What Determines the Digital Transformation of SRDI Enterprises?—A Study of the TOE Framework-Based Configuration
Abstract
:1. Introduction
2. Literature Review
3. Model Construction
3.1. Technological Dimension
3.2. Organizational Level
3.3. Environmental Dimensions
3.4. Construction of Digital Transformation Driver Model for SRDI Enterprises
4. Research Design
4.1. Research Method: fsQCA
4.2. Variable Design
4.2.1. Outcome Variables
4.2.2. Conditional Variables
4.3. Case Selection
4.4. Data Calibration
5. Empirical Analysis
5.1. Necessary Condition Analysis
5.2. Conditional Grouping Analysis
5.2.1. Analysis of Groupings with High Digital Transformation
- (1)
- Organization-environment linkage. Organizational-environmental linkage type refers to the linkage matching between organizational and environmental conditions jointly contributing to the digital transformation of SRDI enterprises. Grouping 1 (~IO∗CS∗MT∗~GS∗CP) shows that SRDI firms with a digital strategy, a high-quality executive team, and high industry competitive pressure can achieve a high level of digital transformation despite the lack of innovation output and government subsidies. About 34.57% of the case firms can be explained by Grouping 1. When SRDI firms face intense industry competitive pressure, the executive team will develop a digital strategy that is in line with the industry development trend. Even if the lack of government subsidies does not provide financial support for the firm’s R&D and innovation activities and the firm’s innovation output is not satisfactory, the SRDI firms can also achieve a high level of digital transformation; because the firms themselves have certain market share and product uniqueness and their market position is difficult to be replaced, they can also achieve a high level of digital transformation.
- (2)
- Pressure-strategy synergy. Pressure-strategy synergistic type refers to the linked match between industry competitive pressure and company strategy together to help the digital transformation of SRDI firms. Grouping 2 (~TI*IO∗CS∗~MT∗~GS∗CP) shows that SRDI firms with digital strategies complemented by certain innovation outputs when facing high industry competitive pressures can achieve a high level of digital transformation even in the absence of a high-quality executive team and government subsidies. Approximately 24.71% of the case firms can be explained by Grouping 2. SRDI firms can also contribute to a high level of digital transformation when faced with high industry competitive pressure, guided by the company’s digital strategy and complemented by certain innovative outputs.
- (3)
- Organization-led. Organizational dominant refers to the synergy between the executive team and the organizational conditions such as the firm’s strategy for the digital transformation of SRDI firms. Grouping 3 (~TI*~IO∗CS∗MT∗GS∗~CP) suggests that even facing lower competitive pressure in the industry, SRDI firms with high-quality executive teams, which formulate their digital strategies based on the future development trend of the industry, supplemented by specific government subsidies, can achieve a high level of digital transformation. About 29.04% of the case firms can be explained by Grouping 3. When SRDI firms are facing lower industry competitive pressure, high-quality executive teams can foresee the future development trend of the industry and prioritize key resources and funds to ensure the implementation of the company’s digital strategy. At the same time, government subsidies also provide enterprises with certain support for digital transformation funds to alleviate the pressure on enterprise funds and stimulate enterprises to achieve a high-level of digital transformation.
- (4)
- All-factor-driven. All-factor-driven refers to the linkage and matching between technology, organization, and environmental conditions that jointly help manufacturing firms’ digital transformation. Grouping 4 (IO∗CS∗MT∗GS∗CP) suggests that SRDI firms with a digital strategy, a high-quality executive team, and facing high industry competitive pressures, complemented by higher innovation output and government subsidies, are better able to achieve a high level of digital transformation. About 40.43% of the case firms can be explained by Grouping 4. When SRDI firms face intense industry competitive pressure, the executive team develops a digital strategy that is aligned with the industry development trend. At the same time, government subsidies provide financial support for R&D and innovation activities, and under the leadership of a top team with a strong digital sensibility, digital inputs and R&D results are rapidly transformed, thus more effectively facilitating enterprises to achieve a high level of digital transformation.
