Advent Research Articles

Measuring the impact of information and communication technology investment on the profitability of Indian manufacturing MSME

PurposeThis study aims to investigate the impact of information and communication technology (ICT) investment on the micro, small and medium enterprises (MSME) profitability in the Indian context.Design/methodology/approachThis study used a framework based on the ICT investment and firm size, measuring the impact on profit before depreciation, interest, tax and amortisation of MSME by taking a random sampling of 300 Indian MSME manufacturing firm’s secondary data from the Prowess database. This framework was analysed using the design of experiment (DoE) technique.FindingsThe study showed that ICT investment has a significant positive relationship with profitability. This study examines the different ICT investment levels to predict investment strategies and fine-tune profit targets. The critical finding is that ICT investment maximises profit at one million rupees. This discovery aids MSME leaders’ sustainable business decision-making.Research limitations/implicationsThis study has an explicit limit to the Indian context, where the firm requirements of countries are different, and these findings need to be validated with many operating variables and applied to more firms with more data. Even so, as a theoretical implication, this study took a novel approach to ICT adoption (through ICT investment) in the Indian MSME sector with guiding levels of ICT investment for each type of firm (i.e. micro, small and medium). This study opens new avenues for investigating researchers and stakeholders by exploring other factors responsible for ICT adoption.Practical implicationsThis study uniquely provides practitioners with the functional level of ICT investment for MSMEs in the Indian context. These finding guides top management to make strategic ICT adoption decisions with information symmetry. At the same time, these findings suggest financial institutions astern their credit programme to provide credit for ICT investment in MSMEs.Social implicationsThis study highlights the value of ICT as a practical resource for business owners that significantly makes MSMEs more informed and profitable, thus creating more jobs and incrementing the country’s gross domestic product (GDP).Originality/valueThis study offers unique empirical findings on how decision makers in MSMEs maximise profits through optimal ICT investment levels depending upon the firm size in an emerging economy like India. There is evidence in the study to conclude that ICT is a need of MSME and has implications for firm performance.

Practices and barriers for big data projects

The adoption of big data analytics is increasing in every major industry, demanding investments in new projects, technologies, architectures, and processes to allow the integration of big data platforms with legacy systems; however, many organizations have failed to incorporate it effectively into their decision-making processes and project benefits have not been adequately captured. This study aims to further investigate how a big data analytics project can be implemented in insurance companies. A case study was conducted on one of the largest insurance companies in Brazil with interviews and document analysis. The study identified five main practices that were adopted to successfully implement a big data analytics project (implement automatic autoscaling alerts, use specialized big data tools, integrate the platform with legacy systems, comply with privacy legislation, and ensure the documentation of technical architecture using business process modeling), as well as four barriers that prevent its proper adoption (complexity of access to multicloud data sources, high processing requirements of unstructured data analysis, failure to attend to business necessities at the right time, and project delays brought by bureaucratic interdepartmental processes); some of these have not previously been identified. Finally, an action plan to address these issues is presented.

Europe’s independence from Russian natural gas — Effects of import restrictions on energy system development

With the Russian invasion on Ukraine in 2022 and the following disruption of Russian natural gas imports, Europe’s energy reliance on Russia has become more apparent than ever. To tackle the resulting challenges of a limited supply of fossil fuels from Russia and especially its effects on energy system development, short and long-term effects need to be investigated thoroughly. This paper aims to quantitatively analyze the impact of reduced natural gas availability from Russia on the European energy system, both in the coming years, as well as in the future. Using the Global Energy System Model (GENeSYS-MOD), three scenarios with varying amounts of Russian natural gas and further impacts of reduced fossil fuel imports from Russia are calculated. Results show that strong effects are mostly observed in the short to medium-term, but an overall earlier phase-out of fossil fuels can be achieved in the long-term. The reduction of natural gas imports is tackled by an increase in LNG imports and domestic natural gas production to overcome the supply gap. Strong reactions are seen in the levelized costs of electricity generation between 2022 and 2025, with higher costs in scenarios with restrictions on Russian natural gas imports, but with a negligible difference in the long-term. Most importantly, lower emissions in scenarios with reduced natural gas supply from Russia highlight the positive effect of an early reduction in fossil fuels and investment in renewable technologies, resulting in a near 100% emission-free energy system by 2045, 5 years before the Base scenario with unrestricted Russian gas imports. The results find that a limitation of Russian fossil imports does not pose a long-term threat to the European energy system or its required transition away from fossil fuels, but can rather accelerate its decarbonization and energy demand reductions.

