Abstract
Despite the acclaimed potential of industry 4.0 for efficiency and growth, statistics show that the majority of firms’ digital transformation programs fail to meet their objectives. We provide a plausible explanation of this understudied phenomenon through theoretical discussions on the four overlooked paradoxical characteristics found between digitalization activities. Further, using the lens of lean and dynamic capabilities theory, we propose strategies for firms to transcend the paradoxes and in turn, realize their expectations of the transformation initiatives.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
Notes
- 1.
- 2.
- 3.
A meta-process is “that orchestrates a number of processes, best practices or competencies to manage comprehensively and systemically, something that is strategically imperative, including the strategy development and execution process itself” [25].
References
Björkdahl, J.: Strategies for digitalization in manufacturing firms. Calif. Manage. Rev. 62(4), 17–36 (2020)
Tabrizi, B., Lam, E., Girard, K., Irvin, V.: Digital transformation is not about technology. Harv. Bus. Rev. 13(March), 1–6 (2019)
Gebauer, H., Fleisch, E., Lamprecht, C., Wortmann, F.: Growth paths for overcoming the digitalization paradox. Bus. Horiz. 63(3), 313–323 (2020)
Linde, L., Sjödin, D., Parida, V., Gebauer, H.: Evaluation of digital business model opportunities: a framework for avoiding digitalization traps. Res. Technol. Manag. 64(1), 43–53 (2020)
Rossini, M., Cifone, F.D., Kassem, B., Costa, F., Portioli-Staudacher, A.: Being lean: how to shape digital transformation in the manufacturing sector. J. Manuf. Technol. Manag. 32(9), 239–259 (2021)
Zangiacomi, A., Pessot, E., Fornasiero, R., Bertetti, M., Sacco, M.: Moving towards digitalization: a multiple case study in manufacturing. Prod. Plann. Control 31(2–3), 143–157 (2020)
Buer, S.-V., Semini, M., Strandhagen, J.O., Sgarbossa, F.: The complementary effect of lean manufacturing and digitalisation on operational performance. Int. J. Prod. Res. 59(7), 1976–1992 (2021)
Rachinger, M., Rauter, R., Müller, C., Vorraber, W., Schirgi, E.: Digitalization and its influence on business model innovation. J. Manuf. Technol. Manag. 30(8), 1143–1160 (2019)
Bogner, E., Voelklein, T., Schroedel, O., Franke, J.: Study based analysis on the current digitalization degree in the manufacturing industry in Germany. Proc. Cirp 57, 14–19 (2016)
Bienhaus, F., Haddud, A.: Procurement 4.0: factors influencing the digitisation of procurement and supply chains. Bus. Process Manag. J. 24(4), 965–984 (2018)
Amit, R., Schoemaker, P.J.: Strategic assets and organizational rent. Strateg. Manag. J. 14(1), 33–46 (1993)
Barreto, I.: Dynamic capabilities: a review of past research and an agenda for the future. J. Manag. 36(1), 256–280 (2010)
Kohtamäki, M., Parida, V., Patel, P.C., Gebauer, H.: The relationship between digitalization and servitization: the role of servitization in capturing the financial potential of digitalization. Technol. Forecast. Soc. Change 151, 119804 (2020)
Schad, J., Lewis, M.W., Raisch, S., Smith, W.K.: Paradox research in management science: looking back to move forward. Acad. Manag. Ann. 10(1), 5–64 (2016)
Feenberg, A.: Ten paradoxes of technology. Tech.: Res. Philos. Technol. 14(1), 3–15 (2010)
Wilson, H., Daugherty, P.: Small data can play a big role in AI. Harv. Bus. Rev. (17 Feb 2020). https://hbr.org/2020/02/small-data-can-play-a-big-role-in-ai
Redman, T., Hoerl, R.: Most analytics projects don’t require much data. Harv. Bus. Rev. (3 Oct 2019). https://hbr.org/2019/10/most-analytics-projects-dont-require-much-data
