Firm Adoption Research Articles

What determines the technology adoption of firms under optimal tax?

Technology adoption in a Cournot duopoly under optimal tax is studied. A benchmark model of laissez-faire economy shows that the chance of adoption increases in market size, a result ubiquitous in the paper. With optimal subsidy, adoption is more likely than in the laissez-faire economy. The chance is even higher if firms make adoption decisions before the government sets the tax rate. Negative externality of the commodity lowers the chance of adoption under optimal tax, but not below that in the laissez-faire economy unless the government moves first and the market is too small. However, if the new technology is clean, the chance of adoption can be significantly improved, even when the externality is only partially remedied. Moreover, a clean technology is more likely adopted than a technology without externality issue when the market is sufficiently large.

What Determines Principle-Based Standards Implementation? Reporting on Global Compact Adoption in Spanish Firms

International Accountability Standards have proliferated in the last 20 years, with the UN Global Compact (GC) as the most widely accepted principle-based standard catalyzing voluntary participation by firms. This study aims to improve understanding about the factors that determine companies’ progress in adopting principle-based standards. Drawing on the resource-based view of the firm, we examine the direct and combined influences of different organizational resources (firm-specific resources, innovative capability, length of participation, and internationalization of the firm) on standard implementation as perceived by 213 Spanish GC signatories. Our results reveal that the level of firm-specific resources has a positive effect on the extent of GC principles implementation and that innovative capability and length of GC participation strengthen this effect. Contrary to our expectations, we find that the internationalization of firms does not have an effect on GC principles implementation. We discuss the implications of these findings for scholars and practicing managers.

IFRS Adoption, Reporting Incentives, and Earnings Quality in Private Firms

The effects of IFRS adoption in public firms have been extensively studied, but the private firm setting still remains underresearched. This study examines financial reporting quality effects around IFRS adoptions of German private firms across two dimensions, earnings quality and disclosure practices. To capture differences in the perceived net benefits of higher financial reporting quality, we identify four different types of firms based on a comprehensive set of firm characteristics. We observe earnings quality improvements around IFRS adoptions primarily for one type of firms, which are young, fast growing and seeking access to public equity markets. Using a matched sample of German GAAP and IFRS reporting firms, we find some evidence suggesting that IFRS also contribute to higher earnings quality. Recognizing that our earnings quality metrics are incomplete measures of reporting quality, we additionally compare IFRS and German GAAP firms’ disclosure practices. We find that IFRS private firms are generally more likely to publish financial reports on their website and they disclose significantly more information in their financial reports. Collectively, our findings provide novel insights into the role of IFRS adoption in the private firms setting.

Adoption, Adaptive Innovation, and Creative Innovation Among SMEs in Malaysian Manufacturing

We categorized innovating firms in an ascending order as adopters, adapters, and creators to examine factors motivating these activities. For small firms, creation and adaption were significantly correlated with export orientation, engaging in collaborative research and development (R&D), receiving technical support from outside agencies, gaining technology from parent establishments, and supplying parts to multinationals. For medium-sized firms, R&D incentives, collaborative research, and accessing technology from parent plants were significant. Adoption in small firms was associated with export exposure and operating for 11 years or more. R&D incentives, collaborative research, and technology transfer from parent plants were negatively related to adoption in medium-sized firms.

Perceived voluntary code legitimacy: Towards a theoretical framework and research agenda

AbstractIncreasingly within industries voluntary codes (standards) are being developed and subsequently used by firms to address social and environmental issues. On any particular issue multiple competing codes may be available for adoption by firms. Given a choice of codes, which ones will firms adopt? Building on existing institutional and economic research pertaining to voluntary codes this paper proposes a theoretical model as to why some codes are perceived as legitimate by firms and hence are widely adopted while others are not. This model proposes that, in addition to the role of the code's content, the characteristics of the adopting firm, and environmental factors, the origins of a voluntary code, including the characteristics of the developer creating it, the development process, and the opportunity for firms to engage in formalized ‘normative conversations’ regarding the code subsequent to its adoption, will influence whether potential firm adopters perceive the code as legitimating and hence decide to adopt it. Rather than code adoption simply reflecting institutional mimicry or a rational transaction by adopting firms this model suggests that both the creation and the maintenance processes surrounding codes play important roles in the perceptions of legitimacy and subsequent adoption of codes by firms.

