Digital transformation: a review, synthesis and opportunities for future research

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  • Published: 18 April 2020
  • Volume 71 , pages 233–341, ( 2021 )

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  • Swen Nadkarni 1 &
  • Reinhard Prügl 1  

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In the last years, scholarly attention was on a steady rise leading to a significant increase in the number of papers addressing different technological and organizational aspects of digital transformation. In this paper, we consolidate existing findings which mainly stem from the literature of information systems, map the territory by sharing important macro- and micro-level observations, and propose future research opportunities for this pervasive field. The paper systematically reviews 58 peer-reviewed studies published between 2001 and 2019, dealing with different aspects of digital transformation. Emerging from our review, we develop inductive thematic maps which identify technology and actor as the two aggregate dimensions of digital transformation. For each dimension, we derive further units of analysis (nine core themes in total) which help to disentangle the particularities of digital transformation processes and thereby emphasize the most influential and unique antecedents and consequences. In a second step, in order to assist in breaking down disciplinary silos and strengthen the management perspective, we supplement the resulting state-of-the-art of digital transformation by integrating cross-disciplinary contributions from reviewing 28 papers on technological disruption and 32 papers on corporate entrepreneurship. The review reveals that certain aspects, such as the pace of transformation, the culture and work environment, or the middle management perspective are significantly underdeveloped.

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1 Introduction

Digital transformation, defined as transformation ‘concerned with the changes digital technologies can bring about in a company’s business model, … products or organizational structures’ (Hess et al. 2016 , p. 124), is perhaps the most pervasive managerial challenge for incumbent firms of the last and coming decades. However, digital possibilities need to come together with skilled employees and executives in order to reveal its transformative power. Thus, digital transformation needs both technology and people. In the last years, scholarly attention, particularly in the information systems (IS) literature, was on a steady rise leading to a significant increase in the number of papers addressing different technological and organizational aspects of digital transformation. In the light of this development, we are convinced it is the right time to map the territory and reflect on the current state of knowledge. Therefore, in this paper we aim at providing a descriptive, thematic analysis of the field by critically assessing where, how and by whom research on digital transformation is conducted. Based on this analysis, we identify future research opportunities.

We approach this objective in two steps. First, we adopt an inductive approach and conduct a systematic literature review (following Tranfield et al. 2003 ; Webster and Watson 2002 ) of 58 peer-reviewed papers dealing with digital transformation. By applying elements of grounded theory and content analysis (Corley and Gioia 2004 ; Gioia et al. 1994 ) we identify important core themes in the literature that are particularly pronounced and/or unique in transformations enabled by digital technologies. In a second step, in order to assist in breaking down disciplinary silos (Jones and Gatrell 2014 ) and avoiding the building of an ivory tower (Bartunek et al. 2006 ; Fuetsch and Suess-Reyes 2017 ), we supplement the pre-dominantly IS-based digital transformation literature with a broader management perspective. Accordingly, we integrate cross-disciplinary contributions from reviewing 28 papers on technological disruption and 32 papers on corporate entrepreneurship.

We find these research fields particularly suitable for informing digital transformation research for two reasons. First, by reviewing the literature on technological disruption we hope to derive implications regarding technology adoption and integration. Burdened with the legacy of old technology, bureaucratic structures and core rigidities (Leonard-Barton 1992 ), incumbents may face major challenges in this respect during their digital transformation journey. Second, we expect corporate entrepreneurship to add a more holistic perspective on firm-internal aspects during the process of transformation, such as management influence or the impact of knowledge and organizational learning.

Our findings and related contributions are threefold: First, based on a systematic and structured analysis we develop digital transformation maps which inductively categorize and describe the existing body of research. These thematic maps identify technology and actor as the two aggregate dimensions of digital transformation. Within these dimensions, we reveal nine core themes which help to disentangle the particularities of digital transformation processes and thereby emphasize the most influential and unique antecedents and consequences of this specific type of transformation. Thus, it becomes possible to identify the predominant contextual factors for which research would create the strongest leverage for a better understanding of the challenges inherent in digital transformation. Second, we contribute to the advancement of this field by elaborating opportunities for future research on digital transformation which integrate the three perspectives mentioned above. In particular, informed by corporate entrepreneurship, we find that the important middle management perspective on digital transformation has thus far been largely neglected by researchers. Also, emerging from our review we call for more studies on the various options for integrating digital transformation within organizational architectures and existing processes. Third, in reviewing the adjacent literature on technological disruption and corporate entrepreneurship, we strengthen the valuable management perspective within the primarily IS-based discussion on digital transformation. This way we avoid the reinvention of the wheel while at the same time enable the identification of cross-disciplinary research opportunities. We hope to stimulate discussion between these different but strongly related disciplines and enable mutual learning and a fruitful exchange of ideas.

2 Conceptual foundations

Technology as a major determinant of organizational form and structure has been well acknowledged by academics for a long time (Thompson and Bates 1957 ; Woodward 1965 ; Scott 1992 ). Following a significant decline of interest in this relationship until the mid-1990s (Zammuto et al. 2007 ), innovations in information technologies (IT) and the rise of pre-internet technologies have revitalized its relevance in the context of organizational transformation. Thus, the literature on IT-enabled organizational transformation, a concept which originates from the field of information systems (IS) that has caught considerable academic attention starting back in the early 1990s (Ranganathan et al. 2004 ; Besson and Rowe 2012 ), may be seen as one of the scholarly roots of digital transformation research. In his seminal book, Morton ( 1991 ) argued that companies must experience fundamental transformations for effective IT implementation. In the course of the years a shift of attention occurred from technological to managerial and organizational issues (Markus and Benjamin 1997 ; Doherty and King 2005 ). Non-technological aspects such as leadership, culture, and employee training were found to be equally important for successful IT-enabled transformation (Markus 2004 ). This is supported by Orlikowski ( 1996 ) who found empirical evidence from a 2-year case study that organizational transformation was in fact enabled by technology, but not caused by it.

Today, information technologies have become ‘one of the threads from which the fabric of organization is now woven’ (Zammuto et al. 2007 , p. 750). Digital technologies are considered a major asset for leveraging organizational transformation, given their disruptive nature and cross-organizational and systemic effects (Besson and Rowe 2012 ). In order to achieve successful digital transformation, changes must occur at various levels within the organization, including an adaptation of the core business (Karimi and Walter 2015 ), the exchange of resources and capabilities (Cha et al. 2015 ; Yeow et al. 2018 ), the reconfiguration of processes and structures (Resca et al. 2013 ), adjustments in leadership (Hansen and Sia 2015 ; Singh and Hess 2017 ), and the implementation of a vivid digital culture (Llopis et al. 2004 ). Therefore, the scope of our review revolves around digital transformation at the organizational level only (in contrast to implications at the individual level).

