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2020 | Book

Digital Business Transformation

Name: Digital Business Transformation
ISBN: 978-3-030-47354-9

Organizing, Managing and Controlling in the Information Age

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Book Series: Lecture Notes in Information Systems and Organisation

Editors: Assoc. Prof. Rocco Agrifoglio, Assoc. Prof. Rita Lamboglia, Prof. Daniela Mancini, Assoc. Prof. Francesca Ricciardi

Publisher: Springer International Publishing

Print ISBN: 978-3-030-47354-9

Electronic ISBN: 978-3-030-47355-6

Part of: Springer Professional "Wirtschaft+Technik" , Springer Professional "Technik" , Springer Professional "Wirtschaft"

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About this book

The recent surge of interest in “digital transformation” is changing the business landscape and posing several challenges, both organizational and sectoral. This transformation involves the application of digital technology in all aspects of business, and enables organizations to create new products and services, and to find more efficient ways of doing business.

Moreover, the digital transformation is happening within and across organizations of all types and in every industry, producing a disruptive innovation that can break down the barriers between people and organizations, and help create more adaptive processes. In the information age, it is imperative for organizations to develop IT-related capabilities that allow them to leverage the potential of digital technologies. Due to the pervasive effects of this transformation on processes, firms and industries, both scholars and practitioners are interested in better understanding the key mechanisms behind the emergence and evolution of the digital business transformation.

This book presents a collection of research papers focusing on the relationships between technologies (e.g., digital platforms, AI, blockchain, etc.), processes (e.g., decision-making, co-creation, financial, compliance, etc.), and organizations (e.g., smart organizations, digital ecosystems, Industry 4.0, collaborative networked organizations, etc.), which have been categorized into three major areas: organizing, managing and controlling. It also provides critical insights into how the digital transformation is enhancing organizational processes and firms’ performance through an exploration and exploitation of internal resources, and through the establishment of external connections and linkages.

The plurality of views offered makes this book particularly relevant for users, companies, scientists, and governments. The content of the book is based on a selection of the best papers (original double-blind peer-reviewed contributions) presented at the annual conference of the Italian chapter of the AIS, which was held in Naples, Italy in September 2019.

Frontmatter

Digitization and Business Model Transformation

Frontmatter

Impact of Artificial Intelligence on Firm Performance: Exploring the Mediating Effect of Process-Oriented Dynamic Capabilities

Abstract

Organizations still dependent on information technology innovation have already adopted the in AI subfields and techniques to adapt or disrupt the market while improvement their performance. Other research has examined the relationship between computing capabilities and organizational performance, with a mediating effect on dynamic process-driven capabilities. We extend this flow of literature and examine the same relationship by taking into account the capabilities of artificial intelligence (AI). Our conceptual framework is based on the paradox of productivity, resource-based view and dynamic capabilities. We relied on an in-depth review of 150 case studies collected on websites related to the integration of AI into organizations. Our study highlights the added value of AI capabilities, in terms of organizational performance, with a focus on improving organizational performance (financial, marketing, and administrative). Our analyses also show that companies improve their performance when they use capabilities of AI to reconfigure their dynamic process-oriented capabilities.

Serge-Lopez Wamba-Taguimdje, Samuel Fosso Wamba, Jean Robert Kala Kamdjoug, Chris Emmanuel Tchatchouang Wanko

Artificial Intelligence and Ethics in Portfolio Management

Abstract

This work in progress aims to explore ethical dilemmas connected to the use of Artificial Intelligence (AI) in financial portfolio management, and their managerial implications. In old school quantitative investing, portfolio allocation decisions are typically based on a well-defined investment strategy. Financial portfolio managers devise and apply investment strategies to maximize expected returns for customers’ portfolios. The introduction of AI-enhanced algorithms enables smart machines to automatically revise and update investment strategies, learning from the past. AI itself might produce significant effects on the gains and losses of the portfolio management strategies, raising ethical dilemmas connected with human versus machine responsibility, accountability, and risk. From the managerial point of view, a new dimension of performance measuring, competence evaluation and incentive allocation is required for managing AI software developers in this area. To explore such dilemmas, empirical evidence is drawn here from MDOTM, an innovative and successful young enterprise developing AI-driven investment strategies for financial markets.

