Digital Technologies and Firm Performance

Technological Forecasting & Social Change 154 (2020) 119962
Contents lists available at ScienceDirect
Technological Forecasting & Social Change

journal homepage: www.elsevier.com/locate/techfore
Digital technologies and firm performance: The role of digital organisational T

culture
Eva Martínez-Caroa, , Juan Gabriel Cegarra-Navarrob, Francisco Javier Alfonso-Ruizc
⁎
a
School of Industrial Engineering, Universidad Politécnica de Cartagena, C/ Doctor Fleming, s/n. 30202. Cartagena, Spain
b
Faculty of Business Studies, Universidad Politécnica de Cartagena, C/ Real, 3. 30201, Cartagena, Spain
c
Spain Saint-Gobain Weber Cemarksa, Spain
A B ST RACT
In recent years new digital technologies have brought about important changes for individuals, organisations and society in general. The vast amount of digitised data
that is made available to companies can be a new source of value generation. However, the mechanisms through which companies can take advantage of digital
technologies to increase performance are not clearly defined. A research model is proposed suggesting that developing a digital organisational culture facilitates both
the process of business digitisation and the generation of value from digital tools, with the ultimate goal of improving organisational performance. The research
involved 93 production centres of a multinational company with presence in more than 10 countries. The theoretical model was tested by using structural equation
modelling. The results show that business digitisation can boost the development of value activities, but companies will only unleash this potential if they incorporate
a digital organisational culture. By defining the organisational culture that best supports their digital strategy, firms can expect to improve their performance.
1. Introduction no longer merely the key to internal process innovation. It is also vital for
external process innovation. In this vein, the European e-Business
Technologies have continued to make progress and a fourth stage Report (2008) identifies three main actors in the ICT-induced value-added
characterised by industry 4.0 is now appearing. The focus is no longer on process: Digitisation or ICT adoption and use; ICT value development; and
simple information management but on the design of services where big impact on company performance.
data plays a key role in competitiveness. The Internet is considered to be It should be noted that the introduction of digital technologies implies
one of the most significant sources of big data (Geoffrion and profound changes in the ways of working and interacting with the en
Krishnan, 2003). Now, organisations in a wide range of industries are re vironment in organisations. Not only may business digitisation cause the
designing processes and even entire business models to transform big data emergence of new business models or the reformulation of traditional
and its applications into strategic advantages (Leischnig et al., 2016). The commercial strategies, but it may also change the relationship between the
trend towards digitally integrated value systems connected through In company and its customers (Scuotto et al., 2017). With digitisation, custo
formation and Communication Technologies (ICT) can be seen as a new mers have direct access to communication with companies, which facilitates
lifecycle of business. Nowadays companies have at their disposal digital the exchange of data between them (Papa et al., 2018) but, at the same
technologies such as IoT platforms, location detection technologies, ad time, this forces companies to pay attention to their digital reputation. These
vanced human-machine interfaces, authentication and fraud detection tools, changes can create tension between old values, systems or procedures and
3D printing, smart sensors, big data analytics and advanced algorithms, the new ones, which can be an obstacle to the implantation and use of new
multilevel customer interaction and customer profiling, augmented reality, technologies (Del Giudice, 2019). Under this framework, a new technology
cloud computing or mobile devices. The focus is on end-to-end digitisation can be implemented, but it must first be assimilated and internalised for
of all physical assets and the integration into digital ecosystems with value better decisions and innovation to occur; that is, to generate value
chain partners. (Fernandes, 2012; Rajahonka and Villman, 2019). This process of gen
Although firms continue to use ICT to improve process efficiency, ICT erating value through digital tools can also create tension in a new reality
are increasingly recognised as important tools for innovation and increasing that must be faced by workers and managers (Preston and Allmand, 2001).
revenues by enabling new services and new ways of working within value The ideas set out above could mean that companies, in order to improve
networks. New challenges include the greater importance of knowledge- performance, have to foster a change of focus which facilitates both the
intensive activities within both the manufacturing and services sector. ICT is process of business digitisation and the generation of value from digital
⁎
Corresponding author.
E-mail addresses: eva.martinez@upct.es (E. Martínez-Caro), juan.cegarra@upct.es (J.G. Cegarra-Navarro), franalfonsoruiz@gmail.com (F.J. Alfonso-Ruiz).
https://doi.org/10.1016/j.techfore.2020.119962
Received 27 June 2019; Received in revised form 10 February 2020; Accepted 12 February 2020
Available online 20 February 2020
0040-1625/ © 2020 Elsevier Inc. All rights reserved.
E. Martínez-Caro, et al. Technological Forecasting & Social Change 154 (2020) 119962
tools. Organisational culture has been considered to be a source of sustained

