A Study on the Determining Factors and Performance of a Company’s Knowledge Absorption Capacity: Focusing on the Digital Transformation of Small and Medium-Sized Manufacturing Companies

Abstract

Purpose This study examines influencing factors appearing in technology, the organization, and the environment in order to create a system for influencing factors on the introduction of the smart factory, which is the digital transformation of the manufacturing site. In addition, we analyze a series of structural impact relationships linked to corporate performance. In particular, this study analyzes the moderating effect of realized absorption capacity in the process of transforming knowledge into differentiated competence in the process of creating performance. Design/Methodology/Approach For the entire sample, a survey was conducted on 1,400 small and medium-sized manufacturing companies that had introduced smart factories, and a total of 317 companies were used in the final analysis sample. Prior to hypothesis testing, confirmatory factor analysis was performed on the measurement factors, and reliability and validity analyses of variables and constituent factors were performed. In addition, study fit analysis and hypothesis testing were performed to present the characteristics of the constructed hypothesis path Findings The TOE framework was used to provide detailed factor and pathway analysis of potential absorption capacity, focusing on variables in technical, organizational and external environmental aspects for enterprise-level digital transformation. In addition, an empirical study was conducted on the relationship between the internalization and utilization of knowledge and the realized absorption capacity in both financial and non-financial performance. As a result of testing a total of 7 hypotheses, 6 hypotheses were adopted. Research Implications Since small and medium-sized manufacturers are interested smart manufacturing processes, there are limitations in conducting various studies in terms of company capabilities and performance. In the future, it is judged that it is necessary to study digital transformation in various fields from a company-wide perspective by expanding not only to manufacturing companies but also to service industries such as distribution, logistics, and IT.