Bytes, barriers, and logics: the vicious circle of digital welfare in fragmented institutional contexts

The ongoing global process of digital transformation has fundamentally reshaped societies and posed new challenges to welfare systems (Greve, 2019). Here we consider two models of digital transformation: the first, “digital transition”, involves the adoption of digital technologies to initiate new activities or services that were not previously possible to produce; the second, “digitalisation of work processes”, involves using available digital tools to carry out operations that were already being performed previously (Steiner, 2021). We consider “adoption” and “rejection” as social constructions, i.e. the outputs of the intricate relationship between different interaction regimes, social institutions and material conditions (Latour, 2007).

The relationship between digitalisation and the welfare state has been at the centre of academic debate for several years and has been explored from various perspectives. One strand of literature has explored how technologies, particularly information and communication technologies, have played a central role in the development of the welfare state since its inception through various forms of population management and the development of databases and citizen monitoring (Dencik and Kaun, 2020). Another strand has stressed how the digital transformation of welfare has raised numerous ethical questions and practical challenges related to policy design, the organisation of interventions, the intensification of production processes, and sustainability challenges (Petropoulos et al., 2019), including the risk of job displacement due to automation (Andreassen et al., 2021) and the reproduction of existing lines of stratification and exclusion (Schou and Pors, 2019). Critical scholarships have explored the relationship between digitalisation and neoliberalism in the welfare state in a complex and multifaceted way. This strand of literature suggests that digitalisation often reinforces and extends existing neoliberal trends in welfare policy, rather than representing a radical break (Van Toorn et al., 2024; Van Toorn and Soldatić, 2024). Digital technologies are seen as tools that enable greater surveillance, conditionality and responsibilisation of welfare recipients, in line with neoliberal ideologies of individual responsibility and reduced state support (Bielefeld, 2024). However, scholars also highlight how digitalisation creates new dynamics that go beyond simple neoliberal logics. For instance, Singh (2024) shows how digital welfare systems still rely heavily on human intermediaries and social relationships, complicating notions of efficiency and automation. Zakharova et al. (2024) reveal tensions between care and control in digital welfare, where caring values persist alongside neoliberal imperatives. The texts demonstrate how digitalisation enables more intensive and granular forms of governance over marginalised populations, often in racialised and ableist ways that extend histories of eugenic thinking (van Toorn and Soldatic, 2024; Mateescu, 2024). This suggests digitalisation may intensify exclusionary aspects of neoliberalism. At the same time, Hjelholt (2024) argues digitalisation can be used strategically by states to sustain welfare models and manage dissent, even in Nordic contexts traditionally seen as resistant to neoliberalism. This indicates a more complex relationship where digital technologies become tools for negotiating tensions between welfare and neoliberal imperatives.

This article aims to explore how social policy factors support or hinder the adoption of technological factors in welfare systems. In this respect, there is a notable gap in research on the implications and impacts of digitalisation on welfare interventions and social and care professionals (Ball et al., 2023), particularly in relation to decisions to adopt or reject innovations (Larasati et al., 2023). This gap is also of a geographical nature, as countries with weaker welfare states, such as those in Southern Europe, including Italy, are not well studied in the academic literature. Part of the reason for this gap is that Central and Northern European countries are leading the way in the digital transition, particularly in public employment services (PESs) (Ball et al., 2023), which serve as models for Southern European countries (Da Roit and Busacca, 2023). It is crucial to recognise that when a social and organisational process moves from one context to another, the receiving context profoundly influences how it is implemented in practice (Malbon et al., 2019; Peck, 2011).

We have chosen to explore active labour market policies (ALMP) as they are fully in line with European social policy trends, which have a strong focus on human capital formation (Garritzmann et al., 2023) with the aim of integrating individuals into the labour market (Ronchi, 2023). The need to improve skills and training for employment often involves digitalisation, which is seen as crucial for digital training programmes, online learning platforms, and digital tools and resources for employment (Busemeyer et al., 2022). Furthermore, the use of digital tools in the design and delivery of ALMPs is often seen as a new way to reorganise the sector, achieving greater efficiency and equity in treatment by providing better services with fewer resources (Scarano and Colfer, 2022). This trend has been particularly pronounced in response to the COVID-19 pandemic, which saw an increased use of ICTs to provide or collect information, offer support and deliver public services (Sacchi and Scarano, 2023).