Elena Beccalli, Viktor Elliot, Francesco Virili

Putting Decision Mining into Context: A Literature Study

Abstract

The value of a decision can be increased through analyzing the decision logic, and the outcomes. The more often a decision is taken, the more data becomes available about the results. More available data results into smarter decisions and increases the value the decision has for an organization. The research field addressing this problem is Decision mining. By conducting a literature study on the current state of Decision mining, we aim to discover the research gaps and where Decision mining can be improved upon. Our findings show that the concepts used in the Decision mining field and related fields are ambiguous and show overlap. Future research directions are discovered to increase the quality and maturity of Decision mining research. This could be achieved by focusing more on Decision mining research, a change is needed from a business process Decision mining approach to a decision focused approach.

Sam Leewis, Koen Smit, Martijn Zoet

Cloud Sourcing and Paradigm Shift in IT Governance: Evidence from the Financial Sector

Abstract

In the digital age, organizations are increasingly shifting their applications, services and infrastructures to the cloud to enhance business agility and reduce IT-related costs. However, in moving applications and data to cloud resources organizations face new risks of privacy violations. To manage this risk, organizations need to be fully aware of threats and vulnerabilities affecting their digital re-sources in cloud. Although some previous studies have focused on the emerging challenges of cloud adoption to governance and control, we know little regarding the paradigm shifts in IT governance processes and practices. To address this gap, we conducted an exploratory case study in two large companies in the financial sector. Our findings show that cloud adoption alters the locus and scope of IT governance which consequently compels organizations to rethink their control mechanisms to mitigate security risks. Our findings contribute to the literature on IT governance and IT outsourcing, and support IT executives and decision makers in mitigating the risks of cloud adoption.

Niloofar Kazemargi, Paolo Spagnoletti

Data-Imagined Decision Making in Organizations: Do Visualization Tools Run in the Family?

Abstract

This paper reports of an experimental crossover between two different perspectives of organizational activities: decision making and data management. Although there are ever growing contact points between the two, it is also true that in enterprises data-driven decision making often shows many room for improvements. A converging direction of these two aspects of organizational routine could be that of comparing and coupling decision making steps, activities and characteristics with data visualization properties, capabilities and enablers of information sharing and assimilation. This study goes in this direction, by proposing an exploratory analysis of decision making models and data visualization characteristics in order to extract a set of common aspects of decision making and to configure a set of connections between them and data visualization tools features. These connections may serve to investigate the strength of synergies between decision making activities and data management visualization, their effectiveness for data-driven decision making and the margin of improvements with respect to the current decision routines in enterprises. This study contributes to set the terrain for making a clearer picture of the strengths and weaknesses of data-driven decision making, to find implications for design of data visualization tools for supporting decision making activities, and to provide indications of how proactively data visualization toolboxes should run in the family at all decision levels and for each role in organizations.

Angela Locoro, Aurelio Ravarini

IT Investment Decisions in Industry 4.0: Evidences from SMEs

Abstract

Organizational processes, production, business strategy, value creation and value delivery are undergoing significant change as a result of emerging new technologies in industry 4.0 context. This has drawn attention across many countries and not only organizations, but also stakeholders and policy makers as the fourth industrial revolution. While Industry 4.0 has been widely investigated in large enterprises, yet to date, little is known about how SMEs with limited financial resources make strategic decisions in particular about IT investment on diverse emerging technologies. To close this gap, this paper focused on the propensity of SMEs in IT investment in an industry 4.0 context. We analyze the responses of 1889 Italian SMEs to Government policies designed to facilitate SMEs in adopting technologies for Industry 4.0. This study aims to contribute to alignment literature by highlighting the importance of IT investment as a strategic decision in Industry 4.0. Moreover, the paper offers a set of practical implications.

Niloofar Kazemargi, Paolo Spagnoletti

Creating a New Innovation Orientation Through Idea Competitions

Abstract

This paper conducts an in depth case study of the implementation of an idea competition in a consulting company. Based on 27 interviews with company managers as well as employees acting as users or non users of the idea competition in the company has changed the innovation orientation of the company along several dimensions including creativity and empowerment, innovation infrastructure, innovation influence and innovation intention.

Hanne Westh Nicolajsen, Ada Scupola

Digitization, Accounting, Controlling, and Reporting

Frontmatter

Accounting Information Systems: The Scope of Blockchain Accounting

Abstract

Distributed Ledger Technology—of which Blockchain is an example—is revolutionizing different sectors, creating new challenges and new opportunities. In this paper, we will investigate the impact of this technology on Accounting and Accounting Information Systems (AIS). The adoption of a Distributed Ledger Accounting presents extremely interesting characteristics, eliminating or redefining the role of entities external to the company, such as Banks, Insurance Companies, Certified Public Accountants and Auditors. Furthermore, we will try to outline the impact of this technology on AIS by hypothesising possible paths of development.