An Investigation into the Risk Assessment of Building-Integrated Photovoltaic Residential Project Development Utilizing the DEMATEL-ANP Methodology: A Chinese Case Study

Numerous countries are implementing building-integrated photovoltaic (BIPV) technology to enhance the energy performance of buildings, as new energy sources have attracted global interest. BIPV residential programs are an essential method to alleviate energy stress and promote energy transition in buildings; however, the high level of technology and capital investment required have hampered their marketization. Although certain obstacles have been examined by researchers, there remains a lack of studies concerning risk assessment in the context of the development of BIPV residential projects. Therefore, this study strives to develop a risk assessment model for the development of these projects. First, a risk evaluation index system is proposed by identifying and analyzing the risks associated with the development of BIPV residential projects, following the lines of risk identification–risk analysis–risk evaluation–risk management. Second, the DEMATEL-ANP-gray cluster analysis was utilized to construct the development risk assessment model. Finally, a case study demonstrates that the methodology proposed in this study can effectively solve the issues associated with correlating risk factors and the quantification of the magnitude of risks in the development of BIPV residential projects. This study will serve as a valuable reference for architect-urban developers and engineer contractors to formulate risk governance countermeasures for BIPV residential projects as it provides a framework for assessing the risk associated with their development.

The Influence of Investments in Science and Technology on the Innovative Development of the Global Economic System

The Influence of Investments in Science and Technology on the Innovative Development of the Global Economic System

The Role of Unmanned Aerial Vehicles (UAVs) in Indonesian Air Defense Management

Indonesia is an archipelagic state with land and maritime borders with other nations. The use of Unmanned Aerial Vehicles (UAVs) has become crucial in safeguarding Indonesia's defense and border areas. This research employs a qualitative method, aiming to gain a deep understanding of the role of UAVs in the Defense management of Indonesia's, covering complex aspects such as policies, implementation, and their impact. The findings reveal that sustained investment in UAV technology and infrastructure is essential to strengthen Indonesia's air defense capabilities. Particularly, High-Altitude Long Endurance (HALE) UAVs prove to be effective and reliable in surveillance with their ability to operate at high altitudes and for extended durations. In the context of Indonesia's air defense, UAVs significantly enhance surveillance, reconnaissance, and national security. Effective integration and utilization of UAVs are key to maintaining protection and sovereignty over the airspace. Appropriate regulations and the establishment of ownership registries are crucial to support responsible UAV usage, especially concerning national security and counterterrorism. The evolving significance of UAVs will continue to shape defense paradigms in the future.

Third‐party logistics firm's technology investment and financing options in platform‐based supply chain with 4PL service

