Numerous benefits of cloud computing for middle and small-sized enterprises (SMEs) have been documented in the literature. However, existing research often focuses on cost saving, it is still not clear whether and how cloud computing creates value for SMEs. This study investigates the mechanism through which cloud computing creates value for SMEs based on multiple cases of Internet-based SMEs from China. More specifically, we suggest that three cloud computing related capabilities (i.e., flexibility, integration, and ubiquity capability) are most critical for SMEs to generate value from cloud computing and cloud computing enhances SMEs’ performance by facilitating their organizational agility