Despite its new opportunities, the digital economy raises questions competitive advantage (Barney, 1991; Sadri and Lees, 2001; Chan et al.,
about how people and organisations will adapt and grow in this new era 2004) and a key factor to organisational effectiveness (Denison, 1990;
(Kane et al., 2015). Organisational culture has been suggested as a factor Gregory et al., 2009; Zheng et al., 2010). Furthermore, organisational cul
that may ultimately influence the effectiveness with which a firm imple ture is known to be important to the success of projects involving organi
ments digital technologies. For example, a firm whose culture is more sational changes (Ke and Wei, 2008), such as those implied by the in
flexible may be more likely to achieve success with new technology than troduction of new digital technologies in the company.
one that is not (McDermott and Stock, 1999). Organisational culture does Previous literature has extensively analysed the role of organisa
not directly lead to organisational effectiveness; rather, it exerts its influence tional culture from different perspectives. Along this line, prior research
through shaping the behaviour of organisational members (Zheng et al., has found an association between organisational culture and perfor
2010). Organisational culture has been adopted in information system re mance (Barney, 1986; Gordon and DiTomaso, 1992; Ogbonna and
search to explain the effects of culture on process management or the im Harris, 2000; O'Really et al., 2014), innovation (Cakar and
pact of ICT on work environments. Ertürk, 2010; Wang et al., 2011; Büschgens et al., 2013; Naranjo-
Companies facing digital transformations with significant expected Valencia et al., 2011; Hogan and Coote, 2014), leadership (Bass and
business benefits for customers and the organisation have failed because Avolio, 1993; Vera and Crossan, 2004; Ke and Wei, 2008; Sarros et al.,
they collided with the company culture (Wokurka et al., 2017). Hence, 2008), knowledge management (Alavi et al., 2005; Al-Alawi et al.,
digitisation requires instilling a digital culture that supports this change; that 2007; Zheng et al., 2010; Rai, 2011), job satisfaction (Lund, 2003;
is, an organisational culture that is fit for digitally transforming organisa Egan et al., 2004; MacIntosh and Doherty, 2010; Belias and
tions. Many firms are aware that they need to transform their culture to Koustelios, 2014) and information technology (Hoffman and Klepper,
achieve their digital objectives (Haffke et al., 2017). While the need to adapt 2000; Harper and Utley, 2001; Leidner and Kayworth, 2006).
to a digital environment may be inevitable, there is no certainty that such a If we extrapolate the term organisational culture to the digital do
shift will create value for the organisation (Weber and Pliskin, 1996). main, it could be argued that in the era of the digital workforce, an
Therefore, research on the critical role of digital culture can help identify the enterprise's culture must expand to include its digital workplace prac
practical aspects necessary to successfully manage a digitisation process. tices (Duerr et al., 2018). Based on these considerations, digital orga
However, there is no work focusing on firms’ organisational culture when nisation culture can be conceptualised by adapting Deshpande and
developing digital transformation (Duerr et al., 2018). While great emphasis Webster's (1989) definition as follows: a set of shared assumptions and
has been placed on the technological and economic changes ascribed to understanding about organisation functioning in a digital context.
digital transformation, digital organisational culture, one of the driving The core of organisational culture is the combination of artefacts;
factors of transformations, has received scarce attention (Wokurka et al., organisational attributes that can be observed, felt and heard as an
2017). Research in this area needs to analyse how digital organisational individual enters a new culture; values or beliefs; norms, standards and
culture may serve as a facilitator for companies in their digital transfor moral principles that can be perceived through interviews and ques
mation. tionnaires;- and underlying assumptions -unconscious and assumed
With the aim of filling this gap in literature, this paper analyses how conceptions that can be indirectly collected through the observation of
having a digital organisational culture facilitates both the process of behaviour (Saffold, 1988; Gordon and DiTomaso, 1992; Schein, 1992).
business digitisation and the generation of value from digital tools, with Duerr et al. (2018) propose an adaptation of this approach to a digital
the ultimate goal of improving organisational performance. To achieve context: (1) Artefacts become manifest in the changing structures of
this, the following section presents the theoretical background and the digitalising firms due to novel ways of internal collaboration (cross-
hypotheses development of this research. Then, the methodology used functional teams, physical and virtual collaboration and dual struc
for data collection and analysis are described. Later, the results from the tures) and external collaboration (start-ups, platforms with competitors
hypotheses testing are detailed. Finally, the paper concludes with a and partners and customer integration). (2) Values are digital goals and
discussion of these results. norms which have been seen to be vital for a new organisational cul
ture. These values are concentrated around the mentality and authority
2. Conceptual framework modes towards digitalisation; for example, responsibilities are dis
tributed across business units to improve the alignment of digital in
2.1. Digital organisational culture novation processes. (3) The underlying assumptions of firms operating
in the digital age are related to the need to integrate IT into innovation
Since the concept of organisational culture was popularised in the 1980s or the equal distribution of power, which empowers employees by in
by Deal and Kennedy (1982) and Peters and Waterman (1982), this topic tegrating their ideas into the digital strategy.
has received considerable attention among both management scholars and Organisational culture has been generally thought of as a long-
practitioners. Organisational culture is typically defined in terms of the way standing and relatively stable characteristic that may provide the
people think, which has a direct influence on the ways in which they behave foundation organisational members need to recognise change and im
(Ke and Wei, 2008). For Barney (1986), the term organisational culture plement adaptations within the context of that particular organisation
refers to a “complex set of values, beliefs, assumptions and symbols that (Costanza et al., 2016). In this sense, Harshak et al. (2013) explain that
define the way in which a firm conducts its business”. Similarly, organisations cannot change their culture just by trying to convince
Deshpande and Webster (1989, p.4) define organisational culture as a “set people of the merits of digitisation. However, although organisational
of shared assumptions and understanding about organization functioning”. culture cannot be changed wholesale, it can evolve. An organisation can
According to Schein, organisational culture is a “pattern of basic assump even use its existing culture and its strengths to generate the change it
tions that a given group has invented, discovered, or developed in learning needs. The organisation can look for the behaviour that already exists
to cope with its problem of external adaptation and internal integration, and which supports a new digital approach and can reinforce this behaviour
that have worked well enough to be considered valid, and, therefore, to be in formal and informal ways. By doing this, the organisation can de
