1. Introduction
The investigation of change and development in organizations is one of the most relevant themes in management studies [
1,
2]. Recently, the global scenario has radically been transformed due to the ongoing pandemic of coronavirus disease and the economic fallout generated by the lockdown in different countries. It seems that the embracing of digitalization and the transformation of business organizations integrating digital technologies have become paramount for the survival of firms [
3]. In this study, digital maturity refers to the competitive advantages gained by a firm in transforming its fundamental business processes into digital processes. Such transformation is led by change management integrated within the organizational culture [
4]. Prior research has suggested that digital maturity embedded across the business processes can increase benefits from current strategic assets when it is integrated within a wider corporate strategy [
5]. Furthermore, digital maturity entails organization transformation, thus, changes in strategy and structure need to be managed to improve business performance [
6].
Digitalization is considered to be an efficient tool to support sustainable environmental, social, and economic development [
7]. Information and communication technologies (ICT) can improve emission reduction, waste management, and production cleanliness, and can enhance the implementation of green development strategies to benefit the ecosystem in which firms operate. To reach sustainability goals, green development needs to be supported by organizational change within a firm [
8]. Still, as it has been acknowledged, organizational change is difficult to implement, and a wide range of firms struggle to cope with digitalization connected to products, services, and business operations in general [
1,
9,
10]. As Li et al. [
5] argued, SME entrepreneurs’ capabilities are often limited, and the firms’ digital transformation is enforced by the ecosystem in which they operate. In the case of SMEs, the founders, owners, or top managers are in charge to lead digital transformation and analyze the position the firm holds compared to their competitors. Thus, a better understanding of their views on digital transformation and sustainability is essential to capture the ongoing processes in moderately competitive regions. The discussion on SMEs and large companies’ digitalization has revealed the managerial and operational challenges of this transformation [
4].
Based on the above mentioned studies, this research aims to investigate the relationship between digital maturity, change management, green development, and business performance in a region where foreign direct investments and state-led investments are key to the survival of firms. The main contribution of this research is the empirical investigation of the role digital maturity plays in the commitment to invest in green development to foster sustainability. The article is structured as follows: In
Section 2, change management, digitalization, and sustainability are framed, adopting the Strategic Action Field (SAF) theory, and hypotheses are discussed. In
Section 3, the research design and methods explain the constructs and scales applied in the survey and justify the use of partial least squares structural equation (PLS-SEM) to investigate the relationship between digital maturity, change management, green development, and business performance. In
Section 4, the results show that change management has a direct positive effect on digital maturity and on green development. Finally, managerial implications, research limits, and future research paths are discussed.
2. Theoretical Background
Globalization has generated the interconnectedness of industries, but business processes and activities are still concentrated regionally. In relatively developed but dynamically growing European regions, the creation of industrial hubs and targeted financial incentives enhance economic performance [
11]. Policymakers in several European regions have recognized the role firms and entrepreneurs play in regional development and have stimulated the creation of a supportive ecosystem [
11,
12]. Regional productivity is associated with creativity, innovation, change management, and digital skills linked to entrepreneurship. The complexity of change management within the public and private sector across different industries is strongly influenced by the economic, political, social, and cultural environment of the ecosystem in which firms operate [
13]. A firm’s capability to allocate resources to manage change in structure, strategy, and processes in a continuously evolving business scenario evolves through the actions of business actors, managers, and employees [
3].
Adopting Fligstein and McAdam’s [
14] Strategic Action Field (SAF) theory to change management, we argue that digitalization can be perceived as either a threat or an opportunity and challenges the rules and practices that were once taken for granted. To leverage on digitalization as an opportunity, collective action within the firm needs to be based on shared understandings of the benefits of digitalization. In SAF theory, a firm is a strategic action field that interacts in the ecosystem with its competitors, different market forces, and social movements [
14,
15]. Fruitful exploitation of resources, capabilities, and the path development to renew business processes can be achieved when change management is led by intrafirm communication and the sharing of common interests and benefits [
3]. As prior research has evidenced, pitfalls along this transformation process cannot be avoided, thus, change management needs to be implemented to gain competitive advantage within the industry [
3,
4,
5].
This leads to our first hypothesis:
Hypothesis 1. Change management has a positive effect on digital maturity.
Applying SAF theory, it can be identified that the successful introduction of structural, strategic, or production changes highly rely on the capabilities of top-managers/founders to make change part of the firms’ organizational culture [
5,
14]. Searching for continuous improvement requires firms to develop new competencies and to use resources and capabilities to reach competitive advantage. Thus, how and what the firm is able to perform is determined by such capabilities. A firm with strong capabilities and commitment is able to deploy proactive strategies that benefit the firm and its environment. Having a commitment to green development is unlikely to create financial benefits, but in combination with managerial capabilities to drive organizational change and to implement new structural, strategic, or productive processes, financial benefits may be gained [
14,
16]. Thus, we predict that:
Hypothesis 2. Change management has a positive effect on business performance.
Hypothesis 3. Change management has a positive effect on green development.
Firms across different sectors have recognized that investments in infrastructures to foster the digital transformation of operations, production processes, and strategy are paramount to gaining competitive advantage and generating increased business performance [
3,
4,
8]. The digital maturity of a firm means that the managers/owners of the company are familiar with existing digital tools and applications and are better at adopting and deploying such tools and applications compared to their competitors. Thus, we can postulate that:
Hypothesis 4. Digital maturity has a positive effect on business performance.