We have focused on Italy because this country is a compelling paradigmatic case (Flyvbjerg, 2011). Unlike Northern European countries with more robust welfare states, Italy’s welfare system is characterised by weakness and fragmentation (Kazepov and Ranci, 2017). Italy represents a paradigmatic case due to its fragmented welfare system and regional disparities in policy implementation. This context allows us to examine how digitalisation efforts unfold in a complex institutional landscape, providing insights into the challenges faced by welfare states with similar structural characteristics. Looking at what is considered to be an adverse case allows us to consider how structural and contextual conditions may influence how policies are formulated, implemented, and experienced and their consequences on policy contexts, professionals and beneficiaries. The complex Italian landscape allows us to explore the factors that influence different actors' decisions to adopt digital solutions, the barriers they face when doing so, and the mechanisms through which these decisions are made in different types of organisations.

Taking all this into account, this work aims to contribute to the international debate on digitalisation and adaptation processes in weaker welfare systems, and to shed light on the combination of different logics of adoption of digital solutions. Specifically, the article presents the findings of ethnographic research conducted in Veneto, a region in North-Eastern Italy characterised by its proactive engagement in combatting social exclusion through ALMPs. This region is significant as it is at the forefront of the fundamental restructuring of welfare systems across Italy (Busacca and Da Roit, 2021; Cefalo, 2022), which is putting more emphasis on activation strategies than on traditional redistributive measures (Hemerijck, 2017).

Ultimately, this article addresses the following research question: How do organisations engaged in active labour market policies respond to digitalisation pressures in a fragmented welfare state? To answer this question, we adopt an approach based on multiple institutional logics. This framework allows us to examine how public and private organisations navigate the competing pressures of market and social logics in relation to digitalisation. These questions allow us to examine the complex interplay between institutional pressures, organisational responses, and individual agency in the digitalisation of ALMPs in Italy. By examining Italy as a “critical case”, we can gain insights into the challenges and opportunities of digitalisation in welfare systems characterised by fragmentation and institutional complexity.

This study adopts an institutional logics perspective to examine the digitalisation of ALMPs in Italy. Institutional logics are defined as socially constructed, historical patterns of material practices, assumptions, values, beliefs and rules that shape cognition and behaviour (Thornton and Ocasio, 1999). This framework provides a valuable lens for analysing how multiple, potentially conflicting institutional demands manifest within organisations and influence organisational practices and outcomes.

A key premise of the institutional logics perspective is that most organisations embody multiple logics (Greenwood et al., 2011). This multiplicity arises as organisations confront institutional environments characterised by diverse and sometimes contradictory expectations from various stakeholders (Kraatz and Block, 2017). In the context of ALMPs, relevant logics may include a social welfare logic emphasising support for vulnerable populations and a market logic prioritising efficiency and cost-effectiveness.

While the prevalence of multiple logics in organisations is widely recognised, research offers conflicting perspectives on the implications of this multiplicity. Some scholars associate multiple logics with contestation and conflict (Battilana and Dorado, 2010; Zilber, 2011), while others describe peaceful coexistence (McPherson and Sauder, 2013) or blending of logics (Binder, 2007). Moreover, some researchers argue that logic multiplicity threatens organisational performance and survival (Tracey et al., 2011), whereas others suggest it can foster innovation and sustainability (Kraatz and Block, 2017).

To reconcile these divergent findings, Besharov and Smith (2014) propose a framework for categorising different types of logic multiplicity within organisations based on two key dimensions: compatibility and centrality. Compatibility refers to the extent to which the instantiations of multiple logics imply consistent organisational actions. Centrality describes the degree to which multiple logics are each treated as equally valid and relevant to organisational functioning. By combining these dimensions, Besharov and Smith (2014) delineate four ideal types of organisations: contested, estranged, aligned, and dominant.

Contested organisations exhibit low compatibility and high centrality. Multiple logics vie for dominance in core organisational features, with no clear hierarchy between them. This configuration often leads to extensive and intractable conflict, as members hold competing expectations about appropriate organisational goals and lack clear guidelines for resolving differences. Estranged organisations, characterised by low compatibility and low centrality, experience moderate conflict. While multiple logics offer inconsistent implications for action, one logic clearly dominates core organisational features, providing a basis for resolving disputes. Aligned organisations demonstrate high compatibility and high centrality. Multiple logics exert strong influence over organisational functioning, but they offer consistent implications for action. This configuration tends to result in minimal conflict, as members lack a clear indication of which logic dominates but face few contradictions between logics. Finally, dominant organisations exhibit high compatibility and low centrality. A single logic prevails in core organisational features, reinforced by one or more subsidiary logics that offer consistent implications for action. This type experiences limited or no conflict arising from multiple logics.