5.2.2. Grouping Analysis of Non-High Digital Transformation
- (1)
- Grouping 5 represents the “all-factor absence type” (~TI*~IO∗~CS∗~MT∗~CP), meaning that when factors such as technology, organization, environment, and others are all missing, it often leads to low digital transformation. Approximately 43.20% of the case companies can be explained by Grouping 5. In cases where SRDI companies face intense industry competition pressure, their executive teams fail to focus on industry development trends in a timely manner, lack necessary guidance for digital transformation strategies, and do not invest in the required technology. This can easily result in digital transformation failure.
- (2)
- Grouping 6 represents the “single-technology type” (TI*IO∗~CS∗~MT∗~GS∗~CP), where companies in this grouping focus solely on technological factors such as research and development investment, while neglecting the impact of organizational environment factors like corporate strategy, executive teams, government subsidies, and industry competition pressure. This also leads to a non-high level of digital transformation. Approximately 37.87% of the case companies can be explained by Grouping 6. In cases where SRDI companies face intense industry competition pressure, their executive teams fail to seize digital transformation opportunities, formulate digital transformation strategies, and lack government subsidy support. Even if there is significant technological investment and some innovation output, it becomes challenging to achieve successful digital transformation.
- (3)
- Grouping 7 represents the “technology-oriented type” (TI*~IO∗~CS∗MT∗~GS∗~CP), where in this configuration, if the executive team focuses solely on research and development investment and neglects the influence of external factors such as industry trends, without formulating a digital strategy, it can also lead to significant challenges in digital transformation. Approximately 22.02% of the case companies can be explained by Grouping7. In cases where SRDI companies face high industry competition pressure, even if the executive team can foresee future industry trends and increase technological investment, the lack of a clear digital strategy results in superficial digital transformation efforts. Digital transformation often requires substantial financial support, and in the absence of government subsidies, it often leads to digital transformation failure for businesses.
- (4)
- Grouping 8 represents the “organizational absence type” (TI*~IO∗~CS∗~MT∗GS∗CP), and approximately 19.45% of the case companies can be explained by Grouping 8. This configuration indicates that even though industry competition pressure and government subsidies may stimulate companies to increase their research and development investment, the lack of a high-quality executive team means that when the wave of the digital economy arrives, the company fails to formulate a digital strategy that adapts to industry trends. This ultimately leads to digital transformation failure.
5.3. Robustness Analysis
6. Conclusions and Policy Implications
6.1. Discussion and Conclusions
- (1)
- A clear digital strategy is a necessary condition for enterprises to realize high-level digital transformation of manufacturing processes. By comparing the groups, it can be seen that the realization of a high level of digital transformation of enterprises has formulated a clear and explicit digital strategy (Grouping 1–Grouping 4); on the contrary, a low level of digital transformation of enterprises has not formulated a digital strategy (Grouping 5–Grouping 8). The new round of scientific and technological revolution and industrial change is developing rapidly, the global economy has shifted from incremental development to stock-based competition, the rigid constraints of resources and environment are increasing, and the development environment of enterprises is becoming more and more complex and changeable, with both opportunities and challenges. Comprehensively enhancing the sustainable development capability of enterprises and resolving uncertainties with digital transformation are the core of the current strategic transformation. To carry out digital transformation, the first and foremost task is to formulate a digital transformation strategy and make it an important part of the development strategy, incorporating the data-driven concepts, methods, and mechanisms in the overall development strategy. Focusing on the vision, goals, business ecology blueprint, and other broad strategic directions put forward in the overall development strategy of the enterprise, the digital transformation strategy is systematically designed, and the goals, directions, initiatives, and resource requirements for digital transformation are put forward. By connecting business, technology, management, and other related contents, and organically integrating with functional strategy, business strategy, and product strategy, it effectively supports the realization of the overall development strategy of the enterprise. Secondly, the formulation and implementation of a digital strategy essentially depends on the enterprise strategy management team, and to a certain extent, the decision logic, decision-making style, and risk preference of the executive team’s strategic decisions have a decisive impact on the effectiveness of the enterprise’s strategic decisions. Based on the theory of senior echelon, the gender, age, education, personal experience, and other characteristics of the executive team have a far-reaching impact on corporate strategic decision-making, and it is no exception for the strategic decision-making of enterprise digital transformation.
