Abstract
Digital transformation (DT) initiatives are underway in different organisations worldwide. Organisations that pursue these DT initiatives can obtain several benefits. While DT has several benefits, high failure rates have been reported. Organisational culture (OC) has been pinpointed as a primary contributor to these high failure rates. Ultimately, there is a dearth of understanding of the concept of DT as it is still emerging. There is a need for a holistic comprehension of DT for organisations to benefit from using digital technologies. One area of DT that requires further research is the relationship between the use of digital technologies, OC, and organisational performance (OP).
The predominant technology adoption models that have been advanced do not extensively discuss the critical roles of OC and OP vis–a–vis DT. The result is that the benefits of using digital technologies are not fully realised. Therefore, there is a gap in the literature pertaining to the nexus between the use of digital technologies, OC and OP. The primary purpose of this study was, therefore, to understand the nexus relationship between the use of digital technologies, OC, and OP and to develop a model for use by project-driven engineering organisations in South Africa. A mixed-method research design, which combined quantitative and qualitative methods, was used to achieve the objectives of the study.
A closed-ended questionnaire survey was used to collect data from an energy company, a water utility, and two logistics companies in South Africa. Cluster sampling was used to collect data from the four organisations. The minimum sample size required was 77, and 148 valid responses were received from the four organisations. In addition, five experts were interviewed, and one focus group discussion was held to collect data from the energy company. Theoretical saturation was used to determine the sample size. Participants were selected using purposive and snowballing samplings. SmartPLS 4.1 and IBM SPSS 29 software packages were used to analyse the collected data. The descriptive statistics were obtained from the IBM SPSS 29 software package. The partial least squares structural equation modelling with the help of the SmartPLS 4.1 software package was used to evaluate the measurement and structural models. Thematic analysis was used to analyse qualitative data.
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The testing of the hypotheses indicated that OC significantly impacted the use of digital technologies and OP. The use of digital technologies insignificantly influenced OP. However, the use of digital technologies fully mediated the relationship between OC and OP. Organisational culture insignificantly moderated the relationship between the use of digital technologies and OP. The control variables, industry type, role, experience, and qualification, trivially influenced OP. Based on these quantitative study findings, the nexus model was finalised.
The finalised nexus model was then validated using qualitative data collected from the energy company. The qualitative data analysis suggested a substantial effect of OC on the use of digital technologies and OP. The use of digital technologies materially impacted OP. Moreover, the use of digital technologies mediated the relationship between OC and OP. Organisational culture also moderated the relationship between the use of digital technologies and OP. The control variables, qualification, experience, and role immaterially influenced OP. Therefore, the results of the qualitative study validated the finalised nexus model, and the nexus was established. Organisations must, therefore, carefully consider the three constructs as part of the DT. Organisations must adopt a strategic management approach, which entails developing and implementing strategies with an engrained balanced scorecard and programme management system. This will result in a coordinated and integrated approach, guaranteeing continuous monitoring, reviewing, and appraising of the DT initiatives.
Therefore, organisations must fully understand the DT concept before embarking on it to mitigate the risk of failure. Organisational leadership and management must carefully examine OC and align it with the digital technologies planned to be adopted due to its substantial effect on the nexus model. Moreover, OP measures must be aligned with OC and the use of digital technologies. While the study significantly contributed to the body of knowledge, it was limited to project-driven engineering organisations within the public sector. The study needs to be extended to other organisations to determine the applicability of the nexus model developed in this study. Additionally, there is a need to determine how each of the four Denison cultural traits impacted digital technologies and performance. Also, the relationship between digital technologies, the different Denison cultural traits, and performance, such as HR practices, employee job satisfaction, employee organisational commitment, and employee job performance, requires further research for a complete comprehension of the DT.