ABSTRACT
Anchored at the knowledge management perspective, we address how information and communication technology (ICT) improves the productivity of emerging economy enterprises. We present the logic that ICT enhances firm performance because it is an important channel or facilitator of effective knowledge sharing and knowledge integration. We further argue that the conditions characterizing an emerging economy (i.e., a country’s economic development) and emerging economy businesses (i.e., internationalization and quality assurance) would affect the extent to which ICT contributes to knowledge management, and thus to firm performance. Our hierarchical linear modeling analysis of 6236 firms from 27 emerging economies lends support to our arguments and predictions, suggesting that ICT is a critical investment that generates satisfactory returns for emerging economy enterprises, yet this investment–return relationship is further contingent upon the macro- and micro-level conditions facing these enterprises. ICT actually adds more value to productivity when a focal emerging economy is less economically developed, and when a focal firm reaches foreign markets or its quality control and assurance is superior.
Parallel to the above trend, research on ICT has begun to forge ahead in recent years. Prior studies looked at ICT conceptually, often through a resource-based view, contending that firms can and do differentiate on the basis of their ICT resources, which then create firm-specific capabilities and contribute to sustained competitive advantage (Bharadwaj, 2000; Melville, Kraemer,& Gurbaxani, 2004; Mithas,Ramasubbu,&Sambamurthy,2011;Ray,Muhanna,&Barney, 2005). Empirical efforts, though limited, have shown that ICT improves a firm’s Tobin’s q (Bharadwaj, Bharadwaj, & Konsynski, 1999) or profit ratio (Santhanam & Hartono, 2003) and can leverage firm-specific assets in the process of international diversification (Chari, Devaraj, & David, 2007). Most extant empirical studies emphasized U.S. firms and relied heavily on data collected from U.S. sources. For example, awidelyused source is InformationWeek’(IW) 500 annual survey of chief information executives of U.S. firms.