In this study, we conceptualize digital transformation at the intercept of the adoption of disruptive digital technologies on the one side and actor-guided organizational transformation of capabilities, structures, processes and business model components on the other side. In other words, and in line with Hess et al. ( 2016 ), we define digital transformation as organizational change triggered by digital technologies. Hence, we argue that two perspectives of digital transformation within organizations must be captured: a technology-centric and an actor-centric perspective. To exploit the technology-centric perspective we include the literature on technological disruption (e.g. Tushman and Anderson 1986 ; Anderson and Tushman 1990 ) and merge it with research on digital transformation. For the actor-centric perspective, we derive essential implications from the field of corporate entrepreneurship (Guth and Ginsberg 1990 ), which we believe may add valuable insights regarding actor-driven innovation and renewal processes within firms. In the following, we offer a brief introduction to both concepts and their relationship with digital transformation.

Rice et al. ( 1998 ) define disruptive innovations as ‘game changers’ which have the potential ‘(1) for a 5–10 times improvement in performance compared to existing products; (2) to create the basis for a 30–50% reduction in costs; or (3) to have new-to-the world performance features’ (p. 52). Similarly, Utterback ( 1994 ) emphasizes this disruptiveness at the firm and industry level and provides a similar ‘game changer’ definition in terms of ‘change that sweeps away much of a firm’s existing investment in technical skills and knowledge, designs, production technique, plant and equipment’ (p. 200). Tushman and Anderson ( 1986 ) distinguish between product and process disruptiveness. Product disruptiveness encompasses new product classes, product substitutions, or fundamental product improvements. Process disruptiveness may take the form of process substitutions or process innovations which radically improve industry-specific dimensions of merit. Christensen and Raynor ( 2003 ) introduce a further form of disruptive innovations, namely disruptive business model innovations, which represent the implementation of fundamentally different business models in an existing business.

We argue that digital technologies may reflect in all of these definitions of disruptive innovation. They may represent new-to-the-world product innovations, dislocate existing processes, and open up entirely new business models. As resumed in a recent study by Li et al. ( 2017 ), e-commerce for instance is defined as a disruptive technology (Johnson 2010 ) which involves significant changes to an organization’s culture, business processes, capabilities, and markets (Zeng et al. 2008 ; Cui and Pan 2015 ).

Corporate entrepreneurship (CE) on the other side is a multi-dimensional concept at the intersection of entrepreneurship and strategic management in existing organizations (Zahra 1996 ; Hitt et al. 2001 ; Dess et al. 2003 ). We adopt the conceptualization proposed by Guth and Ginsberg ( 1990 , p. 5), who argue that corporate entrepreneurship deals with two phenomena ‘(1) the birth of new businesses within existing organizations, i.e. internal innovation or venturing, and (2) the transformation of organizations through renewal of the key ideas on which they are built, i.e. strategic renewal.’ Particularly the aspect of strategic renewal in corporate entrepreneurship, also labelled as strategic change, revival, transformation (Schendel 1990 ), reorganization, redefinition (Zahra 1993 ), or organizational renewal (Stopford and Baden-Fuller 1994 ), provides a promising interface to digital transformation. As stated by Covin and Miles ( 1999 , p. 50), corporate entrepreneurship ‘revitalizes, reinvigorates and reinvents’—processes also required for digital transformation. Various authors have stated that corporate entrepreneurship is a vehicle to improve competitive positioning and transform corporations (Schollhammer 1982 ; Miller 1983 ; Khandwalla 1987 ; Guth and Ginsberg 1990 ; Naman and Slevin 1993 ; Lumpkin and Dess 1996 ). Considering the disruptive nature of many current digital technologies, we believe that organizations need to fundamentally renew and redefine the key ideas of their business in order to fully exploit the potential of digitization and eventually achieve successful transformation. The literature places particular attention on the role of middle managers as the locus of corporate entrepreneurship (Burgelman 1983 , Floyd and Wooldridge 1999 ). Concluding, we will review the research on corporate entrepreneurship and identify those contributions which we believe may offer valuable knowledge regarding actor-driven internal renewal and change processes in the light of digital transformation.

Our review of the literature on digital transformation, technological disruption and corporate entrepreneurship is conducted in a two-step approach. First, we review, analyze and synthesize existing articles on digital transformation. Then, in a second step we supplement these findings be simultaneously reviewing the literature stream on technological disruption and corporate entrepreneurship. We believe a separate analysis and contrasting of the research streams is appropriate for two reasons: first, it provides the reader with more clarity on the status quo of digital transformation knowledge and prevents the confusion of concepts emerging from different literature fields. Second, white spots and opportunities for future research regarding digital transformation become much more visible in such a structured approach.

3 Research methodology

A systematic review is a type of literature review that applies an explicit algorithm and a multi-stage review strategy in order to collect and critically appraise a body of research studies (Mulrow 1994 ; Pittaway et al. 2004 ; Crossan and Apaydin 2010 ). This transparent and reproducible process is ideally suited for analyzing and structuring the vast and heterogeneous literature on digital transformation. In conducting our review, we followed the guidelines of Tranfield et al. ( 2003 ) and the recommendations of Denyer and Neely ( 2004 , p. 133) Footnote 1 as well as Fisch and Block ( 2018 ) in order to ensure a high quality of the review.

The nature of our review is both scoping and descriptive (Rowe 2014 ; Paré et al. 2015 ) as we aim to provide an initial indication of the potential size and nature of the available literature as well as to summarize and map existing findings from digital transformation research. By developing opportunities for future research, our review further contributes to the advancement of this field and stimulates theory development.

For the purpose of data collection, we exclusively limit our focus on peer-reviewed academic journals as recommended by McWilliams et al. ( 2005 ). Thus, we opted to exclude work in progress, conference papers, dissertations, or books. First, based on discussion among the authors and the reading of a few highly-cited papers, we designed our search criteria using combinations of keywords containing ‘ digital* AND transform*’ , ‘ digital* AND disrupt*’ , ‘ digitalization’ , and ‘ digitization ’. Then, we manually searched each issue of each volume of the leading journals in the management Footnote 2 and IS field (AIS Basket of eight). Footnote 3 In addition, we run our search query against five different electronic databases: Business Source Premier (EBSCO) , Scopus , Science Direct , Social Sciences Citation Index (SSCI) , and Google Scholar . We used all years available and only included articles referring to business, management, or economics in order to exclude irrelevant publications. We abstained from including digital innovation in our search (the only exception in our sample is a recent literature review by Kohli and Melville ( 2019 ), in order to capture consolidated insights). Although we realize that it is a hot topic in IS research at the moment (e.g. Fichman et al. 2014 ; Nambisan et al. 2017 ; Yoo et al. 2010 , 2012 ), we aim to concentrate our focus on papers dealing with digital transformation on a broader level (firm and industry), rather than with transitions within innovation management.