The Extensiveness of Corporate Social and Environmental Commitment across Firms over Time

Corporate social commitment (CSC) and corporate environmental commitment (CEC) are often combined under the general rubric of corporate social responsibility. Although the two sets of activities are similar, they are also very different. Both CSC and CEC respond to issues raised by stakeholders, but CEC tends to be more “technical”. This characteristic demands that CEC fit with the organization, which exposes greater economic opportunities than CSC. As a result, we argue that the extent to which these practices are implemented differs across firms over time. We analyze the extensiveness of implementation of CSC and CEC across 266 firms from 1991 to 2003, using latent growth curve modeling and one-way ANOVA. We find that firms moved towards at least a moderate level of CSC over time, but tended to bifurcate in the extent to which they implemented CEC practices, towards either the high or low end of the scale, over time. In this paper, we contribute to the institutional analysis of practice diffusion by examining how the characteristics of different kinds of practices shape the extensiveness of firm adoption patterns. As well, this research also speaks to corporate social responsibility researchers, pointing to the need to sometimes discriminate between social and environmental practices.

The thin red line between success and failure: Path dependence in the diffusion of innovative production technologies

The wide variation in the success of innovations obscures similarities in the process of firms being influenced by other firms when choosing production technology. We argue that diffusion processes are similar across successful and failed innovations. Production asset innovation success results not only from innovation quality differences—early chance events and subsequent path dependence are also intrinsic to diffusion processes. Thus, diffusion processes do not reliably spread the best innovations, producing competitive advantage for firms with an early lead producing innovations and firms adopting high‐quality innovations. We test these predictions quantitatively by analyzing the diffusion of the DC‐10 and L‐1011 airplanes, and find support for our theory linking the social information provided by firm adoptions to the success of innovative production technologies. Copyright © 2014 John Wiley & Sons, Ltd.

Policy Perspective Analysis of Technology Adoption in Industries

Technology innovation offers new paradigm for economic development in the globalized world. Business sector role is significant for the development of the country. Technology adoption is very critical and risk taking decisions for the firms. Firms require greater experience and investment for undertaking technology adoption decision. This paper demonstrates the trend of technology adoption in firms of developing countries and explores industrial landscape features. The case study of Pakistan is used for analysis, it represents the developing country of Asia. The paper used the content analysis method. The key points extracted by using the Socio-economical development indicators. This study is twofold. First highlights the problems and second identify the best strategies for adoption of technology in firms by the government.

Individual and Corporate Decisions to Adopt Social Media: Perception of Risks and Benefits in Small Firms

Social media adoption of small firms has increased over time, but only little is known why firms engage in or deny the use of digital technologies. Using a survey of 268 small Swiss firms, this study identifies the determinants of social media adoption of small firms. Exploratory factor analysis identifies three relevant drivers: perceived risks, perceived usefulness, perceived ease of use. Logistic regression analysis reveals heterogeneous effects. Perceived risks is the main factor deterring executives in small firms from social media activities. Also, perceived usefulness and age of the responsible executive are good predictors for social media adoption, while in contrast age of the firm and perceived ease of use show no effect. The implications for research on small firms and social media are discussed.

Drivers of information and communication technologies adoption in Colombian services firms

This paper analyses the determinants of ICT adoption in Colombian services firms using micro-level data. It contributes to the scant literature on the determinants of ICT adoption at firm level in emerging economies. Due to ICT heterogeneity, different econometric models are estimated to identify the drivers of ICT adoption. The results show that the factors that positively influence ICT adoption are the proportion of foreign capital, firm age, employees' education and the ICT spillovers from the corresponding service industry. Information spillovers from the service industry adopters to non-adopters are taken into account as determinants of ICT adoption. An extended version of the model explores the determinants of ICT adoption comparing large firms and SME. For some variables, such as proportion of foreign capital, firm age and employees' education, the results differ by firm size.