AbstractIn practice, capital‐constrained third‐party logistics (3PL) firms usually obtain bank financing (BF) to invest in logistics technology to enhance the consumer shopping experience. The emergence of financial innovation has prompted the adoption of alternative financing modes by 3PLs, including e‐commerce platform financing (EPF) and fourth‐party logistics financing (4PF). To clarify the differences among the three financing modes at the operational management level, we develop a Stackelberg game model to capture the strategic interactions between the 3PL and creditors. We examine a platform‐based supply chain where a manufacturer sells products through an e‐commerce platform to consumers, with the logistics services for the supply chain provided by the 3PL and fourth‐party logistics (4PL) firms. The analysis results reveal that the equilibrium interest rates under EPF and 4PF share a similar pattern regarding the logistics service cost coefficient, the commission rate, and the 4PL service fee. The difference is that under EPF (4PF), the logistics service level increases in the commission rate (4PL service fee) but decreases under the other financing strategy. Furthermore, the 3PL is inclined to invest in logistics technology only when the fixed investment cost is low, and these financing modes are complementary rather than alternative. The 3PL and manufacturer can benefit from 4PF (BF) when the logistics service cost coefficient is large and the market size is small (large); otherwise, EPF can enhance their profits. We also find that when the opportunity costs of capital are homogeneous, both the 4PL and the platform are consistently willing to act as financiers themselves. However, when considering heterogeneity in the opportunity costs of capital, they may be reluctant to provide financing. Each financing mode may achieve Pareto improvements under specific conditions. Finally, we also analyze the impact of technology R&D risks and endogenous 4PL service fee, yielding some valuable insights.

Changes in the steel chain in Industry 4.0. Some results of survey on the Polish steel market

Abstract The paper discusses the changes occurring in the steel industry and related markets as they move towards Industry 4.0. With significant investments in new technologies, steel mills are creating a smart environment for cooperation between producers, distributors, and consumers of steel products. The influence of Industry 4.0 within mills is being transferred to other participants in the steel product chains, and vice versa. The research aimed to determine the impact of Industry 4.0 technologies on the steel product chains in the Polish steel market. The research was conducted in Poland. The obtained database comprised 208 respondents (company executives), including steel mills and steel product manufacturers. Technologies (the pillars of Industry 4.0) are grouped into five technological fields: automation and robotics; warehouse automation; Computer systems, systems integration, mobile technologies, Big Data and IIoT, Blockchain and cybersecurity. Analysis was realized in the three respondent segments representing the steel chain in Poland [RSs]: Producer [P], Distributor [D], and Consumer [C]. The results of the research can help companies improve their steel product chains. The study takes a value chain approach, considering steel production, distribution of steel products, and services for orders and consumers of steel and steel products.

A shift‐splitting Jacobi‐gradient iterative algorithm for solving the matrix equation A𝒱−𝒱‾B=C

AbstractTo improve the convergence of the gradient iterative (GI) algorithm and the Jacobi‐gradient iterative (JGI) algorithm [Bayoumi, Appl Math Inf Sci, 2021], a shift‐splitting Jacobi‐gradient iterative (SSJGI) algorithm for solving the matrix equation is presented in this paper, which is based on the splitting of the coefficient matrices. The proposed algorithm converges to the exact solution for any initial value with some conditions. To demonstrate the effectiveness of the SSJGI algorithm and to compare it to the GI algorithm and the JGI algorithm [Bayoumi, Appl Math Inf Sci, 2021], numerical examples are provided.

МОДЕЛИРОВАНИЕ ВЛИЯНИЯ СКОРОСТИ РЕЗАНИЯ ПРИ ЛЕЗВИЙНОЙ ОБРАБОТКЕ НА ФОРМИРОВАНИЕ СТРУЖКИ

Modern mechanical engineering is one of the key industries determining technological progress and competitiveness of production. In the development and improvement of machinery and equipment in mechanical engineering, research in the field of chip formation during blade processing plays an important role. Chip forming is the process of removing material using a cutting tool, which can be a blade or a milling cutter. The quality and characteristics of the chips directly affect the efficiency and quality of processing, as well as tool wear and process stability. Studying the effect of cutting speed on chip formation during blade processing is one of the important aspects in improving production processes. The cutting speed determines the speed of movement of the tool relative to the material being processed. As the cutting speed increases, the chip formation process accelerates and heat generation increases. This can lead to increased friction between the tool and the material being processed, which can negatively affect the quality of processing and the service life of the tool. Modeling using the Deform-2D software package allows you to analyze the effect of cutting speed on chip characteristics. The simulation results showed that with an increase in the cutting speed, the chip transitions from a drain shape to a segmented one. This transition may be associated with changes in the contact interaction between the tool and the material, as well as with a change in the direction of chip movement.

