Unravelling the internal and external drivers of digital servitization: A dynamic capabilities and contingency perspective on firm strategy

Wim Coreynen*, Paul Matthyssens, Johanna Vanderstraeten, Arjen van Witteloostuijn

*Corresponding author for this work

Research output: Contribution to JournalArticleAcademicpeer-review

Abstract

Despite the increased interest in using digital technologies for servitization purposes, little is known about what drives firms towards a digital servitization strategy. Using a dynamic capabilities lens, we look into the relationships between two organizational mechanisms – exploitation and exploration – and firms' orientation towards digitization, servitization and digital servitization. On top, we examine the influence of two environmental contingencies – technological turbulence and competitive intensity – as potential influencers of these relationships. We collected and analyzed data of 139 Belgian firms through hierarchical regressions. Exploitation and exploration are positively associated with digital servitization, but exploration trumps the effect of exploitation when firms do both. Technological turbulence is positively associated with digitization regardless of the firm's level of exploration or exploitation, and competitive intensity only relates positively with servitization when firms emphasize exploration. Theoretically, we contribute to the literature by unravelling the relationship between firms' dynamic capabilities and their environment. In order to fully understand firms' strategic transition towards digital servitization, both should be considered. As managerial implications, we suggest that firms pay close attention to adapting their strategy to fit an increasingly changing environment.

Original languageEnglish
Pages (from-to)265-277
JournalIndustrial Marketing Management
Volume89
DOIs
Publication statusAccepted/In press - 1 Jan 2020

Keywords

  • Ambidexterity
  • Competitive intensity
  • Digital servitization
  • Digitization
  • Servitization
  • Technological turbulence

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