taught to new members as the correct way to perceive, think, and feel in velop a digital culture. This digital culture needs to encourage the de
relation to these problems” (Schein, 1985, p. 9). Langan-Fox and Tan (1997, velopment of collaborative work environments, creativity and innova
p. 274) highlighted four core issues regarding organisational culture: (1) it is tion, challenges and initiative and permanent improvement through a
settled and resistant to change; (2) it is taken for granted; (3) it derives its shared digital strategy (Claver et al., 1998; Kane et al., 2015), not only
meaning from the organisation's members; and (4) it incorporates a shared among managers but among all company employees.
understanding.
2
2.2. Business digitisation Companies must be proactive in re-interpreting their corporate culture
around digital aspects in the workplace. Along this line, Kane et al. (2015)
Nowadays, it is widely accepted that digital technologies (viewed as suggest that what separates digital leaders from the rest is a clear digital
combinations of information, computing, communication and connectivity strategy combined with a digital culture poised to drive the transformation.
technologies) can be used in business to obtain sustainable competitive Hence, to successfully develop BD, a specific digital culture is seen
advantages which are essential to survival in the face of competition in to be a prerequisite. This premise is widely accepted by managers. For
some sectors. Digitising something refers to transferring data into a digital example, the consultant CapGemini conducted a study in 2017 on the
form (Salo, 2006). Business digitisation (BD) reflects a firm's approach and Digital Culture Challenge in which they surveyed 1700 respondents
capability to explore and use new digital technologies (Hess et al., 2016). It from 340 European organisations. The main conclusion was that 62% of
is concerned with the changes digital technologies can bring about in a respondents consider digital culture issues to be the number one ob
company's business model -basically in the core functions of ICT: data sto stacle to digital transformation (Buvat et al., 2018). However, this has
rage, data processing and data exchange (Carr, 2003a) - which result, for not been tested in the academic literature. Therefore, the following
example, in data digitisation along the value chain or in the automation of hypothesis is proposed:
processes. According to Breeding (1992), the digital format brings flex H1. : A digital organisational culture has a positive relationship with
ibility, reliability and lower costs to various activities. For this reason, BD.
during the last decade business infrastructure has become digital with in
creased interconnections among products, processes and services. Across
many firms spanning different industries and sectors, digital technologies 2.3. Digital technology value development
are fundamentally transforming business processes, firm capabilities, pro
ducts and services and key inter-firm relationships in extended business Business practices show that not all companies have had equal
networks (Bharadwaj et al., 2013). success in achieving a more profound use of digital technologies. Prior
Although every organisation could potentially facilitate the digitisation work reveals that ICT alone does not create value; it needs to be part of
process in a different way, several studies have already addressed the op a business value creating process and should be aligned with organi
erational aspects of the digitisation process. The history of technological sational factors in a synergistic fashion (Leischnig et al., 2016).
advances in business is littered with examples of companies focusing on Therefore, it is not only necessary to develop a better understanding of
technologies without investing in organisational capabilities that ensure why and how companies adopt digital technologies, but also how they
their impact. In many companies, the failed implementation of technologies exploit them. Companies that have achieved proper implantation and
is a classic example of expectations falling short because organisations didn't acceptance of these technologies face a second challenge: to generate
change mindsets and processes or build cultures that fostered change. value from digital technologies.
According to Hoffman and Klepper, 2000, the influence of organisational Much of the existing research has focused on the adoption decision and
culture has often been ignored or underestimated by managers in assessing on measures such as ‘intent to adopt’. However, it is necessary to deepen the
the success or initial failure in the assimilation of new technologies. There is knowledge about post-adoption variations in value. It is important to view
a difficulty in analysing the role of organisational culture in the successful digital technology diffusion as a multistage process that starts at adoption
adoption of new technologies: The popular and academic literature on or and extends to value creation (Zhu and Kraemer, 2005). Hence, digital
ganisational culture is extensive. There are many conceptualisations that technology value development (DTVD) can be considered as a firm's cap
lead to different possible explanatory variables which could characterise the ability to create value through the application of digital technologies. This
culture of an organisation. It is clear that organisational culture influences conceptualisation reflects the idea of considering to what extent the in
the acceptance of new technologies. Prior work suggests that the fit between vestments made by the company in digital technologies are translated into
a new technological system and organisational culture is critical to permit value activities such as generating new knowledge to innovate, facilitating
the firm to reap the potential benefits expected from the system decision-making, improving customer services, improving coordination
(Cooper, 1994; Rashid et al., 2004; Leidener and Kayworth, 2006; with suppliers or redefining more efficient processes. For example, in the
Kaushal, 2011; Büschgens et al., 2013). For example, Martinsons and European furniture industry, CAD (Computer Aided Design) software and
Chong (1999) note that “even good technology can be sabotaged if it is 3D tools are used by companies of all sizes not only to facilitate the design
perceived to interfere with the established social network (p. 124)”. How process of products, but also to enhance the customer's experience at the
ever, specifically in the digital domain, what is important in the culture of point of sale. 3D tools enable a virtual presentation of products. Ultimately,
an organisation to bring about digital transformation? This research pro this triggers customer-driven production and innovation processes
poses a digital conceptualisation of organisational culture. (European Business Report, 2018).
If we extrapolate the above arguments to the digital domain, it could be As noted in the previous section, companies are more likely to exploit a
considered that introducing digital technology will not guarantee successful technology if their own values match or fit the values embedded within the
implementation. Cooper (1994) suggests that when technological systems technology or those associated with its development (Leidner and
clash with an organisation's culture, the implementation will be resisted in Kayworth, 2006). Researchers have also suggested that companies that are
one of two ways – either the system will be rejected or it will be modified so recognised for their ability to exploit digital technologies often emphasise
that it matches the existing culture. On the other hand, there is a persistent their organisational culture (Büschgens et al., 2013). Business can, through
