Evaluation of Digital Transformation of the Regional Manufacturing Industry Based on the Entropy Weight TOPSIS Method

Qi Peipei; Aimi Fadzirul Kamarubahrin

doi:10.58915/aset.v5i1.3205

Authors

Qi Peipei City University Malaysia
Aimi Fadzirul Kamarubahrin City University Malaysia & Universiti Putra Malaysia

DOI:

https://doi.org/10.58915/aset.v5i1.3205

Keywords:

Regional manufacturing industries, Digital transformation evaluation, Entropy weight TOPSIS

Abstract

Manufacturing digital transformation capability is a key factor in the orderly advancement of digital upgrading in the manufacturing sector. Effective identification and evaluation of this capability can help grasp the core aspects of manufacturing digital transformation and upgrading, thereby improving the efficiency and effectiveness of the transformation process. Based on the definition of manufacturing digital transformation capability, this study constructs an evaluation index system across three dimensions: digital transformation support, digital transformation potential, and digital transformation benefits. The entropy-weighted TOPSIS method is adopted, with empirical analysis based on digital transformation data from the manufacturing industry across 30 mainland Chinese provinces. The study finds that digital innovation capability is critical to the digital transformation of the manufacturing industry, and that the benefits of digital transformation are more directly reflected in economic than in environmental outcomes. While individual provinces and cities are exceptions, the overall level of manufacturing digital transformation in China shows a pattern of eastern regions leading, central regions following, and western regions lagging. In terms of specific digital transformation dimensions, provinces and cities exhibit varying performance in digital transformation support, potential, and benefits.

References

[1] Tekic, Z., & Koroteev, D. From disruptively digital to proudly analog: A holistic typology of digital transformation strategies. Business Horizons, vol 62, issue 6 (2019) pp.683–693.

[2] Warner, K. S., Wäger, M. Building dynamic capabilities for digital transformation: An ongoing process of strategic renewal. Long Range Planning, vol 52, issue 3 (2019) pp.326–349.

[3] Nambisan, S., Lyytinen, K., Majchrzak, A., et al. Digital innovation management: Reinventing innovation management research in a digital world. MIS Quarterly, vol 41, issue 1 (2017) pp.223–238.

[4] Berman, S. J. Digital transformation: Opportunities to create new business models. Strategy & Leadership, vol 40, issue 2 (2012) pp.16–24.

[5] Frankiewicz, B., Chamorro-Premuzic, T. Digital transformation is about talent, not technology. Harvard Business Review, vol 6 (2020) pp.2–6.

[6] Meng, F. S., Zhao, G. Research on factors influencing the development of traditional manufacturing to intelligent manufacturing. Science and Technology Progress and Countermeasures, vol 35, issue 1 (2018) pp.66–72.

[7] Zheng, W. H. Study on digital transformation path of manufacturing enterprises: Based on acatech industry 4.0 maturity index. Technology and Economy, issue 4 (2018) pp.51–55.

[8] Mao, G. L. The “six synergistic” promotion strategy of intelligent manufacturing. Informationization Construction, issue 5 (2019) pp.54–55.

[9] García, A. H. The digital transformation playbook: Rethink your business for the digital age. Economía Industrial, issue 409 (2018) pp.149–151.

[10] McIntyre, D. P., Srinivasan, A. Networks, platforms, and strategy: Emerging views and next steps. Strategic Management Journal, vol 38, issue 1 (2017) pp.141–160.

[11] Yoo, Y. Computing in everyday life: A call for research on experiential computing. MIS Quarterly, vol 34, issue 2 (2010) pp.213–231.

[12] Li, C. F., Li, D. D., Zhou, C. The role mechanism of digital economy driving the transformation and upgrading of manufacturing industry: Analysis from the perspective of industrial chain. Business Research, issue 2 (2020) pp.73–82.

[13] Karimi, J., Somers, T. M., Bhattacherjee, A. The role of information systems resources in ERP capability building and business process outcomes. Journal of Management Information Systems, vol 24, issue 2 (2007) pp.221–260.

[14] Tarafdar, M., Gordon, S. R. Understanding the influence of information systems competencies on process innovation: A resource-based view. Journal of Strategic Information Systems, vol 16, issue 4 (2007) pp.353–392.

[15] Fu, R. C., Liu, Y. Research on the mechanism of enterprise informatization’s impact on innovation capability based on information capability. Scientific Management Research, vol 30, issue 3 (2012) pp.85–88.

[16] Chen, C. H. Research on the construction of digital transformation capability system of traditional enterprises. People’s Forum — Academic Frontier, issue 18 (2019) pp.6–12.

[17] Ma, H., Yang, Y. P. Research on the key model of enterprise informatization capability maturity. Economic and Management Research, issue 1 (2010) pp.73–78.

[18] Zhang, Y. G., Yan, J. M., Chen, R. Evaluation indicators and measurement methods of enterprise informatization sustainable development capability. Statistics and Decision Making, issue 9 (2006) pp.47–48.

[19] Chi, M. M., Ye, D. D., Wang, J. J., et al. How to improve the performance of new product development in China’s small and medium-sized manufacturing enterprises: Based on the perspective of digital empowerment. Nankai Management Review, vol 23, issue 3 (2020) pp.63–75.

[20] De Reuver, M., Sørensen, C., Basole, R. C. The digital platform: A research agenda. Journal of Information Technology, vol 33, issue 2 (2018) pp.124–135.

[21] Fang, T. G. Analysis of factors influencing the development of digital economy in Zhejiang. Statistical Science and Practice, vol 39, issue 3 (2020) pp.52–55.

[22] Pang, R. Z., Zhang, S., Wang, Q. Y. Can digitalization improve environmental governance performance? Empirical evidence from inter-provincial panel data. Journal of Xi’an Jiaotong University (Social Science Edition), vol 56 (2021) pp.1–12.

[23] Guo, Y. W. Research on the relationship between two-dimensional capabilities and performance of enterprise digital transformation. Zhejiang University (2018).

[24] Fang, Y. Innovation capability is a necessary condition for successful digital transformation. State-Owned Enterprises, vol 16, issue 7 (2021) pp.22–23.

[25] Liu, Y., Dong, J. Y., Wei, J. Digital innovation management: Theoretical framework and future research. Management World, vol 36, issue 7 (2020) pp.198–219.

[26] Pang, R. C., Han, Y., Zhao, J. F. Research on the evaluation of the development quality of Chinese regional digital economy. Zhejiang Archives, vol 44, issue 1 (2021) pp.41–43.

[27] Huang, C. S., Zhang, C., Wang, L., et al. Research on the evaluation of transformation and upgrading ability of Chinese manufacturing enterprises under the background of the conversion of old and new kinetic energy. Industrial Technology and Economics, vol 39, issue 8 (2020) pp.78–88.