Successful implementation of digital transformation is beyond the employment of technologies; however, it is dependent on making shifts in business strategies and organizational mindsets. Employees are required to understand the power of digital technologies to influence an organization and accept changes. Leaders are also expected to support the process and facilitate shifts from across the organization to ensure that digital transformation will be successfully implemented. Organizational change is one of the most critical strategies to be employed to ensure the development of digital transformation. Resistance to change alongside developments in digital transformation and lack of support can be considered as one of the main reasons for failure in the digital transformation process that should be addressed. This study aims to explore the relationship between digital transformation and organizational change concentrating on organization dynamics and shifts in different aspects of organizations considering catalyst factors.
TopDespite different definitions of digital transformation in the literature, still there is not a clear understanding of digital transformation that is the result of lacking a solid foundation of digital transformation concept. One area that brings confusion in understanding digital transformation is the failure to differentiate digital transformation from digitization and digitalization and using them interchangeably since they are all associated with employment of technology (Ifenthale and Egloffstein 2020).
Digitalization is “changing and encoding information to language that is understandable by computers and can be stored, processed or transmitted” (Bloomberg, 2018). Digitalization is also defined as “the technical process of converting analog signals into a digital form” (Legner et al., 2017). It also recognized as “the pace of change in a society driven by digital technological development, involving multiple technologies at different stages of maturity that will converge and create new technologies” (McAfee, 2009) and “a socio-technical process of applying digitizing techniques to broader social and institutional contexts that render digital technologies infrastructural” (Tilson et al., 2010).
Based on a definition presented by the Gartner’s IT Glossary, the process of changing analog data to digital form is recognized as digitization; however, digitalization is using digital technologies with the purpose to create value added opportunities and generate revenue.
Digitalization and digital transformation can employ the feedback of digitization as their input. DT is a broader concept in comparison to digitalization; however, the outcome of both is going digital (Haffke et al., 2016). Despite digital transformation was initially started with a special emphasize on the use of digital technologies in an organization, it was then realized that digital transformation is more than shifting digital technologies (Henriette et al., 2015). Digital transformation is the alignment of technology, strategy, culture, people, mindset, leadership and other factors (Goran et al., 2017). Thus, digital transformation is expected to improve operational efficiency, facilitate decision-making (Heilig et al., 2017; Roedder et al., 2016) and create competitive advantage for the business (Korhonen and Halen, 2017; Schwertner, 2017). Besides, some believe that digital transformation also creates value for customers by improving their experience (Rogers, 2016).