Journal
INTERNATIONAL JOURNAL OF OPERATIONS & PRODUCTION MANAGEMENT
Volume 40, Issue 7-8, Pages 1095-1128Publisher
EMERALD GROUP PUBLISHING LTD
DOI: 10.1108/IJOPM-06-2019-0444
Keywords
Digital transformation; Dynamic capabilities; Firm performance
Categories
Funding
- Brazilian research agency Coordination for the Improvement of Higher Level Education Personnel (CAPES) [88881.128754/2016-01]
- Schlumberger Foundation
- Centre for Digital Built Britain (CDBB), University of Cambridge
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Purpose Drawing on the literature on dynamic capabilities and digital transformation, this paper conceptualises and investigates the relevant antecedents of an essential capability for digital transformation - the digital transforming capability - and its effect on the competitive advantage of firms. Design/methodology/approach A framework with individual and organisational microfoundations of the digital transforming capability is proposed based on previous research. The digital transforming capability is conceptualised as a second-order construct. The model is tested using data from a broad spectrum of large US companies. Structural equation modelling (SEM) is applied to test the proposed framework. Findings The study identifies three main microfoundations that, when combined, build a digital transforming capability (digital-savvy skills, digital intensity and context for action and interaction); in addition, the study tests the relationship between digital transforming capability and firm performance. The results validate the proposed theoretical framework. In addition to proposing relevant microfoundations of the digital transforming capability, we advance knowledge on the performance effects of those microfoundations. Originality/value The paper contributes to advancing the understanding of the digital transformation phenomenon by revealing the role of the primary components underlying the digital transforming capability. Yet the mechanisms by which the micro-level aspects are important for digital transformation and organisational outcomes are only suggested by anecdotal evidence. The paper also contributes to ongoing calls for further investigation to extend the understanding of the microfoundations of dynamic capabilities. Finally, by drawing on archival data, this study also contributes to calls to broaden the toolkit used in dynamic capabilities research.
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