Performance management in digital transformation: A sustainability performance approach

Abstract

In recent years, the significant potential and ubiquitous use of digital technologies has motivated firms to achieve sustainable competitive advantages and enhance their ability to fully exploit the benefits of digital transformation. However, the complexity and incomplete understanding of the approaches to digital transformation can be barriers to firms’ success, rendering it impossible to tackle challenges in digital transformation without functional, operational, and strategic initiatives. It is not clear which technologies, strategies, and capabilities are required in digital transformation to achieve sustainability performance. Furthermore, there are no clear strategic approaches to the full exploitation of digital transformation with the aim of sustainability performance.

This dissertation contributes to the knowledge about the approaches to managing (sustainability) performance in digital transformation. First, in addition to determining the drivers of digital transformation, the dissertation enhances understanding of the required smart technologies, digital business strategies, and digital-related capabilities for managing (sustainability) performance in digital transformation. Second, it investigates the necessity of strategic approaches in digital transformation to achieve sustainability performance. Third, it clarifies the roles of both corporate sustainability strategies and performance measurement systems in facilitating the achievement of sustainability performance in digital transformation.

The results of this dissertation have been achieved through four publications, for which the data was gathered through survey questionnaires from SMEs in Finland. The results show that smart technologies, digital business strategies, and digital-related capabilities are necessary to achieve digital transformation. However, the sole utilization of those drivers does not provide sustainability performance; employing strategic approaches, including a corporate sustainability strategy and performance measurement systems, in tandem with those drivers creates sustainability performance in digital transformation. Moreover, this dissertation provides many new insights for both managers and practitioners regarding approaches to digital transformation with the aim of achieving sustainability performance.