view that culture can be consciously designed and manipulated (e.g., activities, policies and procedures, generate a digital culture which supports
Schein, 1985; Block, 2003). Indeed, practitioners allude to an adaptive or creativity and innovation to develop digital value activities (Naranjo-
ganisational culture as a digital culture that is necessary for digitisation Valencia et al., 2011). Digital technologies can represent knowledge in
(Costanza et al., 2016; Bughin and Van Zeebroeck, 2017; Duerr et al., multiple ways and allow dynamic configurations of interpretation. They
2018). Digital culture can therefore be seen as a means through which an enable internal knowledge to be organised, rearranged, and processed to
organisation can begin to plan for digital strategies in a rapidly changing create new value knowledge. They also help departments work together to
environment. Hence, the existing organisational culture should encourage transform and commercialise newly acquired external knowledge
the challenging of accepted values and norms as a prior step to considering (Malhotra et al., 2005). However, in order to exploit these features, it is
whether the initiative of digitisation can be relevant. In other words, the indispensable to have a digital culture that conducts employees and teams
organisation should identify the attributes of the existing culture and then within enterprises towards knowledge sharing and creation. Employee
begin the process of lessening or removing those cultural attributes that willingness to use and share knowledge (Lin, 2007) to generate new and
prevent or slow down successful BD, while establishing organisational valuable ideas (Amabile, 1998), or to perform work in a novel and appro
culture attributes that support successful BD (Harper and Utley, 2001). priate way (McLean, 2005) enables the firm to develop value from digital
3
technologies. A digital culture can stimulate behaviour among the members impact on organisational performance (Tan et al., 2010). This paper
of an organisation that lead them to accept digital technologies as a source focuses on the fact that digital technologies can have an effect on
of value for the organisation and can foster commitment to them performance in a twofold way: from BD and from DTVD.
(Hartmann, 2006). In consequence, a new hypothesis explaining the in Greater BD could provide an increase in benefits to organisations
cidence of digital organisational culture in DTVD is proposed: through cost savings, increased connectivity, greater flexibility
H2. : Digital organisational culture has a positive relationship with (Drnevich and Croson, 2013) and adaptability in an environment which is
DTVD. increasingly complex and competitive. For example, digitisation removes
the barriers of space and time. This allows companies to take better ad
To develop value, new knowledge is needed. BD supports access to
vantage of their human resources (Bhansali and Brynjolfsson, 2007) since
the knowledge that resides inside the organisation but also provides
they can work in different geographical areas by being connected to the
access to external knowledge. Therefore, it seems intuitively clear that
Internet through the wide range of digital tools available. In this regard,
BD provides support for DTVD. They have separate but complementary
Gunasekaran (2002) asserts that BD has the potential to radically change the
roles. DTVD development depends on BD since firms cannot possibly
ways in which we communicate, interact, receive information and en
exploit knowledge without first being able to acquire it (Cohen and
tertainment and acquire goods and services. In addition, digital technologies
Levinthal, 1990). In this sense, BD provides access to a wider knowl
shape new business infrastructures and influence the new organisational
edge base which enables the company to improve its efficiency for
logic and patterns of coordination within and across firms (Bharadwaj et al.,
DTVD. For example, a virtual community operating through a website
2013). Companies can configure teams adapted to particular projects by
or a social network allows a firm to collect vast amounts of information
selecting experts from all over the world who can work in teams more
from the community members. The big data collected can then generate
easily. Moreover, according to Gunasekaran et al. (2002) , digital technol
value if they are analysed and synthesised in order to identify and re
ogies could enhance the promotion of products and services through direct,
cognise what information might be valuable (Roberts et al., 2012). In
information-rich and interactive contact with customers; create a new dis
this way, the firm could extract patterns, form conclusions about users
tribution channel for existing products, based on the direct support of re
and make decisions based on this information.
search carried out on customers and the bi-directional nature of commu
The self-referential nature of digital technologies means that wide
nication; reduce the cost of delivering information to customers; reduce the
spread diffusion of digital innovative initiatives requires ubiquitous
delivery time for digitised products and services; reduce administrative
access to digital tools (Yoo et al., 2010). For example,
work, especially across international borders; and greatly enhance customer
Trantopoulos et al. (2017) study how different types of digital infra
service by enabling customers to find detailed information online.
structures (data access systems, network connectivity) enhance the
Therefore, the following hypothesis is proposed:
impact of deep external knowledge on firm DTVD processes.
H4. : BD has a positive relationship with organisational performance.
Vesselkov et al. (2018) describe the changes that wearables and con
sumer technologies bring to the current value network of the telehealth While organisations can expect mainly operational benefits from BD,
industry. Their findings expand our prior understanding of the com DTVT can bring strategic advantages (Salo, 2006). As Carr (2003a) ex
plementary role of BD to the context of DTVD. According to Zhu and plains, years ago most executives relegated the use of IT to low-level
Kramer (2005), the greater the extent of digital technologies, the employees, such as secretaries, analysts and technicians. It was unusual for
greater the likelihood that organisations will create digital technology executives to incorporate IT into their strategic thinking. Nowadays, CEOs
capabilities that are valuable and sustainable, thereby contributing to regularly talk about the strategic value of digital technologies and how
value creation. This leads to the following hypothesis. they can use them to gain a competitive advantage. DTVT encompasses
H3. : BD has a positive relationship with DTVD. deriving new insights and consequences from the combination of existing
and newly acquired knowledge and incorporating transformed knowledge
into the enterprise's way of doing business, thus enabling innovation and
2.3. Digital technologies and organisational performance
strategic flexibility (Barney, 1991). The business value associated to digital
technologies can be manifested as improved decision quality, employee
The relationship between IT and performance has been a matter of
empowerment, enhanced organisational effectiveness, better quality and
debate for decades. Although a great body of research has emerged on
service, and new products and services or product enhancement as a result
this subject, findings are plagued with ambiguities and inconsistencies.
of re-engineered processes and redesigned organisational structures (e.g.,
In the 1980s and early 1990s, empirical research did not generally find
Dibrell et al., 2008; Wu and Chen, 2014; Bayo-Moriones et al., 2013;
productivity improvements associated with IT investment to be relevant
Chitsaz et al., 2017; Yunis et al., 2017).
