Impacts of digital transformation on firms' competitive advantages: A systematic literature review

Abstract

Abstract Digital transformation impacts firms' competitiveness mainly on innovation, efficiency, cost reduction, and impacts global value chains on specialization, geographic scope, governance, and upgrading. According to literature, the impacts of digital transformation over firms' competitiveness, while presenting a more prominent role over more “classical” advantages, present a majority of positively signed impact directions , being, on average, beneficial to the firms that implement such transformations. Industrial processes' digitalization links global value chains' four main dimensions by increasing the firm's focus on more specific value chain activities ( specialization ) and international expansion opportunities ( geographic scope) activity. In parallel, industrial digital transformation is also motivating firms to expand into upstream activities across the value chains ( upgrading) and impacting significantly at GVCs' strategy ( governance ) due to the emergence of digital platforms, disrupting former competitive settings into new networked “extended business ecosystems.”