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Digital transformation in family-owned Mittelstand firms: A dynamic capabilities perspective

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  • Jonas Soluk
  • Nadine Kammerlander

Abstract

Digital technologies are increasingly affecting industries worldwide in many ways. Although the adoption of digital technologies by firms has been studied extensively from a technical point of view, previous research lacks insight into the managerial aspects of digital transformation, which, given the transformation’s interdisciplinarity, might have substantial implications for information systems research. In particular, it is unclear how small and medium-sized family-controlled firms (known as family-owned Mittelstand firms) with resource constraints handle digital transformation. This paper addresses this gap by drawing on rich data from 127 semi-structured interviews in a multiple case study of 15 family-owned Mittelstand firms from Germany, Austria, and Switzerland. All of these firms are active in the manufacturing industry but vary in terms of their digital transformation progress. Based on within-case and cross-case pattern analysis, we propose that the digital transformation of Mittelstand firms is a process consisting of three stages, namely, process digitalisation, product and service digitalisation, and business model digitalisation, and we reveal triggers for each stage and the dynamic capabilities needed throughout this process. Moreover, we identify three combinations of enablers and barriers that support or hinder the development of dynamic capabilities and thus accelerate or impede the advancement of the digital transformation process.

Suggested Citation

  • Jonas Soluk & Nadine Kammerlander, 2021. "Digital transformation in family-owned Mittelstand firms: A dynamic capabilities perspective," European Journal of Information Systems, Taylor & Francis Journals, vol. 30(6), pages 676-711, November.
    • Handle: RePEc:taf:tjisxx:v:30:y:2021:i:6:p:676-711
    DOI: 10.1080/0960085X.2020.1857666
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    1. Titov Sergei & Trachuk Arkady & Linder Natalya & RD Pathak & Danny Samson & Zafar Husain & S Sushil, 2023. "Digital transformation enablers in high-tech and low-tech companies: A comparative analysis," Australian Journal of Management, Australian School of Business, vol. 48(4), pages 801-843, November.
    2. René Riedl & Mark Stieninger & Manuel Muehlburger & Stefan Koch & Thomas Hess, 2024. "What is digital transformation? A survey on the perceptions of decision-makers in business," Information Systems and e-Business Management, Springer, vol. 22(1), pages 61-95, March.
    3. Alexandra Bertschi-Michel & Philipp Sieger & Thomas Wittig & Andreas Hack, 2023. "Sacrifice, Protect, and Hope for the Best: Family Ownership, Turnaround Moves, and Crisis Survival," Entrepreneurship Theory and Practice, , vol. 47(4), pages 1132-1168, July.
    4. Soluk, Jonas & Decker-Lange, Carolin & Hack, Andreas, 2023. "Small steps for the big hit: A dynamic capabilities perspective on business networks and non-disruptive digital technologies in SMEs," Technological Forecasting and Social Change, Elsevier, vol. 191(C).
    5. Bürgel, Tobias R. & Hiebl, Martin R.W. & Pielsticker, David I., 2023. "Digitalization and entrepreneurial firms' resilience to pandemic crises: Evidence from COVID-19 and the German Mittelstand," Technological Forecasting and Social Change, Elsevier, vol. 186(PA).
    6. Tiwari, Sunil & Sharma, Pankaj & Jha, Ashish Kumar, 2024. "Digitalization & Covid-19: An institutional-contingency theoretic analysis of supply chain digitalization," International Journal of Production Economics, Elsevier, vol. 267(C).
    7. Li, Min & Liu, Na & Kou, Aiju & Chen, Wenchuan, 2023. "Customer concentration and digital transformation," International Review of Financial Analysis, Elsevier, vol. 89(C).