(Dos Santos et al., 1993; Strassmann, 1990; Weill, 1992), suggesting
Moreover, DTVD can provide additional strategic advantages, such
that a productivity paradox does exist. This productivity paradox – first
as formulating effective strategies, designing successful marketing
exposed by Brynjolfsson (1993) – states that IT may have a negligible or
campaigns, analysing the competitive landscape and crafting smart
even negative effect on a firm's performance. In other words, low ag
business plans (Mooney et al., 2001). Based on this argument, this
gregate productivity growth has been found to be achieved during a
paper proposes the following hypothesis:
period of high IT spending. More recently, as new data have been made
H5. : DTVD has a positive relationship with organisational
available and new methodologies applied, empirical investigation has
performance.
found evidence that IT is associated with improvements in productivity
(Sircar and Choi, 2009; Tavana et al., 2009; Martínez-Caro and Cegarra- Fig. 1 provides a synopsis of the arguments above.
Navarro, 2010; Tambe and Hitt, 2013).
However, the digital era raises new questions about how technolo 3. Methodology
gies can improve organisational performance. Even for firms within the
same industry, the impact of digital technologies tends to vary widely 3.1. Data collection
(Hsu et al., 2006). Different companies in different sectors exhibit
varying payoffs, despite having made similar investments in digital To verify the above hypotheses, this study has used the multinational
technologies (Dhar and Sundararajan, 2007). This phenomenon has company Saint-Gobain Weber (https://www.saint-gobain.com/en/
reignited the perennial IT productivity paradox debate and has created weber). Saint-Gobain designs, manufactures and distributes materials.
a new wave of scepticism about the business value of web technologies This is a truly global company, with presence in over 67 countries and
(Carr, 2003b). Today more than ever, researchers face great pressure to the central headquarters in Paris, France. The company employs about
demonstrate that digital technologies have a consistently positive 180,000 employees of more than 100 nationalities, about 25% of whom
4
Fig. 1. Proposed research model.
work for the construction products division. The company turnover in technology value and business performance. The independent sample t-
2018 was €41,774 million. In addition, the company's 2018 sales in test revealed no significant difference between the first and last answers
creased by 4.4% like-for-like, with a positive 3.0% price impact. (p = 0.172, p = 0.211, p = 0.840, and p = 0.568, respectively). Fi
Since Saint-Gobain Weber has invested greatly in digital technolo nally, we conducted the Harman's single factor test (Podsakoff et al.,
gies and in competitiveness, we think this company fits very well within 2003b). The results showed that the fit was considerably worse for the
the aim and scope of this study. Exploring new areas of technology, one-dimensional model than for the measurement model. While the
such as data science and electronics, connected objects or additive one-factor model generated a Satorra-Bentler χ2(65) = 247.12; χ2/
manufacturing, is the main mission of Saint-Gobain. Their objective is d.f = 3.80, the measurement model yielded a Satorra-Bentler
to use digital technologies to achieve both breakthrough innovations χ2(59) = 95.64; χ2/d.f = 1.62). All these results suggest no substantial
and the continuous improvement of their products, processes and ser common method bias (Armstrong and Overton, 1977).
vices in a spirit of openness and attentiveness to customer needs. For Before sending the questionnaire, we held meetings with managers
example, they use advanced human-machine interfaces in order to and key employees within Weber. During these meetings we wrote the
improve industrial performance or data analysis to offer the best quality questions so that they were easily understood by the respondents. As
service to their clients. To achieve this goal, the company has worked to the appendix shows, a seven-point Likert type scale (1 = “totally dis
develop a digital strategy that all employees must embrace. However, agree”, 7 = “totally agree”) was used for all questions. The ques
the company is made up of numerous centres around the world and, tionnaire constructs were as follows:
although there are central guidelines, each adopts them in a particular Measures assessing digital organisational culture (DOC) were based
way. Therefore, it seems to be an interesting framework in which to on Denison and Mishra (1995), Hogan and Coote (2014) and
analyse the role of the digital culture of the different centres in the Büschgens et al. (2013). The final revised scale consists of four items to
development of organisational results through digital technologies. To measure, which refers to the orientation in the organisation towards the
develop this research we select the production centres of the firm. acceptation of technological changes, digital innovation and the sharing
The survey elaboration process started by making contact with a of a digital strategy.
panel of top management executives in order to ensure the coherence of BD was measured considering the research developed by Bowersox et al.
the questions from the management perspective. The idea was to have, (2005), Salo (2006) and Bharadwaj et al. (2013). The authors adopted
from the start of their engagement, close contact with the company in questions focusing on the way information systems in the organisation
order to ensure that any information generated by the research was of generate data in real time along the value chain and foster information
relevance to the organisation, and thus maximise their engagement. traceability during the production process with high levels of quality.
Data were collected between July and August of 2018. A survey was Previous studies by Tallon and Pinsonneault (2001), Melville et al.
sent to all the manufacturing centres (200), with answers received from (2014) and Leischnig et al. (2016) provide guidance in developing
93 of them. All of them fully answered the questionnaire, and this re items to measure DTVD. Three items assessed the development of value
sulted in a response rate of 46.5%, with a factor of error of 7.45% for for business activities in relation to the enhancement of digital tech
p = q = 50% and a reliability level of 95.5%. While this survey in nological solutions for stakeholders (e.g. customers, suppliers and em
volves senior management, the response rate is higher than the average ployees) and business management due to a better understanding of the
rate of 15 to 25% suggested by Menon et al. (1996). The sample can be data available to quickly support business activities.
described as follows: 40% of top managerial positions, 33% of middle Finally, we operationalised organisational performance (OP) using items
management, and the rest came from heads of department and staff from previous research (Judge and Douglas, 1998; Quinn and
members. More than 40% of those interviewed had more than 15 years’ Rohrbaugh, 1983). The final revised scale consists of 3 items to measure OP.
seniority in the company, and 60% were between 36 and 50 years old.
All participants were responsible for managing employees.
3.3. Data analysis
3.2. Measures The proposed hypotheses were tested simultaneously using PLS-SEM
due to the fact that all the constructs have been considered as composites
Three statistical tests were conducted to avoid the presence of re (Henseler et al., 2016a; Henseler et al., 2016b). The test was performed
sponse bias (Podsakoff et al., 2003a). Firstly, a factor analysis of all the using ADANCO 2.0.1 Professional for Windows (http://www.composite-
