The role of dynamic capabilities in overcoming socio- cognitive inertia during digital transformation - A configurational perspective

Digital technologies are radically changing the way traditional companies interact in established markets. Although these technologies provide numerous benefits, many digital transformation projects fail because of companies' inability to adapt. Socio-cognitive inertia is an important factor inhibiting successful organizational transformation. Extant research suggests that, under specific conditions, dynamic capabilities are effective means of reducing socio-cognitive inertia. We combine a case survey and a fuzzy-set Qualitative Comparative Analysis approach to identify patterns of interactions between dynamic capabilities of a firm and its transformation project design that led to the reduction of socio-cognitive inertia. We show that sensing and, in particular, reconfiguration capabilities positively contribute to reducing sociocognitive inertia when combined with a centralized governance approach. However, seizing capabilities neither have a positive nor a negative influence. Furthermore, we show that socio-cognitive inertia can also be reduced by ensuring high participation among employees, even in combination with decentralized governance approaches.