Applying this framework to the context of ALMPs in Italy offers several advantages. First, it provides an original approach for analysing how multiple institutional demands - including those associated with social welfare and market logics - manifest within organisations responsible for implementing these policies. Second, it offers a basis for understanding variation in organisational responses to digitalisation pressures, moving beyond simplistic accounts of adoption versus resistance. Finally, it enables exploration of how different configurations of logics may lead to varied outcomes in terms of conflict, innovation, and policy implementation.

Based on this theoretical framework, we can formulate several hypotheses regarding the manifestation and implications of multiple logics in Italian ALMP organisations:

1. Public sector organisations (e.g. public employment services) are more likely to exhibit contested or aligned configurations, with high centrality of both social welfare logics. This may lead to either significant conflict (in the case of low compatibility) or innovative integration of logics (in the case of high compatibility);

2. Private non-profit organisations are more likely to demonstrate estranged configurations, with social welfare logic dominant but market logic peripheral. This may result in moderate conflict and selective adoption of digital tools that align with social welfare goals;

3. For-profit organisations involved in ALMPs are more likely to exhibit dominant configurations, with market logic prevailing and digitalization reinforcing market-oriented goals. This may lead to rapid adoption of digital technologies but potential neglect of social welfare considerations;

4. The degree of compatibility between social welfare, market logics and digitalisation within organisations will be influenced by factors such as resource constraints, professional training of staff, and ties to field-level referents (e.g. government agencies, technology firms, social service networks).

These hypotheses provide a starting point for empirical investigation of how multiple logics manifest in Italian ALMP organisations and shape responses to digitalisation pressures. By examining variation in logic configurations across different types of organisations, this study aims to develop new understandings of the challenges and opportunities associated with digitalising welfare services in a fragmented institutional context.

Crucially, this theoretical approach also allows for a critical perspective on the digitalisation of ALMPs. Rather than assuming that digital technologies will inevitably lead to improved efficiency and effectiveness, it enables exploration of how different logic configurations may reproduce or exacerbate existing inequalities. For instance, dominant organisations prioritising market logic may use digital tools in ways that further marginalise vulnerable populations, while contested organisations may struggle to implement coherent digital strategies due to ongoing conflicts between logics. By unpacking these dynamics, this study seeks to contribute to broader debates about the implications of welfare state digitalisation for social justice and equity. This theoretical approach allows us to examine how digitalisation interacts with and potentially disrupts existing institutional logics in the context of ALMPs.

This study employs a multi-site ethnographic approach to examine the digitalisation of active labour market policies (ALMPs) in the Veneto region of Italy. Our research design allows for an in-depth exploration of how multiple institutional logics manifest and interact within organisations involved in ALMP implementation, while also enabling a critical analysis of the broader socio-economic context in which these policies unfold.

Italy’s welfare system is characterised by fragmentation, underfunding and lack of coordination, particularly when compared to more robust systems in Northern Europe (Kazepov and Ranci, 2017). This fragmentation is evident in the implementation of ALMPs, which involve a complex network of public and private actors operating at national, regional, and local levels. The decentralisation of ALMP implementation to regions and municipalities, coupled with the involvement of various non-state actors, creates a heterogeneous landscape that reflects and reinforces existing regional inequalities (Busacca and Da Roit, 2021).

In this context, the push for digitalisation of ALMPs represents a significant shift, driven by both European Union directives and national policy initiatives. However, the implementation of digital tools and processes occurs within a system already marked by regionalization, fragmentation and inequality, raising critical questions about the potential for digitalisation to exacerbate existing disparities or create new forms of exclusion. The introduction of new technologies (e.g. SIILS or MyAnpal) at national level is minimal and mainly involves the introduction of automated beneficiary profiling systems. However, individual regional authorities have the power to decide how to incorporate these technologies into their service offerings.

We focus on the Veneto region as a paradigmatic case (Flyvbjerg, 2011) of ALMP implementation in Italy. Veneto is known for its proactive approach to combating poverty through ALMPs and its efforts to integrate social and labour market interventions (Cefalo, 2022). Veneto represents a paradigmatic case for studying ALMPs in Italy, as it is one of the regions where these policies have been implemented most effectively and for the longest time. As a model for other Italian regions, Veneto’s advanced ALMP system offers valuable insights into both the potential and challenges of digitalisation in welfare services. By examining this best-case scenario, we can better understand the complexities of implementing digital solutions in Italy’s fragmented welfare landscape.

