Location and the categorical imperative: Identity rebellion in the Indian IT services industry

Abstract

In recent years, a substantial stream of research has developed on the distinctive globalization patterns of emerging economy MNEs. We find that the extant discussions are limited in so far as they are advantage-centric and location-agnostic. Further, they fail to take account of the curse of the 'low cost' value proposition emblematic of the prototypical emerging economy MNC. Building upon the categorization literature in organization theory, we invoke a novel perspective on location that is mindful of location-specific disadvantages. We conduct a comparative case analysis of two firms in the Indian I.T. services category during 1991 to 2005. Using qualitative data procedures, we present a process model of 'identity rebellion' that explains how emerging economy MNEs manoeuvre around their 'low cost' category identity as they develop capabilities for higher margin activities in the value chain. We contribute to theory on how location shapes categories and how category members, i.e., MNEs, can rebel against the sanctioned attributes of the category.