Our first search query was conducted mid 2017 and yielded an initial sample of 1722 publications. This very large sample was mainly due to the broad ambiguity of the terms ‘digital’ and ‘disrupt’. Given these broad search parameters, we anticipated that only a small fraction of this very large sample would prove to be of substantive relevance to us. To select these relevant articles for our final sample, we performed a predefined and structured multi-step selection process (similar to the approach of Siebels and Knyphausen-Aufseß 2012 ; Vom Brocke et al. 2015 ) and defined specific criteria for inclusion (Templier and Paré 2015 ). The filters during our selection process included (1) scanning the titles, (2) reading abstracts, (3) removing duplicates, (4) full reading and in-depth analysis of the remaining papers, and finally (5) cross-referencing and backward searching by looking through the bibliographies of the most important articles to find additional relevant work. The initial pool was split in half between two panelists who separately performed the scanning of titles, analysis of abstracts and removal of duplicates. After these early steps, the sample could be narrowed down to 155 articles. As we arrived at step 4 “full reading and in-depth analysis of the remaining papers”, both panelists read and independently classified each of the remaining 155 studies. During this process, papers qualified for the final sample if they satisfied three requirements: (1) articles were required to have their primary focus and contribution within digital transformation research or digitally-induced organizational transformation (e.g. a vast number of papers inadequately captured the topic of digital transformation as they primarily focused on business model innovation), (2) articles needed to be based on a sound theoretical foundation and therefore not primarily practitioner oriented (such as articles that offer popular recommendations to business leaders on how to survive digital transformation), (3) papers that were not addressing digital transformation at an organizational level (e.g. the rise of home-based online businesses by entrepreneurs) were dismissed. Whenever disagreements emerged regarding the inclusion or classification of an article, we engaged in discussion and tried to resolve the issue together to make our selection rules more reliable. We updated the review in the autumn of 2018 for any articles that had appeared between then. Following this approach, 58 studies passed all five selection steps and were included in our final sample.

Within this sample, conceptual articles (27) and case studies (20) are dominant. Roughly 60% of the articles stem from the IS literature, while 40% cover a broader management perspective of digital transformation. While the reviewed papers span a time frame from 2001 to 2018, approximately eighty-percent of articles were published within the past 5 years, indicating the relative novelty of digital transformation as a research discipline. The distribution of our sample according to journals is provided in Table  4 of “ Appendix ”.

Upon the recommendation of Webster and Watson ( 2002 ), our categorization and analysis of the literature was concept-centric. First, to facilitate analysis and build a basis for our initial coding, each selected paper was reviewed to determine the following database information.

(1) Article title, (2) outlet, (3) research methodology, (4) sample, (5) region, and (6) key findings (see full database in Table  5 of “ Appendix ”). Next, we started coding our sample, adopting elements of the approach introduced by Corley and Gioia ( 2004 ). We began by identifying initial concepts in the data and grouping them into provisional categories and first order concepts (open coding). Then, we engaged in axial coding (Locke 2001 ) and searched for relationships and common patterns between and among these provisional categories, which allowed us to assemble them into second order themes. Finally, we assigned these second order themes to aggregate dimensions, representing the highest level of abstraction in our coding. In sum, reviewing and analyzing the extant literature, 194 coded insights were generated within the field of digital transformation: 61 first order concepts, nine second order themes, and two aggregate dimensions. The nine second order themes represent core themes across the papers, which finally constitute two aggregate dimensions: technology and actor. In conclusion, we define digital transformation as actor-driven organizational transformation triggered by the adoption of technology-driven digital disruptions. The result of the coding process is a high-level inductive map of the core themes in digital transformation research (Fig.  1 ).

figure 1

Digital transformation high-level thematic map emerging from the analysis of the literature

The reviewed studies from our sample provide a rich body of knowledge regarding the specific contextual factors of digital transformation. This may be beneficial to both researchers and practitioners enabling a more comprehensive understanding of the peculiarities of digital transformation (in comparison to previous technology-driven transformations).

4.1 Macro-level findings

On a macro level, the central observation emerging from our review is that both technology- and actor-centric aspects take center stage within this debate. This is also reflected in various definitions of digital transformation provided in the sample. For example, Lanzolla and Anderson ( 2008 ) represent the technology-centric side and emphasize the diffusion of digital technologies as an enabler for transformation. Such digital technologies may include big data, mobile, cloud computing or search-based applications (White 2012 ). Similarly, Hess et al. ( 2016 ) note that digital transformation is ‘concerned with the changes digital technologies can bring about in a company’s business model, which result in changed products or organizational structures or in the automation of processes’ (p. 124). However, Hess et al. ( 2016 ) also highlight the role of actors (e.g. managers) in promoting transformation processes, while facing the challenge of simultaneously balancing the exploration and exploitation of resources. Leaders must have trust in the value and benefits of new IT technologies and support their implementation (Chatterjee et al. 2002 ).

In total, we find an almost even distribution of papers studying the two dimensions of technology and actor: 33% are technology-centric, 34% are actor-centric, and 33% of papers cover both technology and actor. However, within these two dimensions we observe a rather uneven distribution of articles by second order themes. On the technology-centric side, we find that understanding the implications of digital technologies on the consumer interface and market environment are highly active research streams. In comparison, understanding the pace of change in times of digital transformation and its direct impact on incumbents is so far comparably understudied. On the actor-centric side, our review reveals a very dominant focus on leadership and capabilities in a digital context, while in contrast company culture and work environment thus far received less recognition. We also find that the status-quo of digital transformation literature is rather diverse, in a sense that papers discuss topics across various categories of our thematic map and are therefore not restricted nor focused to a specific unit of analysis. The vast majority of articles is related to adjacent topics of digital transformation underpinning its nature as a diverse and broad field of research while again indicating its emerging nature.

In addition, we observe some degree of diversity in the theoretical foundations drawn upon. Different theories are applied by several authors to capture the context of digital transformation, e.g. alignment view, configuration theory, resource-based view, dynamic capabilities, organizational learning theory, network view or business process reengineering. It would be interesting to use other theoretical angles, for example from the literature on corporate entrepreneurship and technological disruption, in order to increase theoretical diversity. Such an exchange with different fields of research would broaden the scope of the field and help bridging an ivory divide . Finally, from a methodological perspective, we observe that actor-centric papers primarily use case studies while technology-centric studies at this point are pre-eminently conceptual. In general, the literature is scarce regarding quantitative empirical evidence. We see this as a strong indicator for the early stage of digital transformation research.

4.2 Micro-level findings: the technology-centric side of the equation

In the following, we present and discuss the most important findings of the second order themes within the technology-centric dimension. In Fig.  2 we provide a thematic map for this dimension and in Table  1 a brief summary including illustrative quotes.

figure 2

Thematic map for technology-driven themes in digital transformation literature

4.2.1 Pace of change and time to market

In times of digital transformation, the speed of technological change is disproportionally accelerating with new digital capabilities being rolled out every year. The technological capability of applications such as the Internet of Things (IoT), big data, cloud computing, and mobile technologies significantly increases the overall pace of change. For example, entire industries, like the newspaper business, have been transformed and digitized within a very short period of time (Karimi and Walter 2015 ). Further, the cloud and online platforms have revolutionized the process and pace of turning an innovative idea into a business (Vey et al. 2017 ). Today, innovative ideas can be realized within days and companies set-up literally ‘overnight’. In this sense, in the digital world striving for a ‘first-mover advantage’ due to a ‘winner takes it all’ environment has become more important for incumbent firms (Grover and Kohli 2013 ) as they have much less time to respond to such threats and should not give away first-mover advantages too easily.

