Digital transformation readiness in large manufacturing firms: a building block model proposition

Purpose This study identified the key factors that can be used to assess manufacturers' readiness for DT. Design/methodology/approach Non-participating observations and semi-structured interviews were applied to five large manufacturers in Brazil and four in the UK, using content analysis. Findings The paper (1) identifies and discusses the aspects that companies need to consider for digital readiness; (2) presents a model developed in building blocks for DT readiness, which goes beyond the technical dimension; (3) argues that few firms fully understand DT’s meaning, opportunities and risks, and they should invest in strategic and socio-managerial preparation; (4) emphasizes government support as crucial to assist the business digital journey and (5) highlights that DT is a human transformation and technology users are the primary agents of this change. Research limitations/implications Although the literature proposes models regarding the levels of digital maturity, the present study investigates which organizational aspects need to be taken into account to be ready for digital change. The present study identified digital resources concerning the digital context (for instance, agile, collaborative, absorptive and data analytics capabilities) and provided an integrated view that encompasses also external aspects of the environment that need to be taken into consideration when performing the analysis, a contribution to strategic management literature in the sense that it goes beyond studies that usually explore only internal aspects of the firm that cannot properly explain how digitalization can be achieved by an organization. Practical implications Technologies do not cause changes without people being able to extract and understand the value of the use and impact of these technologies. Business innovation demands engagement, attitudes and connections between people. If the factories do not mobilize and train internal and external collaborators to realize the value of digital technologies, the promised gains of DT will hardly be realized. Preparing people is one of the most challenging aspects of business digitalization. The proposed framework offers a multidimensional view of DT, providing insights into strategic aspects and the roles and mindset of employees in organizations on their digital journey, characterized by constant learning. DT is a work of change management, done with, for and by people. The article also helps companies identify critical factors to evaluate before operationalizing digital innovation practices. Social implications This study also contributes to policymakers, such as government and industry consortia, in establishing relevant factors when policies are being drawn. Analyzing the factors for a sector, in general, might inform the investment priority in actions that might foster DT for that sector. Given the recurring turmoils in the global economic environment, broad policies need to be established by the government for business digitalization, which can boost the performance of the productive sector. Originality/value This study provides valuable insights consolidated into a DT readiness model. The article helps companies identify critical factors to evaluate before operationalizing digital practices. It compares the differences and commonalities among factories in an underdeveloped country versus an industrialized nation.