The Effect of Digital Transformation on Organizational Performance: A Dynamic Capability-Based Model

Abstract

Digital transformation has become a widespread topic in business-related and managerial scholarly conversations. Previous studies have confirmed the positive impact of digital transformation on organizational performance. However, we do not have sufficient knowledge about the mechanisms through which this impact can occur. Accordingly, the present theoretical investigation aims to leverage the dynamic capabilities perspective to propose a model explaining one of such mechanisms. Based on this theoretical model, the sensing, seizing, and transforming dynamic capabilities positively mediate the association between digital transformation and performance at the organizational level.

Keywords: digital transformation, dynamic capabilities, organizational performance

JEL Classification: M15