Digitalization of a manufacturing firm and understanding the change through familiar and unfamiliar managerial problems

• Main Author: Isoaho, K. (Kasperi)
• Format: Dissertation
• Language: English
• Published: University of Oulu 2017
• Subjects: Management and International Business
• Online Access: http://urn.fi/URN:NBN:fi:oulu-201711083062; http://nbn-resolving.de/urn:nbn:fi:oulu-201711083062

This study focuses on digitalization of manufacturing industry, commonly known as Industry 4.0. In this study, digitalization is viewed as a radical change from the perspective of current processes and organizational structures. In general, transformation and radical change create a threat for the existence of the organization. Simplified definitions of Industry 4.0 solution in manufacturing environment would be embedded sensor in product components communicating with interlinked manufacturing equipment. At the same time production system analyzes available data from various sources, and represent the information to human operator(s) who oversees ultimate decision making. This study aims at supporting the strategic decision making of the managers working towards Industry 4.0 and digitalization. Secondly, this study makes an attempt to understand if ad hoc process model can be used to describe organizational success. Study combines two models, dynamics capabilities and ad hoc process in order to explain why some firms manage to go through successfully such a big change and some of them not, and which part of the successful digitization might be explained through dynamic capabilities and when the success can be derived from reacting to spontaneously appearing, unfamiliar problems. Study uses qualitative research method, and it has both theoretical and empirical part. Theoretically formulated problems are categorized in the familiar and unfamiliar sub-problems with applicable solutions based on empirical part. Empirical has been collected through theme-centered interviews of four Finnish digitalization experts. Results show that digitization-related problems can be divided in the unfamiliar and familiar problems. Thus, organization might be able to prepare itself for incoming change with dynamic capabilities. Findings to not represent or generate a single I4.0 framework nor organizational change theory, but provide tools for managerial implementation. Results of this study can be used as a vehicle to understand what kind of problems utilization of I4.0 technologies might generate before the actual benefits are reached.