EU-China Economic Relations in the Early 21st Century

The European Union (EU) and China are two of the most influential and complex economies globally. The current state of their relationship is marked by a growing trade deficit for the EU with China, along with increasing Chinese investments in Europe's energy, technology, and infrastructure sectors. The EU has expressed dissatisfaction with China's treatment of foreign investors, limited market access for European companies, and government subsidization of domestic companies. Additionally, the EU has raised concerns about China's human rights record and its policies in Hong Kong, Taiwan, and mainland China. The partnership is expected to remain a key focus for the EU's economic outlook as both sides balance economic potential with geopolitical and security considerations. This report aims to identify and explain the primary issues, key areas for improvement, and mutual interests between the EU and China, while also proposing potential solutions to enhance their economic and trade relations. Informative articles, relevant papers, textbooks, and other sources support the discussion. Although the analysis is subjective, a quantitative methodology is also employed. The discussion presents a common interface and provides recommendations for enhancing financial relations, increasing exchange, financial and security relations, participating in and benefiting from two-way engagement, and enhancing EU-China relations.

Automation’s Impact on Agriculture: Opportunities, Challenges, and Economic Effects

Automation and robotics are the key players in modern agriculture. They offer potential solutions for challenges related to the growing global population, demographic shifts, and economic status. This review paper evaluates the challenges and opportunities of using new technologies and the often-missed link between automation technology and agricultural economics. Through a systematic analysis of the literature, this study explores the potential of automation and robotics in farming practices, as well as their socio-economic effects, and provides strategic recommendations for those involved. For this purpose, various types of robots in different fields of agriculture and the technical feasibility and challenges of using automation have been discussed. Other important factors, including demographic shifts, labor market effects, and economic considerations, have been analyzed. Furthermore, this study investigates the social effects of automation, particularly in terms of employment and workforce adaptation. It finds that, while automation boosts productivity and sustainability, it also causes labor displacement and demands considerable technological investment. This thorough investigation fills a crucial gap by assessing economic sustainability, labor market evolution, and the future of precision agriculture. It also charts a course for further research and policy-making at the intersection of agricultural technology and socio-economic fields and outlines a future roadmap for further research and policy.

Internal Communication Strategies and Employee Engagement

Purpose: The general purpose of the study was to investigate internal communi8cation strategies and employee engagement.
 Methodology: The study adopted a desktop research methodology. Desk research refers to secondary data or that which can be collected without fieldwork. Desk research is basically involved in collecting data from existing resources hence it is often considered a low cost technique as compared to field research, as the main cost is involved in executive’s time, telephone charges and directories. Thus, the study relied on already published studies, reports and statistics. This secondary data was easily accessed through the online journals and library.
 Findings: The findings reveal that there exists a contextual and methodological gap relating to political public relations. Preliminary empirical review revealed that the importance of effective internal communication strategies in fostering employee engagement is evident from numerous studies, which consistently highlight the positive association between transparent communication, two-way communication, leadership communication, and the use of multiple communication channels with higher levels of engagement. Leadership communication, particularly, plays a crucial role in shaping organizational culture and values, impacting employees' commitment to organizational goals. However, challenges such as information overload, language barriers, and discrepancies in communication effectiveness across departments exist. Addressing these challenges requires a multifaceted approach, including training programs and technology investment. Overall, this study underscores the significance of internal communication in enhancing engagement and organizational success, emphasizing the need for future research to explore specific strategies and emerging trends in different organizational contexts.
 Unique Contribution to Theory, Practice and Policy: The Social Exchange theory, Self-Determination theory and Social Identity theory may be used to anchor future studies on internal communication strategies. The study offered key recommendations to enhance organizational practices and improve employee engagement. It emphasizes the importance of transparency, two-way communication, and effective leadership communication in fostering trust and collaboration among employees. Additionally, leveraging multiple communication channels, ensuring consistent messaging, and recognizing employee contributions are vital for promoting engagement and motivation. By implementing these recommendations, organizations can cultivate a positive work environment where employees feel valued, informed, and empowered to contribute to organizational success.

