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How does digital transformation affect innovation quality?

Author

Listed:
  • Tingqian Pu

    (Guizhou University of Commerce)

  • Abdul Hadi Zulkafli

    (Universiti Sains Malaysia, School of Management)

Abstract

In the digital era, digital transformation is disrupting traditional business models and innovation activities. Numerous firms have expedited their endeavors in digital transformation to augment their manufacturing capabilities, operational efficiency, and competitive standing. Despite the increasing scholarly attention on the pivotal role of digital transformation in economic progress, there exists a paucity of research delving into the intricate nexus between digital transformation and innovation quality. The objective of this study is to investigate the relationship between digital transformation and innovation quality. Leveraging annual report data and patent information from Chinese listed companies spanning from 2012 to 2021, we have identified that digital transformation significantly enhances innovation quality. Interestingly, upon further investigation into the relationship between the five sub-dimensions of digital transformation (artificial intelligence, blockchain, cloud computing, big data, and digital technology applications) and innovation quality, positive and significant correlations were observed with artificial intelligence, cloud computing, big data, and digital technology applications, while blockchain did not exhibit a significant impact. Furthermore, the study reveals that the impact of digital transformation on innovation quality varies depending on property rights and regional location. Specifically, this promotional effect is significant only in non-state-owned enterprises and in the central and eastern regions. Overall, this paper enriches the research on digital transformation and innovation quality, providing valuable insights to promote the advancement of digital transformation levels for better serving the high-quality development of the real economy.

Suggested Citation

  • Tingqian Pu & Abdul Hadi Zulkafli, 2024. "How does digital transformation affect innovation quality?," E&M Economics and Management, Technical University of Liberec, Faculty of Economics, vol. 27(4), pages 16-32, December.
    • Handle: RePEc:bbl:journl:v:27:y:2024:i:4:p:16-32
    DOI: 10.15240/tul/001/2024-5-021
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    References listed on IDEAS

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    3. Verhoef, Peter C. & Broekhuizen, Thijs & Bart, Yakov & Bhattacharya, Abhi & Qi Dong, John & Fabian, Nicolai & Haenlein, Michael, 2021. "Digital transformation: A multidisciplinary reflection and research agenda," Journal of Business Research, Elsevier, vol. 122(C), pages 889-901.
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    More about this item

    Keywords

    Digital transformation; innovation quality; artificial intelligence; blockchain; cloud computing; big data; digital technology applications;
    All these keywords.

    JEL classification:

    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

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