Corporate Digital Transformation As A Response To Multiple Institutional Pressures

Since the 21 st century,the global economic is undergoing earth-shaking changes.,the most typical manifestation of which is the coming of digital age.Digital transformation is the general and global trend in the future,which is a situation that companies have to face.However,there is an awkward fact that enterprises may die if they don’t take a digital transformation strategy,or they may be in trouble if they take a digital transformation strategy,also.According to the “White Paper on China’s Digital Economy Development”,about6%-17% respondents in a certain industry stated that they will significantly reduce digital investment in the next two years clearly in 2020.And a survey named " the Report of Digital Maturity about Asia-Pacific Small and Medium-sized Enterprise in 2020" shows that,nearly one-third of the respondents have hardly made any attempts at digital transformation.Digital transformation means that companies use advanced technologies,such as the Internet of Things,the Internet,artificial intelligence,and cloud computing to transform the physical information produced by operational management,Internet of Things,and Internet into data,so as to improve efficiency and change the business model.The digital transformation of enterprises is not only a technological phenomenon,but also an institutional phenomenon.However,as of now,the studies about the antecedents of digital transformation based on institutional theory are still very limited,which cannot put insight into the reasons for not comforting to the global trend of digital transformation effectively.This research will start from two progressive modules.The first module is to explore the influence of institutional pressures on corporate digital transformation.This module may answer the following series of questions: Do the institutional pressures,that are,industrial digitalization and regional digital economy affect the digital transformation of enterprises separately? Does digital attention play an intermediary role in the relationship between industrial digitalization and enterprise digital transformation,and the relationship between regional digital economy and enterprise digital transformation? Do the two institutional pressures,that are,industrial digitalization and regional digital economy have superimposed or conflicting effect? The reason for focusing on industrial digitization and regional digital economy is that,industrial field is one of the most important institutional fields under Chinese socialist economic system.The process of industrial digitization is accelerating.In addition,regional field is another important institutional field under Chinese socialist political system.The regional governments are vigorously promoting digital transformation.The existence of these two institutional pressures,that are,industrial digitization and regional digital economy has become an objective fact faced by enterprises.However,there has little research on the relationship between institutional pressure and digital transformation of enterprises,and there has less research on the influence of field institutional pressure and its path,and the interaction of multiple institutional pressures.Based on institutional theory and cognitive theory,taking the 2011-2019 Chinese manufacturing A-share listed companies as a sample,we found that,the digital transformation of enterprises is the result of industrial digitalization rather than regional digitalization,such that different kinds of institutional pressure do not have reciprocal effects.Although the regional digitalization does not constitute the main institutional antecedent,it is undeniable that it has an obvious boosting effect for enterprises to respond to the pressure of industrial digitalization.Lastly,managers’ perception(refers to digital attention)has a positive intermediary effect on the relationship between industrial digitalization and corporate digital transformation,and the relationship between the interaction of industrial digitalization and regional digitalization,and corporate digital transformation,which constitutes the cognitive process of enterprise digital transformation.The second module is a progressive analysis of the first module,which analyze the general law of organizational response behavior.It places this law in different corporate micro-contexts and observes its variability.That is,the second module is to explore the contextual sensitivity of corporate digital transformation.This study aims to answer the following questions,respectively,whether the type of enterprise,(that are,industrial expert and social expert),the visibility of enterprise,and business pressure(refers to the gap between corporate performance and industry expected performance)adjust the response behavior of the company,and its cognitive process? The reason for focusing on the above three contextual elements is that,the type of enterprise reflects its dependence on the institutional environment,the visibility of enterprise reflects the degree to which the enterprise is exposed to the institutional environment,and the operating pressure of enterprise reflects the degree to which the enterprise searches the environment.From the cognitive perspective,these situational elements affect the cognition of the target stimulus in the environment.Also,from the institutional theory perspective,some of the above-mentioned situational elements also affect the enterprise’s access to legal resources.The current research ignores an important contextual element,that is,corporate operating pressure.Also,how do these contextual factors affect corporate response to institutional pressure in different stage(that are,the cognitive stage and the decision-making stage)is still a blank area.Uncovering this situational sensitivity mechanism is of practical significance.Specifically,should the government support industrial expert enterprises and social expert enterprises,or other weaker enterprises? Should the government support higher visibility enterprises or ordinary enterprises? And should the government support the highest performance companies and the least performance companies,or companies with other performance level? Also,it is of practical significance for companies to adjust their identity and cognitions to find more possibilities.Based on the cognitive perspective and institutional theory,taking the 2011-2019 Chinese manufacturing A-share listed companies as a sample,this article draws the following research conclusions: Firstly,industrial expert companies have weaker dependence on the institutional environment,so that it is more difficult for them to recognize the pressure of industrial digitization,and the pressure of the interaction between industrial digitization and regional digitization.The industrial expert companies and social expert companies can’t get legal resources for environment.Secondly,higher visibility companies are more able to actively perceive institutional pressures and obtain more legal resources.Thirdly,compared with companies under too much or too little operating pressure,companies are more likely to perceive institutional pressure when their performance have a medium gap with expectations.This research has the following theoretical contributions: Firstly,we use strategic cognition theory to gain insights into the relation between institutional pressure and corporate digital transformation,which reveal the cross-level transmission mechanism from macro-system pressure to micro-enterprises.Although previous studies have affirmed the role of cognitive channels,the cognitive process has not been effectively insighted due to the difficulty of measureing managers’ cognition.We use machine learning methods to measure manager’s cognition to solve this problem.Secondly,based on China’s special political and economic systems,we analyze the institutional pressures in the Chinese context,including the differences in legitimacy mechanisms,and the possibility of interaction,which is helpful to contextualize institutional pressures and deepen the application of institutional theory in the Chinese context.Lastly,we supplement the context of performance pressure.We discuss three situations,that are,the type of enterprise,the visibility of enterprise,and the performance pressure of enterprise,analysis their influence on corporate response behavior in different stages,that are,the cognitive stage and decision-making stage.The contextual sensitivity analysis helps to understand the role of contextual factors in different stages.Compared to the general contextual sensitivity discussion which has not opened up the cognitive process,this study is a detailed and in-depth applied research.