Designing Trustworthy Interorganizational Trade Procedures for Open Electronic Commerce

Electronic data interchange currently involves high relationship-specific investments that limit its application to "closed-trading relationships." When electronic data interchange is applied in a more open context, parties will have to be able to rely on interorganizational procedures that control the risks involved in trading with untrusted parties. These procedures have to be audited to identify potential control weaknesses and the resulting fraud potential, including the risks associated with the communication medium used to support the execution of these procedures. This article presents the first steps toward establishing a theory on the auditing of interorganizational trade procedures. The need for a further rationalization and formalization of interorganizational procedures is stressed. An initial set of generic principles for interorganizational trade procedures is presented. The article shows how this theory could be supported using an automated tool, and it demonstrates how this analysis process is conducted automatically. Finally, conclusions and some future research directions are given.