IDEAS home Printed from https://ideas.repec.org/a/eee/proeco/v255y2023ics0925527322003000.html
   My bibliography  Save this article

The interplay between data-driven decision-making and digitalization: A firm-level survey of the Italian and U.S. automotive industries

Author

Listed:
  • Colombari, Ruggero
  • Geuna, Aldo
  • Helper, Susan
  • Martins, Raphael
  • Paolucci, Emilio
  • Ricci, Riccardo
  • Seamans, Robert

Abstract

With the diffusion of information systems and new technologies for the real-time capturing of data, especially in rapid technological and managerial innovation contexts such as the automotive industry, data-driven decision-making (DDM) has now the potential to generate dramatic improvements in the performance of manufacturing firms. However, there is still a lack of evidence in literature on whether these technologies can actually enhance the effectiveness of data-driven approaches. The aim of this article is to investigate the impact of DDM on operational performance moderated by two main dimensions of digitalization: data integration and the breadth of new digitization technologies. The results of a cross-country survey of 138 Italian and U.S. auto-supplier firms, which was supported by plant visits and interviews, suggest that an interplay between DDM and the two dimensions exists. Higher degrees of data integration in information systems increase the positive effect of DDM on the probability of cost reductions. On the other hand, introducing multiple emerging digitization technologies leads to worse DDM results, in terms of cost performance. The conclusion that can be drawn is that the operational employees of auto-supplier firms are now facing difficulties in successfully combining real-time operational data from various sources and in exploiting them for decision-making. Managers and workers need to align their intuition, experience and analytical capabilities to initiate the digitalization process. The challenge, in the medium term, is to limit the difficulties of implementing new digitization technologies and integrating their data, to embrace DDM and fully grasp the potential of data analytics in operations.