Does institutional investor influence information technology investment decisions and corporate performance?

Does institutional investor influence information technology investment decisions and corporate performance?

Varieties of just transitions in the European car industry

ABSTRACT This article examines the responses and strategies developed by business, unions, and governments to the electric turn in the industry in Germany and France, Europe’s main car-producing countries. We concentrate on the role of history and institutions in the determination of adjustment paths. Since institutions reflect specific histories, the electric transition in the industry can take on different forms in different countries. In both countries, governments play a supportive role, leading in France, and following in Germany. The strong works councils in German car companies are reluctant to engage in a rapid transition that would devalue the assets of the workforce and endanger past investments in internal combustion-related technology. Trade unions, in contrast, who organise the workforce in the wider industry, are in favour of a faster transition as it will secure future employment. The French EV industry, in contrast, is now a booming sector, after several decades of deep restructuring with massive employment losses. Its key short-term problem is to train enough workers to staff the rapidly expanding car battery industry. Lacking a deeply rooted training system like the German one, the industry has a relatively free hand in selecting and preparing its future workforce.

Analyzing the load capacity curve hypothesis for the Turkiye: A perspective for the sustainable environment

Although it takes time to achieve a sustainable environment, this goal can be possible with the Sustainable Development Goals. The transition from gray energy sources to green in the 21st century is among the important policy goals of global economies. Since this process is long, countries focus on energy efficiency as part of their carbon reduction policies. In this context, this study investigates the impact of clean energy technologies on environmental quality in Turkiye. Using the load capacity curve (LCC) hypothesis, human capital, income, and natural resources are theoretically added to the balance model. The novel Augmented ARDL with Fourier terms approach is used in the empirical analysis. As a result of the analysis, the LCC hypothesis is valid, and income will support environmental quality after a certain level. While human capital increases environmental quality, natural resources bring environmental pollution. Finally, it is determined that clean energy technologies have not yet reached the level that enables carbon reduction. The finding that clean energy technologies are insufficient for Turkiye, as a result of empirical analysis, shows the uniqueness of this study. With our new findings, policymakers can take action for a sustainable environment. Since Turkiye has to ensure energy security due to its regional characteristics, it should increase investments in clean energy technologies. Based on empirical findings, clean energy technologies will gain momentum as policymakers support human capital.

You can’t con a conman: the perception of deceptive actions performed by the self and others

ABSTRACT Understanding the actions of others is important for predicting whether their intentions are honest or deceitful. Common-coding theory [Prinz, W. (1997). Perception and action planning. European Journal of Cognitive Psychology, 9(2), 129-154. https://doi.org/10.1080/713752551] suggests that the capability to produce a deceptive action could influence the ability to perceive the same action (and vice versa), but can an actor easily fool themselves? The aim of this study was to investigate whether individuals are better able to anticipate the outcome of their own deceptive actions than when others anticipate those same actions. Eighteen skilled rugby players were filmed performing deceptive (side-step) and non-deceptive actions. Eight equally skilled rugby players anticipated the outcomes of the filmed actions (i.e., viewing deceptive actions generated by others) and, six-months after filming, the original group of eighteen rugby players anticipated the action outcome of their own deceptive actions (i.e., viewing self-generated deceptive actions). Results revealed that players were no better at anticipating the outcomes of their own actions than others were. Instead, the response behaviour of the individuals viewing their own actions was indistinguishable from that of others viewing the same actions. In contrast with what might be expected based on common-coding theory, these findings suggest that the typical advantage of self-observation might be negated when the observer has acquired considerable amounts of visual experience in that observation task.