variables to ensure the absence of response bias showed four factors modelling.com/) (Dijkstra and Henseler, 2015a). Given that there is a
with eigenvalues greater than 1.0, with an explained variance of high level of correlation between indicators, digital culture, digitisation
75.41%. Secondly, we proceeded to compare the first and last answers process, technology value and business performance were specified as a
(1 = early and 2 = late) in terms of digital culture, digitisation process, composite reflective construct mode ‘A’ (Dijkstra and Henseler, 2015;
5
Table 1 respectively (Dijkstra and Henseler, 2015; Henseler et al., 2016b). In addi
Results of the Confirmatory Composite Analysis. tion, all the factor loadings from all the constructs are statistically sig
Overall saturated model fit evaluation Value Hi95 Hi99 nificant, with the lowest value for the item measuring “BP2” being “0.501”.
The generated variance inflation factors (VIFs) for all the study variables
SRMR 0.063 0.067 0.074 ranged from 1.370 to 3.822 showing that multicollinearity was not present.
dULS 0.367 0.418 0.508
As shown in Table 3, discriminatory validity was verified in two
dG 0,182 0,211 0.252
different ways. Not only were all HTMT values below the level of 0.90
Note:. (Henseler et al., 2016a), but each construct also related more strongly
Global goodness of fit and bootstrap-based 95% and 99% quantiles (saturated to its own measures than to those of others (Fornell and Larcker, 1981),
model). thereby providing evidence of discriminant validity. Descriptive results
SRMR→ Standardized Root Mean Square Residual; dULS→ Unweighted Least are also presented in Table 3.
Squares Discrepancy; dG→ Geodesic Discrepancy. The results of the hypothesis contrast are collected in Table 4. For
these path coefficients, the intervals determined through the use of
Henseler et al., 2016a). According to Cepeda-Carrion et al. (2019), this bootstrapping (5000 resamples) do not contain the value zero
study has followed three steps to analyse data. (Hair et al., 2013; Hayes and Scharkow, 2013). It is also important to
First, we analyse the model fit. Since the model does not include note that the indirect effects through the digitisation process and the
multidimensional constructs, the measurement and the structural technology value are statistically significant, as the intervals de
models can be estimated and evaluated simultaneously (Benitez et al., termined through bootstrapping do not contain the value zero
2016). As shown in Table 1, the standardised root mean square residual (Preacher and Hayes, 2008; Shmueli et al., 2016). Consequently, from
(SRMR) value and all discrepancies suggest very good measurement the above analysis, hypotheses 1 to 5 were supported.
model fit (Henseler et al., 2016a).
Second, the study analyses both the reliability of the model composites 5. Discussion and conclusions
and their validity. In doing so, we have used Scale Composite Reliability
(SCR) as an appropriate measure of internal consistency reliability In recent years new digital technologies have produced important
(Bagozzi and Yi, 1988). Average Variance Extracted (AVE) has also been changes for individuals, organisations and society in general. Individuals
used to measure unidimensionality (Fornell and Larcker, 1981), and a have become accustomed to the use of mobile devices and to being
Heterotrait-Monotrait ratio of correlations (HTMT) has been used to test continuously connected through the internet. As Blazquez and
discriminant validity (Dijkstra and Henseler, 2015). Third, the fifth hy Domenech (2018) point out, they make use of computers, smartphones
pothesised relationships were tested using ADANCO 2.0.1 through path and tablets in order to buy products online, share their opinions, chat
analysis and the confidence intervals for each relationship. The considera with friends, check the way to get to some place or share their location.
tion of bootstrap percentile confidence intervals gives greater assurance This activity generates a vast amount of digitised data that, when made
than simply relying on testing the significance of null hypotheses available to companies, can be a new source of value generation. For
(Cohen, 1994). Below, the results of the assessment of the measurement example, data could be used with forecasting purposes such as identi
model and the hypothesised relationships are shown. fying trends in new products or services. However, the mechanisms
through which companies can take advantage of digital technologies to
increase performance are not clear enough for scholars and practitioners.
4. Results Companies have repeatedly been told that they need to invest in digital
technologies in order to transform their traditional business models into
The results provided in Table 2 show the validity of the composite e-business models and gain competitiveness. Nevertheless, little research
constructs. The scale composite reliability (SCR) and the average variance has been done about how to use these newly acquired technologies to
extracted (AVE) are above the common standards of 0.8 and 0.5, ensure that they become a vehicle to improving performance.
This research responds to the need for a better understanding of the
Table 2 implications of the development of digital initiatives on performance.
Construct summary, confirmatory factor analysis and scale reliability. In doing so, the importance of considering digital organisational culture
Construct VIF Weight loading Reliability (SCRa., AVEb) as an antecedent of organisational performance through the use of di
gital technologies has been highlighted. The concept of organisational
Digital Culture
culture has been widely used in information systems research as a
DC1 1.881 0.332 0.896 AVE = 0.632
DC2 3.822 0.281 0.759 SCR = 0.871 means to facilitating the acceptance and the use of new information
DC3 3.169 0.249 0.672 systems. The first contribution of this research is to apply this concept
DC4 1.927 0.309 0.834 in a digital context, transforming it into digital organisational culture.
Business digitisation This more specific concept focuses on the assumptions and under
BD1 2.107 0.425 0.922 AVE = 0.675
BD2 2.207 0.375 0.813 SCR = 0.860
standings about organisational functioning in a digital context shared
BD3 2.240 0.330 0.712 by organisational members. Results indicate that digital culture sup
Technology Value ports the development of both BD (H1) and DTVD (H2). Hence, the
TV1 2.044 0.465 0.898 AVE = 0.588 conclusions of previous research that suggests that organisational cul
TV2 1.925 0.406 0.764 SCR = 0.806
ture is a prerequisite to adopting new technology (e.g. Kaushal, 2011;
TV3 1.468 0.301 0.583
Organisational Performance Büschgens et al., 2013) can also be extrapolated to a digital context. In
BP1 1.786 0.406 0.705 AVE = 0.520 addition, digital technologies can be a springboard to developing ac
BP2 1.718 0.282 0.500 SCR = 0.753 tivities of significant value, but companies will only unlock that po
BP3 1.370 0.523 0.905 tential if they incorporate the correct digital culture.
A second contribution to the existing body of knowledge on the subject
Notes:.
The fit statistics for the measurement model were:. is derived from the proposed model where BD and DTVD occur in parallel,
a
Scale Composite Reliability (SCR) of pc= (Σλi)2 var (ξ) / [(Σλi)2 var (ξ) +Σ as separate but complementary processes. Although the digitisation of data
θii] (Bagozzi and Yi, 1988). achieved with BD is important, it will be even more so if it is accompanied
b
Average variance extracted (AVE) of pc= (∑λi2 var (ξ))/[∑λi2 var by a process that allows the data to be exploited in the different contexts in
(ξ) + ∑θii] (Fornell and Larcker, 1981b). which the company operates (e.g., Dibrell et al., 2008; Martínez-Caro and
6
Table 3
Descriptive statistics.
Mean S.D HTMT CA Inter-correlations
1 2 3 4
1. Digital Culture 5.126 1.096 0.719 0.876 0.795

