Explaining strategies for implementing digital transformation in Iranian non-governmental commercial banks

Document Type : Original research

Authors

1 PhD Student/Information Technology Management/Department of Management, Faculty of Administrative and Economic Sciences, Ferdowsi University of Mashhad, Mashhad/Iran.

2 Professor, Faculty of Economics and Administrative Science, Ferdowsi University of Mashhad, Mashhad, Iran.

3 Professor/Department of Information Technology Management, University of Tehran/Tehran.

4 Department of Management, Faculty of Economics and Administrative sciences, Ferdowsi University Of Mashhad, Mashhad, Iran.

Abstract

Digital transformation in the banking industry is recognized as one of the basic requirements for survival and competitiveness in the digital age. This research was conducted to explain the framework of digital transformation implementation strategies in Iranian non-governmental commercial banks. The present research is fundamental in terms of orientation and qualitative research in terms of research method. An exploratory design was used to achieve the research objective. The participant population includes managers, consultants, specialists, and experts who have taken steps in their non-governmental commercial banks toward designing and implementing the digital journey. The research method was purposive sampling and theoretical saturation was achieved with 17 people. The research method is grounded theory and data analysis was conducted using open, axial, and selective coding methods. Research categories were identified using grounded theory analysis and qualitative data analysis was performed using Maxqda software. The research findings show that the strategies proposed for implementing digital transformation in Iranian non-state commercial banks, including customer-centric, operational, innovation and growth, leadership and culture, technology-centric, adaptive and risk, ecosystem and network, and finance and investment strategies, each play a vital role in the success of this process. Successful implementation of digital transformation in Iranian non-state commercial banks requires a comprehensive and multifaceted approach that considers each of these strategies as a basis for effective actions.

