Implementing Vertical Integration in the Industry 4.0 Journey: Which Factors Influence the Process of Information Systems Adoption?

ABSTRACT

One of the key principles of Industry 4.0 is the implementation of vertical integration, which considers the integration of information systems from different hierarchical levels in a company to support decision-making with real-time data flows. Companies face challenges when they want to implement vertical integration, which is not trivial due to the risks inherent to the decision stages of adoption. We investigate the main factors influencing the different stages of adoption of vertical integration to provide a clearer view of what managers should consider at each stage. We adopt a multi-case study approach based on the investigation of ten companies that followed this adoption process. We develop a framework with 22 factors deployed in the three stages of decision (knowledge, persuasion, and final decision) and three main dimensions of analysis: technology, organization, and environment. We analyze the potential tensions between these factors and show how managers should balance such factors during the decision stages.