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Critical factors affecting digital transformation in manufacturing companies

Author

Listed:
  • Koteshwar Chirumalla

    (Mälardalen University)

  • Pejvak Oghazi

    (Södertörns University
    University of Vaasa
    University of Economics and Human Sciences)

  • Rosa Eluekezi Nnewuku

    (Mälardalen University)

  • Hatice Tuncay

    (Mälardalen University)

  • Nima Yahyapour

    (Södertörns University)

Abstract

Digital transformation represents a compelling opportunity for manufacturing companies to enhance their competitiveness. This transformative journey offers myriad possibilities, including improved connectivity between workers and machines, as well as seamless machine-to-machine interactions. However, many manufacturing companies encounter challenges when attempting to implement digital transformation effectively. The process of digital transformation is often slow, and most companies find themselves in the early stages of adoption, grappling with the ambiguity surrounding the associated technologies. A systematic approach for the implementation of digital transformation is still elusive for many manufacturing companies. The number of studies exploring digital transformation is increasingly growing, encompassing various sectors and domains. However, within the manufacturing sector, there remains a need for further research and clarity on systematic implementation approaches. To address these issues, this research undertakes a comprehensive analysis to identify the critical factors that influence digital transformation in the manufacturing sector. The objective of this research is to identify the factors that drive the success of digital transformation in manufacturing companies while also uncovering factors that, when neglected, could lead to failure. Through a systematic literature review, this research identifies 11 critical factors. These factors serve as the basis for developing the ARTO model, a structured framework comprising four distinct categories: "Awareness-related factors," "Readiness-related factors," "Technology Selection-related factors," and "Operations-related factors." Moreover, this research incorporates expert perspectives gathered through a survey to refine the ARTO model. This study offers the ARTO model and digital transformation definition as practical tools for successfully implementing digital transformation in manufacturing companies, while also delineating the intricate relationships among the crucial factors. By shedding light on the factors underpinning digital transformation in the manufacturing sector, this research contributes to the ongoing discourse and facilitates more effective adoption of digital transformation strategies.

Suggested Citation

  • Koteshwar Chirumalla & Pejvak Oghazi & Rosa Eluekezi Nnewuku & Hatice Tuncay & Nima Yahyapour, 2025. "Critical factors affecting digital transformation in manufacturing companies," International Entrepreneurship and Management Journal, Springer, vol. 21(1), pages 1-52, December.
    • Handle: RePEc:spr:intemj:v:21:y:2025:i:1:d:10.1007_s11365-024-01056-3
    DOI: 10.1007/s11365-024-01056-3
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    References listed on IDEAS

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