Suggested Citation

  • Colombari, Ruggero & Geuna, Aldo & Helper, Susan & Martins, Raphael & Paolucci, Emilio & Ricci, Riccardo & Seamans, Robert, 2023. "The interplay between data-driven decision-making and digitalization: A firm-level survey of the Italian and U.S. automotive industries," International Journal of Production Economics, Elsevier, vol. 255(C).
    • Handle: RePEc:eee:proeco:v:255:y:2023:i:c:s0925527322003000
    DOI: 10.1016/j.ijpe.2022.108718
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0925527322003000
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.ijpe.2022.108718?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Nicholas Bloom & Luis Garicano & Raffaella Sadun & John Van Reenen, 2014. "The Distinct Effects of Information Technology and Communication Technology on Firm Organization," Management Science, INFORMS, vol. 60(12), pages 2859-2885, December.
    2. Schniederjans, Dara G. & Curado, Carla & Khalajhedayati, Mehrnaz, 2020. "Supply chain digitisation trends: An integration of knowledge management," International Journal of Production Economics, Elsevier, vol. 220(C).
    3. Bokrantz, Jon & Skoogh, Anders & Berlin, Cecilia & Wuest, Thorsten & Stahre, Johan, 2020. "Smart Maintenance: a research agenda for industrial maintenance management," International Journal of Production Economics, Elsevier, vol. 224(C).
    4. Raj, Alok & Dwivedi, Gourav & Sharma, Ankit & Lopes de Sousa Jabbour, Ana Beatriz & Rajak, Sonu, 2020. "Barriers to the adoption of industry 4.0 technologies in the manufacturing sector: An inter-country comparative perspective," International Journal of Production Economics, Elsevier, vol. 224(C).
    5. Timothy F. Bresnahan & Erik Brynjolfsson & Lorin M. Hitt, 2002. "Information Technology, Workplace Organization, and the Demand for Skilled Labor: Firm-Level Evidence," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 117(1), pages 339-376.
    6. Christian Julmi, 2019. "When rational decision-making becomes irrational: a critical assessment and re-conceptualization of intuition effectiveness," Business Research, Springer;German Academic Association for Business Research, vol. 12(1), pages 291-314, April.
    7. Parsa, Payam & Rossetti, Manuel D. & Zhang, Shengfan & Pohl, Edward A., 2017. "Quantifying the benefits of continuous replenishment program for partner evaluation," International Journal of Production Economics, Elsevier, vol. 187(C), pages 229-245.
    8. Daniel Alejandro Rossit & Fernando Tohmé & Mariano Frutos, 2019. "Industry 4.0: Smart Scheduling," International Journal of Production Research, Taylor & Francis Journals, vol. 57(12), pages 3802-3813, June.
    9. Bokrantz, Jon & Skoogh, Anders & Berlin, Cecilia & Wuest, Thorsten & Stahre, Johan, 2020. "Smart Maintenance: an empirically grounded conceptualization," International Journal of Production Economics, Elsevier, vol. 223(C).
    10. Büchi, Giacomo & Cugno, Monica & Castagnoli, Rebecca, 2020. "Smart factory performance and Industry 4.0," Technological Forecasting and Social Change, Elsevier, vol. 150(C).
    11. Culot, Giovanna & Nassimbeni, Guido & Orzes, Guido & Sartor, Marco, 2020. "Behind the definition of Industry 4.0: Analysis and open questions," International Journal of Production Economics, Elsevier, vol. 226(C).
    12. Kamble, Sachin S. & Gunasekaran, Angappa & Ghadge, Abhijeet & Raut, Rakesh, 2020. "A performance measurement system for industry 4.0 enabled smart manufacturing system in SMMEs- A review and empirical investigation," International Journal of Production Economics, Elsevier, vol. 229(C).
    13. Tortorella, Guilherme Luz & Fogliatto, Flavio S. & Cauchick-Miguel, Paulo A. & Kurnia, Sherah & Jurburg, Daniel, 2021. "Integration of Industry 4.0 technologies into Total Productive Maintenance practices," International Journal of Production Economics, Elsevier, vol. 240(C).
    14. Tina Comes & Bartel Van de Walle & Luk Van Wassenhove, 2020. "The Coordination‐Information Bubble in Humanitarian Response: Theoretical Foundations and Empirical Investigations," Production and Operations Management, Production and Operations Management Society, vol. 29(11), pages 2484-2507, November.
    15. Frank, Alejandro Germán & Dalenogare, Lucas Santos & Ayala, Néstor Fabián, 2019. "Industry 4.0 technologies: Implementation patterns in manufacturing companies," International Journal of Production Economics, Elsevier, vol. 210(C), pages 15-26.
    16. Tortorella, Guilherme Luz & Cawley Vergara, Alejandro Mac & Garza-Reyes, Jose Arturo & Sawhney, Rapinder, 2020. "Organizational learning paths based upon industry 4.0 adoption: An empirical study with Brazilian manufacturers," International Journal of Production Economics, Elsevier, vol. 219(C), pages 284-294.
