Keywords
assessing digital readiness
digital failures
Categories
How to Cite
Abstract
Digital transformation has become a critical imperative for organizations across industries, yet the success rate of such initiatives remains alarmingly low, with up to 95% failing to achieve their intended outcomes. This research paper provides a comprehensive analysis of the common causes of digital transformation failures, with a particular focus on the limitations of existing organizational readiness assessment methods. The study examines factors such as lack of clear goals, organizational and cultural barriers, insufficient leadership support, technological and resource constraints, and human capital and skills gaps that contribute to the high failure rate of digital transformation projects. The paper also explores various frameworks and methodologies used to evaluate organizational digital readiness, highlighting their shortcomings, including reliance on self-reported data, lack of standardization, emphasis on quantitative metrics, and the dynamic nature of digital technologies. The findings underscore the need for a more holistic and continuous approach to assessing digital readiness to ensure successful digital transformation initiatives. The study concludes by emphasizing the importance of addressing these limitations to enhance the success rate of digital transformation efforts.
References
Cross, D. A., & Adler-Milstein, J. (2022). Progress toward digital transformation in an evolving post-acute landscape. Innovation in Aging, 6(4), igac021. doi: 10.1093/geroni/igac021
Danuso, A., Giones, F., & da Silva, E. R. (2022). The digital transformation of industrial players. Business Horizons, 65(3), 341-349. DOI: 10.1016/j.bushor.2021.04.001
Garzoni, A., De Turi, I., Secundo, G., & Del Vecchio, P. (2020). Fostering digital transformation of SMEs: a four levels approach. Management Decision, 58(8), 1543-1562. https://doi.org/10.1108/md-07-2019-0939
Gfrerer, A., Hutter, K., Füller, J., & Ströhle, T. (2020). Ready or not: managers’ and employees’ different perceptions of digital readiness. California Management Review, 63(2), 23-48. https://doi.org/10.1177/0008125620977487
Ghosh, S., Hughes, M., Hodgkinson, I., & Hughes, P. (2022). Digital transformation of industrial businesses: A dynamic capability approach. Technovation, 113, 102414. https://doi.org/10.1016/j.technovation.2021.102414
Han, Y., Yang, J., Ying, L., & Niu, Y. (2024). The impact of corporate digital transformation on labor employment. Finance Research Letters, 60, 104888. doi: 10.1016/j.frl.2023.104888
Hausberg, J., Liere-Netheler, K., Packmohr, S., Pakura, S., & Vogelsang, K. (2019). Research streams on digital transformation from a holistic business perspective: a systematic literature review and citation network analysis. Journal of Business Economics, 89(8-9), 931-963. https://doi.org/10.1007/s11573-019-00956-z
Herzog, M. H., Wilkens, U., Bühlow, F., Hohagen, S., Langholf, V., Öztürk, E., … & Kuhlenkötter, B. (2022). Enhancing digital transformation in SMEs with a multi-stakeholder approach – implications from a socio-technical systems perspective. Digitization of the Work Environment for Sustainable Production, 17-35. https://doi.org/10.30844/wgab_2022_2
Jardak, M. K., & Ben Hamad, S. (2022). The effect of digital transformation on firm performance: evidence from Swedish listed companies. The Journal of Risk Finance, 23(4), 329-348. https://doi.org/10.1108/jrf-12-2021-0199
Kallmuenzer, A., Mikhaylov, A., Chelaru, M., & Czakon, W. (2024). Adoption and performance outcome of digitalization in small and medium-sized enterprises. Review of Managerial Science, 1-28. doi: 10.1007/s11846-024-00744-2
Kontić, L. and Vidicki, Đ. (2018). Strategy for digital organization: testing a measurement tool for digital transformation. Strategic Management, 23(2), 29-35. https://doi.org/10.5937/straman1801029k
Leng, X. and Tong, G. (2022). The digital economy empowers the sustainable development of china’s agriculture-related industries. Sustainability, 14(17), 10967. https://doi.org/10.3390/su141710967
Li, L., Su, F., Zhang, W., & Mao, J. (2017). Digital transformation by sme entrepreneurs: a capability perspective. Information Systems Journal, 28(6), 1129-1157. https://doi.org/10.1111/isj.12153
Lieu, P. T., Hiếu, N. V., & Nhật, T. H. (2022). Does digital transformation stimulate the unemployment rate in Vietnam?. Journal of Reviews on Global Economics, 11, 1-6. https://doi.org/10.6000/1929-7092.2022.11.01
Maroufkhani, P., Desouza, K. C., Perrons, R. K., & Iranmanesh, M. (2022). Digital transformation in the resource and energy sectors: A systematic review. Resources Policy, 76, 102622., doi: 10.1016/j.resourpol.2022.102622
Mohammadi, S., Heidari, A., & Navkhsi, J. (2023). Proposing a Framework for the Digital Transformation Maturity of Electronic Sports Businesses in Developing Countries. Sustainability, 15(16), 12354, doi: 10.3390/su151612354
Nadeem, A., Abedin, B., Cerpa, N., & Chew, E. (2018). Editorial: digital transformation & digital business strategy in electronic commerce - the role of organizational capabilities. Journal of Theoretical and Applied Electronic Commerce Research, 13(2), I-VIII. https://doi.org/10.4067/s0718-18762018000200101
Naseebullah, S. B. Basri, P. D. D. Dominic and M. Jehangir, "Organizational e-readiness impact on E-procurement implementation," 2011 IEEE International Conference on Industrial Engineering and Engineering Management, Singapore, 2011, pp. 605-609, doi: 10.1109/IEEM.2011.6117988.