Digitalization-led sustainability transition can act on multiple levels and can have micro- and macro-perspectives linked to the firm’s sustainability goals. As Stuart Hart already claimed in 1995, the interaction between a firm’s organization and the surrounding natural environment is compelling and will allow it to gain competitive advantage in the long-term. For this reason, Hart and Dowell [
16] position sustainable development among the three key strategic capabilities following pollution-prevention and product stewardship. Firms adopting a sustainable development strategy do less environmental damage and consider the wider social as well as the economic sustainability aspects of their operations [
17]. As prior research has evidenced, firms and organizations are hesitant to adopt sustainability strategies because the financial benefits of such investment can hardly be traced in the short-term [
16]. The exhaustive digitalization firms are undergoing, and the digital maturity of successful companies, can foster the adaptation of sustainability strategies as well. Thus, in line with the above considerations, the following hypotheses are proposed:
Hypothesis 5. Digital maturity has a positive effect on green development.
A firm’s proactive environmental commitment is often referred to as a moral obligation towards society and as a contribution to reach sustainable development goals (
www.un.org). Past literature shows that investment in green development has costs and can occur due to pressure or as part of a corporate social responsibility strategy [
17,
18]. The question whether green development could lead to better business performance has been widely debated [
19,
20,
21]. The debate is centered around the issue of whether high-cost scheme activities such as investment in renewable energy and waste management—which do not lead to immediate economic benefit—create competitive advantage in the long run [
22]. Zeng et al. [
21] evidenced the strong relationship between business performance and environmental performance while analyzing firms in the Chinese manufacturing industry. Cantele and Zardini [
22] highlighted the fact that sustainability should be approached strategically, not only in large companies but also in SMEs, to attain improved performance. Past literature [
23,
24] evidences that the optimal condition to invest in sustainability (green development) occurs when change management is part of the organizational culture and business performance is solid. Thus, we should expect that healthy business performance perceived by firm owners and top managers could stimulate the intention of firms to invest in green development.
Hypothesis 6. Business performance has a positive effect on green development.
5. Conclusions
Using data obtained from 270 SMEs and large companies, we investigated these firms’ perceptions of the relationship between change management, digitalization, business performance, and green development by applying the Strategic Action Field theory [
14]. First, based on a careful definition of change management and digitalization, we analyzed how these are seen to contribute to business performance. In this current coronavirus pandemic crisis, and the economic lockdown that has forced managers and employees to be stuck at home and has led them to work remotely, more than ever, a firm’s digital maturity is paramount for survival. Second, we identified green development as an underestimated strategic intervention area that could be deployed to create competitive advantage. Our results are consistent with the findings of prior studies in management [
16,
17,
18,
19] and show that green development of the ecosystem in which firms operate and in which social actors live is not considered as a strategic intervention. Simply put, top managers think that it does not pay to be green. Short-term financial performance can hardly be improved by green development. Sustainability commitment is for the long-term, aiming to contribute to the regional development of moderately competitive industrial regions. Yet, in regions where industrial development is the top priority, either for public or private local enterprises or for foreign owned companies, the environmental improvement of the ecosystem, unfortunately, lags behind.
The findings of our study support several results of past research and introduce new perspectives. Concerning Hypothesis 1 (change management has a positive effect on digital maturity) and Hypothesis 3 (change management has a positive effect on green development) is the study’s theoretical contribution to the benefits of incorporating change management into corporate strategies using the Strategic Action Field theory [
14]. The results show that multiple and interconnected digital transformation within a firm is considered as a competitive advantage in terms of managerial capability. Digital maturity is not a strategic asset in itself, rather, it enables firms to better face transforming challenges in uncertain times. We can state that a firm’s competitive advantage lies in an efficient change management process integrated within the corporate structure, understood and shared by the firms’ business actors. We suggest incorporating green development as a managerial implication in long-term strategies, defining the long-term goals and sharing the benefits within the ecosystem.
This study has some limitations. The research was conducted in a moderately developed Central-Eastern-European region, and the period of data-gathering might threaten the generalizability of the study. The questionnaire-based research aimed to investigate top-managerial responses and firms’ perceptions, but employees’ opinion and perception on change management strategies should also be investigated.
The global pandemic has taken a heavy toll on lives, health services, jobs, and mental health [
47]. The lockdown of businesses has led to some unexpected consequences such as “good quality air” due to the fact that air pollution has drastically fallen, even in the most polluted regions such as the Po Valley in northern Italy (news.un.org). According to World Meteorological Organization expectations, once the global economy recovers, greenhouse gas emissions will again increase. Due to the coronavirus outbreak, industries, travel networks, and businesses were forced to close down (March–May 2020 in Europe), and most companies had to focus on actions to avoid decline through short-run cost reduction such as asset and employee reduction. When the pandemic eventually subsides, firms—with a high level of digital maturity and/or good financial performance—will need time to return to their original levels of productivity; thus, resource allocation to assure the survival of firms, employee retention, operational reorganization, and intrafirm development will take precedence over investments in green development. Presumably, in the immediate post-COVID-19 period, the economic recovery for firms will be the most pressing concern, regardless of the negative impact of economic growth on the environment. Once the pandemic eases, governments should re-stimulate their economies mindfully in order to foster green development and provide support to firms in the digitalization of production processes and remote working.