Selecting location for a new business unit in ICT industry

Abstract

Location theory is studying the impact of location on any economic activity, trying to understand where operations should be settled and what should be the reason for such a decision. The aim of this paper is to discuss and prioritize the key location determinants for successful selection of an optimal location for a business unit in the ICT industry. It emphasizes the importance of this concept in ICT sector today when the digitalization and big internet revolution occurs. The initial determinants were formed based on the literature review and evaluated through two rounds of the Delphi study among experts from ICT companies in Serbia. The second goal of the study was to reach a consensus about the relative importance of the agreed determinants. According to the obtained results using the AHP decision-making model, the priority in selecting a location for a business unit in the ICT industry is human resource availability, second is the political and economic environment, and the third is the competition. The paper finds that political and economic strategies start to play an important role in ICT market, as governments are getting more interested in this industry. The study confirmed that due to a shortage of labour supply and fierce competition in the ICT sector, the concept of location selection is an important success factor for sustainable growth and development of ICT organizations.