Asia Pacific Journal of Information Systems (APJIS)

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Past Issue

Date	September 2022
Vol. No.	Vol. 32 No. 3
DOI	https://doi.org/10.14329/apjis.2022.32.3.564
Page	564~579
Title	Preemptive or Catch Up? Performance Differences under Enterprise Digital Transformation
Author	Peinan Ji, Guang Yu
Keyword	IT Investment, Digital Transformation, Firm Performance, Investment Decision
Abstract	The use of on-premises technology in the business environment to a competitive advantage is ushering in a new era known as digital transformation. As the foundation of digital transformation of enterprises, information technology still has a paradoxical effect on enterprises. This paper documents the effect of investments in IT on a firm’s long-term profitability performance measures as return on assets (ROA), as well as tests whether the earlier entrant and the later entrant are different in IT investment performance. Using a sample of China’s public firms IT investment data between 2016 and 2019, the result indicates that IT investment in firms have a positive effect on firm performance in full sample, but not in the financial industry firms. When it comes to the different investment time, the result shows no significant difference between the earlier entrant firm and the later entrant firm in the full sample, but not in the case of software industry sample. This should help alleviate the concerns that some have expressed about the viability of digital transformation given the highly publicized IT investment and implementation problems at some firms.