The region is divided into 9 social territorial areas (ATS), each involving a network of public and private actors collaborating to provide integrated training and employment services. Each of these areas has extensive decision-making power over the provision of services and the introduction of digital tools. Practically, the only mandatory digital tool is a beneficiary data collection and management system (IDO) developed by a specialised regional agency. Actually, in each ATS, accredited private agencies operate either individually or in networks and are free to decide whether to adopt any kind of digital tool as well as public organisations involved in services provision. These organisations must meet certain operational and performance standards and employ professionals who are themselves accredited as labour market operators. These private agencies collaborate with municipal social services and PESs for the selection and management of beneficiaries and interventions.

Our study examines ALMP implementation across four distinct ATS within Veneto, allowing us to capture potential variations in digitalisation processes and outcomes. This multi-site approach enables a better understanding of how local contexts interact with broader regional and national policies.

We conducted a multi-site ethnography (Hannerz, 2003) over a period of 22 months, from October 2020 to July 2022, with additional observations in 2023 to capture changes following the launch of new national policies. The research team consisted of 11 researchers (2 team leaders and 9 research fellows) who immersed themselves in the daily activities and interactions of various organisations involved in ALMP implementation across four territories in the Veneto region. All data were collected and analysed in Italian, then translated in English for this paper.

Data collection (see Table 1) involved:

1. Participant observation: We conducted approximately 400 h of observation, distributed among the different types of organisations as in Table 1.

2. In-depth interviews: We conducted 96 semi-structured interviews (approximately 60 min each) with professionals from both public and private organisations. The interviews were distributed as in Table 1. Interviewees included social workers from public municipal social services, labour market professionals from PESs, non-profit and for-profit organisations specialising in training, human resource management, and labour market intermediation. Of the 96 participants in the research project, the majority were women. Most participants were practitioners in operational roles (74), compared to those in management or coordination roles (22); labour market practitioners (59 labour market operators, 20 social workers, and 14 managers); and active in private organisations (54 in private organisations and 42 in public organisations, public employment centres, and municipalities).

This distribution ensures a balanced representation of perspectives from both public and private sector actors, allowing for robust comparative analysis.

We employed an iterative and reflexive approach to data analysis, continuously moving between empirical material and theoretical concepts (Eisenhardt, 1991; Stake, 1995). This process involved:

1. Coding of field notes and interview transcripts using both predetermined codes based on our theoretical framework and emergent codes arising from the data;

2. Thematic analysis to identify patterns related to the manifestation of different institutional logics and their interaction with digitalisation processes;

3. Comparative analysis across different types of organisations (public, non-profit, for-profit) to identify variations in how multiple logics are instantiated and how digitalisation is perceived and implemented;

4. Critical examination of the data to uncover potential power dynamics, inequalities, and unintended consequences of digitalisation efforts.

Initially, the analysis was carried out individually by adopting a “pen and paper method”. During this phase, researcher have been working to identify first-level themes relevant for research aims and their connections. Then, the iterative process of analysis, carried out in group during six discussion sections involving all team members (of about 3 h each), we identified three second-level themes (i.e. constructs) connecting a number of first-level themes, respectively (a) the institutional pressures for digitalisations, (b) organisational, and (c) individual response to digitalisation.

Throughout the analysis, we paid particular attention to how different organisations and actors navigate and reconcile multiple institutional logics in their approach to digitalisation. We also sought to identify instances where digitalisation processes appeared to reinforce or challenge existing institutional arrangements and power dynamics.

Our findings reveal complex dynamics surrounding the digitalisation of ALMPs in Italy’s Veneto region. As part of the iterative analysis process described above, three key second-level constructs emerged. Derived from recurring themes and their intersections, these constructs were empirically observed and consistently identified across participants from all three types of organisations involved. However, according to the theoretical framework, each section presents the results organised according to the different types of organisation.

We observed strong institutional pressures for digitalisation, varied organisational responses, and proactive efforts by professionals - especially those in social enterprises - to drive digital adoption. At the same time, PES and for-profit agency staff often placed greater demands on beneficiaries to engage with digital tools. Below we elaborate on these dynamics at the institutional, organisational, and individual levels.

However, before presenting the different organisational responses to the pressures towards digitalisation, the main digital technologies employed are briefly presented: social networks are used by professionals to promote the services provided, even outside specific communication strategies of the enterprises; only the mandatory data systems at regional (IDO) or national (GEPI) level and their profiling systems, based on statistical regression systems, are used; within individual enterprises, data management systems are present, but there are no shared systems among territorial networks of private organisations, even when they offer services to the same users and could benefit from data sharing to reduce operational redundancies; only occasionally, mostly on the initiative of some professionals, do they use cloud tools; online systems and applications for job searching and CV preparation are used, often together with beneficiaries to make them capable and autonomous in the future.

