Full research paper presentation at Mediterranean Conference on Information Systems (MCIS) - September 2016

1. Sabine Berghaus
MCIS, 06.09.2016
Stages in Digital Business Transformation
Results from an Empirical Maturity Study

2. 2
Problem statement
• Digital innovation can be perceived as threatening and
involves transformational changes.(Yoo et al. 2010)
• Companies struggle with recognizing and understanding
the impact and chances of digitalization. (Matt et al. 2015; Carlo, Lyytinen &
Rose 2012)
• To initiate a digital transformation program, managers
need to understand the current status and capabilities of
their organization.

3. 3
What are typical transformation stages
and what does this tell us about how
organizations prioritized different courses
of action?

4. 4
Digital Maturity Model
Digital Maturity Model
consisting of 9 dimensions1.
Online survey with 60 items
and 5-point Likert scale.
1) Berghaus, S., Back, A.: Gestaltungsbereiche der Digitalen Transformation von Unternehmen:
Entwicklung eines Reifegradmodells. Die Unternehmung. 70, 98–123 (2016).

5. 5
Calculation of Maturity Stages
• Usage of Rasch algorithm: Depending on the answers
of all participants (N=547 participants / 417 companies) a
metric is calculated for each item, that represents the
difficulty.
• Using cluster analysis we group items of similar
difficulty into the five maturity stages.
easy difficult
Item 1 (I1)
Item 2 (I2)
Item 60 (I60)

6. 6
Findings
Stage 1 – Promote & Support
Examples for items in this stage:
 Digital transformation as continual strategic change project.
 High value of digital business in overall strategy.
 Top management recognizes the importance of digital business.
 IT department ensures relevant digital technologies.
Stage 1: Organizations promote digital transformation within
the organization and support respective projects by providing
ressources and infrastructure.

7. 7
Findings
Stage 2 – Create & Build
Stage 2: Organizations experiment with digital innovation in
both internal processes as well as product offerings.
Examples for items in this stage:
 Systematically evaluating potential in new technologies.
 Promote digital innovation.
 New digital ideas or business models implemented.
 Regularly check core processes for improvements.

8. 8
Findings
Stage 3 – Commit to transform
Examples for items in this stage:
 Digital expertise as core component to develop employees.
 Organizational ability to react quickly to changes.
 Partner network for digitization activities.
 Automate routine processes.
 Readiness to take risk with existing business.
Stage 3: Transformation of company culture and
organizational structure accompanied by a systematic
transformation management.

9. 9
Findings
Stage 4 – User-centered & elaborated processes
Examples for items in this stage:
 Customers included in the development of new product ideas.
 Digital content designed according to individual user‘s situation.
 Periodically review transformation goals.
 Data analysis results guide possible actions and strategic decisions.
Stage 4: Focus on customer needs by personalizing
customer experience as well as improving internal
processes.

10. 10
Findings
Stage 5 – Data-driven enterprise
Examples for items in this stage:
 Transformation goals are defined measurably.
 Customer and interaction data collated across different channels
 Expenditure planning for communication based on media usage.
 Real-time data analysis.
Stage 5: Collection, analysis and sense-making of cusotmer
data in business processes.

11. 11
Calculating maturity scores for organizations
Point maturity score
Overall fulfilment of items
Cluster maturity score
Sequential fulfilment of items
in the clusters.
Overall maturity score
Average of point maturity and
cluster maturity score

12. 12
Distribution of overall maturity scores
Maturity
stage 1
Maturity
stage 2
Maturity
stage 3
Maturity
stage 4
Maturity
stage 5

13. 13
Analysis within the dimensions
37%
51% 45%
46%
56%41%
47%
47%
47%

14. 14
Discussion & Contribution
What can we learn from low maturity stages?
Digital commitment an affinity among employees are
important prerequisites that often preexist within the
workforce.
What does the overall order of items tell us?
Digital transformation seems to be intuitively managed
rather than strategically planned.
What can we learn from high maturity stages?
The use of digital data requires more strategic collaboration
between IT and business -> facilitate networked
collaboration in the company.

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Thank you!
Feedback?
Sabine Berghaus
Research Associate
sabine.berghaus@unisg.ch
Chair Prof. Dr. Andrea Back www.aback.iwi.unisg.ch
LinkedIn: https://ch.linkedin.com/in/sabineberghaus
@stadtnomadin