Implications of digitalization for value chains

Abstract

The primary goal of the article is to cover the implications of digital technologies for value chains. The hypothesis of the article is as follow digital technologies driving exponential growth translate into companies’ efforts to be both lean and agile. The problem raised in the study is of being both lean and agile facing the digital disruption. The topic of the impact of digital technologies on value chains has gained an increasing attention from business practitioners. Scholars also have heavily discussed capabilities required for adaptation to technologies driving nonlinear growth. The applied methods encompasses the literature review combined with diagnostic participant action research. The understanding of lean and agile practices was a starting point to build a tool for covering impact of digital technologies on value chains. The literature review allows us to explain reasons for the fast progress in digitalization, defining the digital technologies driving the exponential growth, providing explanation of what is lean, agile and leagile supply chain. Building on the literature review the diagnostic participant action research was applied. The latter allows to verify the assumed hypothesis. While technology and the digital world grow exponentially, the manner in which we operate and organize ourselves is still based on linear models, hierarchical structures and bureaucratic processes. For a reason of this, the deployment of the lean and agile practices would be of benefit to build customer centric solutions. The article provides contribution to models of adaptation of multinationals supply chains towards digital technologies. Whilst the practical study proved that absorption of digital technology is in its infancy, the built diagnostic tool allows us to map the absorption of digital technologies with regards to logistics needs of customers. The conducted study proved existing more than two practices defined by covering logistics customers’ requirements. As a recommendation for the further work would be covering transformation from linear to exponential organization

Keywords

• digitalization, agile, lean, value chain, flexibility, organization, exponential organizations