Keywords

Main Subjects

References

Adner, R., and Kapoor, R. (2016). “Innovation Ecosystems and the Pace of Substitution: Re‐examining Technology S‐curves”. Strategic Management Journal, 37(4), pp. 625-648.‏
Argyris, C., and Schön, D. A. (1997). “Organizational Learning: A Theory of Action Perspective”. Reis, (77/78), pp. 345-348.‏
Barney, J. (1991). “Firm Resources and Sustained Competitive Advantage”. Journal of Management, 17(1), pp. 99-120.‏ https://doi.org/10.1177/014920639101700108
Bass, B. M., and Avolio, B. J. (Eds.). (1994). Improving Organizational Effectiveness Through Transformational Leadership. Sage.
Bass, B. M., and Riggio, R. E. (2006). Transformational Leadership. Mahwah, NJ: Lawrence Erlbaum Associates.
Bharadwaj, A., El Sawy, O. A., Pavlou, P. A., and Venkatraman, N. V. (2013). “Digital Business Strategy: Toward a Next Generation of Insights”. MIS Quarterly, 37, pp. 471-482.‏ https://doi.org/10.25300/MISQ/2013/37:2.3
Brynjolfsson, E., and McAfee, A. (2014). The Second Machine Age: Work, Progress, and Prosperity in a Time of Brilliant Technologies. WW Norton and Company.‏
Carcary, M., Doherty, E., and Conway, G. (2016, September). “A Dynamic Capability Approach to Digital Transformation: a Focus on Key Foundational Themes”. In The European Conference on Information Systems Management (p. 20). Academic Conferences International Limited.‏
Cheng, S., Fan, Q., and Huang, M. (2023). “Strategic Orientation, Dynamic Capabilities, and Digital Transformation of Commercial Banks: A Fuzzy-set QCA Approach”. Sustainability, 15(3), p. 1915.‏ https://doi.org/10.3390/su15031915
Chesbrough, H. (2006). Open Innovation: The New Imperative for Creating and Profiting from Technology. Harvard Business Press.
Chesbrough, H. (2019). Open Innovation Results: Going Beyond the Hype and Getting Down to Business. Oxford University Press.‏
Chesbrough, H. W. (2003). Open Innovation: The New Imperative for Creating and Profiting from Technology. Harvard Business School Publishing Company.‏
Chui, M., Harrysson, M., and Manyika, J. (2021). AI and the Future of Banking. McKinsey and Company.
Davenport, T. H., and Kirby, J. (2016). “Just How Smart are Smart Machines?” MIT Sloan Management Review, 57(3), pp. 20-25. https://doi.org/10.5555/0735-7853.57.3.20
Davis, F. D. (1989). Perceived Usefulness, Perceived Ease of Use and User Acceptance of Information Technology. MIS quarterly, 13(3), pp. 319-340 
Denning, S. (2018). The Age of Agile: How Smart Companies are Transforming the Way Work Gets Done. Amacom.
Fichman, R. G., and Dos Santos, B. L. (2014). “Digital Innovation as a Fundamental and Powerful Concept in the Information Systems Curriculum”. MIS Quarterly, 38(2), pp. 329-343. https://doi.org/10.25300/MISQ/2014/38.2.01
Foss, N. J., and Saebi, T. (2017). “Fifteen Years of Research on Business Model Innovation: How Far Have We Come, and Where Should we Go?” Journal of Management, 43(1), pp. 200-227. https://doi.org/10.1177/0149206316675‏
Giddens, A. (1984). The Constitution of Society: Outline of the Theory of Structuration. Polity.‏
Gupta, A. (2023). “Open Banking as a Strategy for Digital Transformation”. Journal of Digital Innovation, 44(3), pp. 12-19.
Gupta, V., MacMillan, I. C., and Surie, G. (2004). “Entrepreneurial leadership: Developing and Measuring a Cross-Cultural Construct”. Journal of Business Venturing, 19(2), pp. 241-260.‏ https://doi.org/10.1016/S0883-9026(03)00040-5
Hess, T., Matt, C., Benlian, A., and Wiesbock, F. (2016). “Options for Formulating a Digital Transformation Strategy”. MIS Quarterly Executive, 15(2), pp. 123–139. https://doi.org/10.2139/ssrn.2737171
Hillson, D. (2003). Effective Opportunity Management for Projects: Exploiting Positive Risk. Crc Press.‏
Jean, R. J. B., and Kim, D. (2021). “Signalling Strategies of Exporters on Internet Business‐to‐Business Platforms”. Journal of Management Studies, 58(7), pp.1869-1898.‏
Kane, G. (2019). “The Technology Fallacy: People are the Real Key to Digital Transformation”. Research-Technology Management, 62(6), pp. 44-49.‏ https://doi.org/10.1080/08956308.2019.1661079
Kane, G. C., Palmer, D., Phillips, A. N., and Kiron, D. (2015). “Is Your Business Ready for a Digital Future?” MIT Sloan Management Review, 56(4), p. 37.‏
Kaplan, R. S., and Norton, D. P. (2005). The Balanced Scorecard: Measures that Drive Performance (Vol. 70, pp. 71-79). Boston, MA: Harvard Business Review.‏
Kaur, S. J., Ali, L., Hassan, M. K., and Al-Emran, M. (2021). “Adoption of Digital Banking Channels in an Emerging Economy: Exploring the Role of in-Branch Efforts”. Journal of Financial Services Marketing, 26(2), p. 107.‏
Knight, F. H. (1921). Risk, Uncertainty and Profit. Hart, Schaffner and Marx.‏
Kotler, P., Keller, K. L., Brady, M., Goodman, M., and Hansen, T. (2016).
Kotter, J. P. (1996). Leading Change, Harvard Business School Press, Boston.
Lamberton, C., and Stephen, A. T. (2016). “A Thematic Exploration of Digital, Social Media, and Mobile Marketing: Research Evolution from 2000 to 2015 and an Agenda for Future Inquiry”. Journal of Marketing, 80(6), pp. 146-172. https://doi.org/10.1509/jm.15.0415
