Theme 6: the role of institutional forces and their inuences on CS/CH practices of the
vLISPs
There are key agencies (the regulator, the industry ombudsman and the ISP industry
association) and central actors (central actors from external stakeholders and the four
vLISPs) that operate in the institutional environment of vLISPs who inuence the
Figure 2.
Two emerging
organization elds in the
Australian vLISP
industry
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development, adoption and implementation of the industry’s consumer code for CS/CH
practices. Findings point to regulatory pressure as the dominant institutional pressure
in comparison with mimetic and normative pressures operating in the vLISP industry.
The regulatory managers from the top four vLISPs responded to external pressures
because of increased regulatory activities over the past few years, pressures from
multiple constituents to address CS/CH shortcomings and the real threat of tighter
regulation. Their response to such pressures is dependent on the institutional demands
of stakeholders, source of the institutional pressures and under what circumstances
such pressures were exerted. An issue-based coming together of the institutional actors
occurred as a direct response to collective pressures placed on vLISPs by multiple
stakeholders. This led to increased engagement, collaboration and negotiations between
the regulatory managers of vLISPs and external stakeholders in recent times to address
shortcomings in CS/CH. Such frequent and fateful interactions amongst the institutional
actors of the vLISP industry has led to signicant CS/CH improvements in the revised
TCP code in areas such as code compliance, enforcement, CH, billing and point-of-sale
matters. The extensive evidence of collaborative work by central actors during the code
review/revision demonstrates the need for industry wide input to address CS/CH
problems. This re-emphasizes the notion of central actors acting as active agents in
informing the CS/CH practices of the vLISP industry. Therefore, CS/CH practices of the
vLISP industry are institutionally derived practices.
8. Contributions of this research
The study found that institutional pressures inuenced vLISP organizational actions
thereby providing fruitful insights into the institutional factors that drive vLISP
organizational actions. The signicance of the institutional pressures in inuencing
organizational action in relation to CS/CH was studied through various actors’
perspectives by reecting on and analysing their actions in dealing with such pressures.
An important empirical nding was that there is an interplay between institutional
pressures that inuenced the top four vLISP organizational actions. This is an area that
has not been studied before, yet it is important to understand what drives organizational
actions on CS improvements. Using a qualitative approach, this research study has
contributed to providing valuable insight into how institutional pressures drive actors’
actions and attribute meaning to such actions. Further, contribution to the literature on
institutional pressures also occurs by examining the external stakeholders that exert
institutional pressures on the top four vLISPs and how such pressures inuence CS/CH
practices. This is important, given the scant literature on external stakeholders that
exert institutional pressures on the top four vLISPs and their role in inuencing the
industry’s CS and CH practices.
The study established that CS/CH practices of the vLISP industry are institutionally
derived practices based on collaboration among various vLISP industry stakeholders.
An evidence-based approach was used to understand and explain how and why
institutional actors of technology-based service organizations, such as ISPs, act
together. A signicant contribution arising from this study is the identication and
discussion of emerging organizational elds comprising the central actors in the vLISP
industry. These emerging organizational elds have the potential to develop into
mature organizational elds and inform future CS practices and consumer protection
policies in the Internet industry in Australia. Such mature organizational elds exert
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“powerful forces” on individual vLISP organizations and the inuence the “structure
and behaviour” of the organization (DiMaggio and Powell, 1991, p. 267). This study
identied opportunities to conduct longitudinal studies of emerging organizational
elds in the Australian vLISP industry. This contribution also enables comparison
studies in the future both within Australia and internationally to study institutional
inuences on Internet industry practices. Further, country specic studies, such as this
study, provide useful and detailed insights, as it informs how future research studies
outside Australia can use neo-institutional lens to study similar technology-based
service industry practices. In Australia, research focused on studying emerging
industries using the institutional theory is still limited (Truscott, 2007, p. 2,854),
although some studies have been conducted (Clegg et al., 2007, p. 495). This study is a
step forward towards lling this void.
9. Conclusion
This paper showed that the CS/CH practices of the vLISP industry in Australia are
institutionally derived practices developed through the collaborative efforts of
regulatory managers of the four vLISPs, the regulator, the industry ombudsman, the
consumer association, the ISP industry association and the government department for
broadband. These stakeholders have established embryonic organizational elds
(“emerging”) of regulatory managers and other stakeholders which on growth to a
mature organizational eld is likely to inform government and industry policymaking
for future directions with regard to usage and provisioning of Internet services in
Australia. The signicance of a long-term study of these emerging organizational elds
and their development contributes to both the understanding of the structuration of
organizational elds in the Internet industry as well as assessment of the implications
such emerging and mature organizational elds bring to Australian Government policy
formulations and directions for the Internet services in Australia. A useful outcome for
the society from this research is when the longitudinal study of organizational eld
development can generate evidence that when all institutional stakeholders of the vLISP
industry continue to collaborate and engage with each other frequently and fatefully on
a focal issue to improve the CS/CH practices and CS/CH performance of the industry,
there is noticeable progress towards development of customer-oriented CS/CH practices
that will contribute to a better CS experience.
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About the author
Karthik Vilapakkam Nagarajan is a telecommunications engineer and holds a research degree in
ICT from University of Wollongong. He has ⬎12 years of collective experience in research,
management, coordination and teaching in ICT and Business at 4 Australian Universities. In
2011/2012, he was involved in a collaborative research project titled “Accessible Communications:
Tapping the potential in public ICT procurement policy” between University of Wollongong and
the peak Internet industry consumer association in Australia. His research interests include
telecommunications consumer protection policies, institutional theory, technology-based
service industries and ICT accessibility. His latest research project investigated the role of
institutional pressures in inuencing the CS and CH practices of the Australian Internet
industry. Karthik Vilapakkam Nagarajan can be contacted at: vnkarthiklallu@yahoo.com
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