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Indigenous R&D, Outsourcing Technology, and Sustainable Digital Transformation

Author

Listed:
  • Chen Guo

    (Zhongyuan University of Technology)

  • Yiming Zhao

    (Renmin University of China)

  • Zicong Miao

    (China Telecom Cloud Computing Corporation)

  • Weize Li

    (China Telecom Cloud Computing Corporation)

  • Hui Chen

    (China Telecom Cloud Computing Corporation)

Abstract

Enterprises undergo digital transformation by investing in digital technology through either indigenous or outsourcing. Different choices of investment have a different impact on digital transformation. This study proposes two indicators of efficiency to measure the sustainable digital transformation, based on the specific expenses and intangible assets mentioned in financial statements. Results show that companies with strong core competitiveness can greatly improve the sustainability of indigenous investment in digital transformation. Further analysis reveals that non-state-owned, large-scale, and highly competitive firms are more inclined to pursue indigenous R&D (research and development) in digital transformation. Core competitiveness plays a crucial role in improving the sustainability of indigenous investment in digital transformation. The findings remain consistent after conducting various tests. Moreover, this study identifies three mechanisms: dynamic resource integration, probability of transformation of R&D efforts, and gaining a first-mover advantage. The research provides valuable indicators for measuring different ways of digital transformation and contributes to understanding the factors influencing the sustainability of digital transformation.

Suggested Citation

  • Chen Guo & Yiming Zhao & Zicong Miao & Weize Li & Hui Chen, 2024. "Indigenous R&D, Outsourcing Technology, and Sustainable Digital Transformation," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 15(4), pages 20745-20777, December.
    • Handle: RePEc:spr:jknowl:v:15:y:2024:i:4:d:10.1007_s13132-024-01983-0
    DOI: 10.1007/s13132-024-01983-0
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