A meta-analysis of the relationships among digital transformation, innovation and firm performance: the moderating effects of country-specific factors
A meta-analysis of the relationships among digital transformation, innovation and firm performance: the moderating effects of country-specific factors
Xin Shen,Haley Paluzzi,2 Authors,Haozhe Chen
TLDR
The study highlights the relevance of country-specific factors such as national culture characteristics and national economic development level in the success of digital transformation initiatives and supports the moderating roles of specific elements of national culture and national economic development level.
Abstract
PurposeWhile more companies are embracing new digital technologies in their supply chains, many of these projects fail. The literature studying digital transformation is also not conclusive regarding its relationship to firm performance. Additionally, there is a lack of theoretical explanation of the mechanisms that facilitate firm performance improvement through digital transformation. Therefore, this study advances existing knowledge by providing a better understanding of the impact of digital transformation on firm performance. Innovation is explored as a key dynamic capability that enables positive performance gains, and the moderating effects of country-specific factors are examined to enhance our understanding of these phenomena.Design/methodology/approachA meta-analysis method is utilized to aggregate the results reported in the literature. We selected and analyzed 69 empirical articles (121 effect sizes) to advance knowledge surrounding the mediating and moderating effects regarding the relationship between digital transformation and firm performance.FindingsThe results validated that digital transformation has a significant and positive relationship with firm performance outcomes and that both product and process innovation play a partial mediating role in this relationship. Additionally, this analysis supports the moderating roles of specific elements of national culture and national economic development level.Originality/valueBy analyzing existing research, this paper puts forward new insights into the relationships between digital transformation, product and process innovation and firm performance. Particularly, the study highlights the relevance of country-specific factors such as national culture characteristics and national economic development level in the success of digital transformation initiatives. Uncovering these contextual factors relevant to the implementation of digital technologies can significantly benefit future research and practice.