Our research uncovered significant institutional pressures promoting the digitalisation of ALMPs in Italy. These pressures emanate from European and national policies that frame digital technologies as essential for modernising public services, enhancing employability, and fostering economic growth. Notably, at least 20% of funds from the European Union’s Next Generation Plan must be allocated to measures contributing to the digital transition, thus giving a boost to this type of investment, including the digitalisation of businesses, e-government, and public infrastructures, developing human capital, and supporting digital (Brignara and Orlando, 2022) ^[1]. Moreover, documents such as the National Strategy for Digital Skills ^[2] and the Three-Year Plan for IT in Public Administration ^[3] emphasise the centrality of digitalisation in innovation processes. This emphasis begins with public administration, aiming to make life easier for citizens and businesses by reducing time and costs in matching job demand with supply, and is then encouraged in the private sector.

Such pressures are detected by both public and private organisations involved in ALMP.

As one public employment service manager explained:

This sentiment was echoed by a social enterprise director:

For-profit agency professionals also observed this trend:

The institutional pressures for digitalisation manifest in the widespread adoption of various intersecting digital information management systems. For example, when citizens apply for unemployment benefits from INPS (National Institute for Social Security), their information is processed through the Information System for Social and Employment Inclusion (SIISL). This digital platform manages and monitors social assistance programmes and employment initiatives aimed at promoting social inclusion and labour market integration. Through the SIISL, applicants are assessed for their level of employability. Those with lower employability are directed to municipal social services via the GePI platform (Management System for Inclusion Agreements), a digital tool for managing social inclusion agreements. People with higher employability are instead referred to PESs through the MyAnpal online platform, where they can enrol in training and placement programmes. In Veneto, PESs further categorise beneficiaries according to their employability using the IDO (Matching Supply and Demand) digital platform.

As one PES professional explained:

Another example of the central role of digital transition in policy and institutional interventions is the implementation of the “Garanzia Giovani” (Youth Guarantee) programme and the GOL (Guarantee for Workers' Employability) programme. These initiatives mandate the provision of digital training or upskilling courses for all beneficiaries, with the acquisition of digital skills as a core component.

Thus, institutional pressures create normative expectations around digitalisation that permeate various interventions in the ALMPs field. However, these pressures also raise concerns about the potential exclusion of vulnerable groups. As one social worker noted:

Some staff members also expressed reservations about over-reliance on statistical system in ALMP:

Nevertheless, while our research shows that the profiling formulas used by both IDO and SIISL are opaque and inaccessible to most practitioners, many professionals still exhibit a remarkable level of trust in the system. As one PES professional stated:

When the system does not produce expected results, practitioners often believe the tools simply need improving rather than questioning the underlying logic. This further confirms the pervasive and internalised institutional pressures driving digitalisation.

While institutional pressures for digitalisation reach all the different types of organisations operating in ALMPs, our research reveals significant variation in how different types of organisations respond to them. We observed notable differences between public entities such as employment services and social services, and private intermediaries including both for-profit and non-profit organisations.

Public sector organisations generally seem to embrace digital transformation without question. In line with global trends, PESs and social services have a strong focus on digital technology and are implementing it extensively. They are doing so by using digital management systems, training staff in digital technologies, and adapting equipment functionality based on staff feedback.

As one PES manager stated:

However, the adoption of digital tools is not without challenges. As a social worker explained:

In contrast, private organisations, particularly non-profits, seem much less inclined to adopt digital solutions for labour market inclusion. While they also face similar difficulties as the public sector, complaining about lack of funding, under-qualified staff, and digitally illiterate beneficiaries, these organisations tend to use technology opportunistically. Instead of committing to long-term digitalisation, they often leverage technology primarily to access available resources. A social enterprise director candidly admitted:

Social enterprises involved in the research share a general concern about digitalisation processes for two reasons. On the one hand, they consider them too costly compared to the available funding for delivering the services; on the other hand, they are worried that their staff lack the skills and cultural inclination to support the digital transition, partly due to their training, which is oriented towards social services and education:

For-profit enterprises show a slight difference compared to social enterprises, admitting that while they have adopted more technologically advanced solutions in other sectors, they choose not do so in this field. This is both because it is not mandatory and because the available funds are limited. Moreover, they emphasise that the responsibility for accessing digital tools lies more with the beneficiaries than with them, as it is essential for them to be able to enter the labour market:

At the individual level, we observed that practitioners' responses to digitalisation often diverge from organisational stances, particularly in the private sector. This creates an interesting dynamic where individual agency plays a crucial role in driving digital adoption, even in the absence of clear organisational resources and strategies.