The Decision of Small Firms to Adopt Social Media: Perception of Risks and Benefits

Social media adoption of small firms has increased over time, but only little is known why firms engage in or deny the use of digital technologies. Using a survey of 268 small Swiss firms, this study identifies the determinants of social media adoption of small firms. Exploratory factor analysis identifies three relevant drivers: perceived risks, perceived usefulness, perceived ease of use. Logistic regression analysis reveals heterogeneous effects. Perceived risks is the main factor deterring executives in small firms from social media activities. Also, perceived usefulness and age of the responsible executive are good predictors for social media adoption, while in contrast age of the firm and perceived ease of use show no effect. The implications for research on small firms and social media are discussed.

Technology Adoption and Trademarks

Technology adoption in Industries and firms is the current quest. Business sector growth is the current quest in the global market. Intellectual Property (IP) rights data is the indicator for the research and development in the business sector. Patents have gained attraction as indicator by researchers to analyses technology adoption, Research and Development (R & D) and the economic growth. However, trademark is relatively new concept to use it for economic analysis. Trademarks are the most prominent type of Intellectual Property used in most of the developed and developing countries. The analysis used secondary data from different sources. We downloaded trademark data from the WIPO (World Intellectual Property Organization), Goods and Services data from the United Nations Statistics Division, and OECD database. This study is important in spite of its analysis difficulties. This study is in depth analysis of the trademark that distinguishes the role of trademark as technology adoption indicator. This study is twofold. Firstly describes the details about trademark classification. Secondly, it indicate the technology adoption trend by using trademark data.

Does Aspiration Influence Conformity Timing? A Study of Board Committee Adoption in Chinese Firms

Extant studies neglect to explain why organizations vary in responding speed during an institutionalization process, i.e., exhibiting different timing of conformity. This study attempts to apply the behavioral theory of the firm to analyzing the timing of organizational conformity to institutional pressures. We argue that the timing of organizational conformity is a result of the interaction between intensity of institutional pressure and firms’ particular aspirational positions. We developed and tested our arguments in a context of a transitional economy, China. Specifically, we analyze the pattern of board committee adoption by China’s public firms as a response to a government-initiated, standard-based corporate governance code. Empirical evidence shows that when the institutionally legitimate practice presumably brings few immediate benefits to economic performance, firms that are trapped in performance drawbacks are less likely to conform. Mediocre firms are reluctant to conform under weak pressures, but turns to the most rapidly responding group when the institutional pressure is substantially intensified. Our study represents an initial effort to bridge institutional theory and the behavioral theory, which have separately developed for long.

Technology Adoption, Bubbles, Network Externalities and Growth

Can stock market bubbles accelerate long term growth? Do such bubbles indicate irrational behavior? This paper studies the effect of innovation uncertainty on the concomitant time path of firm valuations, technology adoption and growth in a setting that incorporates positive network externalities. In such a setting a bubble may form under rational expectations. The resulting valuation bubble, induced by uncertainty and accelerated by positive externalities, may serve as a coordination mechanism supporting accelerated post-bubble growth. Such a path may compensate for the inability of market participants to internalized and exploit the full potential of positive externalities. It may also overcome the chilling effects often attributed to the adoption process of externality intensive innovations. Under the framework proposed, uncertainty may improve long-term growth. This setup may also be used to explain the accelerated productivity that followed the bursting of notable technology related bubbles such as the railway bubble of 19th century England and the 20th century ICT bubble. Attributing a productive role to certain bubbles may have far-reaching policy implications.

Theoretical Examination of the Pay-for-Performance Practice: Case of a Shipbuilding Company

Pay-for-performance plans are some of widely used human resource practices in many firms, including shipbuilding, for productivity and motivational improvement purposes. Such plans play an important role in industries that are highly labor-intensive, and where effective management of human resources is critical to business operations, such as the shipbuilding industry. Those practices can have large impact on employee performance and ultimately company competitiveness. Research studies that show how such incentive plans improve productivity and reported pattern of adoption by firms have spurred the use and adoption in many firms. However, there are also researchers who point out that there are negative consequences to using incentive plans. Therefore it is important for companies to carefully consider the practices they use. In this paper, I discuss research findings that support the practices and critical viewpoints related to pay-for-performance plans. Research findings from Korean literature are, then, discussed. The shipbuilding industry is chosen because proper human resource management is critical in reducing turnover and increasing employee satisfaction. Through a shipbuilding company case, problems related to using pay-for-performance incentive plans and how they affect work-related issues of employee morale, cooperation, and teamwork will be discussed. While positive aspects have been emphasized to drive greater adoption among firms, the resulting consequences of the pay plans need to be seriously considered and improvements upon the plans made by firms. Improvement suggestions are discussed in the conclusions and implications.

