Chapter 18: Digital Transformation and Institutional Work: A Paradox View

Research on digital transformation (DT) provides a thorough view on companies’ attempts to transform their business strategy, value offerings, processes, and organizational structure. Such transformation has also been linked to implications for organizational culture and identity. Less is known, however, about incumbent companies’ deliberate efforts to change organizational culture and identity as part of their DT efforts. In this paper, we conduct an ethnographic study on a German car manufacturer’s DT process with a specific focus on its attempts to change its culture and identity. Zooming into the car manufacturer’s HR function, we draw on literature on institutional work to outline its efforts to change the organizational culture and identity towards one that supports the manufacturer’s DT agenda. Further, deploying paradox theory, we found that the carried out institutional work exposes four paradoxes: Paradox of Infrastructural Change, Paradox of Task Duality, Paradox of Power Allocation and Paradox of Rooted Practices. We contribute to DT research illustrating the significance of culture and identity change and by identifying four paradoxes, which require to be managed for an organization to progress toward its DT objectives, emerging from such change. We further substantiate and illustrate the usefulness of both institutional work and paradox theory to study DT, related institutional change and its processual dynamics.