In the public sector, different types of practitioners put into practice different strategies to respond to digitalisation. PES professionals generally align closely with their organisations' embrace of digital tools. They rely heavily on management systems and algorithms to direct beneficiaries to activation services, often prioritising technological solutions over individualised approaches. As one professional stated:

However, this reliance on technology can sometimes lead to an overly rigid approach. Another PES professional admitted:

On the other hand, social workers in municipal services often express more scepticism about digitalisation initiatives:

Similarly, professionals working in private organisations often see the mandatory use of digital monitoring platforms as a complicated, expensive, and unnecessary bureaucratic task. A manager at a social enterprise expressed frustration:

Moreover, in the private sector, and particularly among social enterprises, we observed a striking phenomenon where practitioners can be not aligned with their organisations’ approaches to digitalisation. This non-alignment can even go as far as bypassing organisational limitations, taking it upon themselves to drive digital adoption, which is considered to be of paramount importance. As one social enterprise professional explained:

This is consistent with the observation that many private organisations fail to equip practitioners and beneficiaries with adequate IT and digital tools. They rely solely on traditional resources such as PCs, telephones, and office Wi-Fi connections, lacking dedicated apps, subscriptions to job matching services, and artificial intelligence tools that could significantly improve their operations.

In this settings, the proactive approach coming from professionals extends to skills development as well:

However, this insistence on digital engagement in private organisations is not without tensions, particularly when working with vulnerable populations. As one social enterprise professional admitted:

Overall, the varied responses at the individual level highlight the complex interplay between institutional pressures, organisational constraints, and personal initiatives in shaping the digitalisation of ALMPs. While public sector practitioners generally align with institutional and organisational pushes for digitalisation, those in the private sector - especially social enterprises - often drive digital adoption through their own efforts, compensating for organisational limitations. Meanwhile, for-profit agency staff and some public employment service operators place increased demands on beneficiaries to engage with digital tools, reflecting a belief that digital literacy is now essential for labour market success.

The research findings underscore the multifaceted nature of digitalisation in the context of ALMPs in Veneto, Italy.

First of all, the reconstruction reveals that the sector is not undergoing a genuine digital transition but rather a process of mere digitisation of work processes (Verhoef et al., 2021). Activities previously carried out in an analogue manner are now performed using digital tools, but these digital tools do not introduce new processes or new opportunities for the organisations, the professionals, or the beneficiaries.

Secondly, although marginal, our analysis of the digitalisation of ALMPs in Italy’s Veneto region reveals a complex landscape where different types of organisations exhibit varied responses to institutional pressures for digital adoption. Drawing on Besharov and Smith’s (2014) framework of multiple institutional logics, we can position the four types of organisations identified in our study within distinct quadrants of their matrix, testing the hypotheses that were previously expressed.

Within the public sector, we hypothesised that organisations are more likely to exhibit contested or aligned configurations, with high centrality of both social and a market-oriented welfare logics. Depending on the compatibility of such logics, the ambiguity was expected to lead to either significant conflict or innovative integration of logics with regards to digitalisation. In our research, PES emerge as aligned organisations, characterised by high compatibility and high centrality of institutional logics. PES services in fact manage to integrate both market and social welfare logics in their core operations, viewing digitalisation as a means to enhance both efficiency and service quality. The compatibility between these logics in PES can be attributed to their longstanding role in balancing labour market needs with social support functions (Kraatz and Block, 2017). On the other hand, municipal social services exemplify estranged organisations, with low compatibility and low centrality of logics. While primarily guided by a social welfare logic, these services face increasing pressure to adopt market-oriented approaches and digital solutions. However, this market logic remains peripheral and often conflicts with the core social welfare mission, leading to resistance and selective adoption of digital tools.

The varied responses to digitalisation in the public sector align with literature emphasising the multimodal nature of public organisational structures. Notably, these structures accommodate the coexistence of agility and stability, balancing the rapid adaptation to digital transformation with sustainability and service continuity (Faro et al., 2022). This balance is shown to be shaped by the specific functions performed by each department, explaining the different responses to digitalisation between public employment services and social services within the public realm.