Iacopo Ennio Inghirami

Understanding Blockchain Adoption in Italian Firms

Abstract

This study investigates individuals’ blockchain adoption behavior focusing on the Italian setting, and gathering perceptions from information systems practitioners and entrepreneurs. The aim of the paper is to understand what are the factors that push organizational actors to use the blockchain. To this aim we embrace the second version of the unified theory of acceptance and use of technology (UTAUT). The model was estimated using the structural equation modeling with partial least square estimation (PLS-SEM). Our results show that performance expectancy and social influence are factors that have a strong positive effect on people intention to adopt blockchain. Surprisingly, the findings unveil that experience has a negative effect on blockchain use intention. This allows us to argue that the technology under scrutiny has such a disruptive nature that individuals with previous experience look at it with skepticisms as its implementation involves a full re-think of all routines and practices.

Adele Caldarelli, Luca Ferri, Gianluca Ginesti, Rosanna Spanò

Improving Invoice Allocation in Accounting—An Account Recommender Case Study Applying Machine Learning

Abstract

Covering transactions between buyers and sellers, invoices are essential. However, not all invoices can be directly matched to a purchase order due to missing order numbers, differences in terms of the invoice amount, quantity and/or quality. Following design science research (DSR) in information systems (IS), the objective of this article is to propose a new kind of an account recommender by applying machine learning. We take a chemical company as our case study and build a prototype that today handles more than 500,000 invoices without purchase order per year more accurately and efficiently than manual work did before. Finally, we propose five design guidelines to drive future research as follows: (1) Truly understand the business need; (2) More data can only get you so far; (3) Give the machine a good starting position; (4) Computing power is crucial; (5) Do not burn your bridges yet (manual intervention).

Markus Esswein, Joerg H. Mayer, Diana Sedneva, Daniel Pagels, Jean-Paul Albers

Performance-Based Funding in the Italian Higher Education: A Critical Analysis

Abstract

University performance is playing an increasingly important role in financing public institutions. This has resulted in higher competitiveness and stronger emphasis on efficiency and effectiveness and a propensity to hold universities directly accountable. However, assessment tools are not consistently able to measure the achievements of universities in a reliable way due to the lack of indicators that can assess performance objectively. Furthermore, the formulas that are frequently used to determine achievements are complex, and the raw data that feeds such formulas are not unfailingly reliable. The aim of this theoretical study is underlining the potential criticalities of the performance-based approach in the Italian higher education system by critically analysing three of the main mechanisms that are employed to determine resource allocation. The paper also highlights the derived effects that influence the strategic choices and consequent actions that are implemented by universities.

Alberto Ezza, Nicoletta Fadda, Gianfranco Pischedda, Ludovico Marinò

People, Organizations, and New Ways of Working in the Information Age

Frontmatter

Organizational Impacts on Sustainability of Industry 4.0: A Systematic Literature Review from Empirical Case Studies

Abstract

There is an increasing interest in Industry 4.0 (I40) applications for organizations to act sustainable. Indeed literature agrees the adoption of I40 technologies promises various organizational benefits which lead to the achievement of an enduring sustainability and competitive advantage for organizations. However, there is a lack of a study which provides transparency confirming and summarizing those spawned organizational benefits. This paper aims at addressing this gap performing a systematic literature review analyzing I40 empirical case studies for detecting the spawned I40 organizational impacts on sustainability. We employed the triple bottom line (TBL) concept as sensitive device to confront different studies distinguishing among the sustainability dimensions, namely the economic, social and environmental dimensions. We then categorize and group I40 organizational impacts according to TBL dimensions. The review portrays an initial empirical knowledge regarding the I40 organizational impacts on sustainability since 18 I40 empirical case study have found. Furthermore, the literature review reveals that I40 applications mainly impact the economic dimension whereas few applications generated benefits for the remaining dimensions.

Emanuele Gabriel Margherita, Alessio Maria Braccini

Industry 4.0 and the Global Digitalised Production. Structural Changes in Manufacturing

Abstract

The globalization process and the new digitalized production have rapidly changed the structural organizational models of major economies. To avoid the commoditization trap, globalization and price-advantage erosion, manufacturing industries are moving fast from mass to customized productions. They have servitized business operations, taking advantages of the new emerging and digitized technologies within the scenario of Industry 4.0 (I4.0). This paper recalls the most significant debate on the new industrial paradigm, and investigates its impact on the manufacturing sector, focusing on Italian SMEs. It evaluates the effects on labour division, organizational models of production (agents-machines-organization), the “new” power structure, and the economy as a whole. It investigates the effects of technology on the labour market and organizational models with respect to SMEs and networks, concluding that I4.0 could be an effective driving force for networking SMEs, despite the reduction of employees in manufacturing is likely to continue.

