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Whether firms can improve performance by allocating financial resources for information and communication technology (ICT) is an important question in strategic management and information systems literature (Porter, 2001; Kohli & Devaraj, 2003; Melville, Kraemer, & Gurbaxani, 2004; Teece, 2007). ICT adoption has drastically modified communication, sales, and information methods (Lapierre & Denier, 2005), thus enabling firms to achieve strong competitive advantage over its peers. Consequent to the beneficial reports of ICT adoption, few studies also started to investigate the barriers to ICT implementation (Bugamelli & Pagano, 2004; Knockaert, Spithoven, & Clarysse, 2010). However, much of this research focuses on traditional multinationals from the advanced world (aMNCs) (Fabiani et al., 2005; Hollenstein, 2004; Morgan et al., 2006), thereby leaving out the ‘new’ multinationals from emerging markets (eMNCs) – many of whom had effectively deployed ICT in their business processes to become successful global corporations in last two decades (Dohse, Hassink, & Klaerding, 2012; Beerepoot & Roodheuvel, 2016). For instance, the remarkable performance of BAT (standing for Baidu, Alibaba and Tencent), epitomizes the rapid transformation of the Chinese technology sector from mere imitator to innovator (Demirkan, Yang, & Jiang, 2019). Such attention is warranted because eMNCs face unique institutional conditions in their home environment and have resource limitations, which can affect how substantively they adopt these new and emerging ICT technologies in their business models.
Given the limited empirical research on ICT adoption by eMNCs, our research will focus on the role of the various organizational factors on ICT adoption of eMNCs from a big and important emerging market - India. With 451 million monthly active internet users at end of financial year 2019, India is now second only to China in terms of internet users, according to a report by Internet and Mobile Association of India (Mandavia, 2019). According to Google.Inc’s recent report, “On an average India adds 40 Million internet users on a Year-on-
Year basis, which is among the fastest in the world. An Indian subscriber now has an average 8GB per month mobile data usage which has reached levels of developed markets” (Agnihotri, 2019). The Indian Government, through their ‘Digital India’ programme has encouraged the development of digital infrastructure, improving digital literacy and increasingly providing online services to citizens, and has made it a top strategic priority, as an enabler of competitive advantage within the economy. Indian eMNCs, across sectors are focusing on digital transformations by adopting new and emerging technologies such as social media, mobility, analytics and cloud, artificial intelligence etc.
At the same time, ICT adoption requires agility and flexibility within the organization, significant resource commitments and has inherently uncertain performance consequences (Melville et al., 2004; Liang, You, & Liu, 2010). As institutional and competitive pressures are constantly evolving in emerging markets (Hoskisson, Eden, Lau, & Wright, 2000); not all eMNCs are in the same phase in the life cycle and embedded in their business environment (Helfat & Peteraf, 2003). eMNCs that are less embedded, path-dependent in their business approaches can embrace these new technologies to adapt themselves to today’s dynamic competitive reality. For older eMNCs, unlearning their existing ‘ways of doing business’ (Barkema & Vermeulen, 1998), becomes increasingly difficult as they age, due to the increasing cognitive, political, relational barriers and organizational inertia (Autio, Sapienza, & Almeida, 2000). This led us to enquire whether eMNC age acts as an impediment to higher investments in ICT technologies or not.