Within the private sector, non-profit organisations were expected to demonstrate estranged configurations, with a prevalent social welfare logic but a peripheral market logic. However, social enterprises emerge as contested organisations instead, characterised by low compatibility and high centrality of logics. These organisations grapple with conflicting demands from market and social welfare logics, both of which emerge as central to their mission. The incompatibility between these logics leads to ongoing internal conflicts and challenges in implementing digital solutions. For instance, social enterprises struggle to balance the efficiency demands of digital tools with their commitment to personalised, human-centred services for vulnerable individuals (Battilana and Dorado, 2010). This finding aligns with previous research on the challenges faced by hybrid organisations in reconciling competing institutional demands (Pache and Santos, 2013).

As expected, for-profit enterprises align with the dominant organisation type, exhibiting high compatibility and low centrality. In these organisations, the market logic clearly prevails, with digital adoption primarily driven by efficiency and competitiveness concerns. Social welfare considerations, while present, remain peripheral and largely compatible with the dominant market orientation. This supports earlier findings on the dominance of market logics in for-profit organisations operating in social welfare contexts (Garrow and Hasenfeld, 2012). Moreover, isomorphic pressures emerge that influence for-profit enterprises (Dimaggio and Powell, 1983), which adapt their behaviours to a sector with low technological content.This heterogeneous landscape of organisational responses to digitalisation can be largely attributed to the fragmented nature of the Italian welfare system. Unlike more centralised welfare states, Italy lacks a clear, overarching directive that would coercively orient organisational behaviour towards a unified approach to digitalisation. Moreover, the absence of strong coordination mechanisms hinders the development of normative isomorphism that might otherwise lead to more homogeneous responses across different types of organisations (Dimaggio and Powell, 1983). The fragmentation of the welfare system creates a context where each type of organisation interprets and responds to institutional pressures for digitalisation in distinct ways, shaped by their particular blend of logics.

The lack of coherent coordination even risks creating a paradox of “over-digitalisation,” particularly in welfare sectors and activities that could instead align with the concept of being “proudly analog” (Tekic and Koroteev, 2019). Originally associated with business models that emphasise the value of analog processes, such as luxury and handmade goods, this concept can also be applied to welfare services and ALMPs. These sectors derive value from the human element, which cannot simply be replaced by digitised processes without careful consideration. Failing to selectively digitise the appropriate processes risks diminishing their value and, in this context, delivering lower-quality welfare services. This situation intensifies the pressures on vulnerable individuals and frontline workers, echoing concerns raised in the literature on neoliberalism and welfare state digitalisation (Dencik and Kaun, 2020; Schou and Pors, 2019).

The research also revealed that the conflict between institutional logics in responding to digitalisation is particularly pronounced in social services within the public sphere and social enterprises in the private sector, a finding that aligns closely with existing literature. This literature highlights a distinct path of hybridisation in social services, characterised by convergence of practices between the two sectors. Specifically, the distinction between public and third-sector organisations is recognised to be increasingly diminishing, as they both embrace reliance on public funding and policy directives while maintaining connections to specific local actors and contexts (Evers, 2005).

The analysis of the digitalisation of ALMPs in the Veneto region reveals a complex landscape shaped by varied organisational responses to institutional pressures. PESs have successfully integrated digital tools by balancing market and social welfare logics, leading to enhanced service delivery. This confirms the hypothesis that PES can effectively balance multiple logics, resulting in minimal conflict and innovative integration of digital tools. For-profit organisations focus on efficiency and competitiveness, with digitalisation reinforcing market-oriented goals. This finding aligns with the hypothesis that for-profit organisations would exhibit dominant configurations, where market logic prevails and digital adoption is driven by efficiency and competitiveness concerns. Social enterprises, however, struggle with internal conflicts due to the centrality of both market and social welfare logics, resulting in inconsistent digital adoption. This integrates the initial hypothesis about private non-profit organisations, highlighting that social enterprises face significant challenges in balancing these conflicting demands, leading to ongoing internal conflicts and difficulties in implementing digital solutions. Finally, municipal social services resist market-driven digitalisation, highlighting the challenges of aligning digital tools with their core social welfare mission. This finding disconfirms the implicit expectation that all public sector organisations would align similarly to PES. Instead, municipal social services exemplify estranged organisations, with low compatibility and low centrality of logics, leading to resistance and selective adoption of digital tools.