Strategic flexibility in healthcare: an exploration of real options

PurposeThis survey explores the application of real options theory to the field of health economics. The integration of options theory offers a valuable framework to address these challenges, providing insights into healthcare investments, policy analysis and patient care pathways.Design/methodology/approachThis research employs the real options theory, a financial concept, to delve into health economics challenges. Through a systematic approach, three distinct models rooted in this theory are crafted and analyzed. Firstly, the study examines the value of investing in emerging health technology, factoring in future advantages, associated costs and unpredictability. The second model is patient-centric, evaluating the choice between immediate treatment switch and waiting for more clarity, while also weighing the associated risks. Lastly, the research assesses pandemic-related government policies, emphasizing the importance of delaying decisions in the face of uncertainties, thereby promoting data-driven policymaking.FindingsThree different real options models are presented in this study to illustrate their applicability and value in aiding decision-makers. (1) The first evaluates investments in new technology, analyzing future benefits, discount rates and benefit volatility to determine investment value. (2) In the second model, a patient has the option of switching treatments now or waiting for more information before optimally switching treatments. However, waiting has its risks, such as disease progression. By modeling the potential benefits and risks of both options, and factoring in the time value, this model aids doctors and patients in making informed decisions based on a quantified assessment of potential outcomes. (3) The third model concerns pandemic policy: governments can end or prolong lockdowns. While awaiting more data on the virus might lead to economic and societal strain, the model emphasizes the economic value of deferring decisions under uncertainty.Practical implicationsThis research provides a quantified perspective on various decisions in healthcare, from investments in new technology to treatment choices for patients to government decisions regarding pandemics. By applying real options theory, stakeholders can make more evidence-driven decisions.Social implicationsDecisions about patient care pathways and pandemic policies have direct societal implications. For instance, choices regarding the prolongation or ending of lockdowns can lead to economic and societal strain.Originality/valueThe originality of this study lies in its application of real options theory, a concept from finance, to the realm of health economics, offering novel insights and analytical tools for decision-makers in the healthcare sector.

Energy security-related risks and the quest to attain USA’s net-zero emissions targets by 2050: a dynamic ARDL simulations modeling approach

The Russia-Ukraine war and other similar conflicts across the globe have heightened risks to the United States of America's (USA’s) energy security. However, little is known about the severity of the effect of energy security risks on the USA’s quest to attain net-zero emissions targets by 2050. To this end, we examine the effect of energy security risks on the load capacity factor (LCF) in the USA. Employing a time series dataset spinning from 1970 to 2018, the results of the Dynamic Autoregressive Distributed Lag (ARDL) simulations model suggest that energy security-related risk hampers the long-term net-zero emissions targets with its effect decreasing over time until it varnishes in about 5 years time. The results also show that foreign direct investment (FDI) inflows, renewable energy consumption, and green technology have long- and short-run positive effects on the LCF. Conversely, economic expansion and urbanization impede environmental quality by lowering the LCF both in the long run and short run. These findings are upheld by the outcomes of the multivariate quantile-on-quantile regression. Therefore, the study advocates for the consumption of renewable energy, investment in green technologies, and FDI inflows to mitigate energy security-related risks and attain the net-zero emissions targets by 2050 in the USA.

Mapping the path to a net‐zero chemicals industry by long‐term planning with changes in technologies and climate

AbstractThe chemical industry, along with many other industries, has pledged to reach net‐zero emissions within the next few decades for greenhouse gases, plastics, etc. This requires systematic methods to guide investment in technologies and value‐chain alternatives, and develop roadmaps. The proposed framework is a multiperiod planning model to guide optimal reforms in cradle‐to‐cradle life‐cycle networks across the pledged time horizon. It aims to meet environmental targets while minimizing the total annualized cost of natural resources and the investment cost associated with adoption of novel technologies. This considers the evolution of technology readiness levels as S‐curves or continuous time Markov‐chains. Integrated Assessment models account for climate change, decarbonization due to energy mix changes, and carbon taxes. Multiple climate change scenarios and shared socioeconomic pathways are used to model future scenarios. In addition to providing roadmaps, the outputs can also be used to identify technologies that will be robust to future scenarios.