Strategizing in a digital world: Overcoming cognitive barriers, reconfiguring routines and introducing new organizational forms
Volberda, Henk W Khanagha, Saeed Baden-Fuller, Charles Mihalache, Oli R Birkinshaw, Julian
Volberda, Henk W
Khanagha, Saeed
Baden-Fuller, Charles
Mihalache, Oli R
Birkinshaw, Julian
Publication Type
Journal article with impact factor
Editor
Supervisor
Publication Year
2021-10
Journal
Long Range Planning
Book
Publication Volume
54
Publication Issue
5
Publication Begin page
102110
Publication End page
102110
Publication Number of pages
Collections
Abstract
As digital technologies such as cloud and edge computing, machine learning, advanced artificial intelligence (AI), and the internet of things (IoT) unfold, traditional industries such as telecoms, media, entertainment, and financial services are being reconfigured and new sectors are emerging. In this new competitive landscape we observe new organizational forms and new business models, including the emergence of platforms and multi-sided markets. This emergence has required a strategic response from incumbent firms, including both well-established firms and some first-generation digital enterprises. With these advances in digital technology, the very nature of strategy is changing. Fundamentally, the use of digital technologies may provide new opportunities for efficiency gains, customer intimacy, and innovation. However, without the right mindset for change, appropriate digital routines, and structural changes, digital transformation efforts will fail. We therefore present a framework for strategizing in this new digital competitive landscape that underscores the importance of the interplay between (1) the cognitive barriers faced by managers when trying to understand this new digital world and envision new digital business models, (2) a need to reconfigure and extend digital routines, and (3) new organizational forms that are better equipped to creating value and gaining competitive advantage. From this framework of essential pillars, we derive four journeys of digital transformation for companies that were formed in the pre-digital economy. We also describe the management roles required by top, middle, and frontline managers, depending on whether the digital migration is evolutionary or transformative and whether the firm is responding to or attempting to shape the ecosystem. Although digital transformation is technically all about technology, the more important issue is how companies make their way through this strange new digital world in which they find themselves. Ultimately digital transformation is as much about strategizing as it is about technology.
Research Projects
Organizational Units
Journal Issue
Keywords
3503 Business Systems In Context, 35 Commerce, Management, Tourism and Services, Machine Learning and Artificial Intelligence, 9 Industry, Innovation and Infrastructure