Moreover, pure digital companies like Facebook, Google or Amazon have substantially raised the overall time to market and speed of product launches (Bharadwaj et al. 2013 ). With continuous improvements in hardware, software and connectivity, these companies set the pace for a tightly timed series of product launches. Thus, firms in the hybrid world (digital and physical) are being put under enormous pressure to also accelerate their product introductions. In a digitally transformed market, the control of speed of product development and launches is increasingly transferred to an ‘ecosystem of innovation’ in the sense of a network of actors with complementary products and services (Bharadwaj et al. 2013 ).

4.2.2 Technology capability and integration

The technological capability and power of digital transformation applications, such as for example the Internet of Things (IoT), big data, cloud computing, and mobile technologies, is in terms of computing power, data storage and information distribution in many cases significantly higher than in previous technology-driven transformations. Earlier business transformations were mostly concerned about introducing internal management information systems such as enterprise resource planning (ERP) or customer relationship management (CRM). These transformations were usually limited to improvements to business processes within firm boundaries (see Ash and Burn 2003 ; Kauffman and Walden 2001 in: Li et al. 2017 ). But today, cross-boundary digital technologies such as IoT devices (Ng and Wakenshaw 2017 ), 3D printing (Rayna and Striukova 2016 ), and big data analytics (Dremel et al. 2017 ), drive transformations that go far beyond internal process optimizations as they potentially induce drastic changes to business models (Rayna and Striukova 2016 ), organizational strategy (Bharadwaj et al. 2013 ), corporate culture (El Sawy et al. 2016 ; Dremel et al. 2017 ; Sia et al. 2016 ), and entire industry structures (Kohli and Johnson 2011 ).

Further, the review confirms that the role and significance of data itself is changing profoundly and that personal data has become one of the most powerful assets in the digital era (Ng and Wakenshaw 2017 ). In fact, we believe the impact of the massive increase in quantity and quality of data generated every day (Bharadwaj et al. 2013 ) and the game changing power of big data analytics (Günther et al. 2017 ) are yet to be fully experienced and understood by society, economy and academics.

With regards to the process of dematerialization of tangible products and objects (e.g. CDs, books, machinery etc.), triggered by the transformative capabilities of digital technologies, the most notable insight is that intriguingly, in many cases the digital substitutes, for example e-books, offer superior performance and higher customer benefits than their physical counterparts (Loebbecke and Picot 2015 ). This, for example, is in contrast to the assumptions provided by Christensen ( 1997 ) more than 20 years ago, arguing that new disruptive technologies usually provide different values from mainstream technologies and are often initially inferior to mainstream technologies, therefore only serving niche markets in the beginning.

Finally, regarding technology integration, the current state of research emphasizes the importance of flexible IT (Cha et al. 2015 ), new enterprise platforms (El Sawy et al. 2016 ), and a strong and scalable operational backbone (Sebastian et al. 2017 ) as part of an agile digital infrastructure. The old paradigms of technology integration are not effective any more. However, in a second step we need to reach a more comprehensive understanding of ‘how’ and ‘where’ the integration of technology and transformation activities should be embedded within the organizational architectures of incumbent firms.

4.2.3 Consumer and other stakeholder interface

With regards to the customer interface, which is currently receiving the highest levels of attention by scholars, we conclude that there is some solid research particularly on changes in consumer behavior (Berman 2012 ; El Sawy et al. 2016 ; Ives et al. 2016 ; Lanzolla and Anderson 2008 ), consumer preferences (Vey et al. 2017 ) and consumer knowledge (Berman 2012 ; Granados and Gupta 2013 ). Firstly, our review confirms that in the new digital marketplace, consumers behave differently than before, and traditional marketing techniques may not apply anymore. Today there are myriad choices to easily gather information about products and services far before the actual purchase. For instance, customer buying decisions are increasingly influenced by online customer-to-customer interaction via platforms and social media, where users share products feedbacks, upload home video clips, or publish blog entries (Berman 2012 ). In this sense, digital technologies are also transforming firms’ customer-side operations (Setia et al. 2013 ) and customer engagement strategies (Sebastian et al. 2017 ). For example, reaching out to customers in a digital environment requires digital omnichannel marketing, including e.g. social media, mobile apps, and augmented reality (El Sawy et al. 2016 ). Secondly, we may note that digital technologies increasingly reduce the information asymmetries between sellers and buyers (Granados and Gupta 2013 ). In this sense, information ubiquity (Vey et al. 2017 ) and instant access to data via mobile technologies (Berman 2012 ) profoundly change the long-established seller–customer relationship. And thirdly, the current literature raises awareness for the emergence of multi-sided business models. While in the ‘old’ world, intermediaries were matching sellers and buyers, in the digital market place, intermediation increasingly takes place through the establishment of multi-sided digital platforms and networks (Bharadwaj et al. 2013 ; Evens 2010 ; Pagani 2013 ).

4.2.4 Distributed value creation and value capture

The review of the literature reveals that the value chain has become far more distributed in times of digital transformation—particularly value creation and value capture. Two major changes can be observed here: (1) digital technologies offer opportunities to customers to co-create products with the manufacturer, e.g. via digital platforms (El Sawy et al. 2016 ; Ng and Wakenshaw 2017 ), and (2) on an inter-firm level value is increasingly co-created and captured in a series of partnerships in a value network (Evens 2010 ). As Bharadwaj et al. ( 2013 ) argue, network effects are the key differentiator and driver of value creation and capture in a digital world. The focus of value creation is therefore shifting from value chain to value networks. For this purpose, companies like Google are experimenting with multi-sided business models. In such a multilayered business model, a company gives away certain products or services in one layer to capture value at a different layer (Bharadwaj et al. 2013 ). Google is giving away its Android operating system for free and captures value via the ability to control advertising on every phone that uses Android.

In more general terms, we may conclude that control of value in the digital world is less and less determined by R&D capabilities, competitors, or industry boundaries. Instead the buyer, not the seller, determines the dimensions of value that matter (Keen and Williams 2013 ). Therefore, businesses need to engage with their customers at every point in the process of value creation (Berman 2012 ). Also, the strong impact of digital technologies on incumbent’s value chains imply some degree of deviation from the classical and often analog core business. For example, new product-related competencies, platform capabilities or value architectures will be required. And, incumbents must prepare for new forms of monetization in the digitized marketplace.

