Role of Organizational Learning on Industry 4.0 Awareness and Adoption for Business Performance Improvement

Abstract

In this article, we examine the role of organizational learning on Industry 4.0 (I4.0) deployments for enhancing business performance within the manufacturing industries of developing countries. Based on a survey of 246 manufacturers from 12 developing countries recognized by Deloitte's global manufacturing competitiveness index report, a theoretically derived model was verified using structural equation modeling. This study's results show that I4.0 adoption mediates the impact of I4.0 awareness on organizational learning, and I4.0 adoption and organizational learning serially mediate I4.0 awareness and business performance toward creating smart factories. This study contributes: first, by conceptualization and operationalization of the constructs to clarify the role of organizational learning in I4.0 deployments; second, through an organizational learning hierarchy, it presents I4.0 awareness or familiarity as first-order learning, the experience of adopting I4.0 as the second-order learning, and learning that emerges from cycles of awareness and adoption together (cumulatively) as third-order or meta-learning. This study extends the microfoundations of learning capability in the I4.0 context and opens new agendas for future research and practice. It guides managers to consciously develop higher order learning in I4.0 deployments to safeguard I4.0 investments and enable competitive advantage in digitization.