    17. Guo, Daqiang & Li, Mingxing & Lyu, Zhongyuan & Kang, Kai & Wu, Wei & Zhong, Ray Y. & Huang, George Q., 2021. "Synchroperation in industry 4.0 manufacturing," International Journal of Production Economics, Elsevier, vol. 238(C).
    18. Andrew Kusiak, 2018. "Smart manufacturing," International Journal of Production Research, Taylor & Francis Journals, vol. 56(1-2), pages 508-517, January.
    19. Gandomi, Amir & Haider, Murtaza, 2015. "Beyond the hype: Big data concepts, methods, and analytics," International Journal of Information Management, Elsevier, vol. 35(2), pages 137-144.
    20. Osterrieder, Philipp & Budde, Lukas & Friedli, Thomas, 2020. "The smart factory as a key construct of industry 4.0: A systematic literature review," International Journal of Production Economics, Elsevier, vol. 221(C).
    21. Diane E. Bailey & Paul M. Leonardi & Stephen R. Barley, 2012. "The Lure of the Virtual," Organization Science, INFORMS, vol. 23(5), pages 1485-1504, October.
    22. 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.
    23. Dalenogare, Lucas Santos & Benitez, Guilherme Brittes & Ayala, Néstor Fabián & Frank, Alejandro Germán, 2018. "The expected contribution of Industry 4.0 technologies for industrial performance," International Journal of Production Economics, Elsevier, vol. 204(C), pages 383-394.
    24. Li, Ying & Dai, Jing & Cui, Li, 2020. "The impact of digital technologies on economic and environmental performance in the context of industry 4.0: A moderated mediation model," International Journal of Production Economics, Elsevier, vol. 229(C).
    25. Alfred Theorin & Kristofer Bengtsson & Julien Provost & Michael Lieder & Charlotta Johnsson & Thomas Lundholm & Bengt Lennartson, 2017. "An event-driven manufacturing information system architecture for Industry 4.0," International Journal of Production Research, Taylor & Francis Journals, vol. 55(5), pages 1297-1311, March.
    26. Martínez-Caro, Eva & Cegarra-Navarro, Juan Gabriel & Alfonso-Ruiz, Francisco Javier, 2020. "Digital technologies and firm performance: The role of digital organisational culture," Technological Forecasting and Social Change, Elsevier, vol. 154(C).
    27. Ray Y. Zhong & Chen Xu & Chao Chen & George Q. Huang, 2017. "Big Data Analytics for Physical Internet-based intelligent manufacturing shop floors," International Journal of Production Research, Taylor & Francis Journals, vol. 55(9), pages 2610-2621, May.
    28. Dutta, Debprotim & Bose, Indranil, 2015. "Managing a Big Data project: The case of Ramco Cements Limited," International Journal of Production Economics, Elsevier, vol. 165(C), pages 293-306.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Ghafoori, Arman & Gupta, Manjul & Merhi, Mohammad I. & Gupta, Samrat & Shore, Adam P., 2024. "Toward the role of organizational culture in data-driven digital transformation," International Journal of Production Economics, Elsevier, vol. 271(C).
    2. Dumitra Edi-Cristian, 2024. "Overcoming the Challenges of Digitalization. A Study Case Based on DESI and EIBIS," Proceedings of the International Conference on Business Excellence, Sciendo, vol. 18(1), pages 3443-3451.
    3. Ágnes Szukits & Péter Móricz, 2024. "Towards data-driven decision making: the role of analytical culture and centralization efforts," Review of Managerial Science, Springer, vol. 18(10), pages 2849-2887, October.
    4. Antonio Andreoni & Guendalina Anzolin & Mateus Labrunje & Danilo Spinola, 2023. "Unveiling Structure and Dynamics of Global Digital Production Technology Networks: A new digital technology classification and network analysis based on trade data," Working Papers 261, Department of Economics, SOAS University of London, UK.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Laubengaier, Désirée A. & Cagliano, Raffaella & Canterino, Filomena, 2022. "It Takes Two to Tango: Analyzing the Relationship between Technological and Administrative Process Innovations in Industry 4.0," Technological Forecasting and Social Change, Elsevier, vol. 180(C).
    2. Culot, Giovanna & Orzes, Guido & Sartor, Marco & Nassimbeni, Guido, 2020. "The future of manufacturing: A Delphi-based scenario analysis on Industry 4.0," Technological Forecasting and Social Change, Elsevier, vol. 157(C).
    3. Cifone, Fabiana Dafne & Hoberg, Kai & Holweg, Matthias & Staudacher, Alberto Portioli, 2021. "‘Lean 4.0’: How can digital technologies support lean practices?," International Journal of Production Economics, Elsevier, vol. 241(C).
