A study for success factors of eTransformation in steel industry

Abstract

This empirical study is to explain how dynamic capabilities and sectoral innovative characteristics have influenced eTransformation in the steel industry. Explanation will also be given on the success factors of the steel industry``s eTransformation through newly established empirical cases under the aspects of dynamic capabilities and sectoral system. Due to the characteristic of general commonality, limitations have been found in recent internet-based business model research and also on successful eTransformation factors that have been introduced. Not only might there have been difficulty in the specific application but also in the strategic approach unless the lack of internal capacity has been pointed out as a limitation. This study points out the success factors of eTransformation in the modern steel industry by identifying the dynamic capabilities elements and sectoral characteristics in POSCO``s eTransformation process; Integration of the upstream and downstream industry, path-dependent innovative competency, existence of powerful teams seeking various linkages in the internal/external industry, and eTransformation driven process innovation. The major findings from these success factors include that even in a firm``s innovative IT and network-based eTransformation, dynamic capabilities play more important role than the previous strategic factor endowment adoption did, as well as sectoral system characteristics should be considered. In short, firm``s internal competency, market position and processing elements in organizational integration and reconfiguration as well as sectoral uniqueness have proven to be critical requirements in the eTransformation of the steel industry.