How does Digitalization Affect Change Management: Empirical Research at an Innovative Industrial Group

Abstract

Digitalization plays an important role in transformation processes of manufacturing companies. Technology driven projects are heavily initiated, many of them, however, fail to institutionalize change. The technological change is often not integrated within the organizational strategy, structure, behavior, and in consequence, such digitalization projects fail to deliver the expected performance outcomes, as well.We used qualitative research methods to explore how digitalization affects change management within a multinational industrial group that provides innovative manufacturing services to automotive original equipment manufacturers. The industrial group had been undertaking a transformation process towards digitalization and they had been implementing significant innovations regarding their core businesses.We identified the parallel presence of three key competencies of digitalization project team members: ICT management, project management, and change management competencies. These competencies proved to be main characteristics of projects that bring change into an organization by introducing new technologies.Three critical change drivers have also been identified: leadership, communication and stakeholder management. These proved to be essential competencies in order to deliver successful digitalization initiatives.Moreover, institutionalization of the digitalization initiatives has resulted in strategic changes within the critical organizational characteristics of the industrial group: a direct impact on corporate strategy, structural change and behavioral change has also been identified.All the above-mentioned factors have contributed to an increased operational and organizational effectiveness, improved workflows and cross-departmental communications.

Keywords:change management, organizational changes, digitalization, transformation, innovation, manufacturing, project management, ICT management