Lemon, K. N., and Verhoef, P. C. (2016). “ Understanding customer experience throughout the customer journey”. Journal of marketing, 80(6), pp. 69-96. https://doi.org/10.1509/jm.15.04
Li, S., Gao, L., Han, C., Gupta, B., Alhalabi, W., and Almakdi, S. (2023). “Exploring the Effect of Digital Transformation on Firms’ Innovation Performance”. Journal of Innovation and Knowledge, 8(1), Article 100317. https://doi.org/10.1016/j.jik.2023.100317
Liu, M., Li, C., Wang, S., and Li, Q. (2023). “Digital Transformation, Risk-Taking, and Innovation: Evidence from Data on Listed Enterprises in China”. Journal of Innovation and Knowledge, 8(1), Article 100332. https://doi.org/10.1016/j.jik.2023.100332
Matt, C., Hess, T., and Benlian, A. (2015). “Digital Transformation Strategies”. Business and Information Systems Engineering, 57, pp. 339-343.‏ https://doi.org/10.1007/s12599-015-0401-5
McKinsey and Company. (2021). Fintech and the Digital Challenge in Banking. McKinsey Global Institute.
Moore, J. F. (1993). “Predators and Prey: a New Ecology of Competition”. Harvard Business Review, 71(3), pp. 75-86.‏
Morakanyane, R., O'Reilly, P., McAvoy, J., and Grace, A. (2020). Determining Digital Transformation Success Factors.
Nabiyi, F., Shamizanjani, M., and Garoosi Mokhtarzadeh, N. (2024). “Conceptualization of Digital Transformation Strategy and Identifying the Principles and Supporting Capabilities for its Formation with Meta Synthesis Approach”. Science and Technology Policy Letters, 14(1), pp. 29-50.‏ (In Persian)
Nambisan, S., Wright, M., and Feldman, M. (2019). “The Digital Transformation of Innovation and Entrepreneurship: Progress, Challenges and key Themes”. Research Policy, 48(8), p. 103773.‏
Nguyen, N. T. H., Kim-Duc, N., and Freiburghaus, T. L. (2022). “Effect of Digital Banking-Related Customer Experience on Banks’ Financial Performance During Covid-19: a Perspective from Vietnam”. Journal of Asia Business Studies, 16(1), pp. 200-222.‏ https://doi.org/10.1108/JABS-09-2020-0366
Paul J., Ueno A., Dennis C., Alamanos E., Curtis L., Foroudi P., Kacprzak A., Kunz WH., Liu J., Marvi R., Nair SL. (2024). “Digital Transformation: A Multidisciplinary Perspective and Future Research Agenda”. International Journal of Consumer Studies. 2024, 48(2), p. e13015.
Porfirio, J. A., Felício, J. A., and Carrilho, T. (2024). “Factors Affecting Digital Transformation in Banking”. Journal of Business Research, 171, 114393.‏ https://doi.org/10.1016/j.jbusres.2023.114393
Porter, M. E. (2008). Competitive Strategy: Techniques for Analyzing Industries and Competitors. Simon and Schuster.
Reeves, M., and Deimler, M. (2012). Adaptability: The New Competitive Advantage. Own the Future: 50 Ways to Win from the Boston Consulting Group, 19-26.‏
Rogers, E. M. (1962). Diffusion of Innovations. Free Press.
Said, A. I., and Angelita, M. (2020). “Determining Factors for Success of Banking Digital Transformation”. In 3rd Asia Pacific Management Research Conference (APMRC 2019) (pp. 238-241). Atlantis Press.‏ https://doi.org/10.2991/aebmr.k.200812.041
Sebastian, I. M., Ross, J. W., Beath, C., Mocker, M., Moloney, K. G., and Fonstad, N. O. (2020). “How Big old Companies Navigate Digital Transformation”. In Strategic Information Management (pp. 133-150). Routledge.‏
Shahriar, S. (2020). Digital Transformation in Business and Society: Theory and Cases: Edited by Babu George and Justin Paul, Cham, Switzerland, Palgrave Macmillan, 2020, xvii+ 300 pp., RRP£ 96 (Hardback), ISBN 978-3-030-08276-5.‏
Shami Zanjani, M. (2021). Common Challenges of Digital Banking in the World and Iran. http://shamizanjani.ir/چالشهای-مشترک-بانگداری-دیجیتال-در-دنیا-و-یاران. (In Persian)
Strauss, A., and Corbin, J. M. (1997). Grounded Theory in Practice. Sage.
Su, C. W., Pang, L. D., Tao, R., Shao, X., and Umar, M. (2022). “Renewable Energy and Technological Innovation: Which one is the Winner in Promoting Net-Zero Emissions?”, Technological Forecasting and Social Change, 182, p. 121798.‏
Teece, D. J. (2018). “Business Models and Dynamic Capabilities”. Long Range Planning, 51(1), pp. 40-49. https://doi.org/10.1016/j.lrp.2017.06.007
Thibaut, J. W., and Kelley, H. H. (1959). The Social Psychology of Groups. New York: Wiley.
Tidd, J., and Bessant, J. R. (2020). Managing Innovation: Integrating Technological, Market and Organizational Change. John Wiley and Sons.‏
Vial, G. (2021). “Understanding Digital Transformation: A Review and a Research Agenda”. Managing Digital Transformation, 13-66.‏
Westerman, G., Bonnet, D., and McAfee, A. (2014). Leading Digital: Turning Technology Into Business Transformation. Harvard Business Press.‏
Wolf, M., Semm, A., and Erfurth, C. (2018). “Digital Transformation in Companies–Challenges and Success Factors”. In Innovations for Community Services: 18th International Conference, I4CS 2018, Žilina, Slovakia, June 18-20, 2018, Proceedings (pp. 178-193). Springer International Publishing.‏ https://doi.org/10.1007/978-3-319-93408-2_13
 

Files

History

  • Receive Date: 20 December 2024
  • Revise Date: 19 January 2025
  • Accept Date: 01 February 2025

Share

How to cite

Statistics