    8. Marino-Romero, Jorge Alberto & Palos-Sánchez, Pedro R. & Velicia-Martín, Félix, 2024. "Evolution of digital transformation in SMEs management through a bibliometric analysis," Technological Forecasting and Social Change, Elsevier, vol. 199(C).
    9. Bischoff, Thore Sören & Thonipara, Anita, 2023. "Beauty attracts the eye but personality captures the heart … of digital transformation in crafts SMEs," ifh Working Papers 40/2023, Volkswirtschaftliches Institut für Mittelstand und Handwerk an der Universität Göttingen (ifh).
    10. Haomiao Zhai & Fan Yang & Fuxia Gao & Stavros Sindakis & Gazal Showkat, 2024. "Digital Transformation and Over-Investment: Exploring the Role of Rational Decision-Making and Resource Surplus in the Knowledge Economy," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 15(3), pages 14103-14134, September.
    11. Yuan Wu & Ziwei Li, 2024. "Digital transformation, entrepreneurship, and disruptive innovation: evidence of corporate digitalization in China from 2010 to 2021," Palgrave Communications, Palgrave Macmillan, vol. 11(1), pages 1-11, December.
    12. Vuchkovski, Davor & Zalaznik, Maja & Mitręga, Maciej & Pfajfar, Gregor, 2023. "A look at the future of work: The digital transformation of teams from conventional to virtual," Journal of Business Research, Elsevier, vol. 163(C).
    13. Qiuqin He & Carlos Lassala & Rosa Currás-Móstoles, 2024. "Can family CEOs promote enterprises’ digital transformation? An analysis based on ability-willingness paradox," International Entrepreneurship and Management Journal, Springer, vol. 20(4), pages 3181-3205, December.
    14. Szewczyk, Justin & Kurzhals, Christopher & Graf-Vlachy, Lorenz & Kammerlander, Nadine & König, Andreas, 2022. "The family innovator’s dilemma revisited: Examining the association between family influence and incumbents’ adoption of discontinuous technologies," Journal of Family Business Strategy, Elsevier, vol. 13(4).
    15. Rebecca Alguera Kleine & Bingbing Ge & Alfredo Massis, 2024. "Look in to look out: strategy and family business identity during COVID-19," Small Business Economics, Springer, vol. 63(3), pages 993-1018, October.
    16. Annosi, Maria Carmela & Capo, Francesca & Appio, Francesco Paolo & Bedetti, Ivan, 2023. "Unveiling micro-foundations of digital transformation: Cognitive models, routines, and organizational structures in agri-food SMEs," Technological Forecasting and Social Change, Elsevier, vol. 197(C).
    17. de Groote, Julia & Soluk, Jonas & Laue, Sarah-Larissa & Heck, Marius & Kammerlander, Nadine, 2023. "How can family-owned Mittelstand firms use their unique resources to master the digitalization age? The role of family historical, venture, and collaborative capital," Business Horizons, Elsevier, vol. 66(1), pages 133-152.
    18. Moritz Belling & Ulrich Pidun & Dodo zu Knyphausen-Aufseß, 2021. "Unbundling Strategic Change in Family Firms: the Influence of Familiness on the Strategic Change Process," Schmalenbach Journal of Business Research, Springer, vol. 73(3), pages 381-411, December.
    19. Anne-Sophie Christmann & Carlotta Crome & Valerie Graf-Drasch & Anna Maria Oberländer & Leonie Schmidt, 2024. "The Twin Transformation Butterfly," Business & Information Systems Engineering: The International Journal of WIRTSCHAFTSINFORMATIK, Springer;Gesellschaft für Informatik e.V. (GI), vol. 66(4), pages 489-505, August.
    20. Anna Maria Bornhausen & Torsten Wulf, 2024. "Digital innovation in family firms: The roles of non-family managers and transgenerational control intentions," Small Business Economics, Springer, vol. 62(4), pages 1429-1448, April.
    21. Nieto, María Jesús & Santamaria, Luis & Bammens, Yannick, 2023. "Digitalization as a facilitator of open innovation: Are family firms different?," Technovation, Elsevier, vol. 128(C).

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