A Deeper Look at Cloud Adoption Trajectory and Dilemma
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A Deeper Look at Cloud Adoption Trajectory and Dilemma Pei-Fang Hsu 1
# Springer Science+Business Media, LLC, part of Springer Nature 2020
Abstract Different from previous cloud adoption studies that focus on the benefits and concerns of cloud computing from a technology point of view, this study takes a deeper look at two additional firm-specific forces that could better explain firms’ cloud adoption trajectory and dilemma: Path dependency and Institutional forces. Path dependency theory argues that if a firm has invested intensively in traditional IT, it may be more capable of adopting and utilizing new IT since it has accumulated knowledge. However, the firm could also be trapped in its previous path and reluctant to migrate to cloud to avoid sunk costs and switching costs. On the other hand, institutional theory provides an external view and posit that a firm facing more institutional forces from its trading community will have more incentives, as well as pressure, to adopt cloud. We developed a cloud adoption model that features benefits, concerns, path dependency, and institutional forces as prominent antecedents to understand their competing and complementary effects, and empirically tested the proposed model using 177 firms. The results show that, path dependence is indeed an important factor affecting firms’ cloud adoption behaviors; a firm with a better IT position and more satisfying IT outsourcing experiences will have greater cloud adoption intention. Institutional forces do not directly affect cloud adoption intention. Instead, institutional forces increase perceived benefits, through which, indirectly influence cloud adoption intention. The findings delineate the trajectory and dilemma that firms face when migrating to cloud and provide insights to cloud vendors in choosing their target market. Keywords Cloud computing . Path dependency . Institutional theory . Structural equation modeling
1 Introduction Cloud computing is a promising paradigm that delivers IT services as computing utilities. It builds on decades of research in distributed computing, grid computing, and, more recently, web services (Armbrust et al. 2010). Cloud computing implies a service-oriented architecture, reduces information technology overhead for companies, provides on-demand services with great flexibility, and, most importantly, lowers total costs of ownership (Buyya et al. 2008). What cloud computing offers, in a sense, is a new IT sourcing model that provides low-to-no commitment for enterprises to rapidly deploy new IT services and capabilities (Schneider and Sunyaev 2016). However, as the vision, hype, and benefits of cloud computing are popularly discussed, many concerns about cloud computing are gradually emerging, such as information
* Pei-Fang Hsu [email protected]
security, vendor lock-in, performance unpredictability, complexity, and many others (Kung et al. 2015). Because of these concerns, some enterprise infrastructure and operations professionals treat cloud technology as an inferior IT solution, and b
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