This chapter highlights the importance of context and institutional pressures that exist in a firm's strategic business environment. It provides an understanding of India's contextual and institutional environment in which Information Technology (IT) firms operate. The chapter explains the strategic choice theory as applied to the study of human resource management (HRM) and employment relations (ER). Broadly, the structure of the Indian IT industry can be split into four sub-divisions: manufacturing of IT hardware products (ITHM); delivery of IT software services (ITSS), design and delivery of software product development (ITPRD) and IT-enabled services (ITeS), which includes business processes outsourcing (BPO) services. Strategic choice theory has been as applied to the study and practice of HRM and ER by several academics. Quality management capabilities have been linked earlier to developing firm's organisational learning and market-based organisational learning capabilities.