- (2)
- The external environment helps enterprises realize digital transformation, and industry competitive pressure plays a key role. From Grouping 1, Grouping 2, and Grouping 4, we can find that the three groupings of high digital transformation are faced with more intense industry competitive pressure. The higher the degree of competition in the industry, the more it can promote the digital transformation of enterprises. Specifically, the degree of competition in the industry is closely related to the performance of the enterprise, and higher industry competition will compress the profit margin of the enterprise, prompting the enterprise to improve the degree of product differentiation through digital transformation to reduce operating costs and improve business performance to meet the needs of business operators and owners. The higher the degree of competition in the industry, the greater the homogenization of products in the market. The more competitors in the industry, the higher the business risk due to the pressure of survival; in order to stabilize the market scale and ensure survival and development, enterprises tend to accelerate the digital transformation to enhance their competitiveness. In addition, government subsidies are an important policy tool for governments to influence micro-economic agents to carry out digital transformation. According to the theory of government intervention, governments have implemented targeted policy interventions, including financial subsidies, tax incentives, and the establishment of dedicated funds, to promote the digital development of enterprises. On one hand, government grants directly provide financial support to enterprises, making them willing to invest funds in high-risk, long-cycle digital transformation projects. On the other hand, it helps enterprises to release positive signals to the outside world, optimizes the external financing environment, strengthens investor confidence, improves enterprise risk tolerance, and helps managers to choose high-risk investment projects such as digital transformation.
6.2. Research Implications
- (1)
- Theoretical Insights. Firstly, previous research has conducted many useful studies on the drivers of digital transformation, but they are mostly limited to single-factor net effects. This paper uses the fsQCA method to explore the antecedent configuration of digital transformation and the synergistic relationship between factors, which complements the theoretical research on the drivers of enterprise digital transformation to a certain extent. Secondly, distinguishing from the previous digital transformation focusing on traditional manufacturing industries, this paper takes SRDI enterprises as the research object, further subdividing the types of transformation and studying the digital transformation of enterprises based on the TOE framework, which enriches the perspective of theoretical research and expands the understanding of the transformation and upgrading of enterprises from the micro level.
- (2)
- Practical insights. On the one hand, enterprises need to actively embrace the digitalization process and develop a clear and explicit digital strategy. From the four grouping paths of high-level digital transformation, it is easy to see that a clear and definite digital strategy is an important influencing factor contributing to the digital transformation of SRDI enterprises. In addition, the cognition and action of top managers on digital transformation will influence the formulation of the enterprise digital strategy, and the role of top managers should be fully emphasized. As top managers, they should understand the importance of the digital transformation strategy in terms of cognition, match the resources needed for digital transformation in terms of action, and lead the promotion of the digital transformation strategy to the ground. On the other hand, in the context of the global digital economy, enterprises need to actively respond to the impact of digital change on the industry and enhance the long-term competitiveness of the industry through digital transformation. In addition, as most enterprises in China are in the exploration and development stage of digital transformation, the government needs to provide sufficient funds and liberal policies to improve the financing environment for enterprises to realize digital transformation and give them the momentum for digital transformation.