    4. Calış Duman, Meral & Akdemir, Bunyamin, 2021. "A study to determine the effects of industry 4.0 technology components on organizational performance," Technological Forecasting and Social Change, Elsevier, vol. 167(C).
    5. Battistoni, Elisa & Gitto, Simone & Murgia, Gianluca & Campisi, Domenico, 2023. "Adoption paths of digital transformation in manufacturing SME," International Journal of Production Economics, Elsevier, vol. 255(C).
    6. Xi, Mengjie & Liu, Yang & Fang, Wei & Feng, Taiwen, 2024. "Intelligent manufacturing for strengthening operational resilience during the COVID-19 pandemic: A dynamic capability theory perspective," International Journal of Production Economics, Elsevier, vol. 267(C).
    7. Shih-Chia Chang & Hsu-Hwa Chang & Ming-Tsang Lu, 2021. "Evaluating Industry 4.0 Technology Application in SMEs: Using a Hybrid MCDM Approach," Mathematics, MDPI, vol. 9(4), pages 1-21, February.
    8. Cugno, Monica & Castagnoli, Rebecca & Büchi, Giacomo, 2021. "Openness to Industry 4.0 and performance: The impact of barriers and incentives," Technological Forecasting and Social Change, Elsevier, vol. 168(C).
    9. Alok Raj & Anand Jeyaraj, 2023. "Antecedents and consequents of industry 4.0 adoption using technology, organization and environment (TOE) framework: A meta-analysis," Annals of Operations Research, Springer, vol. 322(1), pages 101-124, March.
    10. Meindl, Benjamin & Ayala, Néstor Fabián & Mendonça, Joana & Frank, Alejandro G., 2021. "The four smarts of Industry 4.0: Evolution of ten years of research and future perspectives," Technological Forecasting and Social Change, Elsevier, vol. 168(C).
    11. Rodríguez-Espíndola, Oscar & Chowdhury, Soumyadeb & Dey, Prasanta Kumar & Albores, Pavel & Emrouznejad, Ali, 2022. "Analysis of the adoption of emergent technologies for risk management in the era of digital manufacturing," Technological Forecasting and Social Change, Elsevier, vol. 178(C).
    12. Tortorella, Guilherme Luz & Fogliatto, Flavio S. & Cauchick-Miguel, Paulo A. & Kurnia, Sherah & Jurburg, Daniel, 2021. "Integration of Industry 4.0 technologies into Total Productive Maintenance practices," International Journal of Production Economics, Elsevier, vol. 240(C).
    13. Tortorella, Guilherme Luz & Saurin, Tarcisio A. & Hines, Peter & Antony, Jiju & Samson, Daniel, 2023. "Myths and facts of industry 4.0," International Journal of Production Economics, Elsevier, vol. 255(C).
    14. Yu, Yubing & Zhang, Justin Zuopeng & Cao, Yanhong & Kazancoglu, Yigit, 2021. "Intelligent transformation of the manufacturing industry for Industry 4.0: Seizing financial benefits from supply chain relationship capital through enterprise green management," Technological Forecasting and Social Change, Elsevier, vol. 172(C).
    15. Ghannouchi, Imen, 2023. "Examining the dynamic nexus between industry 4.0 technologies and sustainable economy: New insights from empirical evidence using GMM estimator across 20 OECD nations," Technology in Society, Elsevier, vol. 75(C).
    16. Peerally, Jahan Ara & Santiago, Fernando & De Fuentes, Claudia & Moghavvemi, Sedigheh, 2022. "Towards a firm-level technological capability framework to endorse and actualize the Fourth Industrial Revolution in developing countries," Research Policy, Elsevier, vol. 51(10).
    17. Tao, Zhibin & Chao, Jiaxiao, 2024. "Unlocking new opportunities in the industry 4.0 era, exploring the critical impact of digital technology on sustainable performance and the mediating role of GSCM practices," Innovation and Green Development, Elsevier, vol. 3(3).
    18. Li, Lixu & Ye, Fei & Zhan, Yuanzhu & Kumar, Ajay & Schiavone, Francesco & Li, Yina, 2022. "Unraveling the performance puzzle of digitalization: Evidence from manufacturing firms," Journal of Business Research, Elsevier, vol. 149(C), pages 54-64.
    19. Roland Zs. Szabo & Iva Vuksanović Herceg & Robert Hanák & Lilla Hortovanyi & Anita Romanová & Marian Mocan & Dragan Djuričin, 2020. "Industry 4.0 Implementation in B2B Companies: Cross-Country Empirical Evidence on Digital Transformation in the CEE Region," Sustainability, MDPI, vol. 12(22), pages 1-20, November.
    20. Zhao, Nanyang & Hong, Jiangtao & Lau, Kwok Hung, 2023. "Impact of supply chain digitalization on supply chain resilience and performance: A multi-mediation model," International Journal of Production Economics, Elsevier, vol. 259(C).

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:proeco:v:255:y:2023:i:c:s0925527322003000. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/ijpe .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.