Digitalization and strategic flexibility – a recipe for business growth

Abstract

PurposeThis paper examines how digitalization can affect three aspects of firm growth. The specific objectives are as follows: (1) to increase understanding of how digitalization affects pre-factors for growth, (2) to examine how digitalization transforms the growth process, especially growth strategies and (3) to examine how digitalization is apparent in the outcome of growth.Design/methodology/approachWe explore six Finnish growth companies in order to understand the relationship between digitalization and growth. We used qualitative data collection and the Digimat measurement test for analyzing patterns, themes and best practices to generate a deeper understanding of the impact of digital technologies on business growth and growth strategies in these companies.FindingsWe propose that business growth includes three aspects of growth: pre-factors of growth, growth as a process and growth as an outcome. Digitalization may affect all of these aspects and strategic flexibility can affect business growth. Digitalization and strategic flexibility are intertwined; strategic flexibility enables the application of new technology, and digitalization enables flexibility.Practical implicationsBuilding on the results of the case studies, this research identifies relationships between digitalization, business growth and strategic flexibility.Originality/valueThis paper contributes to the growing literature on digitalization, providing new insight into its relation to business growth.