Digital transformation in manufacturing ecosystems: A case of supply and knowledge network decoupling

Recently, the ecosystem perspective has offered a novel way to analyze technological diffusion and competition, which has been extensively leveraged to understand born-digital firms. These, however, represent only a part of the competitive landscape. Non-born-digital industries, like those focusing on manufacturing, have traditionally been arranged in a network composed by peripheral and core firms, with the latter characterized by holding superior knowledge and the control over the network. Yet, the “digital transformation” of non-born-digital firms is scarcely investigated, and we have limited understanding on how this process may shift the firms’ position in the knowledge and supply network, thus affecting the entire ecosystem. Through a longitudinal qualitative study of Dallara, an Italian motorsport firm that underwent a radical process of digital transformation, our research identifies the implications for the introduction of digital processes in a manufacturing company. We highlight how digital processes increased the firm’s technological modularity, relational orchestration, and knowledge assets, thus allowing the firm to increase its centrality in the knowledge network, while maintaining a peripheral position in the supply network. This corresponded to defocusing from its traditional manufacturing activities, but nonetheless led to increasing performance and sustained firm growth. Implications for theory and practice are discussed.