These findings suggest that a one-size-fits-all approach to digitalisation in welfare systems is inadequate. Policymakers and organisational leaders should consider the specific institutional contexts and logics that shape organisational responses to digitalisation pressures. A more coordinated and context-sensitive approach is necessary to ensure that digitalisation enhances service quality and accessibility without exacerbating existing inequalities. Thus, the study underscores the importance of understanding the interplay between institutional logics, organisational types, and technological change in the digitalisation of welfare services.

All these findings (see Table 2) suggest that rather than addressing the fragmentation of the Italian welfare state, the current approach to digitalisation risks exacerbating them. The fragmented and uncoordinated nature of digital adoption across different types of organisations may lead to increased inequality in service provision, with some beneficiaries receiving technologically enhanced services while others face new barriers to access (Busemeyer et al., 2022). In contested organisations like social enterprises, the internal conflicts between market and social welfare logics can lead to inconsistent implementation of digital tools, potentially compromising the quality and accessibility of services for vulnerable clients. In dominant organisations such as for-profit enterprises, the strong focus on market-driven digitalisation may result in the exclusion of individuals who lack digital skills or access to technology, exacerbating existing inequalities (Larasati et al., 2023). Even in aligned organisations like PES, where market and social welfare logics coexist more harmoniously, the push for digitalisation may inadvertently create new barriers for certain groups of service users. Estranged organisations, exemplified by municipal social services, face the challenge of resisting market-driven digitalisation that may conflict with their core social welfare mission, potentially leading to underinvestment in digital infrastructure and skills.

The potential for digitalisation to trigger processes of exclusion for beneficiaries is particularly concerning. As different organisations adopt varied approaches to digitalisation, there is a risk of creating a “digital divide” in social service provision. Vulnerable individuals who lack digital skills or access may find themselves increasingly marginalised, unable to navigate the digital interfaces that are becoming central to service delivery in some organisations (Schou and Pors, 2019). On the other hand, it depends on the types of organisations providing the services vulnerable individuals deal with. Furthermore, our study indicates that the digitalisation process is creating more challenging working conditions for professionals across all types of organisations. In contested and estranged organisations, professionals must navigate conflicting demands between digital efficiency and personalised care. In dominant organisations and, partially, aligned ones there is a risk of deprofessionalisation as market-driven digital solutions replace professional judgment. Even in aligned organisations, professionals face the ongoing challenge of integrating digital tools with traditional social work practices (Ball et al., 2023).

These findings have significant implications for both theory and practice. Theoretically, our study contributes to the literature on institutional logics by demonstrating how the fragmentation of institutional fields can lead to heterogeneous organisational responses to new institutional pressures such as digitalisation. It also extends our understanding of the challenges of implementing digital technologies in welfare contexts, highlighting the complex interplay between institutional logics, organisational types, and technological change (Thornton et al., 2012).

From a practical perspective, our findings underscore the need for a more coordinated approach to welfare state digitalisation in fragmented institutional contexts. Policymakers and organisational leaders must be attentive to the varied ways in which different types of organisations respond to digitalisation pressures and the potential consequences for service quality, professional practice, and beneficiary access.

However, it is important to acknowledge the limitations of our study. While our extensive case study of the Veneto region provides rich insights into the Italian context, the generalisability of our findings to other national or regional contexts may be limited. Future research could address this limitation by conducting comparative studies across different welfare state regimes to examine how varying degrees of institutional fragmentation influence organisational responses to digitalisation. Additionally, another promising avenue for future research would be to examine the micro-level processes through which professionals and beneficiaries navigate the changing landscape of digitalised welfare services. In-depth ethnographic studies could reveal the strategies employed by frontline workers to reconcile conflicting institutional demands and the experiences of service users as they encounter varied digital interfaces across different types of organisations.

In conclusion, our study highlights the complex challenges of implementing digital technologies in fragmented welfare systems. While digitalisation holds the promise of enhancing service delivery and efficiency, our findings caution against a one-size-fits-all approach. Instead, successful digitalisation of welfare services requires careful consideration of the institutional context, organisational dynamics, and the needs of both professionals and beneficiaries. Only through such a coordinated approach can the potential benefits of digitalisation be realised without exacerbating existing weaknesses in the welfare system. Furthermore, this work highlights that the call for digitalisation carries a strong tacit normativity. This normativity considers digitalisation inherently good, thus encouraging its adoption even when it may be counterproductive for the welfare system. On the contrary, it further penalises the system, creating a vicious circle founded on digitalisation introduced to overcome weaknesses that it instead exacerbates.

I would like to thank Fiorenzo Polito for contributing to the writing of the initial draft of this article and Valentina Lovato for reading and commenting on the article and supporting me during the revision phase.