Operations strategy of cloud-based firms: achieving firm growth in the Big Data era

Abstract

Purpose Cloud computing is a major enabling technology for Industry 4.0 and the Big Data era. However, cloud-based firms, who establish their businesses on cloud platforms, have received scant attention in the extant operations management (OM) literature. To narrow this gap, the purpose of this paper is to investigate cloud-based firms from an operations strategy perspective. Design/methodology/approach A two-phase multi-method approach was adopted. In the first phase, content analysis of 27 reports from cloud-based firms was conducted, aided by text mining keyword extraction. Two data-related operations capabilities were identified and hypotheses were posited regarding the relationships between data resources (DR), operations capabilities and firm growth (FG). In the second phase, a sample of 190 cloud-based firms was collected. Seemingly unrelated regression and bootstrapping method were employed to test the proposed hypotheses using the survey data. Findings The content analysis indicates data as a key resource and both data processing capability and data transformational capability as critical operations capabilities of cloud-based firms. FG is regarded as a top priority in the cloud context. The regression results indicate that DR and the two capabilities contribute to the growth of cloud-based firms. Moreover, a follow-up bootstrapping analysis reveals that the mediating effects of the two capabilities vary between different types of FG. Originality/value To the authors’ best knowledge, this is one of the first OM studies on cloud-based firms. This study extends the operations strategy literature by identifying and testing the key operations capabilities and priorities of cloud-based firms. It also provides insightful implications for industrial practitioners.