Digital Transformation within Manufacturing Companies : An Empirical Study of the Factors Affecting Digital Transformation Using Digital Maturity Model

Abstract: Manufacturing companies are undergoing a digital transformation as the fourth industrial revolution progresses. These companies strive to track their progress in the transformation, understand the affecting factors, and formulate an effective strategy for the transformation. Studies that have been conducted to date have explored various factors that can influence the transformation process in a range of fields, however, there is a lack of research in the manufacturing industry. Hence, the purpose of this research is to explore the enablers and barriers to digital transformation using the maturity model and the importance of having a comprehensive strategy for digital transformation in manufacturing companies. To accomplish this, empirical data is collected through a survey based on a maturity model and combined with interviews. The data collection is done at a case company that is currently undergoing a digital transformation and is facing challenges in further development. The main factors that enable the transformation is leadership support, knowledge creation, having relevant skills, employee involvement and continuous improvement culture. While the barriers to transformation are lack of top management commitment, absence of strategy, lack of financial investments, knowledge ambiguity, poor data management and highly customized products. Many of these factors are consequences of other factors, such as lack of investment which was found to be a consequence of a lack of top management commitment and strategy. Further, the lack of strategy is seen as a root cause leading to insufficient budget, employee resistance, discrepancies in perception among managers, and problems in prioritization of projects. The main takeaways for manufacturing companies from this report are to ensure top management commitment, continuous improvement, and formulation of a comprehensive strategy to succeed with digital transformation.