Innovation Strategies Under Uncertain Regulatory Circumstances: Argentinean ICT MSMEs

Abstract

The purpose of this article is to identify the business strategies of micro, small, and medium enterprises (MSMEs) in the telecommunications sector in Argentina, considering the economic and technical uncertainties and the regulatory constraints they face. We focus on MSMEs because, even though these small businesses provide critical access to infrastructure in remote communities, there is little research about them. Departing from Michæl Porter’s identification of strategies, we find that economic and political uncertainties lead to significant differences in strategies. Through content analysis of company interviews, we were able to identify strategies that prevail under suboptimal regulatory conditions. These are 1) survival, 2) slow modernization, 3) infrastructure capitalization, and 4) diversification and customization. We find that these are reactive and suboptimal business strategies that impede companies’ growth and constrain them to vulnerable niche markets.