4.2.5 Market environment and rules of competition

This is a rather broad and diverse categorization in our review, as it comprises technology-driven changes in the market environment. After consumer-centric aspects this research stream received the most attention by scholars in the review (on the technology-centric side). In sum, the current state of literature recognizes three major developments. First, digital transformation redefines, blurs and even dissolves existing industry boundaries which may lead to cross-industry competition (Sia et al. 2016 ; Weill and Woerner 2015 ). Dominant industry logics (Sabatier et al. 2012 ) apparently do not work anymore in times of digital transformation. The ‘new kid on the block can come out of the blue’ (Vey et al. 2017 , p. 23) and even individuals can become competitors as 3D Printing is expected to lead to a sharp increase in competition from SMEs and individual entrepreneurs (Rayna and Striukova 2016 ). And with the emergence of multi-sided business models also incumbents are starting to disrupt new markets (Weill and Woerner 2015 ). For instance, Google is disrupting the mobility sector with its self-driving car subsidiary Waymo, while Amazon has introduced AmazonFresh as a grocery delivery service which is seen as a potentially tough competitor to supermarkets. Second, with the emergence of digital platforms, networks, and ecosystems the market infrastructure becomes increasingly interconnected (Grover and Kohli 2013 ; Majchrzak et al. 2016 ; Markus and Loebbecke 2013 ). In a broader sense, we see a shift from controlling or participating in a linear value chain to operating in an ecosystem or network (Weill and Woerner 2015 ). As different types of innovation networks with different cognitive and social translations regarding knowledge emerge, novel properties of digital infrastructure in support of each network are required. Digital technologies therefore increase innovation network knowledge heterogeneity (Lyytinen et al. 2016 ). Third, the free flow of digital goods precipitates an erosion of property rights and higher risks of imitation (Loebbecke and Picot 2015 ).

4.3 Micro-level findings: the actor-centric side of the equation

In the following, we present and discuss the most important findings of the second order themes within the actor-centric dimension. In Fig.  3 we provide a thematic map for this dimension and in Table  2 a brief summary including illustrative quotes.

figure 3

Thematic map for actor-driven themes in digital transformation literature

4.3.1 Transformative leadership

Understanding the impact of digital transformation on leadership and management behavior is a very active and prioritized research focus. In total, 23 papers in our review explore this aspect. First and foremost, research calls for a shift in the traditional view of IT strategy as being subordinate to business strategy (El Sawy et al. 2016 ). In the course of the past two decades information technologies have surpassed their subordinate role as administrative ‘back office’ assets and evolved into an essential element of corporate strategy building. Thus, incumbents should align IT and business strategies on equal terms and fuse them into ‘digital business strategy’ (Bharadwaj et al. 2013 ).

Also, emphasis is placed on the changing nature of leadership itself, caused by digital transformation. Such changes may include rapid optimization of top management decision-making processes enabled by instant access to information and expansive data sets (Mazzei and Noble 2017 ), new communication principles (Bennis 2013 ; Granados and Gupta 2013 ), or changes in leadership education (Sia et al. 2016 ). Further, there is consensus that senior management requires a new digital mindset in order to captain their company’s digital transformation journey. Therefore, incumbents should also rethink their leadership education practices. In the past, leadership programs have been primarily about leadership and communication skills. But in times of digital transformation, executives must become ‘tech visionaries’ and develop their transformative powers. For example, Sia et al. ( 2016 ) have conducted a case study on an Asian bank that uses hackathons to educate their senior managers. Media transparency and exposure are further key challenges of digitization where top managers may require some additional education. Given the ubiquity of information and the speed of online data dissemination (via mobile phones, viral effects of social media etc.), leaders today are significantly more exposed publicly than their analog predecessors. Therefore, according to Bennis ( 2013 ) leadership in the digital era needs to be learned through embracing transparency and adaptive capacity (specifically resilience as the ability to rebound from problems and crisis).

Finally, the vast extent and complexity of digital transformation leads to the emergence of an additional position at the top management level—the Chief Digital Officer (Dremel et al. 2017 ; Tumbas et al. 2017 ). Given the immense challenges of digital transformation and the claim for a new mindset and different skills, CEOs or even CIOs are conceivably not the best match (Singh and Hess 2017 ). Particularly not if they are expected to drive digital transformation in addition to their original tasks.

4.3.2 Managerial and organizational capabilities

Our analysis suggests that in order to effectively drive digital transformation additional and refined capabilities are required—both managerial and organizational (Li et al. 2017 )—in comparison to the analogue world.

At the managerial level, for one thing, a much faster strategy and implementation cycle is needed to cope with the pace of digital transformation (Daniel and Wilson 2003 ). The turbulent and ever-changing digital environment is forcing managers to make decisions and implement strategies significantly faster than they had been previously required to. In order to study managerial capabilities in the context of digital transformation, some studies have adopted the theory of dynamic capabilities (Daniel and Wilson 2003 ; Li et al. 2017 ; Yeow et al. 2018 ) as introduced by Teece et al. ( 1997 ), Teece ( 2007 , 2014 ). In particular, results indicate that dynamic capabilities may support the refinement of digital strategy and are therefore not separate from alignment, but on the contrary have the potential to enact and guide the process of aligning.

At the organizational level, one of the most intriguing challenges for incumbents will be to manage the ambidexterity of capabilities in terms of analog and digital capabilities. Firms need to incorporate ‘old’ and ‘new’ capabilities into their organizational structure in a complementary and not impeding way. In addition, capabilities in two further areas are of particular importance to many firms. First, capabilities to implement and operate in networks (Bharadwaj et al. 2013 ), platforms (Li et al. 2017 ; Sebastian et al. 2017 ), and ecosystems (El Sawy et al. 2016 ; Weill and Woerner 2015 ). Depending on contextual factors like for example their industry or business model, companies must learn to take advantage of network effects in terms of complementary capabilities while also learn how to become more of an ecosystem rather than continue managing value chains. Second, in the digital era it is essential to develop sensing capabilities, such as entrepreneurial alertness and environmental scanning (Kohli and Melville 2019 ), in order to identify new ideas and critically evaluate, design, modify and eventually deliver new business models (Berman 2012 ; Daniel and Wilson 2003 ).

4.3.3 Company culture

Digital transformation is not exclusively a technology-driven challenge but requires deep cultural change. Everyone within the organization must be prepared with an adaptive skill set and digital know-how. Two major insights can be identified within the existing literature. First, digital transformation demands a data-sharing and data-driven corporate culture (Dremel et al. 2017 ). Data as such must be recognized much more as a valuable resource and an enabler to become a digital enterprise. This will require higher operational transparency in daily-business and work-routines and a data-sharing mindset among employees. In this sense, incumbents need to develop their informatic culture to an informational culture (Llopis et al. 2004 ). In comparison to an informatic culture, an informational culture values IT as a core element of strategic and tactical decisions and clearly understands the financial and transformative potential of digital technologies. Second, digital transformation may trigger cultural conflict between younger and comparably inexperienced digital employees and older but more experienced pre-digitization employees (Kohli and Johnson 2011 ). Management is well advised to prevent that two different cultures arise within the same organization—a group of employees who understand digital technologies and those who have a long-standing track record in the traditional business but are technologically lagging behind. Facilitating a learning friendly culture (Kohli and Melville 2019 ) and publicly affirming support and trust by the executive level may effectively mitigate such a potential cultural divide.