Baer, M., Dirks, K.T., Nickerson, J.A.: Microfoundations of strategic problem formulation. Strateg. Manag. J. 34(2), 197–214 (2013)
Nell, P.C., Foss, N.J., Klein, P.G., Schmitt, J.: Avoiding digitalization traps: tools for top managers. Bus. Horiz. 64(2), 163–169 (2021)
Schlegel, A., Birkel, H.S., Hartmann, E.: Enabling integrated business planning through big data analytics: a case study on sales and operations planning. Int. J. Phys. Distrib. Logist. Manag. 51(6), 607–633 (2021)
Daniel, K.: Thinking, fast and slow (2017)
Tversky, A., Kahneman, D.: Judgment under uncertainty: heuristics and biases. Science 185(4157), 1124–1131 (1974)
Schreyögg, G., Sydow, J.: Organizational path dependence: a process view. Organ. Stud. 32(3), 321–335 (2011)
Sydow, J., Schreyögg, G., Koch, J.: Organizational path dependence: opening the black box. Acad. Manag. Rev. 34(4), 689–709 (2009)
Feiler, P., Teece, D.: Case study, dynamic capabilities and upstream strategy: supermajor EXP. Energ. Strat. Rev. 3, 14–20 (2014)
Teece, D.J.: Dynamic capabilities as (workable) management systems theory. J. Manag. Organ. 24(3), 359–368 (2018)
Hopp, W.J., Spearman, M.S.: The lenses of lean: visioning the science and practice of efficiency. J. Oper. Manag. 67(5), 610–626 (2021)
Teece, D.J., Pisano, G., Shuen, A.: Dynamic capabilities and strategic management. Strateg. Manag. J. 18(7), 509–533 (1997)
Gölzer, P., Fritzsche, A.: Data-driven operations management: organisational implications of the digital transformation in industrial practice. Prod. Plann. Control 28(16), 1332–1343 (2017)
Caiado, R.G.G., Scavarda, L.F., Gavião, L.O., Ivson, P., de Mattos Nascimento, D.L., Garza-Reyes, J.A.: A fuzzy rule-based industry 4.0 maturity model for operations and supply chain management. Int. J. Prod. Econ. 231, 107883 (2021)
Cifone, F.D., Hoberg, K., Holweg, M., Staudacher, A.P.: ‘Lean 4.0’: how digital technologies support lean practices? In: EurOMA Conference 2019, pp. 1–10 (2019)
Lorenz, R., Buess, P., Macuvele, J., Friedli, T., Netland, T.H.: Lean and digitalization—contradictions or complements? In: Ameri, F., Stecke, K.E., von Cieminski, G., Kiritsis, D. (eds.) APMS 2019. IAICT, vol. 566, pp. 77–84. Springer, Cham (2019). https://doi.org/10.1007/978-3-030-30000-5_10
Solheim, A.B., Powell, D.J.: A learning roadmap for digital lean manufacturing. In: Lalic, B., Majstorovic, V., Marjanovic, U., von Cieminski, G., Romero, D. (eds.) APMS 2020. IAICT, vol. 592, pp. 417–424. Springer, Cham (2020). https://doi.org/10.1007/978-3-030-57997-5_48
Nonaka, I.: A dynamic theory of organizational knowledge creation. Organ. Sci. 5(1), 14–37 (1994)
Acknowledgements
The authors would like to acknowledge the support of the Research Council of Norway and the Norwegian research project Lean Digital.
Author information
Authors and Affiliations
Corresponding author
Editor information
Editors and Affiliations
Rights and permissions
Copyright information
© 2021 IFIP International Federation for Information Processing
About this paper
Cite this paper
Sengupta, S., Dreyer, H., Powell, D.J. (2021). Breaking Out of the Digitalization Paradox. In: Powell, D.J., Alfnes, E., Holmemo, M.D.Q., Reke, E. (eds) Learning in the Digital Era. ELEC 2021. IFIP Advances in Information and Communication Technology, vol 610. Springer, Cham. https://doi.org/10.1007/978-3-030-92934-3_19
Download citation
DOI: https://doi.org/10.1007/978-3-030-92934-3_19
Published:
Publisher Name: Springer, Cham
Print ISBN: 978-3-030-92933-6
Online ISBN: 978-3-030-92934-3
eBook Packages: Computer ScienceComputer Science (R0)