Building dynamic capabilities for digital transformation: An ongoing process of strategic renewal

Warner, Karl S.R.; W�ger, Maximilian

Abstract

In this qualitative study, we explore how incumbent firms in traditional industries build dynamic capabilities for digital transformation. Digital transformation has been defined as the use of new digital technologies, such as mobile, artificial intelligence, cloud, blockchain, and the Internet of things (IoT) technologies, to enable major business improvements to augment customer experience, streamline operations, or create new business models. In making sense of digital transformation, we discovered that leaders in various industry circles use the term inconsistently to describe various strategizing and organizing activities; in addition, the term has gained limited scholarly attention as a context for study of strategic change. Drawing on senior executives' experiences with leading digitalization projects at incumbent firms, we propose a process model comprising of nine microfoundations to reveal the generic contingency factors that trigger, enable, and hinder the building of dynamic capabilities for digital transformation. Our findings reveal that digital transformation is an ongoing process of using new digital technologies in everyday organizational life, which recognizes agility as the core mechanism for the strategic renewal of an organization's (1) business model, (2) collaborative approach, and eventually the (3) culture.

• Journal Article Type: Article
• Acceptance Date: Dec 16, 2018
• Online Publication Date: Dec 19, 2018
• Publication Date: 2019-06
• Deposit Date: Feb 20, 2019
• Publicly Available Date: Dec 20, 2020
• Journal: Long Range Planning
• Print ISSN: 0024-6301
• Publisher: Elsevier
• Peer Reviewed: Peer Reviewed
• Volume: 52
• Issue: 3
• Pages: 326-349
• DOI: https://doi.org/10.1016/j.lrp.2018.12.001
• Keywords: Dynamic capabilities; digital transformation; digitalization; microfoundations; qualitative interpretive research; strategic agility; strategic renewal; technology and innovation management
• Public URL: http://researchrepository.napier.ac.uk/Output/1598746
• Contract Date: Feb 20, 2019