4.3.4 Work environment

Our review reveals that digital transformation is changing the daily work environment in incumbent firms in terms of work structures (Hansen and Sia 2015 ; Loebbecke and Picot 2015 ), job roles, and workplace requirements (White 2012 ). For example, digital interconnectivity enables the emergence of flexible and networked cross-location teams across the entire geographical company map. In this context, traditional hierarchical work structures dissolve and new opportunities emerge beyond company boundaries, such as the integration of external freelancers (Loebbecke and Picot 2015 ). Also, the implementation of a digital workplace becomes inevitable. Particularly for ‘born digital’ younger employees a digitally well-equipped workplace may represent a major criterion for their choice of employer (El Sawy et al. 2016 ). According to White ( 2012 ), a digital workplace must be adaptive, compliant, imaginative, predictive, and location-independent.

However, the most notable insight in this perspective is that—in addition to a potential cultural divide—digitization may effectively lead to a growing skills gap between pre-digitization workers and recently hired digitally savvy employees (Kohli and Johnson 2011 ). In fact, while digital technologies significantly help to optimize and accelerate many work processes and thereby increase productivity, incumbents must be aware that many employees might not keep pace with this digital high-speed train and feel left behind. It is unclear how such a tradeoff is considered and how firms could handle related conflicts.

5 Avoiding an ivory tower: drawing on existing knowledge from adjacent research fields

We assume that pre-existing knowledge on corporate transformation processes in general is partly already available and may provide implications for digital transformation. Therefore, at this point in our review, we aim to stimulate a theoretical discussion by identifying potential white spots abstracted from adjacent research fields. For this purpose, we additionally reviewed 28 studies from the literature on technological disruption (to gain technology-centric input) and 32 papers from corporate entrepreneurship (to expand the actor-centric view). By this, we supplement the pre-dominantly IS-based digital transformation literature with a broader management perspective. First, by reviewing the literature on disruptive innovations we hope to derive implications regarding technology adoption and integration. Burdened with the legacy of old technology, bureaucratic structures and core rigidities (Leonard-Barton 1992 ), incumbents may face major challenges in this respect during their digital transformation journey. Second, we expect corporate entrepreneurship to add a more holistic perspective on firm-internal aspects during the process of transformation, such as management contribution or the impact of knowledge and learning.

We rigorously conducted the same review and analysis process as for our digital transformation sample. A database and concept matrix (Webster and Watson 2002 ) for the sample on technological disruption and corporate entrepreneurship are provided in Tables  6 and 7 of “ Appendix ”. The data structures, which summarize the second order themes for both the actor-centric and technology-centric dimension of these additional research fields are illustrated in Figs.  5 and 6 of “ Appendix ”. Within the main body of this article, we only draw attention toward three key implications (Fig.  4 ). In the following, we provide a brief synthesis of these implications and their grounding in the respective literature. In a second step, we transfer and apply these implications to the context of digital transformation and integrate them into an agenda for future research opportunities.

figure 4

Expanding the digital transformation high-level thematic map with insights from technological disruption and corporate entrepreneurship

5.1 Insights from technological disruption

Existing knowledge from the adoption of disruptive technologies suggests that in order to successfully integrate, commercialize or develop disruptive technologies incumbents need to create organizations that are independent from but interconnected in one way or another with the mainstream business (Bower and Christensen 1995 ). The reasons for this are manifold. For example, managers are encouraged to protect disruptive technologies from the processes and incentives that are targeted to serve established customers. Rather, disruptive innovations should be placed in separate new organizations that work with future customers for this technology (Bower and Christensen 1995 ; Gans 2016 ). Further, separation potentially helps to unravel the discord between viewing disruptive innovations as a threat or an opportunity. Exempted from obligations to a parent company, separate ventures are more likely to perceive a novel technology as an opportunity (Gilbert and Bower 2002 ). And lastly, a freestanding business also enables local adaptation and increased sensitivity to changes in the environment (Hill and Rothaermel 2003 ).

5.2 Insights from corporate entrepreneurship

Our review of the corporate entrepreneurship literature identifies two major implications that have not been (adequately) considered in digital transformation research yet.

First, the literature indicates that middle management plays a crucial role in redefining a firm’s strategic context and by this driving organizational transformation. A middle management perspective has thus far been completely neglected in digital transformation research. We see this as a major gap, since the middle layers of management are ‘where the action is’ (Floyd and Wooldridge 1999 , p. 124). Top management should control the level and the rate of change and ensure that entrepreneurial activities correspond to their strategic vision (Burgelman 1983 ), but middle managers at the implementation level are the driving force and key determinant behind organizational transformation. However, on the downside, middle managers may also represent a major barrier to organizational change (Thornberry 2001 ). Typically, managers have the task to minimize risks, make sure everything is compliant to the rules and perform their functional roles. Thus, middle managers usually have the most to lose from radical changes and are therefore often the least likely to be entrepreneurial or to support transformations (Thornberry 2001 ). In order to solve middle and operational manager’s risk-awareness and unleash their entrepreneurial spirit, research suggests encouraging autonomous behavior (Shimizu 2012 ). In sum, reviewing the literature on corporate entrepreneurship raises our awareness for the impact of hierarchy and management levels on organizational transformation (Hornsby et al. 2009 ).

Second, a closer cooperation and regular exchange between incumbents and start-ups in order to accelerate entrepreneurial transformation is proposed (Engel 2011 ; Kohler 2016 ). Incumbents should recognize start-up companies as a source of external innovation and develop suitable models for collaboration (e.g. corporate accelerators). In particular, incumbents are advised to implement three common best practices from successful start-ups in order to facilitate transformation: (1) working in small omni-functional teams, (2) goal-driven rapid development instead of bureaucratic processes, and (3) field-level exploration of market potential instead of complex and tedious quantitative models (Engel 2011 ). In addition, corporate entrepreneurship underlines the importance of organizational learning as a vehicle to drive and shape cultural transformation (Dess et al. 2003 ; Floyd and Wooldridge 1999 ; Zahra 2015 ). We come to understand that learning, and in fact also knowledge management, are intimately tied to the concept of organizational transformation. A culture of learning and knowledge drives experimentation, encourages the development of an adaptive skill set, reshapes competitive positioning, and opens the minds of employees to new realities (Zahra et al. 1999 ).

6 Opportunities for future research

Based on the cross-disciplinary perspectives from reviewing the literature on digital transformation, technological disruption and corporate entrepreneurship, we propose opportunities for future research on digital transformation. Using our thematic map as a lens to view future research opportunities, we focus on the two dimensions of technology and actor. For the technology-centric dimension we expand on the structural and operational integration of digital technologies and organizational transformation initiatives as well as gaining a deeper understanding of the pace of technological transformation. For the actor-centric dimension we address three topics: we start at the leadership level by emphasizing the relevance of middle management in digital transformation, after that we refer to the potential skills gap and threat of an employee divide in incumbent organizations induced by digital technologies, and finally we move beyond organizational boundaries to turn toward the potential benefits and drawbacks of cooperating with start-ups and pure digital companies to boost transformation. For each area, we propose a set of research questions. Altogether, the agenda is organized around five guiding topics (Table  3 ).