Giovanna Morelli, Cesare Pozzi, Antonia R. Gurrieri

Managing Online Communities and E-WOM: Prosumers’ Characteristics and Behaviors in the Food Service Sector

Abstract

Nowadays having a good online corporate reputation is a valuable resource for organizations, especially in the food and beverage service sector. Potential diners frequently rely on people’s opinions shared online in choosing a new restaurant. In so doing, online communities are gaining increasing importance in influencing the customer journey. This research aims to better understand the prosumers’ use of social media (i.e. people that are both consumers and social media users and that contribute to create digital contents) in choosing a restaurant and reviewing it online. In particular, we want to investigate if prosumers’ characteristics or habits, can influence their use and perception of social media, such as looking for information, writing feedbacks, and trust online reviews. In this paper we will focus on two main prosumers’ characteristics or habits: the frequency of going to a restaurant and the willingness to try new restaurants. Our main findings suggest that prosumers that frequently go to a restaurant have a different approach to social media being more inclined to used them both for gathering information and for reviewing their experience. Similarly, we find that prosumers that have an “explorative” behavior (i.e. enjoy to frequently try new restaurants), use social media differently from prosumers that have a “loyal” behavior, i.e. that choose the same and familiar restaurant. In this explorative study we adopted a quantitative methodology by using a survey on 315 Millennials prosumers. Theoretical and managerial implications are also developed.

Claudia Dossena, Francesca Mochi

Identification of IT-Needs to Cope with Dynamism in Collaborative Networked Organizations—A Case Study

Abstract

Collaborative Networked Organizations (CNOs) are increasingly common in current dynamic markets. The participants in a CNO try to achieve a common goal while acting on market opportunities. Information technology (IT) facilitates collaboration between participants within a CNO. In this paper, we show how CNOs cope with network-dynamics related to their IT-needs. Two sub-characteristics of network dynamics, respectively many-to-many relations and interaction patterns, will be investigated. In the end, we are trying to answer the question regarding what IT-needs CNOs have, to cope with CNO-dynamism. Based on a literature review we developed a framework on CNO-dynamism and executed a multi-case study within four CNOs. We conclude that all framework components are recognized within the CNOs. CNOs appeared to mainly cope with dynamics by using collaborative platforms, task management systems, and conference facilities.

Ronald van den Heuvel, Rogier van de Wetering, Rik Bos, Jos Trienekens

Unwrapping Efforts and Difficulties of Enterprises for Digital Transformation

Abstract

Since the late twentieth century, Information Technology (IT) has made a fundamental transformation in our society through automation, a process known as the third Industrial Revolution. More recently, in the twenty-first century, there has been a farther stage of transformation through IT called “Digital Transformation.” However, enterprises are struggling with aligning suitable digital strategies and actions for Digital Transformation, since there is a fundamental complexity in IT management, and a scarcity of research relating to how enterprises could systematically approach Digital Transformation. Therefore, we conducted eight interviews as a case study to explore key strategic themes for those enterprises regarding Digital Transformation. We applied directed content analysis for the interviews and obtained detailed descriptions that fully explain Digital Transformation in Japanese enterprises. From our results, three key topics have been discovered for the enterprises to consider for Digital Transformation: (1) Customer Experience, (2) Strategic Intent, and (3) Ecosystem. The results of our research contribute to a better understanding of what struggle enterprises have experienced with Digital Transformation by showing a practical approach for real businesses, as well as by demonstrating the possibilities for future research.

Haruka Ikegami, Junichi Iijima

Coordinating Innovation in Digital Infrastructure: The Case of Transforming Offshore Project Delivery

Abstract

The relationship between digitalization, digital innovation, and digital transformation is an emerging topic in information systems (IS) research. Whereas IS researchers widely acknowledge that digitalization underpins both digital innovation and digital transformation, just how and by what mechanisms link digital innovation with digital transformation remains underexplored. Differentiating between ‘digital infrastructure innovation’ and ‘innovation in digital infrastructure’, this paper contributes towards current discussions by empirically elaborating how the open-ended and generative potential of digital innovation in practice has to be negotiated against the installed base of technical and organizational arrangements in digital transformation. We pursue this argument through a case study of digital innovation coordination in an inter-organizational digital innovation project with the goal of instigating digital transformation within the offshore construction industry.

