A Critical Review for Digital Capabilities Model

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Digital transformation (DX) has been regarded as a very important issue for the last few years for the industry and academia. Also, in the COVID-19 pandemic, companies have an urgent need to review the supply chain, which is the basis of DX. This is because the business environment for customers and supplies changes rapidly. Companies are looking for DX strategies, ways to proceed, and methods and tools in a chaotic world. Digital Capabilities Model (DCM) for supply networks is an effective tool to answer these needs. DCM is groundbreaking in diagnosing a company's DX maturity from a process perspective and leading to innovation, therefore attracting the attention of academicians and industry players. It is made up of six DCM Level-1 capabilities and 38 Level-2 capabilities constructed on these six Level-1 capabilities. However, there is a lack in theoretical and comprehensive reviews on practical implementation in business. This paper is one of the first academic literature reviews on DCM for supply networks. It is found that DCM is closer to a workable model than other DX maturity models because it steps into the process. By utilizing DCM, a simple and precise method for diagnosis and for discovering measures to improve the level, has been developed. Moreover, this study identifies that smart operations are an important capability in Japan.

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