Predicting technology integration and performance in transition economies: insights from Russia

Abstract

Purpose – The purpose of this paper is to examine a traditional information technology (IT) integration-performance framework in the transition economy of Russia, which has undergone significant and tumultuous institutional shifts. The research incorporates variables not previously utilized in the supply chain literature but underscore significant roles in the context of the Russian institutional environment to examine the drivers of IT integration. Design/methodology/approach – The Moscow-based, Public Opinion Research Center (VCIOM) was contracted to collect data from Russia manufacturing firms with 100 or more employees, and the effort resulted in 769 responses from Russian private sector firms. This primary survey data were combined with two secondary data sets to test the model using structural equation modeling. Findings – Overall, the results indicate that firms in developed economies must pay special attention to specific contextual nuances in transition economy firms that can affect their ability to successfully navigate this significantly different supply chain environment. Specifically, the results show that spatial distance from Moscow hampers a firm’s ability to integrate its logistics IT capabilities, suggesting that “modern” logistics IT (and possibly supply chain practice in general) initiate from the Moscow core and spread outward. Further, results find that growth in the number of foreign competitors in a firm’s primary industry over the prior five-year period associates with greater integrated logistics IT. It appears that increasing foreign competition creates a sense of urgency for managers within Russian firms to focus on cost reduction and improvements in logistics efficiencies by way of greater IT integration. Originality/value – A significant portion of research related to supply chain management and firm performance takes place in the economically developed West, but there are questions about whether these findings are applicable in transition economies that have a significantly different set of institutional dynamics. This research highlights how the unique contexts in transition economies such as Russia can present challenges for firms as they adapt to the realities of global market dynamics.