2. Business Digitisation 4.545 1.239 0.535 0.860 0.602 0.821
3. Technology Value 4.932 1.165 0.719 0.797 0.466 0.439 0.766
4. Organisational Performance 5.255 0.877 0.502 0.764 0.336 0.368 0.401 0.721
Note:.
Mean = the average score for all of the items included in this measure; S.D. = Standard Deviation; HTMT= Heterotrait-Monotrait Ratio; CA = Cronbach's Alpha.
The bold numbers on the diagonal are the square root of the Average Variance Extracted. Off-diagonal elements are correlations among constructs.
Table 4
Construct effects on endogenous variables.
Hypotheses Path Coef. Confidence intervals Supported
2.5%CIli 99.5%CIhi
H1: DOC → BD a1=0.475⁎⁎⁎ 0.311 0.674 Yes

H2: DOC → DTVD a2=0.517⁎⁎⁎ 0.361 0.727 Yes
H3: BD → DTVD a3=0.211* 0.027 0.441 Yes
H4: BD → OP a4=0.301⁎⁎ 0.127 0.556 Yes
H5: DTVD → OP a5=0.286⁎⁎ 0.089 0.521 Yes
Indirect effects though Point estimate Percentile bootstrap 95% confidence interval
2.5%CIli 99.5%CIhi Sig
DOC→BD→DTVD=a1 × a3 0.100 0.010 0.256 Yes
BD→DTVD→OP=a3 × a5 0.060 0.004 0.158 Yes
DOC→BD→DTVD→OP=(a4 × a5)+(a1 × a4)+(a1 × a3 × a5) 0.319 0.193 0.507 Yes
Notes:.
[(based on t(4999), one-tailed test);.
⁎⁎⁎
p < 0.001;.
⁎⁎
p < 0.01;.
⁎
p < 0.05]
DOC = Digital Organisational Culture; BD = Business Digitisation; DTVD = Digital Technologies Value Development; OP = Organisational Performance.
Cegarra-Navarro, 2010; Chitsaz et al., 2017; Yunis et al., 2017). Results communication among members of the organisation and with suppliers,
empirically support the idea that BD influences DTVD (H3). This finding customers or collaborators, regardless of their geographical location, or
confirms previous research (e.g. Zhu and Kramer, 2005; Vesselkov et al., supporting the collection of data provided by customers or potential
2018) that indicates that the greater the scope of digitalisation in a com customers. On the other hand, the support of H5 confirms that DTVD
pany, the more likely it will be that value-added activities can be developed. influences organisational performance. These findings reinforce previous
For example, with the support of appropriate digital technologies, a com research (Mooney et al., 2001; Zhu and Kramer, 2005; Dubey et al.,
pany can collect a large amount of data from its external environment. 2019; Richards et al., 2019) that highlights the key role of digital tech
Subsequently, these data can be exploited and transformed into knowledge nologies in developing value to achieve organisational performance.
at the service of managers, allowing them to make better decisions. Under Although firms continue to use digital technologies to improve process
this framework, a digital organisational culture provides an environment efficiency, these technologies are increasingly recognised as an important
that supports the balance between BD and DTVD when this proves neces tool for innovation and increasing revenues by enabling new services and
sary. It is through such a culture that members of an organisation will new ways of working within value networks. While the first generation of
identify procedures and structural and cultural artefacts to codify data, digital technologies allowed companies to optimise their internal op
while they track the value generated by the exploitation of these data. erations, more recently, digital technologies have evolved by expanding
The third contribution derives from the results of the empirical test of beyond internal dimensions, entering into the areas of the offering of
the relationship between digital technologies and firm performance. It company products and services (Nylén and Holmström, 2015). Currently,
has previously been pointed out that the classic productivity paradox has digital technologies are playing a central role in the radical restructuring
again become an issue with the rise of digital technologies, and when the of several industries through the development of value-added activities
business value of digital technologies is questioned. In this research it has that constitute competitive advantages and performance increases for the
been suggested that BD supports the improvement of organisational company. As Bharadwaj et al. (2013) pointed out, advances in our
performance (H4). Although firms have been focusing on investment in thinking about digital business strategy will occur as we articulate the
digital technologies with the aim of obtaining benefit from them, to shifts in sources of value creation through digital resources and the lo
achieve this goal it is crucial that new tools be adopted, assimilated and cation of value capture in digital business networks and ecosystems. The
used by the members of the organisation in their daily work. This aspect support of H4 and H5 suggests that companies can benefit from digital
has been widely studied in the literature of the last ten years (e.g., technologies in two ways: by obtaining operational benefits through BD
Amstrong and Sambamurthy, 1999; Lin, 2006; Ongori and Migiro, 2010) and strategic benefits through DTVD. Therefore, it is essential to promote
arriving at the unanimous conclusion that if a new technology is not the development of both BD and DTVD in a complementary way in order
accepted, its success is impossible and the company will have wasted to obtain the maximum benefit from digital technologies.
their money. Therefore, once a new digital technology has been made
routine and integrated into daily work, an increase in the profits of the 5.1. Implications
company can be obtained as a result of the advantages provided by that
technology. These advantages can be crystallised, for example, in From the above contributions, we derive the following implications
streamlining administrative procedures, facilitating real-time for practice. From a managerial perspective, this study provides insight
7
for managers regarding the significant role of a digital organisational organisations from other sectors, such as the technology or food in
culture in facilitating BD and the development of IT value. They should dustries, to better understand the applicability of our findings.
frame policies accordingly. Managers must be on guard and must an Some caution must be taken when generalising the results since the
ticipate their organisation's reaction to impeding changes (Hoffman and work has been carried out in various production centres that have
Klepper, 2000). The lack of a clear digital strategic direction often leads different characteristics from each other, but are subject to certain
to conflicting agendas and difficulty in achieving unity of purpose with general company guidelines.
new initiatives. Managers should identify the attributes of the existing In addition, the answers come from managers, although aspects
culture and then begin the process of lessening and removing those shared by all employees such as digital culture are being tested. Even
cultural attributes that prevent or slow down digitisation, while es though this may not be relevant when addressing strategic aspects,
tablishing cultural attributes that support successful digital technology future research could consider the responses of both senior and inter
exploitation (Harper and Utley, 2001). mediate management, as well as employees, to have a broader vision.
Furthermore, this research indicates that by defining an organisa Future research could also seek to eliminate the subjectivity in the