6.1 Integration of digital transformation within organizational structures and activities in incumbent firms

Our review of the literature on digital transformation reveals a knowledge gap regarding this topic. However, we do gain some interesting cross-disciplinary insights from technological disruption at this point. In fact, as already discussed, studies on technological disruption indicate that in order to successfully integrate, commercialize or develop disruptive technologies incumbents need to create organizations that are completely independent from but interconnected in one way or another with the mainstream business (Bower and Christensen 1995 ; Gans 2016 ; Gilbert and Bower 2002 ; Hill and Rothaermel 2003 ).

Thus, the question arises as to how incumbents should incorporate their digital transformation activities. Several options and interesting questions arise in this matter that future research may investigate on:

Which forms of organizational architecture are most suitable for digital transformation? Seamless integration of digital technologies requires building an agile and scalable digital infrastructure that enables continuous scalability of new initiatives (Sia et al. 2016 ). For example, Resca et al. ( 2013 ) suggest a platform-based organization. In addition, digital transformation demands a new kind of enterprise platform integration (El Sawy et al. 2016 ). Given the high intensity of interactive digital connectivity between the outside and inside of a company, traditional enterprise platforms (like ERP) and the ‘old’ supply chain management integration paradigm are in many cases not the most suitable solution anymore. Therefore, flexible IT is a key transformation resource in the digital world (Cha et al. 2015 ). Pursuing an open innovation approach might be another alternative for incumbents.

When and why is it an advantage/disadvantage to start digital transformation in a new organization which is completely independent from traditional business, as suggested by technological disruption research? Under what circumstances and why do spill - over - effects to the parent organization happen/not happen? ? For example, Ravensburger AG , a German toy and jigsaw puzzle company, founded Ravensburger Digital GmbH as a subsidiary in 2009. The purpose of the subsidiary was to become the firm’s digital competence center. In 2017, the digital subsidiary was reincorporated in the parent organization as a digital unit with the goal to apply their digital knowledge to transform the traditional business segments. We call for more qualitative case study research devoted to this question to develop our understanding in this topic.

How, when, and why do incumbents benefit from adopting a ‘let a hundred flowers bloom’ philosophy versus taking a ‘launch, learn, pivot’ approach? In the first scenario, a company would start its digital initiatives across all divisions simultaneously and locally to encourage broad experimentation. Such an approach was adopted by AmerisourceBergen Corp. , an American drug wholesale company. The company is convinced that digital transformation is a matter of culture that needs to be established across the entire organization. For this purpose, it implemented agile project teams throughout the entire enterprise, of which each focused on different aspects. On the downside, companies following such a broad approach may risk losing focus and at some point, the various initiatives may start competing against each other. Hence, we believe it is crucial to have a big picture in mind and accordingly allocate resources and attention very thoughtfully. Alternatively, incumbents may start with a pilot transformation project in a smaller market or subsidiary. Arguably, a major advantage is the opportunity to assure that customers are happy with the transformation results and everything is working out well before starting the large roll out in other markets. And it provides incumbents time to fine-tune their initiatives. For example, American medical company Alcon premiered their initial transformation efforts in Brazil before ramping up their rollout in 27 further countries.

6.2 Pace of digital transformation

The rapid pace of technological change is perhaps the most defining characteristic of digital transformation in distinction to previous IT-enabled transformations. Yet, as this topic is only addressed by four papers in our sample it is still to be studied in more depth. For example, there is consensus among the studies that the pace of change has accelerated significantly, however the parameters that define the pace of change remain yet to be defined. Further, we are informed that some industries like the newspaper business have been digitally transformed within a very short period of time (Karimi and Walter 2015 ), while other branches are still under transformation or are yet to be converted. We posit two exemplary research questions regarding the pace of digital transformation:

What are the parameters that define the pace of change? Our review reveals that the speed of product launches (Bharadwaj et al. 2013 ) and the time it takes to turn an idea into a business (Vey et al. 2017 ) are two potential indicators, but we certainly need to obtain a more comprehensive conceptualization at this point.

Why do industries adopt to digital transformation at a different speed? For example, consider front-runner industries like the media or publishing versus late-comers such as oil and gas. In this specific case, the easiness to dematerialize and digitize the product portfolio is certainly a main reason. However, other industries are less obvious, and we would like to invite future research to investigate upon these conditions. What are the parameters that define whether an industry is more or less transformative?

6.3 The role of middle management in digital transformation

We have learned from our review of the corporate entrepreneurship literature that middle managers are the locus of organizational transformation in incumbent firms (Floyd and Wooldridge 1999 ; Hornsby et al. 2002 , 2009 ; Shimizu 2012 ). While top management controls the level and rate of change, middle managers are in charge of execution (Burgelman 1983 ). Hence, one may conclude that middle managers are the kingpin of digital transformation. Yet, there is not a single paper in our sample that covers a middle management perspective in digital transformation. We believe that this subject has been highly neglected in research to this point and deserves far more attention in future. Several topics are particularly interesting:

How and why is digital transformation affecting the role, tasks and identity of middle managers? How and why do middle managers react to these changes? Based on our review, we expect a deep change in the nature of middle management’s role and influence in a ‘digitally transformed’ company ranging from administration to leadership aspects. Middle managers require a new attitude as they move from directing and controlling stable processes and people at the middle of hierarchy to managing resources and connecting people in the middle of networks. In addition, middle managers in the digital era must step up to their role of supporting, enabling, and coaching people to use the available digital tools. They are expected to facilitate the organization.

What kind of new responsibilities and functions in middle management hierarchy are required to accelerate digital transformation? The odds are that change fatigue might grow on employees and digital transformation may start faltering. For this purpose, horizontal functions such as business-process management layers or central administration platforms may be implemented (McKinsey & Company 2017 ). They could be shared across multiple initiatives within the organization and help to accelerate transformation.

Which mindset and digital literacy do middle managers need to be the driving force behind digital transformation? How, when, and why are middle managers motivated/not motivated to drive transformation? Research on corporate entrepreneurship emphasizes that middle managers are often the least likely to support change as they are inherently risk-averse, hardly entrepreneurial and very attached to their functional routines (Thornberry 2001 ). In addition, middle managers may easily get stressed about their ‘sandwich’ position in-between senior management and the operational level. So how can we expect middle managers to be the speedboat of digital transformation? Also, incumbents need to carefully evaluate the existing digital skills and literacy of their middle managers. How comfortable do they feel with digital tools, social media, the cloud and similar trends? They may not fulfill their coaching and leadership role if they heavily struggle with technology in the first place.

How and why is digital transformation affecting the interface of the top management team (TMT) and middle managers? The relationship between the TMT and middle managers is a very special and important relationship which significantly affects both strategy formulation and the quality of implementation. Middle managers are the organizational ‘linking pins’ between top and operational level and thus heavily rely on a good exchange with their superiors. To what extent and in which ways does digital transformation affect this special leader–follower relationship? How are digital technologies changing the speed and quality of information exchange? What is the impact on the inter-personal level?