6.3. Research Limitations and Prospects
Author Contributions
Funding
Institutional Review Board Statement
Informed Consent Statement
Data Availability Statement
Acknowledgments
Conflicts of Interest
References
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Variable Dimension | Variable | Full Affiliation | Intersection Point | Completely Unaffiliated |
---|---|---|---|---|
Outcome variable | Degree of digital transformation (DTL) | 5.26 | 3.58 | 2.17 |
Technical Dimension | Technology inputs (TI) | 0.20 | 0.10 | 0.07 |
Innovation outputs (IO) | 5.72 | 4.19 | 1.52 | |
Organizational dimensions | company strategy (CS) | 4 | 3 | 1 |
Management Team (MT) | 3.79 | 3.25 | 3.0 | |
Environmental dimension | Government subsidies (GS) | 16.80 | 15.73 | 12.90 |
Industry Competitive Pressure (CP) | 9.33 | 3.06 | 1.23 |
Conditional Variable | High Digital Transformation | Low Digital Transformation | ||
---|---|---|---|---|
Consistency | Coverage | Consistency | Coverage | |
TI | 0.582819 | 0.597048 | 0.584604 | 0.633781 |
~TI | 0.642509 | 0.593753 | 0.628314 | 0.614476 |
IO | 0.678258 | 0.634282 | 0.618282 | 0.611893 |
~IO | 0.584985 | 0.591522 | 0.630464 | 0.674663 |
CS | 0.731665 | 0.86857 | 0.300133 | 0.377058 |
~CS | 0.475246 | 0.390859 | 0.865383 | 0.779312 |
MT | 0.696674 | 0.794736 | 0.356331 | 0.430178 |
~MT | 0.500487 | 0.423542 | 0.829972 | 0.743308 |
GS | 0.684866 | 0.628992 | 0.60692 | 0.589891 |
~GS | 0.553461 | 0.570902 | 0.618282 | 0.674936 |
CP | 0.688116 | 0.833486 | 0.352032 | 0.451253 |
~CP | 0.546961 | 0.443712 | 0.870099 | 0.74699 |
High Digital Transformation Antecedents Configuration | Non-High Digital Transformation Antecedents Configuration | |||||||
---|---|---|---|---|---|---|---|---|
Parameterization | Grouping 1 | Grouping 2 | Grouping 3 | Grouping 4 | Grouping 5 | Grouping 6 | Grouping 7 | Grouping 8 |
TI | ⊗ | |||||||
IO | ⊗ | ● | ⊗ | ● | ⊗ | ● | ||
CS | ||||||||
MT | ⊗ | ● | ||||||
GS | ⊗ | ⊗ | ● | ● | ● | |||
CP | ⊗ | ● | ||||||
Raw coverage | 0.3457 | 0.2471 | 0.2904 | 0.4043 | 0.432 | 0.3787 | 0.2202 | 0.1945 |
Unique coverage | 0.1258 | 0.0499 | 0.0543 | 0.1291 | 0.0583 | 0.0521 | 0.0565 | 0.0102 |
Consistency | 0.9193 | 0.9661 | 0.9470 | 0.9163 | 0.8719 | 0.8852 | 0.8776 | 0.9406 |
Solution coverage | 0.6429 | 0.6357 | ||||||
Solution consistency | 0.9352 | 0.8543 |
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Qi, P.; Xu, C.; Wang, Q. What Determines the Digital Transformation of SRDI Enterprises?—A Study of the TOE Framework-Based Configuration. Sustainability 2023, 15, 13607. https://doi.org/10.3390/su151813607
Qi P, Xu C, Wang Q. What Determines the Digital Transformation of SRDI Enterprises?—A Study of the TOE Framework-Based Configuration. Sustainability. 2023; 15(18):13607. https://doi.org/10.3390/su151813607
Chicago/Turabian StyleQi, Peipei, Can Xu, and Qi Wang. 2023. "What Determines the Digital Transformation of SRDI Enterprises?—A Study of the TOE Framework-Based Configuration" Sustainability 15, no. 18: 13607. https://doi.org/10.3390/su151813607