Mina Haghshenas, Thomas Østerlie

Digital Ecosystems for Business Innovation and Digital Transformation

Frontmatter

Organizational Capabilities for Social Media Management: How Restaurant Managers Approach to the Digital Ecosystem

Abstract

Digital platforms and social media are now widespread and their diffusion enables the development of digital ecosystems where organizations, users and firms’ stakeholders virtually meet, share knowledge, influence each other and co-evolve. In order to effectively manage and exploit digital ecosystems, organizations require to evolve their processes and capabilities. The paper aims are threefold: (1) understanding how restaurant managers perceive and approach the digital ecosystem, (2) investigate how they concretely manage the digital ecosystem, and (3) comprehend what organizational competences are perceived as useful to effectively manage the digital ecosystem. We adopt an explorative approach through a qualitative analysis of 54 companies in the food and beverage service sectors.

Claudia Dossena, Francesca Mochi

Achieving Trust, Relational Governance and Innovation in Information Technology Outsourcing Through Digital Collaboration

Abstract

Through an explorative case study, this paper provides insights on how the adoption of a digital collaboration tool (i) can create a more trust-based relationship between ITO client and suppliers, and (ii) can foster collaborative relationships that result in both operational and strategic innovation outcomes. Our case study is based on an ITO project developed by Infocert, the first Certification Authority in Italy, having issued and managed more than 4,500,000 qualified certificates of digital signature. Our findings show how digital collaboration can affect trust before and during the engagement phase of the IT outsourcing process. The digital media tool increased communication flexibility and supported temporary relationships based on explicit rather than implicit agreements. This case, therefore, highlights how the use of a digital collaboration tool can change relational governance in a short time frame as trust among client and suppliers switched swiftly from affective attitudes to a more objective relations based on competencies.

Giovanni Vaia, William DeLone, Daria Arkhipova, Anna Moretti

In Vino Veritas? Blockchain Preliminary Effects on Italian Wine SMEs

Abstract

Transparency and traceability in the food industry have become two central themes for both consumers and companies. On the one hand, consumer awareness increases with more available in depth information, whilst food manufacturers try to mitigate food safety risks, reduce coordination costs and fraud by improving their presence on the market. In this scenario, innovative technologies and blockchain may have a major impact. The authors investigate the adoption of blockchain in the Italian wine industry and, in particular, the effects of blockchain on the complex inter-organizational supply chain systems SMEs are engaged in. A qualitative approach was chosen to preliminary analyse the motivations driving small Italian wineries to adopt blockchain technologies, and the advantages or drawbacks managers identified during pilot experiments.

Roberta Cuel, Gabriella Maria Cangelosi

Digital Competences for Civil Servants and Digital Ecosystems for More Effective Working Processes in Public Organizations

Abstract

Advancements in digital transformation, artificial intelligence, cloud computing, the Internet of Things (IoT), block-chain, big data, smart-working, information systems’ interoperability, etc. are changing the nature of the link between technology and employment in public sector. There is the potential that these changes could bring also benefits beyond labour substitution, including higher levels of output, better quality, and fewer errors that are achievable through automation. The increasing introduction of automation and other digital technologies in public organizations means information systems could progressively substituting traditional outdated workers in performing routine, codifiable tasks while at the same time amplifying the productivity of workers in supplying problem solving skills and adaptability. In a specific report of 2018 PwC calculated that 5.1 million jobs, or 44%, were at risk of digital disruption. A digital workplace value chain has becoming a revolutionary and dominant part of the world economy. Each stage can occur in different countries and under different regulatory conditions and be implemented wherever the necessary skills and materials are available at competitive cost and quality. Digital transformation itself should not be seen as a negative for the workforce. If adopted successfully and combined with successful organisational change and change management practices, they can help public organizations to be able to achieve and became more competitive. This article aims to describe the main goals and the preliminary results of a research that aims at analysing the digital technologies adoption rate in the European public sector, in order to assess also the motivations about the adoption as well as the no-adoption decision, the kind of technologies principally actually adopted inside public organizations and the activities of value chains where the new investments in these new technologies are focused.

Nunzio Casalino, Tommaso Saso, Barbara Borin, Enrica Massella, Flavia Lancioni

Backmatter

Title: Digital Business Transformation
Publisher: Springer International Publishing
Print ISBN: 978-3-030-47354-9
Electronic ISBN: 978-3-030-47355-6
DOI: https://doi.org/10.1007/978-3-030-47355-6
Editors:: Assoc. Prof. Rocco Agrifoglio
Assoc. Prof. Rita Lamboglia
Prof. Daniela Mancini
Assoc. Prof. Francesca Ricciardi

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