Digital orientation: Conceptualization and operationalization of a new strategic orientation

Although there is ample evidence that digital technologies are strategically important for value creation, extant literature lacks holistic concepts that capture an organization's strategic orientation concerning digital innovation and transformation initiatives. This study integrates recent digitalization themes with IT business alignment research to conceptualize a new strategic orientation construct: digital orientation. The construct is manifested in four dimensions which we operationalize for computer-aided text analysis. We validate the construct based on 6498 shareholder letters from large US firms over 16 years. Building upon the resource-based view, we validate the digital orientation construct by linking it to firm performance. Our findings advance the literature on strategic orientations and bring the domains of strategy and information systems closer together. The novel digital orientation construct and the validated measurement instrument lead to many new research opportunities. (c) 2020 The Authors. Published by Elsevier Ltd. This is an open access article under the CC BY license (http://creativecommons.org/licenses/by/4.0/).

Automated summary

This study introduces a new concept of digital orientation, which fills the gap in the existing literature that lacks holistic concepts capturing an organization's strategic orientation towards digital innovation and transformation initiatives. The construct is validated through a study of 6498 shareholder letters from large US firms over 16 years, and the findings advance the literature on strategic orientations and bridge the domains of strategy and information systems. The novel digital orientation construct and validated measurement instrument open up numerous new research opportunities.