Navigating digital transformation: the role of management innovation in achieving digital maturity

Abstract

Purpose Digital technologies promise efficiency gains and untapped opportunity. Adoptions of digital technology lead firms to rethink their organizational setup and existing practices. This paper aims to present a management innovation-based framework that describes new processes and practices for digital transformation. Design/methodology/approach This study uses a structural equation modeling approach to test the framework with survey responses from a sample of 901 Taiwanese organizations – both local firms and multinational subsidiaries – to explore the linkages between adoption of digital technologies and digital maturity. Findings The results reveal that management innovation mediates the relationship between digital technology adoption and digital maturity. Moreover, fast-paced environments have a greater impact of management innovation toward digital maturity than slow-paced environments. Originality/value This study adds to emerging research that considers the role of organizational learning in digital transformation efforts. The extent to which organizations link the lessons from direct experience to digital routines through which management innovation is implemented determines to a large extent whether this strategic initiative is optimized by the firm. More generally, the findings point to the mutual importance of digital maturity and experiential learning efforts, and suggest a specific means by which learning processes are mobilized by innovating organizations. This study contributes to digital transformation research by providing insight into how a firm can restart failed transformation initiatives of this kind.