The impact of digital transformation on innovation performance in production environments

Abstract

The objective of this Thesis is to make an extensive analysis of the impact of digital transformation on innovation performance in the production process based on systematic literature review. Four important elements are being studied here namely the impact of digital transformation on innovation performance, the intermediary organization-based variables, contextual conditions, and possible paradoxical effects of digital transformation in manufacturing industry. Digital transformation generally has a positive impact on innovation performance by improving data integration, increasing operational transparency, and optimizing production systems. However, the relationship is not purely technological. Improvements in innovation performance largely depend on the development of complementary organizational capabilities, such as dynamic capabilities, big data capability, and organizational agility. Situational variables such as risk-taking predisposition, environmental turbulence, and institutional support are important determinants of this link. Also, too much use of information technology can result in a decrease in productivity and coordination problems, pointing to the need for moderation.

Overall, digital transformation acts as an enabling factor for innovation in production environments rather than a guaranteed driver of performance. Achieving effective innovation outcomes requires not only the adoption of digital technologies but also proper strategic alignment and the development of organizational capabilities.