ICT Adoption, Capabilities Development and Innovation Processes in Argentina: An Employment Approach

The discussion on innovation and the adoption of new information and communication technologies (ICT) and their impact on economic growth and development have flared up in the past few years. This debate has become increasingly relevant mostly in emerging countries like Argentina, which, in spite of high economic growth rates in the last decade, has been facing the challenge of quality employment creation. This article analyzes the impact of the ICT diffusion process in Argentine companies from a firm-level employment and innovation capabilities development approach. Recent findings support the linkage between different firm level ICT adoption patterns and the development of innovation capabilities and employment dimensions, while capturing the heterogeneity of the productive structure. These results provide useful evidence to think and develop new productive and technological policies not only for Argentina, but also to the rest of Latin American countries and other emerging regions such as Africa.

Predicting Purchase Timing, Product Choice, and Purchase Amount for a Firm's Adoption of a Radically Innovative Information Technology: An Analysis of Cloud Computing Services

Cloud computing is a radically innovative information technology (IT) that has been widely commercialized, but understanding its adoption by a firm has been a mystery. Cloud computing offerings include servers, storage and data product services, and desktop cloud solutions for small businesses. Because prior knowledge about cloud computing adoption is quite limited, this paper attempts to fill the gap in the adoption–provider framework by identifying the drivers that help a firm adopt a radical innovation in a business-to-business scenario. We developed an integrated model that links the purchase timing, product choice, and purchase amount decisions of the different types of cloud computing services. The theory of relationship marketing consisting of “commitment” and “trust” constructs has been extended to include the “need” construct to explain the adoption behavior of the cloud computing services. We empirically tested the proposed framework using data from a large IT company. Results indicate that the proposed model predicts the purchase timing with an accuracy of 78%, type of choice with an accuracy of 81%, and purchase amount with a mean absolute percentage error of 28% for the cloud computing services. The paper highlights the contribution, limitations, and future research for both researchers and practitioners.

Strategic rationale for responding to extra-jurisdictional regulation: Evidence from firm adoption of renewable power in the US

It is well documented that firms respond to regulations in their home jurisdictions. We present hypotheses that firms also respond to regulations in jurisdictions where they do not operate. We examine renewable-power provision in the U.S. electric utility sector between 2001 and 2006, and find that firms adopt more renewable-power generation when their peers (i.e., firms in the same regulatory jurisdiction) face greater renewable-power standards in other jurisdictions. The underlying mechanism is that forward-looking firms assess when extrajurisdictional regulations foreshadow regulatory changes where they operate. Our analyses support this mechanism versus plausible alternatives. We demonstrate firms acting strategically to respond to extrajurisdictional regulations and show that the central conduit motivating this response is the extrajurisdictional footprint of firms operating in the same jurisdiction as a focal firm.

Adoption of free and open source software within high-velocity firms

Free and open source software (FOSS) solutions are not only considered to be a disruptive force in the proprietary software industry but have helped firms deliver efficient and proficient processes and position themselves in global supply networks. The purpose of this study was to conduct an investigation of FOSS adoption in firms operating in high-velocity environments and identify factors that have an impact on the adoption process. Primary data were gathered from a cluster of firms operating in a high-velocity environment. The results provide an insight about the FOSS adoption process to both practitioners and academics alike. Our results indicate that performance attitude of managers, data regulation and facilitating conditions are important determinants of a firm's behavioural intention (BI) to adopt and use FOSS. Interestingly, influences from social and organisational domains have little effect on a firm's BI to adopt FOSS solutions. Overall, the article provides a structure to FOSS adoption which is relevant to managers and academics.

Factors Affecting RFID Adoption in Chinese Manufacturing Firms: An Investigation Using AHP

The aim of this study is to determine and prioritise factors affecting RFID adoption in Chinese manufacturing firms. Using six case studies and employing the analytical hierarchy process (AHP) approach this study suggests that the critical factors affecting RFID adoption are top management support, hardware & software cost, tag cost, industry force, and compatibility. These factors belong to soft factor-category as well as hard factor-category. For effective adoption of RFID technology management of the manufacturing firms must take these factors into account.