Sustained value creation driven by digital connectivity: A multiple case study in the mechanical components industry

This paper investigates how digital connectivity drives new forms of sustained value creation in traditional in- dustries, where many firms still compete and strategize within a traditional industry structure and supply chain logic. We perform a multiple case study with four companies active in the vehicle component industry and implementing digital connectivity in a business-to-business (B2B) setting. Results show that digital connectivity enables greater transparency, trust, and collaboration with customers and creates new forms of value creation through companies’ strategizing actions – aimed at developing highly customized solutions – and critical capa- bilities – needed to configure a customer-centric value chain, integrate buyer-supplier digital resources, and improve the coherence between data-driven decision-making, lean management, and employees’ skills. We shed light on how manufacturers leveraged digital connectivity to successfully assimilate and scale up their digital- related capabilities across different dimensions, transforming their business models in a sustained way. This should also complement a change in the governance of customer transactions, fostering transparency and trust. Fine-tuning and expanding well-established B2B relationships through digital connectivity become a priority for traditional businesses to change to new and efficiently sustained value co-creation forms that can be com- plemented to a successful business model innovation or co-creation strictly linked to larger network connections.