Nwaiwu, F. (2018). Review and comparison of conceptual frameworks on digital business transformation. Journal of Competitiveness, 10(3), 86-100. https://doi.org/10.7441/joc.2018.03.06
O’Leary, D. (2022). Digitization, digitalization, and digital transformation in accounting, electronic commerce, and supply chains. Intelligent Systems in Accounting Finance & Management, 30(2), 101-110. https://doi.org/10.1002/isaf.1524
Oludapo, S., Carroll, N., & Helfert, M. (2024). Why do so many digital transformations fail? A bibliometric analysis and future research agenda. Journal of Business Research, 174, 114528, doi: 10.1016/j.jbusres.2024.114528
Puckett, C. (2022). Digital Adaptability: A new measure for digital inequality research. Social science computer review, 40(3), 641-662. doi: 10.25384/SAGE.C.5065595.V1
Qomariyah, A. N., Mursidah, E., Gonti, Y. A., & Wahyuni, D. (2020). Analysis of organizational readiness towards library 4.0: a case study at x library. Record and Library Journal, 6(2), 110. https://doi.org/10.20473/rlj.v6-i2.2020.110-119
Rebekah, Eden., Andrew, Burton-Jones., Veronica, Casey., Michael, Draheim. (2019). Digital transformation requires workforce transformation. Mis Quarterly Executive, doi: 10.17705/2MSQE.00005
Rialti, R., & Filieri, R. (2024). Leaders, let’s get agile! Observing agile leadership in successful digital transformation projects. Business Horizons. doi: 10.1016/j.bushor.2024.04.003
Schneider, S. & Kokshagina, O. (2021). Digital transformation: what we have learned (thus far) and what is next. Creativity and Innovation Management, 30(2), 384-411. https://doi.org/10.1111/caim.12414
Silva, R., Mamede, H. S., & Santos, V. (2023). Clarification of the Present Understanding of the Assessment of an Organization’s Digital Readiness in SMEs. Organization, 16, 17, doi: 10.28991/esj-2023-07-06-025
Soto Setzke, D., Riasanow, T., Böhm, M., & Krcmar, H. (2023). Pathways to digital service innovation: The role of digital transformation strategies in established organizations. Information Systems Frontiers, 25(3), 1017-1037. doi: 10.1007/S10796-021-10112-0
Ubaidillah, E., Gunawan, I., Adha, M. A., Ariyanti, N. S., & Erviana, Y. (2020). Students perception of technology-assisted services and readiness of employee digital competencies in Covid-19 pandemic era. Proceedings of the 6th International Conference on Education and Technology (ICET 2020). https://doi.org/10.2991/assehr.k.201204.026
Vogelsang, K., Liere-Netheler, K., Packmohr, S., & Hoppe, U. (2018). Success factors for fostering a digital transformation in manufacturing companies. Journal of Enterprise Transformation, 8(1-2), 121-142. https://doi.org/10.1080/19488289.2019.1578839
Warner, K. and Wäger, M. (2019). Building dynamic capabilities for digital transformation: an ongoing process of strategic renewal. Long Range Planning, 52(3), 326-349. https://doi.org/10.1016/j.lrp.2018.12.001
Wolf, M., Semm, A., & Erfurth, C. (2018). Digital transformation in companies–challenges and success factors. Innovations for Community Services: 18th International Conference, I4CS 2018, Žilina, Slovakia, June 18-20, 2018, Proceedings (pp. 178-193). Springer International Publishing. Doi: 10.1007/978-3-319-93408-2_13
Xie, X., Zhang, H., & González-Tejero, C. B. (2022). How organizational readiness for digital innovation shapes digital business model innovation in family businesses. International Journal of Entrepreneurial Behavior & Research, 29(1), 49-79. https://doi.org/10.1108/ijebr-03-2022-0243
Yen, Y. Y., Zhang, C. Y., & Yen, W. T. M. (2024). Retaining knowledge workers for effective digital transformation. International Journal of Innovative Research and Scientific Studies, 7(1), 202-210. https://doi.org/10.53894/ijirss.v7i1.2602
This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.
Copyright (c) 2024 Maciej Koczerga