What is the impact of digital transformation on the overall importance of the middle management layer? Since the 1950s, research indicates the decline of middle managers in terms of both numbers and influence (Dopson and Stewart 1993 ; Leavitt and Whisler 1958 ; Pinsonneault and Kraemer 1997 ). The shift in emphasis from planning and controlling to speed and flexibility is severely affecting the assumedly ‘slow’ middle. Are middle managers afraid that digital technologies will replace most of their traditional tasks and functions, e.g. communicating and monitoring strategy? Will digitalization naturally empower lower level operational managers at the bottom and consequently eliminate the middle layer?

6.4 A growing skills gap and threat of an employee divide

Given the complexity and explosive pace of digital technologies, there is a threat of a growing skills gap between pre-digitization workers and recently hired digitally savvy employees (Kohli and Johnsons 2011 ). A couple of topics are particularly interesting for future research:

How, when and why are incumbents able/unable to mitigate a growing skills gap and employee divide in the face of digital transformation? Given the increased complexity of digital technologies, traditional IT trainings may not be effective anymore. In a similar vein, how could different levels of knowledge and experience residing within different employees be integrated in the context of digital transformation? Future research might examine the mechanisms required for facilitating or hindering such an integration.

How and when are incumbents able/unable to incorporate ‘old’ and ‘new’ capabilities within their organization? On the one hand firms need to develop new capabilities to continuously transform their business, while on the other hand they must leverage their existing knowledge and skills in order to maintain their existing operations. Thus, for the time of transformation incumbents need to develop multiple, often inconsistent competencies simultaneously. In this context, how do firms ensure not to lose focus while mastering the challenge of ambidexterity in times of digital transformation?

Who in the company is managing the development and transformation of skills (e.g. HR, senior leadership, IT division, functional teams, employees etc .), and how and why does that impact outcomes of digital transformation ? This question is not addressed by current research at all. However, according to a survey (Capgemini Consulting 2013) this lack of alignment with digital strategy is rather worrisome. Responsibilities for skills transformation and development in times of digitization need to be clearly defined and allocated. Empirical academic research in this direction might be helpful to understand the status-quo in incumbent firms regarding this issue.

6.5 Cooperation with startups and pure tech companies to accelerate digital transformation

Corporate entrepreneurship proposes a closer cooperation and regular exchange between incumbents and start-ups in order to accelerate entrepreneurial transformation (Engel 2011 ; Kohler 2016 ). In fact, start-ups are often perceived as the forerunners of digital transformation. They are praised for faster innovation capabilities, higher levels of agility, a culture of risk-taking, and supremely digitized processes and workflows. In contrast, incumbents have more experience, access to capital, established brand trust and a huge customer base. Hence, a cooperation between start-ups and incumbents may be beneficial for both parties. In addition, non-tech incumbents may also consider cooperating with pure digital players which are beyond their start-up phase but are important knowledge carriers in digital matters. Two topics are particularly interesting:

Assuming that successful start - ups have a good digital culture — what are the constituent pillars of such a digital culture? And how could incumbents incorporate these “best practices” and “lessons learned”?

What are the benefits of employee exchange programs with technology companies or start - ups to scale - up digital skills? For example, in early 2008 consumer goods giant Procter and Gamble and Google have been swapping two dozen employees in an effort to foster creativity, exchange thoughts on online advertisement and strengthen their mutual relationship. This program worked very well for both sides.

7 Limitations and conclusion

Our review is not without limitations. First, the specific objectives and nature of our filtering process applied during the review naturally come with a certain selection bias. For example, data collection, analysis and interpretation remain influenced by the subjective assessments of the researchers. Also, despite being the common rule within systematic literature reviews, searching exclusively in peer-reviewed academic journals might have omitted some relevant research contained in books or dissertations. However, by means of a rigorous and transparent search process, an as complete as possible review sample was collected and analyzed subsequently. Second, using a high-level thematic map for such a complex multi-dimensional phenomenon like digital transformation highlights particular connections while it potentially fails to capture others. Specifically, critics may point to the lack of analytical depth within each second order theme. However, we believe that within the limited scope of a review our broad thematic description nevertheless adds value to the advancement of this field and should rather be seen as a holistic starting point for future research to dive deeper into the characteristics of sub-themes of digital transformation. Finally, we are aware that our focus on the organizational level of digital transformation within the private sector does not fully capture the implications of digital transformation for our society, as it also occurs at various other levels, such as the individual level or public sector. As such, future researchers may apply alternative approaches to review and synthesize the existing literature on digital transformation. For example, in contrast to our inductive method to code and analyze our sample, it may also be interesting to apply a more deductive and pre-structured method, in particular when focusing on a deeper understanding of the sub-themes emerging from our analysis. Accordingly, future research could benefit from adopting a phenomenon-based research strategy as proposed by von Krogh et al. ( 2012 ).

Concluding, our paper contributes to the extant discussion by consolidating, mapping and analyze the existing research on digital transformation, sharing important macro- and microlevel observations in the literature and proposing corresponding future research directions. Emerging from our review of 58 studies, we develop a thematic map which identifies technology and actor as the two aggregate dimensions of digital transformation and that elaborates on the predominant contextual concepts (second order themes) within these dimensions. From a macrolevel perspective, we observe that the status-quo of digital transformation literature is rather diverse, in a sense that papers discuss topics across various clusters and concepts. Further, we find some degree of diversity in the theoretical foundations drawn upon as well as confirm that the existing literature in general is scarce regarding quantitative empirical evidence. Another important contribution of our paper is bringing different lenses together by integrating knowledge from related disciplinary areas outside IS management, such as technological disruption and corporate entrepreneurship. With our review, we hope to provide a comprehensive and solid foundation for the on-going discussions on digital transformation and to stimulate future research on this exciting topic.

The development of clear and precise aims and objectives; pre-planned methods; a comprehensive search of all potentially relevant articles; the use of explicit, reproducible criteria in the selection of articles; an appraisal of the quality of the research and the strength of the findings; a synthesis of individual studies using an explicit analytic framework; and a balanced, impartial and comprehensible presentation of the results.

The search included Academy of Management Journal , Administrative Science Quarterly , Entrepreneurship Theory and Practice , Journal of Management Studies , Strategic Management Journal .

The search included European Journal of Information Systems , Information Systems Journal , Information Systems Research , Journal of the Association for Information Systems , Journal of Information Technology , Journal of Management Information Systems , Journal of Strategic Information Systems , MIS Quarterly , MISQ Executive .

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figure 5

Data structure for the technology-centric dimension of technological disruption

figure 6

Data structure for the technology-centric dimension of corporate entrepreneurship

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Nadkarni, S., Prügl, R. Digital transformation: a review, synthesis and opportunities for future research. Manag Rev Q 71 , 233–341 (2021).

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