tional culture that better supports their digital strategy, managers can answers with more objective indicators. For example, empirically ob
expect to achieve greater benefits. Well-managed digital technologies tained key performance indicators could be used in order to evaluate
can generate tremendous value. Thus, rather than being dragged for the results obtained more objectively. In this paper organisational
ward reluctantly by competitive necessity, managers should define a culture has been considered as an antecedent variable. The inclusion of
digital strategy and direct digital investments to critical areas within other variables could also open new avenues for future research since
the business in order to obtain operative and also strategic advantages there are many variables that may have an influence on organisational
through digital technology usage and value creation. performance through the exploitation of digital technologies.
Managers who look to the future and want to implement digital Although the direct relationship between digital organisational
processes may well discover that their primary objective is to maintain culture and organisational performance has not been the aim of this
a balance between BD and DTVD. study, the significant correlation coefficient value of 0.336 at a level of
BD can provide a firm with the capability to acquire and assimilate p < 0.01 confirms that both variables are positively correlated (see
knowledge, but this capability does not guarantee the transformation and Table 3). This may mean that moving from a traditional culture to a
exploitation of this knowledge. Those firms focusing on BD are likely to be digital culture not only improves organisational performance, but it
able to continually renew their knowledge stocks, though they may need also requires a combination of experience, education and opportunity
to assume the costs of acquisition without gaining benefits from ex (i.e. contextual enablers). In this study, technology value and business
ploitation. Conversely, firms focusing on digital technologies for trans processes are used to visualise outputs achieved with digital organisa
formation and exploitation (DTVD) may achieve short-term profits tional culture, but future studies are needed to further explore the links
through exploitation, but may fall into a competence trap and may not be between contextual enablers and digital organisational culture.
able to respond to environmental changes. Since the potential for any
organisation to improve its performance will depend substantially on its
CRediT authorship contribution statement
ability to support both processes (i.e. BD and DTVD), companies face great
challenges arising from how to maintain a balance between the two pro
Eva Martínez-Caro: Conceptualization, Supervision, Writing - ori
cesses. In fact, managers may be over-investing in the implementation of
ginal draft, Writing - review & editing. Juan Gabriel Cegarra-Navarro:
one of these dimensions, and under-investing in (or underestimating)
Methodology, Software, Formal analysis, Writing - original draft.
mechanisms and aspects to coordinate them.
Francisco Javier Alfonso-Ruiz: Methodology, Data curation,
Investigation.
5.2. Limitations and future research
Besides the implications, there are also some limitations to our work Acknowledgements
which serve as opportunities for further research. First, the conducting
of this research in collaboration with a large multinational organisation This work was partially supported by the Spanish Ministry for
from one specific business sector opens further opportunities for future Economy, Industry and Competitiveness (Research Project ECO2017-
studies. For example, there is value in replicating the analysis in 88987-R).
Appendix: Questionnaire items
Organisational Digital Culture: with respect to your organisation, indicate the extent to which you agree or disagree (1 = strongly disagree and 7 = strongly agree):
ODC1: The teams collaborate functionally in the initiatives for the innovation and digital transformation
ODC2: There is a clear orientation to digital technology changes inside the company's culture
ODC3: The culture of digital innovation and change takes part as a natural process within the Company
ODC4: The organization shares with the staff the digital strategy, taking into consideration their suggestions
Business Digitisation: with respect to your organisation, indicate the extent to which you agree or disagree (1 = strongly disagree and 7 = strongly agree):
BD1: The information systems of your organization generate data in real time along the value chain (information from machinery or processes)
BD2: There is a high degree of traceability of information during the production process of your company
BD3: The level of quality of the information generated by the information systems of your organization is high
Digital Technologies Value Development: with respect to your organisation, indicate the extent to which you agree or disagree (1 = strongly disagree and 7 = strongly agree):
DTVD1: Has technological solutions that digitally connect essential business activities with customers, suppliers, employees and assets
DTVD2: Has defined how to assign data a central role in decision making and business management
DTVD3: Uses an open digital platform to implement innovative new ideas to quickly support business activities
Organisational Performance: with respect to your organisation, indicate the extent to which you agree or disagree (1 = strongly disagree and 7 = strongly agree):
BP1: It is growing more
BP2: It is more profitable
BP3: It has higher productivity
Notes:.
ODC = Digital Culture; DB= Business Digitisation; DTVD = Digital Technologies Value Development; OP = Organisational Performance.
8
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Management School in the United Kingdom and holds various fellowships and awards,
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Roberts, N., Galluch, P.S., Dinger, M., Grover, V., 2012. Absorptive capacity and in such as: Visiting Fellowship – British Academy; McMaster World Congress award to the
formation systems research: review, synthesis, and directions for future research. MIS Best Academy Paper in Intellectual Capital & Innovation; MECD/Fulbright Fellowship.
Q. 36 (2), 625–648.
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Manage. Dev. 20 (10), 853–859. https://doi.org/10.1108/02621710110410851. Politécnica de Cartagena. He has worked for more than 10 years in the company Saint-
Saffold, G.S., 1988. Culture traits, strength, and organizational performance: moving Gobain Weber as Process Engineer. He has been responsible for Lean Manufactoring
beyond “Strong” culture. Acad. Manage. Rev. 13 (4), 546–558. https://doi.org/10. Manager and Regional Industrial Manager. He is currently developing his doctoral thesis.
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Technological Forecasting & Social Change 154 (2020) 119962

Contents lists available at ScienceDirect

Technological Forecasting & Social Change

Digital technologies and firm performance: The role of digital organisational T

tools. Organisational culture has been considered to be a source of sustained

Fig. 1. Proposed research model.

1. Digital Culture 5.126 1.096 0.719 0.876 0.795

H1: DOC → BD a1=0.475⁎⁎⁎ 0.311 0.674 Yes

Appendix: Questionnaire items

References Sons, Oxford, England.

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