The Impact of ICT on International Strategies: Developing a Two-Step Model

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In recent years, management researchers have increasingly focused their efforts on the study of e-business, that is the application of ICT to business management and operations. For what concerns international business, the extant literature has mainly focused on the “e-management” of specific value-creating activities in an international context, while less attention has been paid to the analysis of the impact of ICT on the development of international strategy. In particular, limited research has looked at how the use of ICT affects the strategic orientation of firms, making it possible to adopt new approaches to worldwide competition. This theoretical paper responds to that call developing a two-step model of ICT-driven evolution of international strategy. Moving from traditional tools of international strategy analysis, such as the seminal Porter’s configuration/coordination matrix, we first outline how a massive use of ICT can help firms to change their orientation from a multidomestic (or “country-by-country”) approach to a global one. Then, we show the contribution of ICT to the adoption of more composite strategies than the pure global one, based on concentration and standardization, such as the transnational strategy.
While the first step mainly relies on the efficiency gain resulting from the application of ICT to business processes, the second one is a consequence of the enhanced intra-firm communication possibilities that these technologies ensure.
As we assume that the global development of firms is substantially a “global learning” matter, it is quite straightforward that such technologies, which have information as their primary input, give a decisive contribution to the elaboration of original and effective solutions to the problem. In conclusion, we believe the study’s findings are important for increasing our understanding of the influence of digital innovation on international strategies, whose definition is the first and unavoidable step of the internationalization process of firms.